(FreePressBeacon.com) – In a major blow to the current administration’s liberal agenda, the Supreme Court decided not to step in and reverse the rulings of lower courts that are currently stopping Joe Biden and Kamala Harris’ student loan giveaways.
This plan seeks to reduce what borrowers have to pay each month and could eventually wipe out their remaining debt.
Introduced in August 2023, the Saving on a Valuable Education (SAVE) plan is the latest effort from the White House to address student debt ahead of the elections.
This came after the Court turned down an earlier proposal in June 2023 to erase more than $400 billion in loans.
The SAVE plan proposes cutting the amount borrowers need to pay from 10% of their discretionary income down to 5%.
Discretionary income has now been defined as the amount they earn over 225% of the poverty line.
Those making less than that threshold would not have to pay anything. Also, debts totaling $12,000 or less would be forgiven after ten years, as long as necessary payments have been made until then.
Initially, the Biden-Harris team said this plan would cost $156 billion over ten years, but the Congressional Budget Office’s estimate sits at $276 billion
However, eleven states that are suing to stop the plan assert it will actually cost the nation $475 billion.
Since the start of his administration, Biden and Harris have managed to cancel about $144 billion of the roughly $1.6 trillion total in student loan debt.
This cancellation has helped nearly 4 million borrowers, with $62.5 billion of that coming through a program that gets rid of student loans for public-sector workers.
The Supreme Court’s refusal to overturn the lower-court ruling does not affect the 8 million borrowers currently benefiting from the SAVE plan.
The Department of Education has already put these borrowers into a temporary situation where they do not have to pay interest on their loans until the court issues are resolved.
Though the Supreme Court is not ready to hear the SAVE plan case during its next session, the issue might eventually get there after the lower courts have made their decisions.
If it does, the Court will need to determine if the Department of Education has the power, under a 1993 law, to set up rules for eventual loan forgiveness.
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