The Washington Post reports, Judge dismisses GOP-led states’ lawsuit to block student-loan forgiveness plan:
A federal judge on Thursday denied a bid by six Republican-led states to block the Biden administration from moving forward with plans to cancel up to $20,000 in federal student-loan debt for more than 40 million people, days after borrowers began signing up for relief.
The states filed a lawsuit last month, saying that the administration has overstepped its authority by creating the forgiveness program without going through Congress. They also claimed the plan would threaten the revenue of state entities that profit from federal student loan, and they requested the court stop the federal government from canceling any debt as the case proceeds.
U.S. District Judge Henry E. Autrey of the Eastern District of Missouri issued a 19-page order concluding that the states lacked the standing to bring the lawsuit to stop one of the administration’s signature economic policies. “While plaintiffs present important and significant challenges to the debt relief plan, the current Plaintiffs are unable to proceed to the resolution of these challenges,” he wrote.
The ruling by Autrey, a George W. Bush appointee, was one of two victories Thursday for the administration’s plan. In a separate case, U.S. Supreme Court Justice Amy Coney Barrett denied a request by the conservative legal outfit Wisconsin Institute for Law and Liberty, working on behalf of a taxpayer’s association, to pause the program.
Nebraska Attorney General Doug Peterson (R), one of the states’ officials who sued the administration, said the coalition would appeal. “The states continue to believe that they do in fact have standing to raise their important legal challenges,” he said in a statement. “As a result, the States will be appealing and seeking immediate relief.” The other states involved in the suit are Arkansas, Iowa, Kansas, Missouri and South Carolina.
An appeal would send the case to a conservative panel of judges on the U.S. Court of Appeals for the 8th Circuit.
The lawsuit, one of several filed against the forgiveness plan, was widely considered to be one of the most serious legal challenges.[So much for that prediction.]
“Republican members of Congress and Republican Governors are doing everything they can to deny student debt relief even to their own constituents,” White House press secretary Karine Jean-Pierre said in a statement Thursday. “The President won’t stop fighting these suits and working to help families as they recover from the pandemic.”
The Education Department began accepting applications for relief last Friday. More than 12 million people have applied to date, according to the White House, while 8 million more have been notified of their eligibility for automatic cancellationbecause their information is already on file. The administration said people should complete the form by Nov. 15 to have them processed before federal student loan payments resume in January.
“The court made the right call in dismissing this ideological challenge to debt relief,” said Abby Shafroth, director of the National Consumer Law Center’s Student Loan Borrower Assistance Project. “The six states failed to establish that student debt relief harms them — in fact, it promises over $46 billion in relief to working- and middle-class residents in their states. Their residents should cheer this decision along with families across the country.”
Biden’s loan relief plan will cancel up to $10,000 in federal student debt for borrowers who earn up to $125,000 annually, or up to $250,000 for married couples. Borrowers who received Pell Grants are eligible for an additional $10,000 in forgiveness.
The Biden administration has been adamant that its debt cancellation plan is legal. The Justice Department released a 25-page memo in August justifying the policy under a 2003 law authorizing the secretary of education “to alleviate the hardship that federal student loan recipients may suffer as a result of national emergencies.”
It is the same law, known as the Heroes Act, the Trump administration used at the outset of the coronavirus pandemic to pause payments on federal student loans as Americans faced the economic fallout of the national health crisis. Justice Department attorney Brian Netter recently reminded the court of that and noted there were no attempts to challenge the legality of the payment moratorium.
“This is a statute about emergencies,” Netter said during a recent courthearing on the injunction. “It seems hard to fathom that Congress wouldn’t have understood at the time that a larger national emergency is going to prompt and necessitate a larger action by the secretary of education.”
