On Wednesday, six states argued that President Joe Biden’s proposal to resume his plan to forgive billions of dollars in student debt went beyond the bounds of his administration, and they asked the U.S. Supreme Court to deny the request.
In response to the Biden administration’s appeal to the courts to overturn a lower court’s injunction stopping the program while the constitutionality of it is being debated, the states of Arkansas, Iowa, Kansas, Missouri, Nebraska, and South Carolina submitted a response. Republicans control five of the six states, including Kansas, which has a Republican attorney general.
According to the state’s complaint, Biden’s administration is attempting to “assert power well beyond anything Congress could have envisaged.” According to the administration, the decision to reject the proposal on November 14 has left millions of borrowers in a precarious situation.
The administration is also appealing a federal judge’s finding that the program is illegal based on his decision on November 10 in Texas. Following that choice, the administration stopped accepting applications for student debt relief.
Biden stated in August that the U.S. government will cancel up to $10,000 in student loan debt for borrowers making less than $125,000 per year, or $250,000 for married couples, in a measure that would help millions of Americans. Up to $20,000 of student debt will be forgiven for those who earned Pell Grants, which were intended for college students from lower-income families.
The Democratic president’s pledge to assist former college students who are saddled with debt during the 2020 presidential campaign was fulfilled by the policy. The government would spend about $400 billion on debt forgiveness, according to a September estimate by the Congressional Budget Office.
In their complaint, the states opposing the scheme claimed that the debt cancellation plan violated congressional power, jeopardized future state revenues, and harmed the earnings of state organizations that finance or manage student loans.
The 8th U.S. Circuit Court of Appeals, which is based in St. Louis, stopped the program while it heard an appeal from the states after a federal court dismissed their complaint for lack of standing.
The 8th Circuit’s ruling, according to Biden’s administration, leaves borrowers “uncertain about the extent of their debt and unable to make financial decisions with an accurate understanding of their future repayment responsibilities,” the Supreme Court was informed.
The administration also suggested that the justices could hear the case directly, without going through the 8th Circuit, and render a decision by the end of June.
A 2003 law known as the Higher Education Relief Opportunities for Students Act, which permits the government to modify or waive federal student loans during times of war or national emergency, has been the target of several legal challenges questioning Biden’s authority to cancel the debt. The pandemic, according to the Biden administration, was such an emergency.
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The states that are contesting the program on Wednesday criticized the justification. The government “uses it here to place tens of millions of borrowers in a better position by canceling their debts en masse,” they claimed in their application. The law is intended to prevent borrowers from getting into worse financial situations.
Biden on Tuesday extended a pause in student loan repayments, begun during the COVID-19 pandemic, to no later than June 30, while expressing confidence in the legitimacy of his plan. According to Biden, the Supreme Court would have enough time to make a decision at that point before the hiatus ends.