Six Republican-led states sue to halt Biden's bid to forgive student loans

Six Republican-led states on Thursday filed a challenge to the Biden administration's student loan cancellation program in federal court in Missouri on Thursday. In the lawsuit, Nebraska, Arkansas, Iowa, Kansas, Missouri and South Carolina asked the court for an immediate temporary restraining order pausing the program.

Prompt relief is being sought because the Biden administration has indicated it will start cancelling loan balances as early as next week, Nebraska Attorney General Doug Peterson said in a statement. The lawsuit comes two days after conservative group Pacific Legal Foundation filed a federal lawsuit with the intent of stopping President Joe Biden's student loan cancellation plan.

On Monday ,the Congressional Budget Office said Biden's plan to cancel some student loan debt will cost $400 billion. Biden said in August that the U.S. government will forgive $10,000 in student loans for millions of debt-saddled former college students, keeping a pledge he made in the 2020 campaign for the White House.

Critics of the plan raised concerns over its inflationary impact, while the White House said it was fiscally justified because the federal deficit was on track to drop by $1.7 trillion reduction in the current fiscal year compared with the prior year. The smaller deficit is largely due to the end of many COVID-19 aid programs and unexpectedly higher revenues. As of June 30, 43 million borrowers held $1.6 trillion in federal student loans. About $430 billion of that debt will be canceled, the CBO estimated. The CBO previously projected that some of the funds canceled by Biden's action would eventually have been forgiven anyway.

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