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The Biden-Harris administration refuses to give up its repeated illegal attempts to give away hundreds of billions of dollars by canceling student loans. The Mackinac Center filed two lawsuits challenging two of the older schemes, but most of the recent action is on the Saving on a Valuable Education Plan.
SAVE was one of the responses to the U.S. Supreme Court’s 2023 decision in Biden v. Nebraska, which prevented the administration from unlawfully canceling the debt of 20 million student loan borrowers and lowering the debt of another 23 million at a cost of $430 billion.
Under SAVE, the administration is again trying to appropriate money without the authorization of Congress. This time the amount is $475 billion. Several lawsuits against this plan are ongoing. Recently, two U.S. circuit courts and the Supreme Court reviewed the question of whether injunctions against SAVE should continue. The Mackinac Center filed amici to the Tenth Circuit Court of Appeals and to the Supreme Court in support of an injunction. The Supreme Court upheld an injunction issued by the Eighth Circuit Court and ordered it to decide the merits of the case quickly. The Mackinac Center has since filed an amicus brief in that case.
On Sept. 3, 2024, seven states filed a lawsuit to stop the Biden-Harris administration’s attempt to perform an end run on the Eighth Circuit injunction. This latest attempt at mass illegal cancellation of debt would require third-party student loan servicers to have begun canceling student loans as early as that same week. According to the complaint in that lawsuit:
“[The Education Secretary] knows that ‘the States cannot turn back the clock on any loans that have already been forgiven.’ . . . So it does not matter how many rules he breaks in the process, so long as he forgives billions of dollars in debt before the courts stop him.”
Student loans and college costs are undoubtedly important issues. There are plenty of economic reasons against widespread debt forgiveness, to say nothing of its unfairness to those who have paid their own loans or chosen not to incur college debt. But if the administration continues to push for debt forgiveness, it should accept that this policy must be implemented constitutionally. The Mackinac Center is fighting hard to prevent these violations of the separation of powers.
