Supreme Court To Take Up Biden’s Student Loan Giveaway

The Supreme Court on Thursday agreed to hear arguments over President Joe Biden’s scheme to cancel billions in student loan debt. A lower court put the brakes on the giveaway after six states sued, accusing the White House of taking unconstitutional action.

The debt relief plan took shape after months of intense pressure from progressive Democrats.

The high court passed on the administration’s request to lift the injunction enacted by the 8th U.S. Circuit Court of Appeals, meaning the new policy remains on hold. Oral arguments will be heard in the Feb. 2023 session.

The fast-tracking of the case means that a ruling is likely by June.

Biden’s plan to eliminate up to $20,000 in student debt per eligible borrower was announced in August and immediately challenged by several states as an overreach. Arkansas, Iowa, Kansas, Missouri, Nebraska, and South Carolina filed suit.

The states asserted that the measure will diminish tax revenues or other funding for governmental agencies with financial ties to federal student loans.

The high court agreed to decide two issues. First is whether the litigating states have the standing to bring the suit against the Biden White House. And second, whether the debt cancellation exceeds the authority of the Secretary of Education to approve.

The program has already granted loan forgiveness to an estimated 16 million borrowers, though it has been on hold since October for legal reasons.

The Department of Education said another 10 million borrowers may also get debt relief if the program is allowed to proceed.

The Biden administration announced last week that it was extending the federal student loan pause into 2023. On Thursday, the White House assured borrowers that payments would be on hold while the case is reviewed by the Supreme Court.

Press Secretary Karine Jean-Pierre said in a statement that the administration welcomed the high court’s involvement. She called the program “necessary to help over 40 million eligible Americans…recover from the pandemic and move forward with their lives.”

In a separate case, the ruling by a Texas district judge striking down the debt forgiveness plan as illegal was upheld Wednesday by the 5th Circuit Court of Appeals.

The Biden White House overreached by unilaterally enacting the debt relief plan that clearly falls under constitutional authority granted only to Congress. But in an election year, the administration knew it would appeal to a wide swath of voters, and it apparently did.