Wisconsin Spotlight | Oct. 5, 2022
MADISON — President Joe Biden’s “One-Time Student Loan Debt Relief Plan” comes with a big bill for U.S. taxpayers. Now Wisconsin taxpayers are taking the president to court.
On Tuesday, the Wisconsin Institute for Law & Liberty (WILL) filed a federal lawsuit on behalf of the Brown County Taxpayers Association. The complaint alleges the Biden administration’s student loan forgiveness program violates the constitutional separation of powers because it was unilaterally crafted by the executive branch. It was written without authority — as well as the constitutional guarantee of equal protection under the law, underscored by the official documents that outline the program’s preference toward specific races, the lawsuit states.
WILL is asking the U.S. District Court for the Eastern District of Wisconsin Green Bay Division to issue a temporary restraining order to prevent Biden and federal officials from canceling any debt before a decision is reached in the lawsuit.
“The President has no authority to order a wholesale forgiveness of student loans, costing taxpayers up to a trillion dollars. Whether this plan is good for America is for Congress to decide,” said Rick Esenberg, WILL’s president and general counsel.
Biden in August announced that the administration will forgive up to $10,000 in student loans for individuals making less than $125,000 a year or couples earning less than $250,000. Those who receive Pell grants would be eligible for another $10,000 in loan cancelation.
Taxpayers — including the many who have no college debt or have already paid it off — would be on the hook for an estimated $400 billion in debt transfer, according to the nonpartisan Congressional Budget Office.
“Student Loan Debt Relief takes from one group of people and arbitrarily distributes the spoils to another group,” said Rich Heidel, president of the Brown County Taxpayers Association. “The Plan amounts to nothing more than a modern-day version of King George III’s Stamp Act where there was massive taxing and spending without participation of the People’s representatives.”
Biden’s bailout could go into effect as soon as this week, so WILL is asking the court to quickly block implementation while the lawsuit moves through the court system.
Other lawsuits are pending. One complaint, filed in September by attorneys general in Arkansas, Iowa, Kansas, Missouri, Nebraska and South Carolina, argues taxpayers shouldn’t have to pay debt from other Americans who chose to go college.
As CBS News reports, a federal judge in that case is expected to rule on whether to issue an injunction by next Wednesday.
WILL’s lawsuit is part of its Equality Under the Law Project, which fights to protect against racial discrimination and violations of constitutional liberties. The legal initiative won a huge victory last year when a Wisconsin federal judge paused the Biden administration’s program to forgive federal farm loans for people of color.
In the student loan debt transfer plan, the Biden administration argues it is authorized under the 9/11-era HEROES Act. But that program derived from a law designed to help the men and women of the Armed Services, allowing the president to make specific changes to student loan programs when “necessary in connection with a war or other military operation or national emergency.”
“The President is abusing this law by claiming that all Americans are in a state of emergency because of COVID-19, even though he recently declared that the pandemic was over. And as confirmed by the two preceding administrations, the HEROES Act does not allow the President to unilaterally forgive student loans,” the public interest law firm states in a press release.