In a recent development, seven Republican-led states have filed a lawsuit against President Biden, Education Secretary Miguel Cardona, and the Department of Education, alleging an unlawful attempt to "mass cancel" nearly $147 billion in federally held student loans. The states of Alabama, Arkansas, Florida, Georgia, Missouri, North Dakota, and Ohio argue that the proposed student loan forgiveness plan would result in the "overnight" cancellation of $73 billion and a total cancellation of $146.9 billion.

According to the lawsuit, this marks the third time Secretary Cardona has tried to implement massive loan cancellations, with previous attempts being halted by the courts. The plaintiffs argue that the current plan is a covert move by the administration to bypass the legal obstacles they have faced before.

Missouri Attorney General Andrew Bailey, who is leading the complaint, criticizes the Education Department for attempting to implement the loan forgiveness plan just weeks before the upcoming elections. Bailey claims that the department is resorting to desperate measures, likening their approach to "throwing spaghetti at the wall to see what sticks."

The lawsuit alleges that Secretary Cardona has already issued orders to loan servicing companies to begin the process of mass loan cancellation, a move that violates a statute prohibiting the implementation of such rules before 60 days of their publication. This raises concerns about the administration's adherence to established protocols.

The proposed student debt cancellation plan, introduced by the Education Department in April, has drawn criticism from Republican plaintiffs who argue that it circumvents federal court injunctions that have already halted some loan forgiveness initiatives. The plan automatically includes borrowers with at least one outstanding federally held student loan in the forgiveness process unless they actively opt out by contacting their loan servicer before August 30.

Under the proposed plan, interest would be forgiven for millions of borrowers up to $20,000, including those with household incomes over $240,000. Additionally, undergraduate student borrowers who have been making loan payments for 20 years and graduate students who have been making payments for 25 years would have their loan balances wiped clean. The plan also aims to forgive debts for students who attended institutions that are no longer part of federal grant and loan programs or lack financial value, as determined by the Education Department.

The controversy surrounding loan forgiveness doesn't end there. The lawsuit also raises concerns about the cost of specific income-driven repayment plans, such as the Saving on a Valuable Education (SAVE) Plan, which could amount to as much as $475 billion. The SAVE Plan has already faced legal blocks from federal courts. Furthermore, the lawsuit invokes previous Supreme Court rulings that struck down Biden's attempt to unilaterally cancel student debt through a law intended for veterans. The court deemed the attempt unconstitutional.

While the Department of Education highlights that 4.8 million Americans have already had their debts forgiven, totaling $169 billion, critics argue that these actions are politically motivated. Congressional Republicans accuse the Biden administration of using these loan forgiveness initiatives to gain support from younger and educated voters ahead of the 2024 elections.

Senator Bill Cassidy (R-La.), the top Republican on the Senate Health, Education, Labor, and Pensions Committee, states that the administration lacks the legal authority to unilaterally cancel student loans. He argues that forcing taxpayers who did not attend college or have already paid off their loans to bear the burden is an abuse of power.

The Department of Education declined to comment on the pending litigation but affirmed their commitment to supporting borrowers struggling to repay their federal student loans. They mentioned that they would continue to follow the law while preparing for potential debt relief, which would only be implemented after finalizing proposed rules introduced earlier this year.

As this legal battle unfolds, the future of student loan forgiveness initiatives and the financial burden they pose to both borrowers and taxpayers hangs in the balance.