By The New York Times (U.S.) | Created at 2024-10-04 21:23:09 | Updated at 2024-10-04 23:16:49
2 hours ago
Politics|Judge Halts Biden Student Debt Plan Right After It Was Allowed to Proceed
https://www.nytimes.com/2024/10/04/us/politics/biden-student-debt-missouri.html
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The ruling was the latest instance of legal whiplash for the over 27 million borrowers who could qualify, and yet another blow to the president’s pledge to provide mass student debt relief.
Oct. 4, 2024, 5:14 p.m. ET
A federal judge in Missouri on Thursday temporarily blocked a Biden administration plan to cancel student debt less than a day after another judge had allowed it to proceed, throwing into uncertainty the fate of a program that could affect more than 27 million borrowers.
The decision stymied the administration’s efforts to finalize the program before President Biden leaves office in January, and was the latest roadblock in his halting efforts to fulfill a campaign pledge to provide mass student loan relief. Legal challenges have held up several programs, and the one stopped on Thursday has now been halted twice.
The program would cancel up to $20,000 in accrued interest on the loans and would forgive outstanding balances for borrowers who started repaying their loans decades ago, among other measures. It is the biggest piece of the president’s multipronged effort to offer broad student debt cancellation after the Supreme Court threw out his first plan.
A coalition of seven Republican states sued last month to block the plan, arguing that the Education Department had rushed to lay the groundwork for the program before it was completed and that the debt cancellation it proposed could financially harm states and federal loan servicers. J. Randal Hall, a U.S. District Court judge for the Southern District of Georgia, temporary blocked it a month ago. He then released the hold on Wednesday, before transferring the case to what he concluded was the more proper venue of Missouri.
In a blunt order on Thursday, Judge Matthew T. Schelp of the U.S. District Court for the Eastern District of Missouri wrote that the states were likely to succeed in challenging the program as unlawful. Making his case, he cited a decision in July by the U.S. Court of Appeals for the Eighth Circuit to block the SAVE program, the administration’s other major student debt plan.
Letting the hold on the program expire now, Judge Schelp reasoned, could open the door for the Education Department to cancel significant amounts of debt that could be difficult to collect later if courts found the program unlawful. So he put the hold back in place.
