On Tuesday, seven Republican-led states took legal action to challenge the latest student loan forgiveness plan by the Biden administration. According to the GOP, the Department of Education already planned to start erasing student debts as soon as this week.
The GOP lawsuit came less than a week after the Supreme Court denied Biden’s administration a reviving of a different student debt forgiveness plan designed to reduce the monthly payment for millions of borrowers and boost loan forgiveness for others.
According to the lawsuit filed in the federal court in Brunswick, the state attorneys general focused on a rule the Education Department proposed in April that would provide forgiveness of federal students’ debts for about 27.6 million borrowers.
The attorney generals of Missouri and Georgia stated they recently received documents that revealed the Education Department directed the federal loan servicers to start erasing hundreds of billions of dollars of debts as early as Tuesday or Saturday before the rule was finalized.
According to the lawsuit, the rule could result in the overnight cancellation of at least $73 billion in loans. Billions in further debt forgiveness could also follow. The states claim that the Education Department has no right to implement such debt forgiveness.
Andrew Bailey, Missouri Attorney General, stated, “We successfully halted their first two illegal student loan cancellation schemes; I have no doubt we will secure yet another win to block the third one.”
Republicans have been mainly against Biden’s Student debt forgiveness, claiming that they unfairly leave the taxpayers on the hook to pay for other people’s debt.
A spokesperson from the Education Department declined to comment on the case but emphasized that the department “will continue to fight for borrowers across the country who are struggling to repay their federal student loans.” The department, under the Biden administration, has approved $169 billion in debt forgiveness for 4.8 million borrowers.
The lawsuit is the latest legal challenge against Biden’s efforts to fulfil his campaign pledge and deliver debt forgiveness for millions of American student loan borrowers.
The GOP previously convinced the 6 to 3 conservative majority of the US Supreme Court in June 2023 to block a $430 billion plan by the Biden administration that would have erased up to $20,000 in debt per borrower for 43 million Americans.
The administration later devised the Save on Value Education Plan (SAVE), which was designed to reduce the monthly payments for millions of student borrowers. However, the GOP also convinced the US courts of appeals to block the plan.
