President Biden’s latest student loan relief package was blocked by federal courts in Kansas and Missouri on Monday following lawsuits from several Republican-led states.
A nationwide preliminary injunction issued by U.S. District Judge Daniel Crabtree in Kansas and U.S. District Judge John Ross in Missouri, both appointees by former President Barack Obama, prevents the Biden administration from forgiving any more federal student loan payments for borrowers enrolled in Savings for Worth Education (SAVE) plans.
The 81-year-old president’s Department of Education will also be barred from implementing new SAVE plan provisions while the litigation continues.
The judges did not seek to recover debt relief that had already been paid.
Biden’s SAVE plan, which is expected to cost U.S. taxpayers $475 billion over the next decade, aims to cut income-based monthly student loan payments in half and eliminate monthly payments for minimum wage workers. For student loan borrowers who owe $12,000 or less, all outstanding debt would be forgiven after 10 years.
The University of Pennsylvania’s Penn Wharton Budget Model estimated that approximately 750,000 households with an average household income above $312,000 would also benefit from debt relief under the SAVE plan, with an average of $25,541.39 in debt reduction, significantly more than the average of $4,899.26.
The plan is set to go into full effect on July 1 and has already forgiven about $5.5 billion in student loan debt.
The justices ruled that the lawsuits led by Missouri Attorney General Andrew Bailey and Kansas Attorney General Kris Kobach are likely to succeed in arguing that Biden overstepped his authority when he circumvented Congress and implemented the SAVE plan.
“Today’s victory in Kansas is a victory for the country,” Kobach, a Republican, said in a statement. “Whether to forgive billions of dollars in student loan debt, as the court rightly held, is a critical question only Congress can answer. The Biden Administration is trying to usurp Congress’ authority.”
“This is not only unconstitutional, it’s unfair,” he added. “A blue-collar worker from Kansas who didn’t go to college shouldn’t have to pay off the student loans of a New Yorker with a degree in gender studies.”
Bailey, a Republican, similarly argued that “Congress never gave Biden the authority to saddle working Americans with $500 billion in other people’s debt.”
“This is a major victory for the Constitution,” the Missouri attorney general wrote to X.
The Supreme Court last summer rejected President Biden’s attempt to forgive $400 billion in federal student loan debt.
Kobach’s complaint states that the SAVE plan ” [Biden’s] This was “the first illegal attempt at debt forgiveness,” with the president seeking to forgive between $10,000 and $20,000 in federal student loan debt for approximately 40 million students.
White House spokeswoman Karine Jean-Pierre said in a statement that the Biden administration plans to continue enrollment in the SAVE Plan despite the injunction.
“We strongly disagree with today’s ruling regarding Plan SAVE, and the Department of Justice will continue to vigorously defend Plan SAVE,” she said in a statement.
“It is disappointing that Republican elected officials and their allies have fought so hard to block their constituents from accessing reduced payments and a quicker path to debt forgiveness, and that the court is now rejecting the authority the department has repeatedly applied for decades to improve income-contingent repayment plans.”
“Today’s ruling will not stop the government from doing everything we can to provide students and borrowers with the relief they need,” Jean-Pierre added. “That’s why the Department of Education will continue to enroll even more Americans in SAVE and help more students and borrowers benefit from the programs that continue to be available to them, including zero payments for those making less than $16 an hour, monthly payment relief for millions more borrowers, and protections from runaway interest for borrowers who are making monthly payments.”
The Department of Education did not respond to The Washington Post’s request for comment.
