Biden's student loan repayment plan dealt another blow by federal court



Joe Biden's attempts to fulfill a major campaign promise to relieve student loan debt took another hit this week when a federal appeals court blocked the Saving on a Valuable Education program, better known as SAVE.

On a one-page, unsigned order issued on Thursday, the Eighth Circuit Court of Appeals granted the request of six Republican-led states, including Missouri, to suspend implementation of aspects of the SAVE program while the court considers a more permanent block favored by Republicans. A district judge had already blocked implementation of the other parts of the SAVE program in a ruling last month.

Supporters of SAVE, on the other hand, waxed histrionic that the order blocking the implementation of SAVE would upend people's lives, even though the program began offering debt relief only a few months ago.

Andrew Bailey, the Republican attorney general of Missouri who filed the emergency motion on behalf of the plaintiffs, celebrated the order as a "HUGE win" for everyday Americans. Bailey called SAVE "illegal" and claimed it was a backdoor means of saddling taxpayers — many of whom never went to college — "with half-a-trillion dollars in Ivy League debt."

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"I'm proud to lead from the frontlines on this. In Missouri, we believe in paying our debts and not burdening hardworking taxpayers. Today’s victory is a win for every hardworking American who pays their bills without leaning on their neighbors," Bailey added in a separate statement.

Supporters of SAVE, on the other hand, waxed histrionic that the order blocking the implementation of SAVE would upend people's lives, even though the program began offering debt relief only a few months ago.

"Today’s ruling from the 8th Circuit blocking President Biden’s SAVE plan could have devastating consequences for millions of student loan borrowers crushed by unaffordable monthly payments if it remains in effect," said a statement from Secretary of Education Miguel Cardona.

"This decision threatens the entire federal student loan system and will cause complete chaos and confusion," added a statement from Eileen Connor, president and executive director of the Project on Predatory Student Lending.

The Biden administration has tried to ease or outright cancel student loan debt for years after campaigning heavily on the issue in 2020. However, time after time, the courts have overruled many of those efforts. In June 2023, the Supreme Court struck down Biden's attempts to cancel up to $20,000 in loans for qualified borrowers.

SAVE was yet another means of trying to achieve a similar end. To date, more than 8 million people have enrolled in SAVE, and over 400,000 of them who had taken out no more than $12,000 originally had their entire debt eliminated. The appellate court order will not affect any debt cancellation that has already been given through the SAVE program.

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Biden rolls out another $7.4B in student loan debt ‘forgiveness’ while lawsuits pile up



The Biden administration announced Friday plans to "cancel" another $7.4 billion in federal student loan debt for 277,000 borrowers, despite a growing pile of lawsuits.

According to the White House, the current administration has approved $153 billion in so-called student loan “forgiveness.” Some cancellations were rolled out as part of its Saving on a Valuable Education Plan, a new income-driven repayment plan that sets monthly payments based on borrowers’ income. Approximately 8 million borrowers are enrolled in the program, more than half of whom have had their monthly payments dropped to $0. More than 1 million others enrolled in the SAVE Plan pay less than $100 per month.

After the Supreme Court rejected Biden’s attempt to provide sweeping debt cancellations last year, the administration has ignored the ruling by announcing many smaller, similar plans to wipe out debt for borrowers. Following the court’s ruling, Biden reaffirmed his commitment to canceling student loan debt.

“This latest round of debt cancellation comes on the heels of President Biden announcing new plans that, if implemented, would cancel student debt for over 30 million Americans when combined with actions the Administration has taken over the last three years. This week’s announcements reinforce the President’s commitment to using every path available to deliver student debt relief to as many borrowers as possible through various actions,” the White House stated Friday.

The latest round of cancellations impacts borrowers enrolled in Biden’s SAVE Plan, other income-driven repayment plans, and individuals receiving Public Service Loan Forgiveness.

Republican lawmakers have slammed the administration’s plan, stating that it passes the debt along to American taxpayers. Over the last several weeks, Republican attorneys general have filed two separate lawsuits against the White House, claiming that the debt cancellations are illegal.

Kansas Attorney General Kris Kobach and 10 other states sued the administration in March, accusing Biden of ignoring the Supreme Court’s June ruling against debt cancellations.

The Biden administration’s Education Department responded to the complaint, stating, “The Department does not comment on pending litigation. However, Congress gave the U.S. Department of Education the authority to define the terms of income-driven repayment plans in 1993, and the SAVE plan is the fourth time the Department has used that authority.”

“The Biden-Harris Administration won’t stop fighting to provide support and relief to borrowers across the country – no matter how many times Republican elected officials try to stop us,” it added.

On Tuesday, an additional seven states, led by Missouri Attorney General Andrew Bailey, filed a separate lawsuit for the Biden administration’s attempts to circumvent the court’s decision.

