On Thursday, a federal appeals court issued a ruling that blocked the Biden administration’s intention to develop a new student loan forgiveness plan that would reduce borrowers’ monthly payments. The U.S. Eight Circuit Court of Appeals approved a request from seven Republican states to prohibit parts of the Department of Education’s plans.
In a prior ruling last month, a U.S. District Court in St. Louis blocked the government agency from proceeding with additional student loan forgiveness under the Biden administration’s Saving on a Valuable Education (SAVE) plan. However, the Eight Circuit stepped in and blocked additional elements of the plan that hadn’t already been addressed.
The SAVE plan would reportedly grant more favorable terms for borrowers enrolled in the income-based repayment schedules currently offered. The initiative seeks to lower the monthly payments for eligible borrowers who fall within a specified income range and whose principals were $12,000 or less after ten years of repayments.
The group of conservative states, led by Missouri Attorney General Andrew Bailey, requested that the 8th Circuit Court block the remainder of the plan. “The Court granted our emergency motion to BLOCK Joe Biden’s entire illegal student loan plan, which would have saddled working Americans with half-a-trillion dollars in Ivy League debt,” Bailey wrote on social media. “HUGE win for every American who still believes in paying their own way.”
Expectedly, the Biden administration has retaliated against the ruling, maintaining that it would continue to seek ways to enact the president’s agenda surrounding student debt forgiveness. In a statement to Fox Business, a Department of Education spokesperson said, “We are assessing the impacts of this ruling and will be in touch directly with borrowers with any impacts that affect them.”
“Our Administration will continue to aggressively defend the SAVE Plan – which has been helping over 8 million borrowers access lower monthly payments, including 4.5 million borrowers who have had a zero dollar payment each month,” the statement continued. “And, we won’t stop fighting against Republican elected officials’ efforts to raise costs on millions of their own constituents’ student loan payments.”
Earlier this year, The American Tribune reported on statements from President Biden where he claimed the Supreme Court “didn’t stop me” in his campaign to place the burden of irresponsible borrowing on the American taxpayers. The Supreme Court previously struck down Biden’s plan, ruling that his administration was attempting to go beyond its authority.
“Early in my term, I announced a major plan to provide millions of working families with debt relief for their college student debt. Tens of millions of people in debt were literally about to be canceling their debts. But my MAGA Republican friends in Congress and elected officials and special interest stepped in and sued us. The Supreme Court blocked it,” Biden said.
Biden continued, “But that didn’t stop me. I announced we’re going to pursue alternative paths for student debt relief for as many borrowers as possible. That’s the effort that’s been underway the last two years. Fix was called the safe plan existed, I fixed it to make it the most affordable repayment plan ever. Before I took office, student borrowers had to pay 10% of their discretionary income on a monthly basis. If they made less than if they didn’t have enough to do that.”
Watch his remarks below:
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