Biden’s Student Loan Forgiveness Scheme Is Temporarily Blocked By A U.s. Appeals Court

On Thursday, a judge in a lower court in the United States dismissed a lawsuit brought by six states and led by Republicans that challenged the debt-forgiveness program. On Friday, however, an appeals court in the United States temporarily blocked President Joe Biden’s plan to cancel billions of dollars in college student loans.

The emergency petition that the states had submitted to the 8th U.S. Circuit Court of Appeals was granted, and the court froze the loan forgiveness plan until the court rules on their request for a longer-term injunction. This is happening while the states are appealing the decision that was made against them on Thursday.

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In addition, the appeals court in St. Louis issued a directive that a shortened briefing timeline be followed on the matter.

On Thursday, U.S. District Judge Henry Autrey in St. Louis made a ruling that, despite the fact that six states led by Republicans had brought up “important and significant challenges to the debt relief plan,” he dismissed their lawsuit on the grounds that they lacked the necessary legal standing to pursue the case. Autrey’s decision came as a result of a hearing that was held in St. Louis.

The states of Nebraska, Missouri, Arkansas, Iowa, Kansas, and South Carolina have expressed concern that Vice President Joe Biden’s plan would circumvent the authority of Congress and put at risk the future tax revenues of their states as well as the money earned by state entities that invest in or service student loans.

Biden's Student Loan Forgiveness Scheme
Biden’s Student Loan Forgiveness Scheme

Their lawsuit is one of several that Republican state attorneys general and conservative legal organizations have brought forth in an effort to derail the debt forgiveness plan that Democratic Vice President Joe Biden announced in August.

An emergency request to put the debt relief plan on hold in a separate challenge brought by the Wisconsin-based Brown County Taxpayers Association was denied by Justice Amy Coney Barrett of the United States Supreme Court without any explanation. Judge Autrey’s decision came about an hour after she made that decision.

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It was announced by Vice President Joe Biden that the federal government will forgive up to $10,000 in student loan debt for borrowers with an annual income of less than $125,000, or $250,000 for married couples. This program will help millions of Americans. Up to $20,000 of the debt of borrowers who were awarded Pell Grants, which are financial aid awards given to students from families with modest incomes, will be forgiven.

Biden had pledged to assist borrowers who had graduated from college but were still struggling to pay off their student loans during his campaign for the presidency in 2020. In September, the Congressional Budget Office estimated that the government would incur a cost of approximately $400 billion as a result of the debt forgiveness.

Democrats are hopeful that the strategy will increase support for them in the upcoming midterm elections on November 8, which will determine which party controls Congress.

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