The Supreme Court of the United States (SCOTUS) recently delivered a significant blow to the Biden administration by denying its request to lift a block on the Saving on a Valuable Education (SAVE) plan. This program was designed to provide relief to millions of borrowers struggling with student loan debt, but it’s now caught in a legal quagmire, thanks to ongoing litigation and Republican-led opposition.
The block came from the 8th Circuit U.S. Court of Appeals in Missouri, which issued a nationwide injunction that temporarily froze the entire SAVE program. The Department of Justice, representing the Biden administration, quickly sought emergency relief from the Supreme Court, arguing that the appeals court had overstepped by imposing such a sweeping block.
However, the request was denied by Justice Brett Kavanaugh, who has jurisdiction over emergency applications from Missouri. Kavanaugh’s order directed the appeals court to continue deliberating on the case, leaving the Biden administration’s plans in limbo.
🎓Student Loans: Update (8/28/2024)
The Biden administration hoped to limit the SAVE injunction during the appeals process.
However, the Supreme Court denied this request…
This means the SAVE plan will remain blocked as the injunction proceeds through the appeals process. pic.twitter.com/JuLU3GIEg2
— Michael Putterman, CFP® 🤑🥼 (@DreamBiggerLLC) August 28, 2024
The SAVE plan, introduced by President Biden after the Supreme Court struck down his earlier student loan forgiveness proposal, was aimed at easing the financial burden on borrowers. The White House touted the plan as a way to lower monthly payments, reduce overall costs, and potentially forgive remaining balances for borrowers with smaller loans after 10 years of payments. Yet, this legal roadblock means those benefits are on hold, leaving many borrowers in a state of uncertainty.
Missouri Attorney General Andrew Bailey, who has been at the forefront of the legal battle against the SAVE plan, hailed the Supreme Court’s decision as a victory for fiscal responsibility. In his view, the ruling reinforces the idea that Congress, not the executive branch, should determine policies with such sweeping financial implications. Bailey’s statement emphasized the importance of personal responsibility, framing the decision as a win for Americans who “believe in paying their own way.”
On the other side of the aisle, the Biden administration and the Department of Education expressed deep disappointment with the ruling. A White House spokesperson underscored the administration’s commitment to defending the SAVE plan, which they argue has already provided significant relief to millions of borrowers. The Department of Education echoed this sentiment, promising to minimize disruption to borrowers while awaiting further legal developments.
As the litigation continues, the future of the SAVE plan remains uncertain. The Biden administration is expected to keep fighting in court, but for now, the program is on hold, and borrowers enrolled in the plan are being placed into forbearance. Meanwhile, another lawsuit challenging the income-contingent aspects of the SAVE Act is making its way through a separate appeals court, adding another layer of complexity to the ongoing legal battle.
Today, the Supreme Court unanimously ruled to maintain the pause on the Biden-Harris Administration’s unconstitutional student loan cancellation scheme: the Saving on a Valuable Education (SAVE) plan.
Read Chairman @RepArrington’s statement: pic.twitter.com/tXac2dEhBW
— House Budget GOP (@housebudgetGOP) August 29, 2024
This legal showdown highlights the deep divisions over how best to address the student loan crisis in the United States. For now, the Biden administration faces an uphill battle in its efforts to implement broad student loan relief, with the courts—and public opinion—playing crucial roles in determining the outcome.
