Seven attorneys general in red states across the country banded together on Tuesday, April 9 to push back against the Biden Administration’s attempt to forgive some portion of student loans, as he rolled out on Monday during a trip to Wisconsin. The AGs were from Missouri, Arkansas, Florida, Georgia, North Dakota, Ohio, and Oklahoma, and in the suit, they argued that Biden’s is unconstitutional and “illegal.”
As background, on Monday, April 8, the Biden White House announced, “From Day One President Biden vowed to fix the Federal student loan program and make sure higher education is a ticket to the middle class – not a barrier to opportunity. To date, the Biden-Harris Administration has taken historic action to approve debt cancellation for 4 million borrowers, helping these borrowers get more breathing room in their daily lives, access economic mobility, buy homes, start businesses, and pursue their dreams. Today, President Biden is announcing his Administration’s new plans that, if finalized as proposed, would provide debt relief to over 30 million borrowers when combined with actions the Administration has taken over the last four years. These plans would not only help create more financial stability for millions of working and middle-class families, they would also help address the disproportionate debt burden on communities of color and advance racial equity.”
It continued, “These actions are expected to provide significant relief to Black and Latino borrowers, borrowers who attended community college, and borrowers who are financially vulnerable because they took out debt but never had the chance to complete their degree. Not only are Black students more likely to take on student loans than their white peers, but they also end up holding nearly twice as much debt as their white peers four years after graduation. And Latino borrowers are also more likely to default on their student loans compared to white borrowers.”
Watch Biden’s announcement here:
The red state AGs fired back in a lawsuit spearheaded by Missouri. In the complaint, they said, “Yet again, the President is unilaterally trying to impose an extraordinarily expensive and controversial policy that he could not get through Congress. This latest attempt to sidestep the Constitution is only the most recent instance in a long but troubling pattern of the President relying on innocuous language from decades-old statutes to impose drastic, costly policy changes on the American people without their consent.”
Continuing, they argued, “Just last year, the Supreme Court struck down an attempt by the President to force teachers, truckers, and farmers to pay for the student loan debt of other Americans—to the enormous tune of $430 billion . . . In striking down that attempt, the Court declared that the President cannot ‘unilaterally alter large sections of the American economy’ . . . Undeterred, the President is at it again, even bragging that ‘the Supreme Court blocked it. They blocked it. But that didn’t stop me.'”
They also argued, “This rule unlawfully seeks to evade the limits Congress set out in statute for the IBR program. It also would gut the statutory purpose of providing loans. By their nature, loans require repayment except in extenuating circumstances. The Federal Government’s thresholds are set so high—arbitrarily so—that it creates a grant for most borrowers.”
Further explaining that point, they argue, “In other words, unlike every other loan program, the majority of borrowers will receive a grant. Indeed, the Federal Government bragged in March that the clear majority of individuals on this new plan—57%—are paying nothing. This is not a student loan program. It is a grant program that Congress never authorized.”
After explaining the flaws with the President’s program, the AGs demand that the court halt the program, saying, “This Court should speedily put a stop to the President’s unlawful attempt— again—to skirt Congress and the Constitution.”
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