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Supreme Court Blocks $20,000 Student Loan Forgiveness Program, Impacting Millions Across the United States

The much-anticipated student loan forgiveness program created by President Joe Biden, designed to provide relief to over 40 million Americans, was recently halted after a lawsuit filed by six Republican state Attorneys General, leading to a Supreme Court ruling against the program.


  • More than 4.6 million individuals in the states that brought the lawsuit were eligible for relief under the forgiveness program

  • In total, the Republican-led lawsuit denied constituents nearly $65 billion in relief, approximately $10 billion per state 

  • President Biden promised to look for other avenues towards student loan forgiveness

Supreme Court Blocks Biden's Student Loan Forgiveness Program

Advocates for Biden's student loan forgiveness program outside the Supreme Court. Credit: ABC News

The End of the Student Loan Forgiveness Program

On June 30, 2023, the Supreme Court delivered a landmark decision on the last day of its 2022 term. With a majority conservative bench, the court ruled against President Biden's Student Loan Forgiveness Program. Despite no loans having been forgiven yet, the program received an influx of over 26 million applications for relief in the last year, with 16 million receiving the administration's approval, illustrating broad support for the initiative.

Despite the program's wide popularity, it faced opposition from a collection of Republican-led states and other conservative entities who challenged the legality of the program in court. Their argument focused on the claim that the executive branch does not possess the power to cancel student debt on such a large scale.

In a 6-3 decision, the Supreme Court concurred with the opponents of the program, stating that the Biden Administration did not have authority under a 2003 federal law to forgive such a colossal amount of student debt. Chief Justice John Roberts authored the decision, favoring the six states - Arkansas, Iowa, Kansas, Missouri, Nebraska, and South Carolina - that initiated the case.

Implications for the Residents of the Six States
More than 4.6 million individuals in the states that brought the lawsuit were eligible for relief under the forgiveness program. Thus, the action of the Attorneys General has potentially denied their constituents nearly $65 billion in relief, approximately $10 billion per state.

President Biden's Reaction and Future Plans

President Joe Biden expressed his disappointment hours after the Supreme Court decision, maintaining that the Supreme Court had misinterpreted the Constitution, and he did not overstep his authority.


President Biden underscored the number of approved eligible borrowers while criticizing Republican officials and special interests who blocked the loan forgiveness.


In his remarks, the President pointed out the irony that many of the same people who opposed student loan forgiveness had supported the Paycheck Protection Program (PPP) during the COVID-19 pandemic when it was in their favor.


Biden emphasized the societal benefits that the plan would have brought, such as improved economic activity, increased homeownership, and the confidence for more couples to start families. He expressed determination to move forward and provide student loan relief through a new strategy compliant with the Supreme Court’s ruling.

What Was the Loan Forgiveness Program?

Introduced on August 24, 2022, President Biden's Student Loan Forgiveness plan was expected to benefit over 40 million Americans. Early data from the Biden Administration revealed that no state would have seen fewer than 45,000 residents qualifying for up to $10,000 in loan forgiveness.


The program aimed to provide relief to those earning less than $125,000 individually, or $250,000 as a couple in the fiscal year 2021-2022. Furthermore, Pell Grant recipients were eligible for up to $20,000 in loan forgiveness. Early White House data indicated that the bulk of this loan relief, 90%, would have benefitted borrowers earning less than $75,000 per year.


The program's cancellation will undoubtedly have a significant impact on states, with high-population states such as California, Florida, Texas, and New York having been expected to see the greatest benefit from the loan forgiveness program. Smaller states, too, were slated to see substantial numbers of eligible borrowers, illustrating the nationwide significance of this program.

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