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All of government planning and budgeting is based on a believe in overgrowth - and as those paying attention know, that isn't happening. I suspect these events point to officials knowing they are in deep and trying to avoid it coming to full light. Most people have no clue how deep that dependence runs.
I do believe from an initial standing that they'd at least have that authority legally. This is pure government failure and government created "debt" so this isn't the same as the student loan fiasco with involves third (and fourth) parties.
Politically it would be a smart move to stop it, and failing to do so is giving your opponent ammunition. For example, Trump could come out and say that he'd wipe it out when he takes office - turn it into a campaign issue. This paints Biden into a bit of a corner because he has to either oppose it or look like he is just doing what Trump says - ie. no leading.
Which hints strongly at the notion of that campaign staff being fairly incompetent. Unless there is something I'm unaware of (entirely possible) that would prevent the POTUS from doing that, this would be an easy win for them.
Hell, even if it is legally grey, who would oppose it enough to get it to the courts?