US Supreme Court Rejects Biden Administration’s Student Loan Forgiveness Plan

On Friday, the Supreme Court issued a decision that was sharply divided along ideological lines, holding that the Biden administration exceeded its authority when it tried to forgive or reduce the amount of student loans that millions of Americans owed.

The decision, which was reached by a vote of 6-3, with conservative justices in the majority, effectively put an end to the $400 billion plan that had been announced by President Joe Biden the previous year, and it left borrowers on the hook for repayments, which are expected to resume by the end of the summer.

The court came to the conclusion that the administration cannot move forward with such an expensive plan without the approval of Congress. The majority of voters did not buy the argument that the HEROES Act, a bipartisan law passed in 2003 that deals with student loans and was known as the law that gave Biden the power he claimed to have.

“Six different states brought a lawsuit against the federal government, claiming that the HEROES Act does not give permission for the loan cancellation plan. In a statement released on behalf of the court, Chief Justice John Roberts stated, “We agree.”

Justice Elena Kagan wrote in a dissenting opinion, which was joined by the court’s two other liberals, that the majority of the court overrides the combined judgment of the Legislative and Executive Branches, which will have the effect of removing loan forgiveness for 43 million Americans. Kagan’s opinion was joined by the other two liberals on the court.

According to a schedule that was initially established by the administration and included in the agreement to raise the debt ceiling, it is anticipated that loan repayments will resume by the end of August. Since the beginning of the pandemic caused by the coronavirus more than three years ago, payments have been put on hold.

People with an annual income of less than $125,000 or households with an annual income of less than $250,000 were eligible to have their student loan debt of up to $10,000 forgiven as part of the forgiveness program.

Pell Grant recipients, who typically demonstrate a greater financial need, would have had an additional $10,000 in debt forgiven if this proposal had been approved. The administration stated that 26 million people had applied for relief, but only 43 million would have qualified for the program. It was estimated that the cost would be $400 billion over a period of 30 years.