Late Friday evening, a federal appeals court put a temporary halt to President Joe Biden’s student debt forgiveness program, preventing loans from being canceled until the court reviews the legal challenge, yet the White House is still encouraging applications.
In response to the court’s temporary hold, White House press secretary Karine Jean-Pierre gave a statement: “Tonight’s temporary order does not prevent borrowers from applying for student debt relief at studentaid.gov – and we encourage eligible borrowers to join the nearly 22 million Americans whose information the Department of Education already has. It also does not prevent us from reviewing these applications and preparing them for transmission to loan servicers.”
Up to $20,000 of debt per applicant could be canceled under the new plan; the Congressional Budget Office estimated that the program would cost about $400 billion over the next 30 years.
The case was brought by six Republican-led states—Missouri, Arkansas, Kansas, Nebraska, South Carolina, and Iowa—that contend that Biden doesn’t have the authority to grant such sweeping loans without the approval of Congress. In response, the government said because of a 2003 federal law, Higher Education Relief Opportunities for Students (HEROES) Act, the Department of Education has “broad authority to manage the federal student financial aid programs.”
A district court dismissed the suit earlier this week, saying the states did not establish standing.
On Thursday, in a separate attempt to block Biden’s loan forgiveness plan, Supreme Court Justice Amy Coney Barrett rejected an emergency request from a taxpayers’ association in Wisconsin to halt the policy.
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Earlier on Friday, while giving remarks at Delaware State University, President Biden called out Republicans, including Rep. Marjorie Taylor Greene (R-Ga.), who criticized his loan forgiveness plan as being hypocritical as they had massive PPP loans forgiven: “Representative Vern Buchanan of Florida said our plan was ‘reckless.’ Guess how much he got in that program forgiven? $2,300,000.”
Biden continued: “Ted Cruz, the great senator from Texas, said [the program] is for slackers who don’t deserve relief. Who in the hell do they think they are?”
In response, Cruz tweeted that Biden had “unbelievable gall” for “comparing PPP loans…to loan forgiveness he gave to his Ivy League slacker fringe liberal base to buy their votes.”
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As the Biden administration continues to face legal challenges, it has said it would not begin to cancel debt before Sunday, October 23. The deadline for the government to respond to the states’ filing is Monday, while the deadline for the states to reply to the government’s response is Tuesday.
Kelly Rissman
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