Bailey called the programs Biden’s “embarrassing attempt to buy the 2024 election in direct violation of the law.”

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Biden admin forges ahead with student loan debt ‘forgiveness’ by ‘canceling’ $6 billion for 78,000 public service workers



The Biden administration continues to announce additional rounds of federal student loan debt “forgiveness” despite the Supreme Court’s ruling last year.

On Thursday, the White House issued a press release declaring another $6 billion in debt cancellations.

“Today, my Administration is cancelling student loans for an additional 78,000 public service workers — teachers, nurses, firefighters, and more — through Public Service Loan Forgiveness,” Biden announced. “These public service workers have dedicated their careers to serving their communities, but because of past administrative failures, never got the relief they were entitled to under the law.”

The Public Service Loan Forgiveness Program was signed into law by President George W. Bush in 2007. Its goal was to encourage more Americans to seek employment in the public service sector.

The White House’s press release noted that the Biden administration has wiped out federal student loan debt for 870,000 public service workers. Previous administrations combined only provided relief to 7,000 workers, according to the announcement.

Biden touted that he has "canceled" debt for four million Americans since taking office. Last year, the administration attempted to unilaterally eliminate $10,000 of federal student loan debt for individuals making less than $125,000 annually and married couples making less than $250,000 annually. In June, the Supreme Court blocked Biden’s plan, which would have canceled approximately $430 billion of debt for borrowers.

Since the ruling, the administration has continued to pursue its goal of providing so-called debt forgiveness through smaller, similar programs that pass the burden to all American taxpayers. So far, Biden has zeroed out $143.6 billion in debt for student loan borrowers.

“In the wake of the Supreme Court’s decision on my Administration’s original student debt relief plan, we are continuing to pursue an alternative path to deliver student debt relief to as many borrowers as possible as quickly as possible,” Biden said.

The administration has made it clear that it aims to continue to offer student debt cancellations to as many borrowers as possible.

A January Intelligent.com survey revealed that many borrowers refuse to pay back their student loans to pressure the administration to zero out all debt. According to the study, which polled 1,000 federal student loan borrowers, six in 10 individuals have missed a payment since the federal government ended the payment pause in October. It found that 25% of borrowers have not made a single payment and only 40% have made all their monthly payments.

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Justice Amy Coney Barrett shuts down bid to block Biden's student loan forgiveness program



President Joe Biden's student loan forgiveness program was granted a reprieve Thursday when Supreme Court Justice Amy Coney Barrett refused a bid to block the controversial policy.

Barrett oversees emergency requests from the 7th Circuit Court of Appeals, and she shut down it down without comment and without noting whether it was referred to the rest of the Supreme Court justices.

The emergency appeal was filed by the Wisconsin Institute of Law and Liberty on behalf of the Brown County Taxpayers Association, but the federal government argued that they had no standing to make the request.

Seperately on Thursday, a federal judge denied a challenge to the forgiveness program from six Republican-led states. U.S. District Judge Henry Autrey in St. Louis said the states lacked standing for the lawsuit. A spokesperson for the Nebraska attorney general's office said they would appeal the decision.

Biden announced the plan to partially forgive student loans in August and sparked criticism that he was making a bid to buy the votes of those who carried the debt while burdening the taxpayer with the bill. The Biden administration has argued that it had the power to implement the program due to the state of emergency created by the coronavirus pandemic.

The federal government will be able to start forgiving the loans as early as this weekend.

Critics of the loan forgiveness program accuse Biden of acting unconstitutionally and say he doesn't have the power to act without Congress voting on it. Meanwhile, critics on his left have demanded he forgive all student debt in order to bolster the economy.

"It simply should not be the case that the president of the United States can unilaterally choose to spend 4% of the country's gross domestic product without clear congressional authorization," said Rich Eisenberg of the Wisconsin Institute for Law and Liberty.

A report from the Congressional Budget Office found that the student loan forgiveness program could cost as much as $400 billion.

Here's more about the student loan program:

Student loan forgiveness; SCOTUS rejects Wisconsin group's appeal | FOX6 News Milwaukeewww.youtube.com

Libertarian group files lawsuit challenging the legality of Biden admin’s federal student loan forgiveness plan



A libertarian group filed a lawsuit on Tuesday challenging the legality of the Biden administration’s federal student loan forgiveness plan. The group argued that some borrowers would have their state taxes increased if they participated in the debt cancellation.

The federal student loan forgiveness program would cancel $10,000 of debt for borrowers earning less than $125,000 annually and households earning less than $250,000 annually. The policy also applies to Pell Grant borrowers who will receive an additional $10,000 in debt cancellation. The application for the federal student debt cancellation is expected by early October.

