President Joe Biden placed a strong emphasis on eradicating college debt as a fundamental aspect of his political agenda. Since assuming office, he has implemented several measures that have been beneficial for individuals. In August 2022, the President unveiled an extensive initiative that aimed to absolve either $10,000 or $20,000 of debt for millions of borrowers who fulfilled specific financial criteria.
While the program is presently suspended, legislators have chosen to take action to formally express their opposition to it through legislative means.
House Republicans successfully passed a resolution on May 24 to overturn President Biden’s proposal for forgiving student loan debt. The president aimed to provide $10,000 in debt forgiveness for individuals who did not receive a Pell Grant and earned less than $125,000 per year (or $250,000 annually for couples). Borrowers who met these income criteria and had received a Pell Grant would be eligible for twice that amount.
According to the US Department of Education, this plan was estimated to cost American taxpayers approximately $137.9 billion until 2032. However, economists from the Wharton School at the University of Pennsylvania conducted an analysis of the policy and projected that it could potentially increase the number of eligible borrowers from around 33% to 75%, resulting in a total cost of up to $361 billion over a span of 10 years.
Using the Congressional Review Act, Republicans utilized a means to challenge and revoke the student loan forgiveness program. The resolution successfully passed the House with a vote of 218 to 203, predominantly along party lines. Democratic Representatives Marie Gluesenkamp Perez (WA) and Jared Golden (ME) supported the resolution.
On June 1, the Senate addressed the measure and approved it with a vote of 52 to 46. Democratic Senators Jon Tester (MT) and Joe Manchin (WV) voted in favor of the repeal. Senator Kyrsten Sinema (AZ), who transitioned from being a Democrat to an Independent, also voted to annul the student loan forgiveness plan.
It is anticipated that President Joe Biden will veto the resolution, and neither chamber possesses the votes required to overturn his veto.
The Biden Administration is facing challenges beyond Congress. The Supreme Court listened to arguments against the policy in February, and according to reports, the justices expressed doubts regarding the president’s plan. In the case of Biden v. Nebraska, a coalition of conservative states contended that the administration had exceeded its authority.
The Constitution grants Congress the power of the purse, which means that only they have the authority to authorize expenditures. The action taken by lawmakers to overturn the policy carries significant weight with the Supreme Court, as it demonstrates the lack of support for the president’s actions from Congress. The administration’s attempt to bypass congressional involvement may have negative consequences.
A decision from the Supreme Court in the case is expected to be announced soon.