White House still moving forward with plans to forgive student loans despite order

Election 2024 Biden
Posted at 10:57 AM, Oct 25, 2022

Despite a judge’s order last week issuing a temporary stay on President Joe Biden’s plan to forgive up to $20,000 in student loans, the White House is still urging borrowers to apply for forgiveness.

White House press secretary Karine Jean-Pierre said federal student loan borrowers are still encouraged to go to to apply for loan forgiveness.

“The Department of Education will continue reviewing applications and preparing them for transmission to loan services. As of Friday, 22 million student borrowers have already applied for this game-changing relief,” Jean-Pierre said.

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.”

“What I can say: It's a temporary order, and we're going to do everything that we can to continue to do our outreach and make sure that people apply,” Jean-Pierre said.

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.