Biden Administration Considers Extending Student-Loan Moratorium Once Again after ‘Forgiveness’ Order Legal Defeats

Following a pair of court rulings blocking President Biden’s student-loan “forgiveness” plan, White House aides are now reportedly making plans to once again extend the federal student-loan repayment moratorium to cushion borrowers from the full cost of their outstanding loans, sources close to the situation told the Washington Post.

The Biden administration has faced several legal challenges since the president announced in August that he would be forgiving up to $10,000 in student debt for individuals making less than $125,000 per year and $20,000 for Pell Grant recipients in the same income category. The student-loan repayment moratorium has been extended four times since first taking effect in March 2020.

On Monday, the U.S. Court of Appeals for the 8th Circuit issued an injunction against Biden’s student-bailout plan in a unanimous decision favoring a Republican-led coalition of states.

Publicly, senior figures in the White House have remained firm that legal setbacks and all, the administration’s commitment to student debt relief is unwavering.

Press secretary Karine Jean-Pierre stated Monday following the 8th Circuit Court ruling that the Biden administration remains “confident in our legal authority for the student debt relief program and believe it is necessary to help borrowers most in need as they recover from the pandemic.”

“The Administration will continue to fight these baseless lawsuits by Republican officials and special interests and will never stop fighting to support working and middle-class Americans,” she added.

In response to the latest rulings, White House officials have reportedly begun to prepare for the possibility that the loans can’t be forgiven.

“As the legal vulnerability has become clearer and clearer, the White House has been making increasingly firm plans to extend the loan repayment pause…The extension we’re likely to see is meant to make sure borrowers don’t have the rug pulled out from under them, rather than an indefinite replacement for loan forgiveness,” a person familiar with the matter told the Washington Post.

The news comes on the heels of last week’s ruling by a federal judge in Texas that also blocked the bailout plan, calling it an “unconstitutional exercise of Congress’s legislative power.”

“No one can plausibly deny that it is either one of the largest delegations of legislative power to the executive branch, or one of the largest exercises of legislative power without congressional authority in the history of the United States,” Judge Mark Pittman wrote in his opinion.

The nonpartisan Congressional Budget Office estimates Biden’s student bailout may cost as much as $400 billion.