Despite a recent court ruling, President Joe Biden said he expects the federal government will be able to start forgiving student loans soon despite a recent temporary stay issued by a court.
Biden told Reshad Hudson, a reporter for Nexstar, “We’re going to win that case. I think in the next two weeks, you’re going to see those checks going out.”
Relief for students was expected to be in place before the resumption of federal student loan payments in January. The White House has continued to encourage federal student loan borrowers to apply for forgiveness as the legal process plays out.
A judge ordered last week a temporary stay on Biden’s plan to forgive up to $20,000 in student loans.
The judge’s stay came after six Republican-led states filed a lawsuit attempting to stop Biden’s plan from going into effect. A lower court had ruled the states did not have standing, but an appeals court granted the stay.
The stay is not a final decision on it but allows the court time to review the case before allowing the administration to execute the student loan forgiveness. The White House stressed that the order was “temporary.”
The six states say that Biden’s plan is too costly. The Congressional Budget Office said the cost for the government to forgive student loans is an estimated $400 billion.
“A significant majority of Americans have already paid off their student loans or chose not to pursue higher education at all,” said Iowa Gov. Kim Reynolds. “By forcing them to pay for other people’s loans – regardless of income – President Biden’s mass debt cancellation punishes these Americans and belittles the path they chose. This expensive, unlawful plan is an insult to working people and must be stopped.”
Proponents of student loan forgiveness point out the rising cost of education in recent decades. The cost of tuition at a public four-year university in 2020-21 averaged $9,400, up from $8,500 from a decade earlier, when adjusted for inflation.
Government data shows that in the last three decades, the cost of attending a public university, which is generally far more affordable than a private one, has doubled. In the last 40 years, the cost has tripled.
A student attending a public university from 2017-21 would be expected to pay $38,093 in tuition and mandatory fees, in 2021 dollars. A person who attended a public university in 1977-81 would have been expected to pay $10,335 in 2021 dollars.
Biden's plan calls for borrowers with incomes of up to $150,000 to receive up to $10,000 in federal student loan forgiveness. That amount increases to $20,000 for borrowers who received pell grants.
