US Supreme Court Halts Student Loan Relief Programme: A Brief Overview of America’s Legal System
The Supreme Court has upheld the suspension of U.S. President Joe Biden’s student loan relief program, which was aimed at extending payment periods and potentially forgiving debts up to $12,000 (£9,100). The decision, made on August 28, is a setback to Biden’s $475 billion (£360 billion) relief plan, which was part of his campaign promise to alleviate millions of students from debt. This ruling gives a victory to Republicans who opposed the program, leaving 8 million borrowers in limbo as the legal battles continue.
In April 2024, several Republican-led states filed lawsuits against Biden over his implementation of the Saving on a Valuable Education (SAVE) plan, arguing that it exceeded his authority. Biden’s initial campaign promise included offering relief to 43 million Americans by canceling a portion of the $1.6 trillion (£1.2 trillion) federal student loan debt. The Supreme Court had previously struck down a broader $400 billion (£303 billion) debt forgiveness plan announced by Biden in June 2023 after it was challenged by Republican states.
The White House launched the SAVE plan in August 2023, touting it as the most affordable repayment plan ever created. Despite some parts already taking effect in February 2024 and others scheduled for July, the plan has faced legal challenges. The administration estimated the plan would cost taxpayers around $156 billion (£118 billion) over a decade, while Republican attorneys general argued the actual cost would be $475 billion.
In response to the legal challenges, two judges in Missouri and Kansas issued rulings in June. The Missouri judge prohibited the government from providing additional debt relief, while the Kansas judge halted the implementation of certain parts of the program set for July 1. Following an emergency application by the Biden administration, the Supreme Court decided not to lift the freeze on the SAVE plan.
Conservative justices cited the major questions doctrine in their ruling, emphasizing the importance of congressional decision-making on issues of national significance. Missouri Attorney General Andrew Bailey praised the Supreme Court’s decision, stating, “This is a huge win for every American who still believes in paying their own way.” (Reuters contributed to this report.)
