The Biden Administration is being sued over its efforts to forgive student loan debt. This latest attempt is through the SAVE Plan, which aims to cut monthly payments and accelerate the path to having loans forgiven. It’s being challenged by a group of conservative states led by Missouri Attorney General Andrew Bailey.
Solicitor General Josh Divine said that President Joe Biden is attempting to cancel student loans in “direct defiance” of last year’s Supreme Court ruling.
“I mean, on the very same day last year that the Supreme Court said to the Biden Administration you can’t do this, literally minutes later, they said, ‘well we’re going to try it again. We’re going to try it again under a different statute that has even less plausible authority,’” Divine said.
A federal judge in St. Louis blocked the plan earlier this summer, and that ruling was upheld by the Eighth U.S. Circuit Court of Appeals. This week, the U.S. Supreme rejected Biden’s request to allow his forgiveness plan to remain in effect while it’s being challenged at the appeals court level.
“I don’t think the president should be making promises that he knows he can’t keep,” he said. “He shouldn’t be promising the American people ‘I’m going to cancel your loans’ when he knows he has no authority to do that. This is about more than just the people who have taken out student loans. I mean, I have more than my fair share of student loans.”
For nearly two years, Missouri has helped lead the charge over accusations that President Biden and his administration is attempting to “saddle working Americans with $500 billion in someone else’s Ivy League debt.”
Divine made clear that he, nor the Attorney General, are not against loan forgiveness as there are programs in federal law that they support.
“I think the costs of education is out of control,” said Divine. “It has been for 30 years, and I support legislative efforts to take a look into this, especially legislative efforts that are going to change the incentive structure for colleges not to keep increasing the amount of tuition. This does the opposite of that.”
Examples of federal loan forgiveness programs include Income-Driven Repayment Forgiveness, Teacher Loan Forgiveness, Public Service Loan Forgiveness as well as programs for the military and AmeriCorps members.
But regarding the SAVE Plan, Divine claimed that it reduces the monthly amount to zero.
“I think it’s an understatement to say that the changes to the payment amount would reduce the monthly payment amount,” he said. “It, for the vast majority of people on the SAVE Plan, it turns the amount to zero. That’s not just ‘hey we’re going to have a lower amount,’ that is ‘you never have to pay anything back ever again.’ That’s loan forgiveness.”
The eight million borrowers who are enrolled in the SAVE Plan have been placed in an interest-free forbearance period, during which they are not required to make monthly payments.
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