Circuit court puts final nail in the coffin for Biden’s $500M student loan forgiveness plan

The U.S. 8th Circuit Court of Appeals delivered a final blow to former President Joe Biden’s student loan forgiveness plan on Tuesday. Missouri Attorney General Andrew Bailey initiated legal action against the Biden administration over the $500 million SAVE plan, which aimed to eliminate student loans. The court’s ruling stated that Biden’s secretary of education exceeded their authority by implementing a plan that forgave loans instead of requiring repayment.

Bailey emphasized that the court’s decision would prevent future presidents from attempting similar maneuvers to forgive student loans. He expressed the importance of upholding this precedent to protect working Americans from shouldering the burden of others’ Ivy League debt.

Last year, the Supreme Court rejected the Biden administration’s request to lift the injunction on the SAVE plan. A federal appeals court in Missouri also halted the program’s enforcement while legal proceedings continued in lower courts. The Department of Justice, representing the Biden administration, sought emergency relief from the Supreme Court, arguing that the nationwide injunction went too far.

Despite these setbacks, the Biden administration vowed to defend the SAVE plan, which has provided relief to over 8 million borrowers, including 4.5 million with zero monthly payments. The White House spokesperson reiterated their commitment to fighting against Republican officials’ efforts to increase student loan costs for millions of borrowers.

Biden introduced the SAVE plan after the Supreme Court rejected his initial student loan forgiveness proposal. The White House projected that the plan could reduce borrowers’ monthly payments to zero, cut costs in half, and save individuals at least $1,000 annually. Additionally, borrowers with original balances of $12,000 or less would have their remaining debt forgiven after ten years of payments.

The 8th Circuit ruling, along with the previous legal challenges, underscores the contentious debate surrounding student loan forgiveness policies in the United States. As the Biden administration faces obstacles in implementing its initiatives, the future of student loan relief remains uncertain.

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