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Several Republican-led states have filed a lawsuit against the Biden administration over its plan to provide relief to millions of Americans burdened by student loan debt, accusing President Joe Biden of bypassing Congress and exceeding his authority.
Filed by Kansas and 10 other states, the federal lawsuit claims that the administration’s income-driven SAVE Repayment Plan is similar to Biden’s previous student loan forgiveness plan in its government overreach, an argument that won at the Supreme Court last summer.
“Last time Defendants tried this the Supreme Court said that this action was illegal,” the lawsuit says. “Nothing since then has changed.”
The states that joined Kansas’ lawsuit are Alabama, Alaska, Idaho, Iowa, Louisiana, Montana, Nebraska, South Carolina, Texas and Utah.
The states that joined Kansas’ lawsuit are Alabama, Alaska, Idaho, Iowa, Louisiana, Montana, Nebraska, South Carolina, Texas and Utah.
The program, which was rolled out in August, calculates repayment amounts based on a person’s income and family size, instead of their loan balance. The plan also provides early debt forgiveness for certain borrowers.
The White House announced earlier this year that some borrowers who signed up would have their debt canceled beginning in February, months ahead of schedule.
Kansas Attorney General Kris Kobach, who is leading the lawsuit, told Fox News on Saturday that the SAVE plan comes at the expense of people who make less money:
They are forgiving the student loans of people who ran up huge debt, maybe went on to graduate school, and they’re paying for it with the taxpayer dollars provided by people who didn’t go to college because it was too expensive, or people who worked their way through college, or families like mine scraping to save money to help send our kids through college, rather than rack up this debt.
Kobach added: “So, they’re transferring wealth from lower-income and middle-income people to people [with] higher income. It’s extremely unfair. It’s also illegal.”
But research has shown that it’s not as black and white. Borrowers from lower- and middle-income households stand to benefit greatly from loan forgiveness plans, and not all borrowers who qualify for forgiveness have a degree. Studies have also suggested that student loan relief can help level out racial and gender wealth gaps.