Republican-led states challenge President Biden’s plan for student loan repayment | Global News

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Republican-led States Sue Biden Administration Over Student Loan Repayment Plan

A group of 11 Republican-led states, including Kansas, has filed a federal lawsuit against the Biden administration to block the new student loan repayment plan known as the SAVE Plan. The plan, which provides a faster path to loan cancellation and lower monthly payments for millions of borrowers, has already cancelled loans for more than 150,000 individuals.

Legal Challenge to Biden’s Authority

The lawsuit argues that President Biden overstepped his authority in creating the SAVE Plan, comparing it to his previous attempt at student loan cancellation, which was deemed illegal by the Supreme Court. The states claim that nothing has changed since the court’s ruling and that Biden’s actions are still unlawful.

Biden’s Efforts to Address Student Loan Debt

President Biden announced the SAVE repayment plan in 2022, along with a separate plan to cancel up to $20,000 in debt for over 40 million Americans. While the Supreme Court blocked the broader cancellation plan, the legality of the SAVE Plan was not addressed at that time.

Concerns Raised by Republican States

The states involved in the lawsuit argue that the new repayment plan will have negative consequences, including discouraging borrowers from pursuing public service careers and increasing opportunities for fraud. They also express concerns about the economic impact of injecting billions of dollars in loan relief into the U.S. economy.

Potential Implications of Lawsuit

If successful, the lawsuit could effectively halt the implementation of the SAVE Plan and undermine President Biden’s efforts to provide widespread student loan relief. The Education Department is currently working on a more limited plan for mass loan cancellation following the Supreme Court’s rejection of the initial proposal.

Overall, the legal battle over the SAVE Plan highlights the ongoing debate surrounding student loan debt and the role of the federal government in addressing this issue.