📚 Loan forgiveness feat. SCOTUS

1. Biden's student loan forgiveness plan faces the ultimate test at the Supreme Court

IOU on the hill… SCOTUS started hearing arguments challenging President Biden's student loan forgiveness plan yesterday, putting the financial future of 40M+ indebted Americans in the (judicial) balance. Last year, Biden announced plans to cancel up to $20K in federal student loan debt for qualified borrowers. But the program was halted in November after six GOP-led states brought a case against it — and it’s still on pause. Now the US’s highest court must decide whether the forgiveness policy is an overreach of executive power, and if it causes harm to plaintiffs.

• Behind the bench: Conservative justices seemed skeptical, with some saying it would be unfair for Americans who already paid off their loans or never took on debt.
• Biden’s camp said that the debt-relief plan was legal under the Heroes Act, which gives the Department of Education extra power during national emergencies.
• State attorneys said the plan could strip Missouri (a key player in the case) out of revenue earned from its state’s loan servicer.

Repayment woes… the court’s forgiveness decision isn’t the only challenge borrowers are facing. The pause on loan repayments has been extended eight times through two presidencies, saving borrowers $5B/month. But if the legal disputes aren’t resolved by June, then payments will restart in August. If the court issues a ruling in March, they could restart as early as May.

THE TAKEAWAY

Americans might not be prepared… Some recent college grads have never had to make a student loan payment, since the pause has lasted nearly three years. The extra costs could weigh on millions of US families already grappling with record household debt and stubborn inflation. The average loan payment is nearly $400/month.

2. A broad TikTok ban could be in the cards as the US stresses national-security concerns

TikTok-ban saga, reloaded… The US government’s been talking about banning TikTok for years over national-security concerns with the Chinese-owned app. The possibility just got more real: yesterday a bill that would give Biden the power to ban TikTok was on track to pass a key House committee vote. If it is greenlighted by Congress, it could lead to a Tok-less life for the 100M Americans using the app.

• Tok nerdy to me: The bill, memorably named “H.R. 1153,” would change rules that’ve shielded TikTok from US sanctions on China. Those rules exempt “informational materials” like news and magazines from sanctions-related bans. Now…
• UnStitched: The bill could strip protections from companies that share Americans’ personal data with China-affiliated entities.
• Tick tock: It’s expected to pass in the Republican-controlled House, but its outlook is iffy-er in the Dem-majority Senate.

For You-page tunnel vision… Supporters of the ban say that TikTok is a tool that the Chinese Communist Party can use to monitor and manipulate Americans (think: weaponizing data, spreading misinfo). Critics like the ACLU argue that a broad ban would amount to censorship of free speech, violating the First Amendment. Meanwhile:

• The US, Canada, and the EU have already barred federal employees from having TikTok on government-issued devices. India full-on banned TikTok for all its citizens.

THE TAKEAWAY

It’s a messy Tok situation… The US has criticized China for being a censorship state (Google, Twitter, Facebook, and even TikTok itself are banned there). Now the US wants to ban a social-media app… but for national-security reasons. If TikTok actually poses a serious security threat, there’s a lot at stake: over two-thirds of American teens use TikTok, and a third of US TikTok users say they regularly get their news on the app.

3. Heard on the Block: "DAO"

🐝 If bees ditched their queen and voted on what to do with all the honey…

A decentralized autonomous organization, or DAO, is a semi-leaderless crypto org that makes governance decisions based on token holders' votes. So if a bunch of strangers wanted to pool their $$ to buy a golf course or run a fast-food franchise, they could create a DAO to do just that (no IRL handshakes required).

What else we’re Snackin’

• Cart: Target posted an uptick in holiday sales thanks to inflated groceries and essentials like TP. But the red-cart icon gave an uninspiring forecast as customers spend less on discretionary items like TVs.
• MuskUp: Chinese state media cautioned Elon Musk to reel it in after he tweeted about the origin of the coronavirus. FYI: China is Tesla’s second-largest market, and its key Shanghai factory can crank out 1M cars/year.
• Snapped: Pandemic-era food-stamp benefits are set to end today for 30M Americans in 32 states. As boosted SNAP benefits are getting scrapped, food prices are up 10% on the year.
• Everyman: Goldman Sachs is considering pivoting from its consumer offerings like Marcus savings accounts and Apple cards. The Wall Street giant lost billions from its consumer-facing biz.
• RushIn: Russia has embraced China's yuan as it continues to reduce its dependence on the US dollar for international trades. The shift could better position Russia to weather Western sanctions.

Snack Fact of the Day

Wednesday

• Earnings expected from Kohl’s, Jack In The Box, Lowe’s, Wendy’s, Salesforce, Dollar Tree, Okta, and Office Depot

Authors of this Snacks own shares: of Apple, Google, Tesla, and Dollar Tree

ID: 2764602