Student debt relief activists participate in a rally at the U.S. Supreme Court on June 30, 2023 in Washington, DC.
Kevin Dietsch/Getty Images
President Joe Biden’s student-loan forgiveness plan was struck down on Friday by the Supreme Court.
A White House fact sheet from months ago showed how many people could have benefited.
It showed the number of people who applied or were automatically eligible for debt relief before lawsuits paused applications.
The Supreme Court struck down President Joe Biden’s plan to wipe out up to $20,000 in federal student-loan debt for borrowers, which would have eliminated around $430 billion in student loans for millions of borrowers.
A fact sheet from the White House that was published earlier this year showed the number of people in every state, Puerto Rico, and Washington, DC, who had applied for relief or were automatically eligible before this was blocked by lawsuits. Those who were deemed eligible “had already provided sufficient information to the Department of Education,” per the sheet. Additionally, it noted “the Department was required to stop accepting applications as a result of lawsuits brought by opponents of the program” in November.
The fact sheet noted that overall, 26 million people had applied or were automatically considered eligible. Over 2 million people in Texas and over 2 million people in California were either deemed automatically eligible or had applied.
“Overall, more than 40 million borrowers would qualify for the Biden Administration’s debt relief program,” the fact sheet stated. “Nearly 90% of the benefits of the relief going to out-of-school borrowers would go to those earning less than $75,000 per year.”
These borrowers owe a combined $1.6 trillion in student-loan debt, according to the White House.
The Supreme Court on Friday ruled that the HEROES Act of 2003, which permits the Education Secretary to waive or modify student-loan balances connected with a national emergency, cannot be implemented as it was not the appropriate law to carry out this plan.
The Court did not strike down student-debt relief entirely, though. The president can still pursue alternate routes under different laws. Rep. Alexandria Ocasio-Cortez of New York tweeted Friday that the Higher Education Act is one option for continuing loan forgiveness before payments are scheduled to resume in October.
Interest on student loans is scheduled to resume September 1. The repayment could pose challenges to the economy, such as a likely reduction in consumer spending.
“My Administration’s student debt relief plan would have been the lifeline tens of millions of hardworking Americans needed as they try to recover from a once-in-a-century pandemic,” Biden said in a statement following the ruling.
“I will stop at nothing to find other ways to deliver relief to hard-working middle-class families,” he added.
The Supreme Court’s decision came in two separate rulings. The high court ruled that the plaintiffs in one case, US Department of Education v. Brown, did not have standing — but the second case, Biden v. Nebraska, prevailed and the six GOP-led states had standing to sue on behalf of student-loan company, MOHELA.
Many Democrats slammed the ruling while vowing to keep fighting for student-loan forgiveness, urging Biden to take unilateral action to get American borrowers relief. Many Republicans celebrated the decision, noting the plan was unfair and unconstitutional.