A St. Louis appeals court has temporarily blocked Joe Biden’s plan to cancel hundreds of billions of dollars in student loan debt one day after a judge dismissed an effort by six Republican states to challenge the program.
The 8th U.S. Circuit Court of Appeals granted an emergency stay barring the discharge of any student debt until the court rules on the original request for a permanent injunction. The six states were successful in getting an expedited appeals process for their suit.
Although U.S. District Judge Henry Autrey agreed the suit raised several important questions, he found that the states failed to prove they had the standing to sue.
Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina said Biden’s plan skirted congressional authority and threatened the states’ future tax revenues and money earned by state entities that invest in or service the student loans.
White House press secretary Karine Jean-Pierre said Thursday’s temporary order does not prevent borrowers from applying for student debt relief or bar the Biden administration from reviewing applications and preparing them for transmission to loan servicers.
“We encourage eligible borrowers to join the nearly 22 million Americans whose information the Department of Education already has,” Jean-Pierre said.
“It is important to note that the order does not reverse the trial court’s dismissal of the case or suggest that the case has merit,” she added. “It merely prevents debt from being discharged until the (appeals) court makes a decision.”
That’s a lie. When the trial judge notes that the suit raises “important and significant challenges to the debt relief plan,” that suggests that the case has merit. It was tossed because of a technicality — the only hope for Biden in seeing this debt forgiveness plan through to the end.
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Nebraska Attorney General Doug Peterson, a Republican who is leading the lawsuit, welcomed the temporary stay.
“It’s very important that the legal issues involving presidential power be analyzed by the court before transferring over $400 billion in debt to American taxpayers,” he said.
The case reaching the 8th Circuit is one of a number that conservative state attorneys general and legal groups have filed seeking to halt the debt forgiveness plan announced in August by Biden, a Democrat.
Autrey ruled about an hour after U.S. Supreme Court Justice Amy Coney Barrett denied without explanation an emergency request to put the debt relief plan on hold in a separate challenge brought by the Wisconsin-based Brown County Taxpayers Association.
The issue of standing will bedevil opponents of Biden’s student loan forgiveness plan to the end. The problem of finding people with standing to act as plaintiffs is difficult to solve because the most natural plaintiffs — student borrowers — benefit the most from debt relief.
Until that problem is solved, Biden’s debt relief plan has a good shot at becoming law.
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