Biden’s student loan cancellation plan declared unlawful

Lavina Daryanani

Back in August, President Joe Biden announced the much-awaited plan to deliver on a campaign promise to provide $10,000 in student debt cancellation for millions of Americans and up to $10,000 more for those with the greatest financial need. Alongside, new measures to lower the burden of repayment for their remaining federal student debt were also announced.

Now, however, the Federal judge has declared that President Biden’s plan to cancel student debt is unconstitutional.

The series of events that led to the declaration

Last month, the Job Creators Network Foundation filed a lawsuit on behalf of a borrower who did not qualify for the full $20,000 in debt relief and one who was ineligible altogether.

One of the plaintiffs in the case, fell under the income threshold and was eligible to have $10,000 wiped out. However, he did not he did not qualify for the additional $10,000 because he never received a Pell Grant—a form of federal aid for low-income students. The other plaintiff in the lawsuit was ineligible for Biden’s plan because her federal loans originated through the defunct Federal Family Education Loan (FFEL) program.

Worth noting here is that the total cost of both four-year public and four-year private college has nearly tripled since 1980, even after accounting for inflation. Federal support has, however, not kept up.

Source: Fact Sheet

The suit also noted that the administration violated federal procedures by denying borrowers the opportunity to provide public comment before revealing the program. The plaintiffs further argued—in part—that the Biden administration made arbitrary decisions about who would qualify for debt forgiveness and how much of their balance would be canceled.

Justice attorneys, however, argued that the plaintiffs were not entitled to any amount of loan forgiveness and their grievances were not concrete. Trump appointed U.S. District Judge Mark T. Pittman, nonetheless, declared the policy unlawful in the Thursday order.