Judge Autrey at the hearing questioned whether the scale of loan cancellation, at a cost of roughly $300 billion, warranted explicit authorization from Congress because of the economic and political significance, a legal idea known as the “major questions” doctrine [a totally made up “doctrine” from right-wing think tanks]. The Supreme Court invoked that [made up] doctrine earlier this year to limit the Environmental Protection Agency’s power to combat climate change. Higher education experts had expected the doctrine to be used to invalidate Biden’s debt relief program.
Netter said the debt relief program was designed to respond to the scale of the national emergency and avoid an anticipated wave of delinquencies when the pause on federal student-loan payments lifts. The pause was extended through Dec. 31.
“The way that this [activist radical Republican] Supreme Court has analyzed agency action could pose a threat [to the administration] if this case got that far,” said Kate Elengold, assistant professor of law at the University of North Carolina School of Law. “I think the department has a really strong argument, but that’s what I’m watching most closely.”
The coalition of states involved in the lawsuit argue that the administration has no right to take action on this scale without congressional approval. Moreover, they say, the policy would impose economic harm on state investment entities and student loan companies that own debt from the defunct Federal Family Education Loan (FFEL) program.
After Biden unveiled his cancellation plan in August, many commercial FFEL borrowers consolidated their loans into Direct Loans to qualify for relief. The states have said the plan enticed borrowers to consolidate, which deprives their related entities of interest income.
But hours before the case was filed, the Biden administration scaled back eligibility for the debt relief program, saying commercial FFEL borrowers could no longer consolidate to qualify for the one-time relief. Justice Department attorneys said the decision undercut the states’ claims.
Judge Autrey agreed. In Thursday’s ruling, he said, “the lack of the ongoing incentive to consolidate defeats the claims of Arkansas and Nebraska.”
He also questioned whether Missouri had the right to bring a lawsuit on behalf of the Missouri Higher Education Loan Authority, a quasi-state outfit that owns and services FFEL debt. Autrey said that while the governor does appoint five members of the company’s board, its revenue and liabilities are independent of the state.
Most of the states involved in the lawsuit say they will lose tax revenue because of Biden’s policy. They take their cue from the federal government, which will not count discharged student debt as taxable income through January 2026. Autrey shot down that claim, saying “the tenuous nature of future income tax revenue is insufficient to establish a cognizable injury to support standing to bring this action.”
Courts do not render advisory opinions. There needs to be an actual case or controversy, and the claim must be ripe for adjudication, i.e., there has been an actual harm or loss suffered.
Among the other ongoing cases is one filed by the conservative Job Creators Network Foundation on behalf of a commercial FFEL borrower who is ineligible for relief and an eligible borrower who does not qualify for the full $20,000 in debt relief. The suit alleges that the administration denied borrowers the opportunity to voice their opinions on the policy by forgoing a comment period. Justice attorneys have argued in other cases raising similar claims that the Heroes Act doesn’t require notice and comment, said Elengold at UNC School of Law. A hearing on the group’s request for an injunction is set for Tuesday.
UPDATE: On Thursday, Supreme Court Justice Amy Coney Barrett rejected an attempt by a Wisconsin taxpayers group to halt implementation of Biden’s plan. But the Eigth Circuit Court of Appeals granted a temorary stay in dischrging student debts in the case brought by Repubican attorneys general.
NBC News reports, Federal appeals court temporarily blocks Biden’s student debt relief program:
A federal appeals court on Friday halted implementation of President Joe Biden’s student debt relief program, dealing a blow to the administration just days after it began accepting applicationsfrom borrowers to have as much as $20,000 in loans canceled.
CNBC reports President Biden said 22 million people have registered for student loan relief since applications opened on Monday.
The 8th Circuit Court of Appeals hit pause on the Biden administration’s efforts while it considers an appeal from officials in six GOP-led states who had their lawsuit against the program dismissed by a federal judge on Thursday.
In its one-page ruling, the court prohibited any student loan debt to be discharged under the program until the court rules on the appeal. The court said that the Biden administration had until Monday to respond.
