As of: 10/22/2022 4:58 a.m
Shortly before the midterms, US President Biden wants to implement his promised debt relief for graduates – but a court is putting a stop to it for the time being. The background is the lawsuit of several states.
In August, US President Joe Biden announced that he intends to fulfill one of his campaign promises: debt relief for people with a university education. But now an appeals court has put this project on hold, at least for the time being.
The Republican-led states of Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina had filed a lawsuit against the planned debt relief, citing, among other things, the threat of losses for the state institutions through which student loans are granted.
But the lawsuit was initially unsuccessful. On Thursday, the competent district court had dismissed the lawsuit. However, the states appealed to the Court of Appeals and also requested an injunction suspending implementation of the debt relief until the Court of Appeals ruled on their lawsuit.
Amount of debt relief dependent on income
According to Biden’s plans, college graduates earning less than $125,000 a year would have $10,000 of debt waived from their college finance. Those who come from low-income families and have therefore received a special state loan for their studies should have to pay off $ 20,000 less.
According to the government, 43 million people could benefit
The US government estimates that around 20 million former students could be freed from their debts to the state in this way. However, many more people would benefit from the debt relief: the White House announced in August that there are probably up to 43 million in the entire United States. And just on Friday, Karine Jean-Pierre, spokeswoman for the White House, said that more than 22 million Americans had already expressed interest in the debt relief.
A total of around 45 million people in the United States have student debt from the state – amounting to around 1.6 trillion dollars. Studying in the United States often costs enormous amounts of money. Colleges often charge between $10,000 and $70,000 per year.