Biden’s Student Debt Relief Plan Halted Again by Another Judge, Reports Reuters

By Nate Raymond and Daniel Wiessner

A U.S. District Judge has temporarily blocked the Biden administration from enacting a plan that aims to relieve student loan debt for millions of Americans.

The ruling was issued by Judge Matthew Schelp in St. Louis and favored six Republican state attorneys general who filed a lawsuit against the student loan forgiveness initiative. Schelp, appointed by former President Donald Trump, granted a preliminary injunction preventing the administration from “mass canceling” student loans while the legal challenges proceed.

This decision follows a previous ruling by a different judge on October 2, who shifted the lawsuit from Georgia, determining that the state would not suffer any legal harm due to the proposed debt relief.

The attorneys general have accused the U.S. Department of Education of exceeding its authority by pursuing a regulation that should instead be addressed through Congressional legislation. The department first proposed this debt relief plan in April after previous initiatives faced legal hurdles. The plan aims to eliminate $73 billion in student loan debt for approximately 27.6 million borrowers.

During his 2020 presidential campaign, Biden pledged to provide debt relief for countless Americans who relied on federal student loans to fund their education.

Initially, the lawsuit was filed in Georgia, where Judge J. Randal Hall imposed a temporary block in September; however, that order expired on October 3. Hall is the judge who later transferred the case to Missouri.

Schelp concurred with Hall’s findings, stating that the relief program should be halted until a determination of its legality is made by the courts. He wrote that allowing the administration to forgive the loans would impede the judicial review process.

Missouri Attorney General Andrew Bailey called the ruling “yet another win for the American people,” asserting that the court appropriately recognized the consequences of the proposed debt cancellation.

The U.S. Department of Education has not yet commented on the ruling.

The proposed debt relief regulation targets individuals who owe more than they originally borrowed due to interest accumulation, borrowers who have been repaying loans for 20 or 25 years, and those eligible for forgiveness under previous programs but who did not apply.

The rule is still in the proposal stage, a point emphasized by the Justice Department in its argument that no conclusive agency action exists for judicial review. The states contended that the administration might expedite loan cancellations as soon as the rule is finalized, potentially before any legal challenges could be mounted. They suggested that the Education Department would instruct loan servicers to begin processing debt relief around the time of the upcoming presidential election.

Critics within the Republican party have labeled Biden’s student loan forgiveness initiative as an overreach that disproportionately benefits college-educated borrowers at the expense of others who do not receive similar relief. The White House has characterized the student loan system as fundamentally flawed, emphasizing the need for support to alleviate the financial burdens on borrowers pursuing higher education.