Just in time for the election, President Joe Biden's student loan forgiveness plan is back on the table after a federal judge allowed a temporary restraining order blocking the program to expire, and transferred the case to a different court.
The decision, handed down by U.S. District Judge J. Randal Hall in Georgia, clears a major obstacle for the Biden administration as Vice President Kamala Harris scrambles to persuade voters affected by "Bidenomics" that she can make life better for average Americans - by bailing out voluntary debt that's unable to be discharged in bankruptcy.
The expiration of the restraining order marks a rare win for Biden, who has faced a series of legal roadblocks as conservatives continue their fight to dismantle the debt relief plan. Conservatives have argued that the program unfairly burdens taxpayers and exceeds the administration's legal authority, but Wednesday's ruling gives the administration a green light - for now.
The case, brought by seven Republican-led states, originally sought to prevent Biden from moving forward with his student loan forgiveness initiative. Missouri, Georgia, and others argued that the plan would slash state tax revenue and hit state agencies, like the Missouri Higher Education Loan Authority (Mohela), where it hurts. Mohela, which services federal student loans, claims it stands to lose a chunk of its revenue once loans are forgiven or reduced.
While Judge Hall had previously sided with these arguments, he dismissed Georgia from the case, ruling that the state failed to prove it would suffer significant harm. The lawsuit will now move to the Eastern District of Missouri, where the plaintiffs will continue their fight.
Missouri Attorney General Andrew Bailey has been at the forefront of the legal battle, arguing that the loss of revenue from servicing student loans would impact state scholarships. This echoes the same legal strategy that struck down Biden's earlier student loan forgiveness attempt, which the Supreme Court shot down in 2023.
Under the Biden relief plan, four distinct groups would receive assistance;
- Borrowers who first entered repayment at least 20 or 25 years ago.
- Those who owe more on their student loans today than what they originally borrowed due to the impacts of interest accrual and capitalization.
- People who attended institutions that lost access to federal financial aid programs because of a failure to meet federal standards.
- Borrowers who qualify for student loan forgiveness under other programs but have not enrolled or applied.
Of course, nothing for taxpaying plumbers and electricians who will help foot the bill...