The Pacific Legal Foundation, a Sacramento law firm, filed the case against the policy in federal court in Indiana. All student loan forgiveness for borrowers in Indiana, Arkansas, California, Minnesota, Mississippi, North Carolina, and Wisconsin is subject to state taxes under current law.

Caleb Kruckenberg, an attorney at the Pacific Legal Foundation, said it is illegal for the Biden administration to create the policy without statutory authority.

“Congress did not authorize the executive branch to unilaterally cancel student debt,” said Kruckenberg in a statement on Tuesday. “It’s flagrantly illegal for the executive branch to create a $500 billion program by press release, and without statutory authority or even the basic notice and comment procedure for new regulations.”

The lawsuit states that broad student debt relief would place a substantial burden on taxpayers, the majority of whom either did not attend college, attended but avoided debt, or already paid off their student loan debt.

The case argued that the plaintiff, Frank Garrison, who lives in Indiana, would not benefit from the loan forgiveness.

“Mr. Garrison and millions of others similarly situated in the six relevant states will receive no additional benefit from the cancellation—just a one-time additional penalty,” the suit read.

The Biden administration claimed authority to write off student loans by citing the 2003 HEROES Act, intended to aid Iraq War veterans, which authorized the secretary of education to reduce or eliminate debt during a “national emergency.”

The lawsuit argues that the debt cancellation is not justified by the act because “the cancellation is neither ‘necessary,’ nor is it targeted at harms that are ‘a direct result of a... national emergency.’”

The complaint accused the Department of Education of failing to “undertake the notice-and-comment process required for rulemaking, much less solicit any public input.”

“Nothing about loan cancellation is lawful or appropriate,” the case argues. “In an end-run around Congress, the administration threatens to enact a profound and transformational policy that will have untold economic impacts. The administration’s lawless action should be stopped immediately.”

The Pacific Legal Foundation’s lawsuit calls for the policy to be overturned and temporarily halted while legal questions are resolved.

GOP lawmakers blast the Biden admin's student loan debt cancellation plan and warn it will increase inflation



Republicans have been lambasting President Joe Biden's plan to cancel massive quantities of federal student loan debt.

The administration's plan calls for wiping out $20,000 of student loan debt for individuals who received Pell Grants and $10,000 for those who did not get Pell Grants — this debt cancellation would be available to individuals earning less than $125,000 annually.

\u201cIn keeping with my campaign promise, my Administration is announcing a plan to give working and middle class families breathing room as they prepare to resume federal student loan payments in January 2023.\n\nI'll have more details this afternoon.\u201d
— President Biden (@President Biden) 1661355129

While the policy promises a windfall for those who have taken on student loan debt and not yet paid it off, the plan will not benefit individuals who have already paid off their federal student loans or people who have never taken out any student loans.

In addition to the inherent unfairness of the debt cancellation proposal, Republican lawmakers have been warning that the plan will worsen inflation.

"Biden’s student loan plan will cause more inflation. Wiping hundreds of billions of dollars off the government balance sheet is like injecting hundreds of billions of newly printed dollars into the money supply. Inflation impacts retirees & lower + middle income families most," GOP Rep. Thomas Massie of Kentucky tweeted.

"Sad to see what’s being done to bribe the voters. Biden's student loan forgiveness plan may win Democrats some votes, but it fuels inflation, foots taxpayers with other people’s financial obligations, is unfair to those who paid their own way & creates irresponsible expectations," Republican Sen. Mitt Romney of Utah tweeted.

"So, you choose to avoid debt & start a business - screw you… pay off your loans responsibly - screw you… take the GI bill & service of country - screw you. But choose to major in 'gender' studies & pile up debt to live in your parents' basement - lottery! #StudentLoanScam," GOP Rep. Chip Roy of Texas tweeted.

\u201cSo, you choose to avoid debt & start a business - screw you\u2026 pay off your loans responsibly - screw you\u2026 take the GI bill & service of country - screw you. But choose to major in \u201cgender\u201d studies & pile up debt to live in your parents\u2019 basement - lottery! #StudentLoanScam\u201d
— Chip Roy (@Chip Roy) 1661369810

"Today, @JoeBiden forced every American who didn't attend college or has already paid off their loans to now pay off others' debts. Democrats' canceling student loans isn't a 'relief' for Americans. It's an added burden that will only further increase inflation," Sen. Rick Scott of Florida tweeted.

"To be clear — student debt is not being 'canceled' or 'forgiven.' It's just being transferred from well-off college graduates to working class taxpayers," GOP Rep. Mike Johnson of Louisiana tweeted.

Biden Wants You To Pay for Someone Else's Debt

Biden Wants You To Pay for Someone Else's Debt