The Supreme Court of the United States rejected President Joe Biden’s proposal to cancel billions of dollars’ worth of student loans.
The scheme, which would have forgiven approximately $10,000 (£7,800) per borrower and up to $20,000 in some situations, has been effectively cancelled as a result of the 6-3 verdict.
More than forty million people in the United States will have their loans impacted as a result of the ruling.
US Supreme Court strikes down student loan forgiveness plan
According to Mr. Biden, it has made the people of the United States “angry.” He promised to implement new measures to decrease university debt by making use of other regulations that were already in existence.
Since some conservative states filed a lawsuit against the president, saying that he exceeded his authority, the proposal to cancel student loans has been in limbo. The Supreme Court was of the same opinion.
Following the announcement of the decision, President Joe Biden gave a statement from the White House in which he said, “I know there are millions of Americans in this country who feel disappointed and discouraged or even a little bit angry.” I must say I do too.”
However, he made a solemn promise to collaborate with the Department of Education in the search for further ways to assist people in reducing the burden of their financial obligations.
“Because of today’s judgement, one door has been shut. “All right, let’s get started on the next one,” he remarked.
Over the course of the past 15 years, the total federal student debt has more than tripled, going from approximately $500 billion in 2007 to $1.6 trillion now.
The United States Department of the Treasury recorded a charge of $430 billion the previous year. This was done to cover the $300 million in costs related to the debt forgiveness programme, in addition to the additional costs involved with the extension of a moratorium on payments imposed during the COVID era through the end of the year.
Plaintiffs appeared before the Biden administration in two distinct lawsuits: one involved six Republican-controlled states (Nebraska, Missouri, Arkansas, Iowa, Kansas, and South Carolina), while the other involved two individual borrowers of student loans. Plaintiffs filed both actions against the administration.
Plaintiffs in both cases asserted that the executive branch lacked the authority to discharge such a large portion of outstanding student debt.
The Supreme Court came to the conclusion that the two individual borrowers did not present a convincing case that the loan forgiveness plan would harm them, so they lacked the legal standing to contest the Biden administration’s proposal.
