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The United States Supreme Court recently denied the Biden administration's emergency request to reinstate the federal student loan relief plan known as the Saving on a Valuable Education (SAVE) plan.
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This decision upholds a lower court’s injunction against the plan, which was imposed by the Eighth Circuit Court of Appeals.
The SAVE plan, introduced by the Department of Education in July 2023, aimed to cap loan payments at 5% of discretionary income and offered other provisions to reduce borrower burdens.
Republican-led states challenged the plan, claiming it would cost up to $475 billion without congressional authorization and should be blocked similarly to a previous student loan forgiveness program struck down by the Supreme Court.
The Solicitor General argued that the plan’s provisions are supported by a 1993 federal law and claimed the appeals court’s injunction is overly broad.
The conservative justices on the Supreme Court adhere to the "major questions doctrine," which restricts federal agencies from making significant economic changes without explicit congressional approval.
This ruling leaves the future of Biden's student debt relief uncertain, especially with the upcoming election, where this issue is likely to be contentious.
The legal battle underscores ongoing conflicts between the executive branch and the judiciary over administrative authority and major economic policies.