A federal appeals court delivered a crushing blow Tuesday to a more than $475 billion student debt cancellation program begun by former President Joe Biden, ordering the underlying regulation be blocked in its entirety.
The Eighth US Circuit Court of Appeals had partially blocked the loan forgiveness effort last year — but a three-judge panel at the St. Louis-based court issued a final judgment to a lower court prohibiting any part of the initiative from taking effect.
Judge L. Steven Grasz in a 25-page opinion ruled that Biden’s Education Secretary, Miguel Cardona, had “gone well beyond” his constitutional authority in creating the Saving on a Valuable Education (SAVE) plan.
“Rather than implying by omission or other ambiguities, Congress has spoken clearly when creating a repayment plan with loan forgiveness or otherwise authorizing it — explicitly stating the Secretary should cancel, discharge, repay, or assume the remaining unpaid balance,” Grasz wrote, finding “no comparable language” in the SAVE Plan.
In 2023, the Penn Wharton Budget Model estimated the so-called “repayment plan,” which Grasz said allowed for student debt to be “largely forgiven rather than repaid, would cost taxpayers $475 billion over the next decade.
Hellbound and Down 