Biden’s Forgiveness Strategy Is Facing More Challenges
The president’s plan to eliminate student loan debt was already being challenged by six Republican-led states: Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina. These states also claimed that the president had exceeded his powers.
The states’ lawsuit was dismissed by a federal judge who claimed that although they raised “important and significant issues to the debt relief scheme,” they lacked the legal authority to bring the claim.
After their case was dismissed, the GOP-led states didn’t give up. In their appeal, they requested that the president’s plan which was scheduled to begin in October, be put on hold while their application was reviewed.
The states’ emergency petition was approved by the 8th U.S. Circuit Court of Appeals, preventing the Biden administration from beginning to forgive any student debt. The Education Department has nevertheless urged borrowers to keep requesting forgiveness because its plan had not yet been overturned.
Over 26 Million Borrowers Have Requested Cancellation
On August 24, Biden declared that tens of millions of Americans would be qualified for student loan forgiveness with amounts ranging from $10,000 to $20,000 depending on whether or not they were recipients of the Pell Grant, a sort of financial aid offered to low-income households.
Republicans have denounced student loan forgiveness as a gift to wealthy college grads long before Biden took action in response to criticism from consumer activists and other Democrats. They asserted that the president lacked the authority to pardon consumer debt without the approval of Congress.
The legal challenges poured in, as expected. At least six lawsuits have been filed thus far in opposition to the president’s plan.
The Education Department had first stated that borrowers would be granted forgiveness six weeks after applying. On October 17, the whole application went live and within three weeks, about 26 million people had asked for assistance. 16 million such requests have had their demands granted as of yet.
The department has said that it will hold the applications of borrowers who have already applied for the time being. According to higher education expert Mark Kantrowitz, borrowers should wait it out.
According to Kantrowitz, “the program is suspended, but the U.S. Department of Education is appealing. There were several odd characteristics of the Texas court finding that may lead to a successful appeal.