Gage Skidmore
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The U.S. Supreme Court on Friday struck down President Joe Biden’s plan to forgive student loan debt for millions. In a 6-3 decision, the court said the Biden Administration overstepped its power by trying to implement the student loan forgiveness program.
The program would have forgiven up to $20,000 in student loan debt for students who received Pell Grants and up to $10,000 in debt for those who didn’t receive the grants. People with individual incomes less than $125,000 and household incomes of $250,000 would have been eligible for forgiveness.
However, such forgiveness, which would have cost about $400 billion over 30 years and benefited some 40 million people, requires authorization from Congress, the Supreme Court ruled. The decision drew disappointment from student loan borrowers and elected officials.
In a post on Twitter, President Biden called the decision “unthinkable” adding, “This fight isn’t over.”
During a news conference Friday afternoon, Biden said that his administration is still pursuing student loan forgiveness through the Higher Education Act of 1965. He said this approach will take longer, which is why the administration is creating a temporary 12-month, on-ramp repayment program. If you cannot make payments, this on-ramp will temporarily remove the ability to default on student loan repayments. “Today’s decision has closed one path,” he said. “Now we’re going to pursue another.”
In light of the decision, U.S. Rep. Colin Allred of Dallas said he’d continue trying to expand repayment plan options and job training opportunities and lower the cost of higher education. “Today’s decision on student loans by #SCOTUS is disappointing to the millions of folks who were hoping for relief,” the Democrat representative, who is running for Ted Cruz’s Senate seat in 2024, said in a post on Twitter. “Too many Americans are burdened by student loan debt, and no one should be buried in loans just for getting an education.”
Today's decision on student loans by #SCOTUS is disappointing to the millions of folks who were hoping for relief. Too many Americans are burdened by student loan debt, and no one should be buried in loans just for getting an education.
— Rep. Colin Allred (@RepColinAllred) June 30, 2023
Allred’s colleague, U.S. Representative Jasmine Crockett of Dallas, said in a statement that the Supreme Court has decided to shackle millions of borrowers to often predatory student loan debt.
“Millions of Americans were pressured to take on student loan debt to compete in our modern workforce, and are now trying to pay off mountains of debt with wages that have remained largely stagnant for decades,” she said. “The cost of higher education is roughly ten times higher than it was 50 years ago, rents and cost of living have skyrocketed, while average wages adjusted for inflation have barely changed in that same amount of time.”
Crockett also referenced Supreme Court Justice Clarence Thomas, who voted to strike down Biden’s program. Thomas adopted his son Mark Martin when he was 6 years old and eventually sent him to a boarding school, according to ProPublica. It would cost about $6,000 a month to attend the boarding school, but Thomas didn’t cover the bill. A bank statement obtained by ProPublica shows that Harlan Crow, a billionaire Dallas real estate magnate, paid the tuition the month of July 2009. A former administrator at the school told ProPublica that Crow paid for Martin’s tuition the whole year he attended.
“This ruling is especially ironic, given that a Supreme Court Justice has apparently found the cost of education in America so unbearably high that he must depend on the generosity of a billionaire patron to cover the cost of tuition for a child in his care,” Crockett said. For the majority of Americans who don’t have billionaire buddies to cover their bills, this ruling threatens to bankrupt a generation already crippled by two recessions and a pandemic in their prime working years.”
So let me get this straight: a Supreme Court Justice can receive $$ from a billionaire to cover his grandnephew's tuition, but working Americans can't receive student debt relief? Is that what fairness looks like in America?
I've got THOUGHTS on this. My statement below. pic.twitter.com/YvvmAkHRxI
— Congresswoman Jasmine Crockett (@RepJasmine) June 30, 2023
The Student Borrower Protection Center condemned the Supreme Court decision.
“Today’s decision is an absolute betrayal to 40 million student loan borrowers and their families counting on the court to uphold the law and move them closer to economic freedom,” Persis Yu, the organization’s deputy executive director, said in a statement.
The center also released results from a poll it conducted showing a majority of potential voters support the student loan forgiveness program. According to the poll, about 61% of likely voters said they supported the program, and 36% said they opposed it.
The decision comes after two lawsuits were filed against the Biden administration over the program. One lawsuit, Biden v. Nebraska, was brought by Republican officials in Nebraska, Missouri, Kansas, South Carolina, Arkansas and Iowa. These states argued that the program would affect their ability to collect tax revenue from student loan borrowers. The other lawsuit came out of North Texas and was filed by the Addison-based advocacy group Job Creators Network Foundation. In that suit, titled Biden v. Brown, two Texas student loan borrowers sued because they did not qualify or only partially qualified for the program. In a unanimous decision, the Supreme Court declined to take up the Texas case, ruling the plaintiffs lacked standing to sue.
Regardless, Elaine Parker, president of the Job Creators Network Foundation, said in an emailed statement that the decision in Bide V. Nebraska was a “great victory for our Constitution.” She said the foundation’s case played an “integral role” in the Supreme Court striking down the program.
“We brought this case on behalf of two plaintiffs, and we’re pleased the ruling stops one of the most egregious examples of executive overreach in modern American history,” Parker said. “Our case, brought in Texas, blocked the entire program at the district level and stopped the application process, allowing the legal challenge to go to the Supreme Court. We are all winners today that this illegal program has been struck down.”
Despite the decision on the suits, some say there is still a path forward for student loan forgiveness. One source with the White House told The Hill that the Biden Administration was prepared for this to happen and that it will be announcing new plans to protect student loan borrowers.
“While we strongly disagree with the court, we prepared for this scenario,” the source told The Hill. “The president will make clear he’s not done fighting yet and will announce new actions to protect student loan borrowers.”
Student loan payments are set to resume in October, and interest on those loans will start accruing in September.