White House press secretary Karine Jean-Pierre on Friday emphasized that the appeals court ruling does not prevent borrowers from submitting applications for loan forgiveness.
“It is also important to note that the order does not reverse the trial court’s dismissal of the case, or suggest that the case has merit. It merely prevents debt from being discharged until the court makes a decision,” she said in a statement. “We will continue to move full speed ahead in our preparations in compliance with this order. And, the Administration will continue to fight Republican officials suing to block our efforts to provide relief to working families.”
The Republican attorneys general no doubt will be relying on the totally made up “major questions” doctrine, which an activist radical Republican Supreme Court invoked earlier this year, making it up out of whole cloth, to gut the Environmental Protection Agency’s power to combat climate change.
Legal precedent is squarely on the side of the government, as noted above, but this activist radical Republican Supreme Court has no use for precedent and stare decisis. Their disdain forthe rue of law my influence the Federalist Society Republican judges on the Eigth Circuit Court of Appeals.
But Justice Amy Coney Barrett’s rejection of an attempt by the Wisconsin taxpayers group (right-wing think tank) to halt implementation of Biden’s plan may be signaling that the Court will not entertain this appeal.
Discover more from Blog for Arizona
Subscribe to get the latest posts sent to your email.
“…college educated women are homely cat ladies who can’t get a man living lonely lives.”
Some of us are dog moms. Dogs do tend to get you out of the house so our lives are probably less lonely than cat ladies. In fact, just this morning we hung out with Hunter, Miwanna, Molly, Murphy, and Muffy.
Getting started in life with just a high school education is tough. Now perhaps if these big infrastructure projects start getting underway that will be a path for less educated young people to enter the middle class and sustain that lifestyle. Much like manufacturing did in post WWII America.
Even so, someone has to assume the cost of developing the workforce. People usually don’t graduate from high school with the skills to do much of anything until they are trained. And our culture has moved too far in the direction of expecting 18 yr old children to find their own way and finance their training and education. This is an unreasonable burden to put on very young people and it is clearly not working.
Everyone knows this. But your average GOP stupid AF politicians and voters have bought into the idea that poor and low income people are basically undeserving. So if they struggle, too bad, they deserve to struggle. This, of course, is self defeating because we need them to be educated and trained for 21st century jobs. But when half the voters allow their hatred and racism and prejudice to overwhelm any intelligent decision about policies that lift people up or improve the quality of all our lives, then it’s hard to move forward. Progressives and some Democrats spend a lot of time trying to convince the electorate that people are worth the investment, even people who are poor or black or brown.
Fox News, far right commenters, and right wing politicians have been openly telling people, especially women, to avoid college.
Part of their getting back to the 1950’s agenda.
Most of these pundits and pols have ivy league or ivy league adjacent degrees so screw them.
I assume most of them got into those schools with help from mommy and daddy, like T4ump and Kushner, and are not actually that bright. So screw them twice.
The things they say about college educated women are especially telling, literally at times saying college educated women are homely cat ladies who can’t get a man living lonely lives.
Men who says things like that are insecure little bitches. Betas.
They’re literally the Christian version of Boko Haram.
Not sure why Kavanagh had to post, does he thing he’s a scrappy cub reporter breaking a scoop, or is he just happy that millions of American will have an unfair financial burden that hurts the American economy… not really a question.
Give to RaicesTexasDotOrg in Honor of the Dishonorable Arizona Rep John Kavanagh.
Well, the GOP clearly benefits when the people are stupid AF so that has to be their motivation.
Otherwise, they would be supportive of all measures taken by the Federal government to develop an intelligent and skilled workforce for 21st century jobs.
Free community college is the logical next step, and despite GOP obstruction, we will eventually get there.
But in the interim, these people who had to borrow thousands of dollars to try to get an education and be a more productive member of the community deserve some relief.
Why would anyone deny that to the citizens?
A federal appeal court just put a temporary hold on the program.