ST PAUL, Minn. — Supporters of President Biden's latest student loan repayment plan gathered outside the federal courthouse as a three-judge panel from the U.S. Eighth Circuit Court of Appeals heard the most recent challenge to it.
The SAVE — or Saving on Valuable Education — program aims to reduce student debt by $170 billion, a scaled-back plan the U.S. Dept. of Education created after the courts struck down Biden's plan to cut college loan debt by $430 billion. The program expands the scope of an existing income-based repayment program by shortening the repayment terms and erasing some of the interest.
"This isn’t just about repayment. This is an attack on everyone who had a dream and worked hard to go to college, but didn’t have rich parents who could write a check," Melissa Byrne of the We the 45 Million organization told reporters outside.
"This debt takes away the American dream and turns it into a debt sentence that last and lasts and lasts."
One of those who spoke at the press conference was Alyssa Barnes, a U.S. Navy Gulf War veteran from Maine, who says she won't be able to repay the $130,000 in debt she incurred in undergraduate and graduate school, while trying to support herself and two sons as a single mom.
"I feel a lot of regret that I didn't know what I didn't know when I took out those loans," Barnes told KARE. "Over a third of by debt is just from interest accruing over the years — $37,000 is just interest. During COVID I called them to try to refinance and they just hung up on me."
Missouri's Republican Attorney General Andrew Bailey led the legal attack against the plan and was joined in the effort by several other Republicans attorney generals. He has challenged the legality of using the current repayment plan to cancel interest debt, and more generally asserts only Congress can craft such a program.
Bailey, speaking on the Christian Washington Watch podcast, said Missouri has legal standing to challenge the repayment program because the state's higher education system will lose funding if the state's student loan program known as MOHELA can't collect fully on student loans.
"They owe money to the State in the Lewis and Clark Discovery Fund used to pay for capital improvements in higher education facilities, and they also fund scholarships. So, there's direct, concrete harm to the State of Missouri if those student loan payments to MOHELA are canceled by President Biden's plan."
Minnesota Attorney General Keith Ellison, a Democrat, took his GOP counterparts to task during Thursday's news conference outside the courthouse.
"Here come these AGs who are supposed to be the people’s lawyer of their states, and they fight tooth and nail to block opportunity," Ellison said.
He said the SAVE program was modest, not earthshattering.
"Look, we ask people to better themselves, to pursue education, to get more education so they can make a greater contribution to themselves or their family and community, and then what we do is say? 'Here’s a bunch of debt!' Unless you're rich!"
During Thursday's oral arguments the three judges, all appointed by Republican presidents, appeared to be skeptical of the government's argument that SAVE program can be expanded the way the Biden Administration has done.
The U.S. Supreme Court already decided the Republican AG's lawsuit can proceed, and asked the Eighth Circuit Court of Appeals to rule on the merits of the challenge.