Leaders.com
  • Login
  • Subscribe
  • Business
  • Leadership
  • Wealth
  • Master Classes
  • Business
    • Entrepreneurs
    • Executives
    • Marketing and Sales
    • Social Media
    • Innovation
    • Women in Business
  • Leadership
    • Personal Growth
    • Company Culture
    • Public Speaking
    • Productivity
    • Hiring
    • Social Issues
    • Leaders
  • Wealth
    • Investing
    • Cryptocurrency
    • Retirement
    • Venture Capital
    • Loans and Borrowing
    • Taxes
    • Markets
    • Real Estate
  • Master Classes
  • Login
  • Subscribe
Loans and Borrowing Biden

Biden appeals courts striking down his executive order (Photo by Win McNamee/Getty Images)

By Tyler Hummel Leaders Staff

Tyler Hummel

Tyler Hummel

Tyler Hummel is a news writer for Leaders Media. He was the Fall 2021 College Fix Fellow and Health Care...

Full bio


Learn about our editorial policy

Nov 22, 2022

The Unforgiving Process of Student-Loan Forgiveness

The student-loan forgiveness program is being appealed to the Supreme Court in spite of several courts striking it down. 

Key Details

  • President Joe Biden signed an executive order on August 24 that allows student debt holders earning less than $125,000 to have up to $20,000 in debt forgiven. 
  • The order was paused following several rulings against it—including an Eighth Circuit Court of Appeals order in October and a Texas federal judge on November 14 ruling the law was illegal. 
  • The U.S. Solicitor General Elizabeth Prelogar and the Justice Department appealed to the Supreme Court on Friday to move the law ahead. 
  • On Saturday, thousands of applicants were notified by Education Secretary Miguel Cardona that they have been approved and that funds will be sent out “if and when we prevail in court.”
  • The Biden administration says that the program has seen 26,000 applicants, that 16,000 have already been approved, and that the lawsuits have no merit.

Why it’s News

The Biden administration is moving very confidently in its belief that it will find a way to successfully payout its student-loan forgiveness program. It reminded the Supreme Court that millions of young people are burdened by billions in debt that are limiting their ability to build their lives. 

“The Eighth Circuit’s erroneous injunction leaves millions of economically vulnerable borrowers in limbo, uncertain about the size of their debt and unable to make financial decisions with an accurate understanding of their future repayment obligations,” says Prelogar.

Others are not convinced that Biden’s appeal will work. The legal challenges are directly opposing the law as an overstep of executive authority. Several prominent analysts are saying that the Supreme Court will strike it down. 

“There’s a good chance courts are going to look at this and say, the president overstepped his authority—spending is really the authority of the Congress,” says Committee for a Responsible Federal Budget member Marc Goldwein. 

“I think the likelihood is that this more or less marks the death knell as it were for the administration’s attempt to forgive student debt,” says Cato Institute SVP Clark Neily. 

Bipartisan policy analysts are suggesting that President Biden’s announcement last week to offer $10,000 to $20,000 in student-loan forgiveness to 43 million Americans will add to the budget deficit. 

Maya MacGuineas, the president of the Committee for a Responsible Federal Budget, told Barron’s that the policy will increase deficits by hundreds of billions of dollars, increase inflation, and up the risk of a recession. 

“When all is said and done, we’ll have spent $800 billion on changes to student-loan policy since the pandemic started… This is a stunning amount of money to be spent without congressional approval. It’s on top of a $24 trillion national debt that is set to surpass its record as a share of the economy within the next decade,” says MacGuineas. 

Notable Quote 

“President Joe Biden should take the legal wrangling over his proposed student loan giveaway as a giant note to self: Next time he wants to create a massive new government program, he should take it to Congress first. It may be inconvenient, but it’s what our Constitution requires,” says USA Today.

Home / News / The Unforgiving Process of Student-Loan Forgiveness
Share
FacebookTweetEmailLinkedIn

Related Stories

Boring Investments Can Bear Exciting Results

by Hannah Bryan Leaders Staff
Markets

16 minutes ago

boring investments pay off

Investments in unassuming companies may yield better results than investments in exciting, active businesses. 

Key Details

  • Fund manager Clifford Asness has taken a different strategy than some of his peers, choosing not to focus on growth stocks.
  • In the short term, Asness’ firm AQR was outpaced by its competitors, but now that tech stocks are declining, Asness’ method is beginning to pay off, Forbes reports.
  • At AQR, portfolio managers focus on value stocks, believing that, over time, these investments will have a more significant payoff than hot-growth stocks. 
  • Value stocks tend to be slow-growth, unexciting investments such as Stellantis. Ferrari is the opposite, an exciting, quickly-growing organization.

Go deeper

FacebookTweetEmailLinkedIn

The Price Of Social Media Access

by Savannah Young Leaders Staff
Social Media

16 minutes ago

Social media is becoming costly as more platforms that were once free are adding features only accessible with a fee

Social media is becoming costly as more platforms that were once free are adding features only accessible with a fee.

Key Details

  • Twitter owner Elon Musk tweeted that starting April 15, only tweets by paid verified users will show up on Twitter’s “For You” news feed.
  • Facebook parent Meta launched a paid subscription allowing users on both Facebook and Instagram to pay a monthly fee for verification.
  • Snapchat recently started licensing its augmented reality software and tools to other companies.

Go deeper

FacebookTweetEmailLinkedIn

SVB Bankruptcy Stalls Startups

by Tyler Hummel Leaders Staff
Investing

5 hours ago

SVB

While SVB depositors have been promised a bailout from the Federal Reserve, the negative impact of the collapse continues to have ramifications for the market—particularly on startups. 

Key Details

  • With the planned sale of the bankrupt Silicon Valley Bank (SVB) to First Citizens BancShares, the financial world is still picking up the pieces from three weeks of chaos. 
  • The failure of one of the leading startup banks in Silicon Valley has cooled investor enthusiasm for the rest of the market, with thousands of investors pulling out of new projects.
  • 59% of venture capitalists say SVB is making fundraising more difficult, and 22% say they may not be able to raise any additional funding in 2023, The New York Times reports.

Go deeper

FacebookTweetEmailLinkedIn
subscription economy
Marketing and Sales

19 hours ago

Paying By the Month Is a New Trend

by Hannah Bryan Leaders Staff
Sydney
Environment

20 hours ago

Australian EV Sales Finally Hit the Gas 

by Tyler Hummel Leaders Staff
The global semiconductor chip shortage has flooded into the banking sector, causing delays for new credit and debit cards
Business

20 hours ago

One Thing Delaying Credit-Card Shipments

by Savannah Young Leaders Staff

Recent Articles

Productivity

Mar 27, 2023

84% of Workers Are Easily Distracted—Here Are 10 Tricks to Stay Focused

Learn to improve mental performance when you can’t stay focused.

Leadership

Mar 22, 2023

Creating Loyal Employees Is About More Than Just the Paycheck

If you think simply paying your employees more will gain their loyalty, think again.

Business

Mar 20, 2023

Worried About ADHD At Work? Here’s How It Might Actually Help You

Neurodivergent people often have a high level of creativity and innovative thinking.

  • Business
  • Leadership
  • Wealth
Join the Leaders Community

Get exclusive tools and resources you need to grow as a leader and scale a purpose-driven business.

Subscribing indicates your consent to our Terms & Conditions and Privacy Policy

Leaders.com
  • Privacy Policy
  • About
  • Careers
  • Cookie Policy
  • Terms
  • Disclosures
  • Editorial Policy
  • Member Login

© 2023 Leaders.com - All rights reserved.

Search Leaders.com