President Joe Biden’s plan to offer millions of borrowers up to $20,000 in federal student loan forgiveness was stopped by a U.S. judge in Texas on Thursday. The program had already been suspended while a federal appeals court in St. Louis considered a separate lawsuit filed by six states opposing it.
The program, according to District Court Judge Mark Pittman, a former president Donald Trump appointment stationed in Fort Worth, usurped Congress’ authority to enact laws.
“We do not have an all-powerful executive with a pen and a phone ruling this nation. Instead, the Constitution that governs us establishes three separate and independent branches of government, “Pittman composed.
Added him: “The Court is aware of the country’s current political polarization. But maintaining the division of powers as set down in our Constitution is essential to the survival of our Republic.”
For people making less than $125,000 or households making less than $250,000, the debt cancellation proposal would eliminate $10,000 in student loan debt. Receivers of Pell Grants, who often exhibit greater financial need, would also receive a $10,000 debt forgiveness bonus.
Federal student loans taken out for undergraduate and graduate study, as well as Parent Plus loans, are all affected by the cancellation.
The debt forgiveness program had been put on hold by the 8th U.S. Circuit Court of Appeals as it looked into a challenge to the program brought by the states of Nebraska, Missouri, Iowa, Kansas, Arkansas, and South Carolina.
The White House has urged debtors to continue filing for relief, despite the administration’s temporary inability to actually pay off debt due to the stay because the court decision does not bar applications or the processing of petitions. More than 22 million borrowers have requested debt relief as of the end of October.
When a pause brought on by the COVID-19 pandemic is set to expire on January 1, it is unclear whether borrowers who anticipated having their debt cancelled will have to start making payments again due to the legal challenges.
Economists are concerned that many people have not yet recovered financially from the pandemic and that many could fall behind on their payments and go into default if debtors who were anticipating debt cancellation are expected to make payments instead.
The White House didn’t respond to the decision right away.
Pittman ruled on Thursday that the Higher Education Relief Opportunities for Students Act of 2003, or HEROES Act as it is more commonly known, did not give the loan forgiveness program the legal justification that the Joe Biden administration had claimed it did.