The US Supreme Court blocks Biden’s student loan forgiveness

By RockedBuzz 7 Min Read
origin 1

By John Kruzel

WASHINGTON (RockedBuzz via Reuters) – The U.S. Supreme Court dealt President Joe Biden a painful defeat on Friday, blocking his plan to cancel $430 billion in student loan debt, a move expected to benefit up to 43 million Americans and keep an election promise.

The Democratic chairman denounced the 6-3 decision — fueled by court conservatives and authored by Chief Justice John Roberts — and announced new measures to provide relief to student loan borrowers using a different approach.

The court sided with six conservative-leaning states — Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina — that opposed Biden’s student loan forgiveness. His ruling dealt a major blow to the 26 million borrowers who applied for relief after Biden announced the plan in August 2022 and represented a political setback for Biden.

“Today’s decision closed one avenue. Now we pursue another,” Biden said at the White House, announcing steps taken under a law called the Higher Education Act. “I will never stop fighting for you. We will use all the tools at our disposal to get the student debt relief you need and achieve your dreams.”

Roberts scoffed at the Biden administration’s argument that the loan forgiveness program — a national emergency move resulting from the COVID-19 pandemic — was merely a modification of an existing program, and noted that such an action broad would require clear congressional approval.

“The secretary’s plan ‘modified’ the provisions cited only in the same sense that the French Revolution ‘modified’ the status of the French nobility – it abolished them and supplanted them entirely with a new regime,” Roberts wrote, referring to United States Secretary of Education Miguel Cardona.

“From a few narrowly delineated situations specified by Congress, the secretary has extended the pardon to nearly every borrower in the country,” Roberts said.

The three liberal judges of the court dissented. The court acted on its last day of rulings in its tenure that began in October.

The ruling invoked the “major matters” doctrine, a beefy judicial approach that gives judges broad discretion to invalidate executive agency actions of “broad economic and political significance” unless Congress clearly authorizes them in legislation . Conservative justices had previously used this doctrine to invalidate other Biden policies, including pandemic-era eviction protections for residential renters and his mandate to vaccinate or test COVID-19 for big business.


Biden’s plan delivered on his 2020 campaign promise to cancel a chunk of $1.6 trillion in federal student loan debt, but was criticized by Republicans who called it excessive authority and an unfair advantage for college-educated borrowers, while other borrowers received no such relief.

Under the plan, the U.S. government would forgive up to $10,000 in federal student debt for Americans earning less than $125,000 who took out loans to pay for college and other postsecondary education and $20,000 for scholarship recipients. Pell study program for students from low-income families.

The administration said the plan was authorized under a 2003 federal law called the Higher Education Relief Opportunities for Students Act, or HEROES Act, which allows the education secretary to “waiver or modify” financial assistance to students during war or national emergencies.

Biden and his Republican predecessor Donald Trump have both relied on the HEROES Act to repeatedly suspend student loan payments and halt interest accumulation to ease the financial strain on student loan borrowers during the COVID-19 pandemic.

Cardona said the Department of Education has now finalized an income-based loan repayment plan that cuts monthly payments to zero for millions of low-income borrowers, saves all other borrowers at least $1,000 a year, and it stops out-of-control interest that leaves borrowers owing more than their initial loan.

The department, Cardona said, will also provide a 12-month transition period to help borrowers successfully return to repayment without falling into insolvency or default. It will help borrowers avoid the harsher consequences of missed, partial or late payments such as bad credit reports and loans routed to collection agencies, Cardona added.

Biden, who is seeking re-election next year, has criticized Republican elected officials who have opposed his plan.

“They have had no issues with billions in pandemic-related loans to businesses, including hundreds of thousands and in some cases millions of dollars for their own businesses,” Biden said.

Some 53% of respondents supported Biden’s debt relief, with 45% against, in a US RockedBuzz via Reuters/Ipsos poll in March.

The principal issues doctrine stems from an approach favored by many conservatives and business groups to curb what they see as the excesses of the “administrative state”. They oppose what they see as power accumulated by the executive branch without proper scrutiny by the courts and Congress.

Justice Elena Kagan, in a joint dissent with her two liberal colleagues, derided this doctrine as “made up.”

“No wonder the majority invoke the doctrine,” Kagan wrote. “The ‘normal’ majority interpretation of the statute cannot support its decision. The statute, read as written, gives the Secretary broad authority to alleviate the effect of a national emergency on the ability of borrowers to repay student loans.” .

Two individual borrowers opposed to the plan’s eligibility requirements also sued, but judges on Friday rejected their claims due to a lack of standing to sue.

(Reporting by John Kruzel; Additional reporting by Steve Holland and Jeff Mason; Editing by Will Dunham)

origin 1
origin 1
origin 1

Share This Article
Leave a comment