The Biden administration’s latest effort to forgive $73 billion in student loans encountered another hurdle as a federal judge in Missouri granted a preliminary injunction to block the program.
The injunction was issued after a hopeful but all-too-brief development in Georgia, where a federal judge had allowed a temporary restraining order against the White House's proposal to expire and transferred the case to Missouri.
As reported by Barron's, Missouri District Court Judge Matthew Schelp asserted that the states challenging the plan were likely to succeed in proving its unlawfulness, “like every court reviewing the previous plans to unilaterally erase it.”
The current iteration of the plan focuses on loan balances that have grown beyond the initial principal amount, as well as long-term borrowers and those saddled with debt that was disproportionately larger than their income.
The Missouri decision marks just the latest episode in Republican-led states’ long-running opposition to the program, which they characterized as an unlawful mass cancellation of student debt. The Committee for a Responsible Federal Budget, a non-profit that tracks fiscal policy issues, has estimated that recent efforts to cancel student debt, including Biden's latest plan, would cost between $870 billion and $1.4 trillion combined.
“The Court rightfully recognized Joe Biden and Kamala Harris cannot saddle working Americans with Ivy League debt. We will never stop fighting for the rule of law and fairness for all,” Missouri Attorney General Andrew Bailey told Barron's in a statement.
This is the administration’s third attempt to address the nation’s college debt, which totals approximately $1.6 trillion across 43 million Americans. The Supreme Court had previously rejected Biden’s initial plan in a 6 to 3 ruling in June 2023, asserting that the administration lacked the authority to implement widespread loan forgiveness. His second initiative – the SAVE program, which aims to reduce payments based on borrowers’ income levels – also remains on hold due to a separate court injunction.
The latest effort, dubbed “Plan B,” is designed to assist borrowers affected by rising loan balances due to interest accrual and those who have been repaying loans for two to two-and-a-half decades. However, this week’s latest ruling marks another pause in the administration's efforts, as the fight over the plan's legality continues to wend its way through the court system.
Relationships are key to our business but advisors are often slow to engage in specific activities designed to foster them.
Whichever path you go down, act now while you're still in control.
Pro-bitcoin professionals, however, say the cryptocurrency has ushered in change.
“LPL has evolved significantly over the last decade and still wants to scale up,” says one industry executive.
Survey findings from the Nationwide Retirement Institute offers pearls of planning wisdom from 60- to 65-year-olds, as well as insights into concerns.
Streamline your outreach with Aidentified's AI-driven solutions
This season’s market volatility: Positioning for rate relief, income growth and the AI rebound
