On Tuesday, a coalition of seven attorneys general from Republican-led states launched a legal challenge against the Biden administration’s latest effort to forgive student debt.
The lawsuit, filed in federal court in Brunswick, Georgia, targets a rule proposed by the U.S. Department of Education (ED) in April, which aims to forgive federal student loans for an estimated 27.6 million borrowers. The attorneys general from states like Georgia and Missouri argue that the department is moving forward with canceling loans before the rule is finalized, potentially starting as early as this week.
According to the lawsuit, ED has instructed federal loan servicers to begin canceling hundreds of billions of dollars in loans, with at least $73 billion in debt set to be erased overnight. The states argue that ED lacks the authority to carry out such widespread debt cancellation without proper legislative approval.
“We successfully halted their first two illegal student loan cancellation schemes; I have no doubt we will secure yet another win to block the third one,” Missouri Attorney General Andrew Bailey, who is leading the lawsuit, said in a statement.
The lawsuit is the latest in a series of legal battles against Biden’s efforts to fulfill his campaign promise of providing student debt relief to millions of Americans. In June 2023, the Supreme Court, with its 6-3 conservative majority, blocked Biden’s earlier plan to cancel up to $20,000 in debt per borrower for up to 43 million Americans. The administration then introduced the SAVE (Saving on a Valuable Education) plan, which aimed to reduce monthly payments and expedite loan forgiveness. However, this plan was also blocked by a federal appeals court, and the Supreme Court declined to lift the injunction on August 28.
The current lawsuit centers on the Biden administration’s latest approach, which relies on a provision of the Higher Education Act. This clause, supported by leading Democrats like Senate Majority Leader Chuck Schumer and Senator Elizabeth Warren, is argued to provide the legal basis for student debt cancellation. The outcome of this lawsuit could significantly impact the administration’s ability to deliver on its debt relief promises ahead of the upcoming presidential election.
