President Biden’s student loan cancellation plan has once again been put on hold.
Yesterday, U.S. District Judge Matthew Schelp in Missouri further delayed Biden’s plan to cancel student loan debt for over 30 million Americans, temporarily blocking the administration from acting.
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The Supreme Court has previously rejected an earlier proposal that would have canceled debt for 43 million people.
Six Republican-led states had urged the Missouri judge to make the injunction, claiming the Education Department could “unlawfully mass cancel up to hundreds of billions of dollars in student loans as soon as Monday.”
In response, the Education Department said, “This lawsuit was brought by Republican elected officials who made clear they will stop at nothing to prevent millions of their own constituents from getting breathing room on their student loans.”
If put into action, Biden’s new plan could alleviate the financial burden for 30 million people, eliminating up to $20,000 in interest for eligible borrowers. However, it’s been on hold since September after the states filed a lawsuit in Georgia, where a federal judge dismissed the case. But from there, it only transferred to Missouri.
“This is yet another win for the American people,” said Missouri Attorney General Andrew Bailey. “The Court rightfully recognized Joe Biden and Kamala Harris cannot saddle working Americans with Ivy League debt.”
Missouri’s legal standing in the case against Biden’s student loan forgiveness plan is considered stronger because the state’s loan servicing entity, MOHELA, could potentially lose revenue if the plan is implemented. Since MOHELA was created by the state, any financial harm to MOHELA could be viewed as a direct injury to Missouri itself.
That doesn’t mean much to the millions of people who’d gotten their hopes up over the past year, thinking they’d finally see some relief from their hefty student loan debt. It seems that outcome is but a distant dream now: Regardless of the Missouri district court’s decision, it’s likely that the losing side will appeal the ruling. Potentially, the case will go all the way to the Supreme Court.
