Kamala Harris says 'won't stop fighting' for student debt relief after Supreme Court blocks Biden's SAVE plan

After the United States Supreme Court on Wednesday (August 28)declined to reinstateUS President Joe Biden administration's recent effort to cancel loans for millions of borrowers, Vice President and Democratic presidential candidate Kamala Harris said that she will continue to fight for student debt forgiveness.

Why are Republican-led states opposing the SAVE plan?

Over a dozen Republican-led states together had taken legal action against the federal government over the Saving on a Valuable Education (SAVE) plan, claiming it could cost at least $475 billion over a decade. Meanwhile, the Congressional Budget Office has estimated the cost of the loan forgiveness plan to be $276 billion.

Recently, the Supreme Court refused a Justice Department request to overturn a ruling from the 8th US Circuit Court of Appeals, which had blocked Biden's loan forgiveness plan. This plan was introduced by the White House last year, after another student loan relief proposal from the incumbent president, which aimed to forgive up to $20,000 in debt for millions of Americans, was struck down by the Supreme Court.

In an unsigned order, the Supreme Court asked for a comprehensive ruling on the SAVE plan by the 8th Circuit Court of Appeals "with appropriate dispatch." Student loan forgiveness was a significant point during Biden's 2020 campaign, and Harris said that if she is elected in November, she would continue with the current president's strategy for debt relief.

"@POTUS and I have canceled nearly $170 billion in student debt for almost 5 million Americans. We are also fighting to defend our SAVE Plan, which has lowered payments for millions of Americans. We won't stop fighting to build an economy that works for every American," Harris wrote on X, previously known as Twitter.

Key features of the SAVE plan for student debt relief

The SAVE plan is designed to provide relief to borrowers by reducing the required monthly payments on federal loans from 10 per cent to 5 per cent of their discretionary income. Those earning less than 225 per cent of the federal poverty line, or $32,800 annually, would not be required to make payments on their loans.

Additionally, the plan would allow for loan balances of $12,000 or less to be forgiven after 10 years of timely payments. In April, the Biden administration announced that nearly eightmillion people had signed up for the SAVE plan, with 4.5 million borrowers having monthly payments reduced to $0.

(With inputs from agencies)