- President Biden's student loan forgiveness plan is currently paused after two court rulings.
- A major labor federation "is extremely disappointed in the partisan legal effort" to stop relief for borrowers.
- The White House is reportedly considering extending the current payment pause as the cases play out.
Millions of student loan borrowers are stuck in forgiveness limbo, as President Joe Biden's relief plan remains on ice.
Over the past week, courts handed Biden's student-debt relief plan two major blows. Last Thursday, a federal judge in Texas ruled the loan forgiveness illegal in response to a lawsuit filed by two student-loan borrowers who didn't qualify for the full amount of relief. On Monday, the 8th Circuit Court of Appeals ruled the temporary stay it placed on the relief nearly three weeks ago should remain in place. That decision was in favor of the six Republican-led states who sued the debt relief, arguing it would hurt their states' tax revenues.
The country's largest labor federation, the AFL-CIO, isn't pleased.
"The AFL-CIO is extremely disappointed in the partisan legal effort to shut down the Biden administration's life-changing student loan relief. Borrowers who have filed for forgiveness should not have to wonder if they will once again be forced to live with crushing student loan debt as a result of a court challenge," AFL-CIO director of government affairs Bill Samuel said in a statement. "With the payment pause end date of Dec. 31 rapidly approaching, the AFL-CIO will continue to advocate for the full implementation of the Biden administration's student loan debt cancellation plan."
The AFL-CIO, which represents 12.5 million American workers, was one prominent group in pushing for the initial forgiveness plan to go through. The federation's president, Liz Shuler, called on Biden to cancel student debt in the spring. Now, the administration's plans to do just that have been put on pause.
Advocates have already chimed in, calling for payment pauses to continue past December. Senator Elizabeth Warren slammed the decision from a Texas judge to block relief, saying that they're playing politics "instead of actually following the law."
The White House and Education Department have not commented on whether a further extension of the payment pause is on the table, but The Washington Post reported on Monday that White House aides are discussing an extension past December 31 as Biden's debt relief remains held up in federal courts.
At this point, the 26 million student-loan borrowers who have already submitted their online applications for relief are in legal limbo, waiting to learn if they will have to resume payments with any reduction to their balances. Biden's Justice Department has appealed the rulings, but it's a process that could take months, and during this time the administration is not accepting any new applications.
Still, the Biden administration remains confident the legal battles won't permanently block student-loan forgiveness.
"We believe we're going to prevail in court," Anita Dunn, a senior advisor to Biden, told NBC News on Sunday. "And at that point, we will swiftly move to make sure that the over 26 million people at this point who have — whose information this administration has — that we'll move swiftly for loan forgiveness."