On Monday, two federal judges issued rulings to block a significant portion of President Joe Biden’s initiative to indefinitely postpone or cancel nearly half a trillion dollars in student debt.
U.S. District Judge John Ross in Missouri and U.S. District Judge Daniel Crabtree in Kansas both ruled in separate cases stemming from legal challenges brought by Republican-led state attorneys general. The challenges targeted Biden’s plan, which aimed to indefinitely suspend payments for a large number of borrowers, potentially costing taxpayers an estimated half a trillion dollars.
Last year, the U.S. Supreme Court struck down Biden’s comprehensive student debt cancellation plan, which had sought to modify a 2003 law. The revised plan dramatically expanded the scope of debt forgiveness, proposing to cancel $10,000 per borrower with certain limitations. The plan was scheduled to take full effect on July 1, potentially impacting more than half of all borrowers. Some borrowers had already seen their payments reduced to zero. While estimates on the cost to taxpayers vary, some projections suggest it could reach around half a trillion dollars.
Critics of Biden’s plan argue that the authority to allocate federal funds lies with Congress, not the president. They also contend that it is unfair for taxpayers to bear the financial burden of forgiving student debt, especially since many college graduates are positioned to earn higher incomes than those without degrees who would be contributing to this cost.
