In a major blow to President Joe Biden’s ambitious student loan debt relief plan, the Supreme Court delivered a decisive ruling on Friday, asserting that the administration lacks the authority to move forward with its proposed program.
The highly anticipated decision, rendered in a 6-3 vote, effectively bars the cancellation of over $430 billion in student loan debt, leaving millions of borrowers in financial uncertainty.
Chief Justice John Roberts, who authored the majority opinion, wrote that the Secretary of Education’s plan canceled about $430 billion of federal student loan balances, completely erasing the debts of 20 million borrowers and lowering the median amount owed by the other 23 million from $29,400 to $13,600.
He added, “Six States sued, arguing that the HEROES Act does not authorize the loan cancellation plan. We agree.”
Disappointed by the court’s ruling, President Biden expressed his disagreement with the decision in a statement and vowed to explore alternative avenues to alleviate the burden on hardworking middle-class families. He announced that he would be addressing the nation in the afternoon to address the matter.
“My Administration’s student debt relief plan would have been the lifeline tens of millions of hardworking Americans needed as they try to recover from a once-in-a-century pandemic,” President Biden stated. “Nearly 90 percent of the relief from our plan would have gone to borrowers making less than $75,000 a year, and none of it would have gone to people making more than $125,000. It would have been life-changing for millions of Americans and their families. And it would have been good for economic growth, both in the short- and long-term.”
President Biden criticized Republican lawmakers for their alleged hypocrisy, citing their support for substantial pandemic-related business loans, including their own, while obstructing relief for hardworking Americans.
“The hypocrisy of Republican elected officials is stunning. They had no problem with billions in pandemic-related loans to businesses – including hundreds of thousands and in some cases millions of dollars for their own businesses. And those loans were forgiven. But when it came to providing relief to millions of hard-working Americans, they did everything in their power to stop it,” President Biden asserted.
Despite the setback, President Biden emphasized his administration’s progress in addressing the challenges of student loan debt. Initiatives such as historic increases to Pell Grants, loan forgiveness for teachers, firefighters, and public servants, and the introduction of a debt repayment plan capping undergraduate loan payments at 5 percent of discretionary income have all been part of the broader effort to make higher education accessible and affordable.
“I believe that the Court’s decision to strike down our student debt relief plan is wrong. But I will stop at nothing to find other ways to deliver relief to hard-working middle-class families. My Administration will continue to work to bring the promise of higher education to every American,” President Biden pledged.