Biden’s Idea to Reduce Student Loans is Rejected by a Federal Judge

President Joe Biden’s plan to forgive student loans has been ruled illegal by a federal judge in Texas. In October, the Job Creators Network Foundation, a conservative group, filed the lawsuit on behalf of two borrowers who did not qualify for debt relief.

Biden’s plan had already been put on hold because of a separate legal case. In 2003, Congress passed a law called the HEROES Act, which the Biden administration says gives the secretary of education the power to wipe out most student loan debt.

But the federal judge in Texas said that the law does not give the executive branch clear permission from Congress to make the programme to forgive student loans.

“The programme is thus an unconstitutional exercise of Congress’s legislative power and must be vacated,” wrote Judge Mark Pittman, who was nominated by then-President Donald Trump.

“In this country, we are not ruled by an all-powerful executive with a pen and a phone,” he continued.

The Justice Department said Thursday that it would appeal the decision, and White House press secretary Karine Jean-Pierre said in a statement, “We strongly disagree with the District Court’s ruling on our student debt relief programme.”

“For the 26 million borrowers who have already given the Department of Education the necessary information to be considered for debt relief – 16 million of whom have already been approved for relief – the Department will hold onto their information so it can quickly process their relief once we prevail in court,” Jean-Pierre said.

Since October 21, when the 8th US Circuit Court of Appeals put a hold on the programme, the Biden administration can’t cancel any debt.

The appeals court hasn’t decided yet on that case, which was brought by six states with Republican governors. On October 20, a judge in a lower court threw out the lawsuit, saying that the states did not have the right to bring the challenge.

The programme is also being challenged in court in a number of other ways by the Biden administration. Two different challenges to the programme have been turned down by Supreme Court Justice Amy Coney Barrett.

Under Biden’s plan, federal student loan debt for single borrowers who made less than $125,000 in 2020 or 2021 and for married couples or heads of households who made less than $250,000 in those years could be forgiven up to $10,000.

If a borrower who meets the requirements also got a federal Pell grant while in college, that person could have up to $20,000 of debt forgiven.

Federal judge strikes down Joe Biden's student debt relief plan
Federal judge strikes down Joe Biden’s student debt relief plan

In the case that was decided on Thursday, one of the plaintiffs did not qualify for the student loan forgiveness programme because her loans are not held by the federal government. The other plaintiff is only eligible for $10,000 in debt relief because he did not get a Pell grant.

They said that they couldn’t say they didn’t agree with the program’s rules because the administration didn’t follow the Administrative Procedure Act’s formal notice-and-comment rule-making process.

“This ruling protects the rule of law which requires all Americans to have their voices heard by their federal government,” said Elaine Parker, president of Job Creators Network Foundation, in a statement Thursday.

Bernie Marcus, a big donor to Trump who used to run Home Depot, started the group to help people.

Due to a benefit related to the pandemic, payments on federal student loans have been put on hold since March 2020. They will start up again in January.

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