States argue that Biden’s $400 billion student loan handout is unlawful 

Five states have filed their written response to the U.S. Supreme Court after the government attempted to have the lawsuit dismissed, alleging that President Biden’s $400 billion student loan bailout is an ‘unlawful’ abuse of the Higher Education Relief Opportunities for Students (HEROES) Act of 2003. The states of Nebraska and others maintain that the program must be put on hold. Last week, the Biden administration filed an emergency petition with the Supreme Court to vacate a federal appeals court’s ruling blocking the student loan forgiveness program from going into effect. The states claim that the president’s true goal is to fulfill his campaign promise to erase student loan debt by using the pretext of the COVID-19 pandemic.

“According to the Act, there must be a genuine national emergency. The President’s ultimate objective, however, is to fulfill his campaign pledge to cancel student loan debt, and the Department’s dependence on the COVID-19 outbreak is a ruse to hide that purpose “The states responded in writing.

“The agency uses the purportedly COVID-19-caused present economic difficulties to link the Cancellation to the epidemic while concealing its true motivation. However, as those symptoms are not specifically related to the pandemic, the Department has not sufficiently connected the Cancellation to a national emergency “they said.

After the Biden administration submits its final reply brief, the court will be prepared to make an order. That may occur during the next several days.

The administration requested an urgent review of a lower court’s injunction against the implementation of the student loan forgiveness scheme by the Supreme Court on Friday.

The White House contends that both the states bringing the legal challenge lack legal standing to do so and that they would prevail on the merits of the case. The federal government claims that the move is legal.

The Biden administration emphasized in its proposal that the loan forgiveness scheme must be approved since borrowers are now in a precarious financial situation.

The administration informed the court that debtors who are qualified for loan forgiveness now anticipate monthly payment reductions of $200 to $300. But because of the injunction, it claimed, “the debtors most likely to fail suffer protracted ambiguity regarding the nature of their payment responsibilities and when those duties will restart.”

Many borrowers won’t have the knowledge they need to determine if they can afford to move professions, purchase a home or vehicle, or take on other long-term financial responsibilities as long as that uncertainty persists.

In their brief on Wednesday, the states asserted that if the injunction were lifted, they would suffer from a “wave of damages.”