Biden administration urges Supreme Court to lift block of student loan forgiveness scheme

An appeals court had halted the student loan forgiveness programme indefinitely and argued that the Biden administration lacked congressional authorization to eliminate student debt.

By ET Spotlight Special | Nov 19, 2022, 03.20 AM IST

An appeals court halted the student loan forgiveness programme indefinitely and argued that the Biden administration lacked congressional authorization to eliminate student debt.

The US President Joe Biden’s administration urged the Supreme Court on Friday to revive his student loan forgiveness proposal, which a federal appeals court had halted.

In court documents, Elizabeth Prelogar, the Solicitor General, urged the justices to withdraw an injunction imposed on Monday by the St. Louis-based 8th U.S. Circuit Court of Appeals. In a separate lawsuit, a federal court in Texas has also stopped the plan. The administration has also requested the 5th U.S. Circuit Court of Appeals in New Orleans to remove the injunction.

Will IT stocks outperform peers? Sunil Damania's 12 predictions for Samvat 2079

1/12

While many analysts are making bleak predictions for IT stocks after a choppy Samvat 2078, Sunil Damania, Chief Investment Officer, MarketsMojo, before listing out his predictions for the next year, iterated about the past predictions.

The expert said, "Last Diwali, I made 12 bold predictions. They ranged from forecasting the auto sector’s outperformance to inflation remaining stubborn and compelling Central Banks to hike interest rates to LIC going public and a 65% probability that the Sensex will have negative returns. I am glad to inform you that 10 predictions were on the dot."

On similar lines, he has made some predictions for next Diwali or Samvat 2079 that are as follows:

According to Prelogar's recent brief, the 8th Circuit's judgment places a lot of economically disadvantaged borrowers in limbo, unsure of the extent of their debt and unable to make financial decisions based on an accurate assessment of their future repayment responsibilities.

The idea has been contested by a variety of persons and groups, with the issue presently before the Supreme Court including claims made by six states: Nebraska, Missouri, Arkansas, Iowa, Kansas, and South Carolina.

The states had been denied legal standing by a federal judge, but the appeals court disagreed, concentrating on a Missouri organization that manages federal student loans. The state claims that if loans are forgiven, the agency will lose money.

One significant challenge for people opposing the program is demonstrating legal standing to suit by demonstrating how the program has impacted them.

FAQs

Who is eligible for student loan forgiveness?
The debt forgiveness proposal introduced in August would eliminate ten thousand dollars in student loan debt for persons earning less than 125,000 dollars or households earning less than 250,000 dollars.

After 20 years, are student loans forgiven?
If you haven't repaid your loan in full after 20 years, any outstanding balance will be forgiven.

Download
The Economic Times Business News App for the Latest News in Business, Sensex, Stock Market Updates & More.