Supreme Court says no to Biden student loan forgiveness plan. How that affects Idahoans
The Supreme Court quashed President Joe Biden’s plan for student loan forgiveness Friday, a measure that could have offered tens of thousands of dollars in relief to some borrowers, including more than 100,000 Idahoans.
In a 6-3 decision on ideological lines, the court said the program was not authorized under the 2003 Higher Education Relief Opportunities for Students Act, which allows the government to grant waivers for financial aid.
Invoking the act, the Biden administration had promised to forgive more than $400 billion in debt to alleviate financial distress caused by the coronavirus pandemic. But the court said the White House initiative exceeded its power under the law.
“We hold today that the act allows the secretary [of education] to ‘waive or modify’ existing statutory or regulatory provisions applicable to financial assistance programs under the Education Act, not to rewrite that statute from the ground up,” Chief Justice John G. Roberts wrote for the majority.
Biden proposed relieving up to $20,000 for student loan borrowers who received a Pell Grant, a form of federal aid for low-income students. The plan, announced last August, would forgive up to $10,000 for those who earn under $125,000 a year individually or are in households that make under $250,000.
About 26 million borrowers applied or were deemed eligible for forgiveness. That included more than 126,000 people in Idaho, according to the White House.
The Supreme Court heard arguments from two lawsuits in February. In one, states contended that the president overreached his authority and that the plan would injure student loan financiers. In the other, plaintiffs said they would be harmed because they would be at least partially excluded from the program.
The court unanimously ruled that plaintiffs in the second case lacked standing. If it had been the only case before the court, Biden’s loan program could have survived. It was the case brought by the states that delivered the fatal blow.
“The hypocrisy of Republican elected officials is stunning,” Biden said in a statement after the ruling was released. “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,” he said.
Idaho Gov. Brad Little was one of 22 governors who signed a letter opposing Biden’s plan in 2022. The governors said the plan would cause more student borrowing, higher tuition rates and increased inflation.
“The SCOTUS ruling proves what we all knew – Biden’s student debt proposal was unconstitutional and unfair,” Little, a Republican, posted Friday on Twitter. “Taxpayers should not be on the hook to pay the debt willing taken on by others. This is about personal responsibility — you took out a loan, you have to pay it back.”
Federal student loan repayments will resume in October after being repeatedly halted during the pandemic, the U.S. Education Department said before the decision. Interest will start to accrue again on Sept. 1. Congress prevented further pauses on repayment as part of the agreement to lift the debt ceiling that was signed into law this month.
Federal loans account for more than two-thirds of student borrowing in the U.S, according to the Public Policy Institute of California. The total national balance comes to about $1.6 trillion.
More than 200,000 people in Idaho have student loan debt, according to federal data.
The Biden administration has forgiven at least $66 billion for nearly 2.2 million borrowers through other means, recent Education Department data shows.
Other forms of student loan forgiveness that have continued include relief for people in public service or who attended schools like Corinthian Colleges — for-profit institutions that the administration said took advantage of students.
A poll indicated that most people did not want the court to strike the Biden plan. Polling from Data for Progress and the Student Borrower Protection Center released Friday showed that 61% of likely voters supported it.
More than a third of voters opposed the plan, but only Republicans older than 45 had a majority of respondents disapprove.
The poll was conducted at the end of May through the beginning of June.
