Student loan borrowers and the Too Much Talent Band demand debt cancellation outside the White House on January 13, 2022, in Washington, D.C.
'They Want to Make Fraud Legal': Right-Wing Court Blocks Biden Student Debt Rules
"These for-profit companies literally committed crimes—but Trump/Reagan judges don't care," said one economic justice group.
Economic justice advocates on Monday said three right-wing federal judges sought to "make fraud legal" when they blocked newly implemented Biden administration rules that made it easier for student loan borrowers to cancel their debt if they were defrauded.
A panel on the 5th U.S. Circuit Court of Appeals—composed of judges appointed by former Republican Presidents Ronald Reagan and Donald Trump—granted a temporary nationwide injunction requested by Career Colleges & Schools of Texas (CCST), a group representing dozens of for-profit colleges.
The panel said it will consider the group's case against the rules in the fall and did not explain their reasoning in the two-page ruling, but the Debt Collective, a union of student loan borrowers that has advocated for student debt cancellation for years, said the three judges simply "don't care" that for-profit colleges "literally committed crimes."
"We have a judicial problem," said the group.
The rules—which took effect on July 1 and are separate from President Joe Biden's thwarted student debt cancellation program—were finalized late last year by U.S. Education Secretary Miguel Cardona. The new policy reformed the government's "borrower defense to repayment" standards, which govern the Education Department's authority to discharge loans due to colleges' misconduct.
Under the rules, the Education Department was able to review claims filed by individual borrowers or large groups of student who said they had been defrauded. They also compelled colleges to cover the cost when students' loans were cancelled due to fraud and made it easier for borrowers to obtain relief if an institution closed suddenly after promising them an education.
Peter Mills, a legislative assistant to U.S. Sen. Chris Murphy (D-Conn.), demanded to know how CCST had legal standing when it requested the injunction.
"They got their money and defrauded students," he said on social media. "Why does it matter at all what happens to the loans we should've never allowed to go to criminal organizations like these colleges in the first place?"
As the ruling was handed down, The Washington Post reported that the Project on Predatory Lending (PPSL) has accused the Education Department of violating its new policy of requiring loan servicing companies to issue full refunds to borrowers whose student debt has been cancelled.
"There should be parity in the department's policy on these refunds," Eileen Connor, president and director of PPSL. "If it was willing to make a change going forward, why not apply that policy to everyone?"
The Debt Collective said that ongoing litigation regarding student debt cancellation denotes "problem" with the Biden administration as well as with the courts.
The administration "should simply stop funding predatory colleges," said the group. "They can do this without Congress."
We are at a crossroads
This country and this world are at a monumental crossroads. US voters have an opportunity to beat back the forces of fascism and confront the billionaires who are rigging the economy, our media system, and our democracy, making it increasingly impossible for ordinary people to get by. We’re not just talking about the election. We’re talking about what must be done once these fascist elements are vanquished from power. We need a bolder set of solutions than what either major party has so far been willing to offer and a working-class movement ready to fight like hell for it. Trump didn't emerge from nowhere. The conditions that fueled MAGA authoritarianism were created by decades of radical neoliberal economic policies and a corrupt political system dominated by corporate interests. They slashed taxes on the super-rich, promising that the benefits would trickle down. They said giveaways to the corporate titans would make life more affordable for the rest of us. It was all bullshit. And when a bitter, betrayed populace searches for someone to blame, right-wing demagogues have little trouble finding scapegoats. People know when they're being lied to, but you won't hear any of this from the corporate media. Only independent journalism—powered and funded by people who believe in building a better world—can deliver truly trustworthy daily news. Our Fall Campaign is underway, and we need your help. To power our newsroom through the rest of the year, we need to raise $125,000 by midnight on October 31. So if you share our vision, please contribute whatever you can to sustain our work. |
Economic justice advocates on Monday said three right-wing federal judges sought to "make fraud legal" when they blocked newly implemented Biden administration rules that made it easier for student loan borrowers to cancel their debt if they were defrauded.
A panel on the 5th U.S. Circuit Court of Appeals—composed of judges appointed by former Republican Presidents Ronald Reagan and Donald Trump—granted a temporary nationwide injunction requested by Career Colleges & Schools of Texas (CCST), a group representing dozens of for-profit colleges.
The panel said it will consider the group's case against the rules in the fall and did not explain their reasoning in the two-page ruling, but the Debt Collective, a union of student loan borrowers that has advocated for student debt cancellation for years, said the three judges simply "don't care" that for-profit colleges "literally committed crimes."
"We have a judicial problem," said the group.
The rules—which took effect on July 1 and are separate from President Joe Biden's thwarted student debt cancellation program—were finalized late last year by U.S. Education Secretary Miguel Cardona. The new policy reformed the government's "borrower defense to repayment" standards, which govern the Education Department's authority to discharge loans due to colleges' misconduct.
Under the rules, the Education Department was able to review claims filed by individual borrowers or large groups of student who said they had been defrauded. They also compelled colleges to cover the cost when students' loans were cancelled due to fraud and made it easier for borrowers to obtain relief if an institution closed suddenly after promising them an education.
Peter Mills, a legislative assistant to U.S. Sen. Chris Murphy (D-Conn.), demanded to know how CCST had legal standing when it requested the injunction.
"They got their money and defrauded students," he said on social media. "Why does it matter at all what happens to the loans we should've never allowed to go to criminal organizations like these colleges in the first place?"
As the ruling was handed down, The Washington Post reported that the Project on Predatory Lending (PPSL) has accused the Education Department of violating its new policy of requiring loan servicing companies to issue full refunds to borrowers whose student debt has been cancelled.
"There should be parity in the department's policy on these refunds," Eileen Connor, president and director of PPSL. "If it was willing to make a change going forward, why not apply that policy to everyone?"
The Debt Collective said that ongoing litigation regarding student debt cancellation denotes "problem" with the Biden administration as well as with the courts.
The administration "should simply stop funding predatory colleges," said the group. "They can do this without Congress."
- Organizers Warn Biden Against 'Doing Nothing' If Supreme Court Blocks Student Debt Relief ›
- GOP Resolution to Block Student Debt Relief Would Have 'Ruinous Impact,' Report Warns ›
- Biden Admin Halts Student Debt Relief Applications After Right-Wing Judge's Ruling ›
- 100+ Groups Urge Senate to Build 'Federal Judiciary That Works for All of Us' ›
Economic justice advocates on Monday said three right-wing federal judges sought to "make fraud legal" when they blocked newly implemented Biden administration rules that made it easier for student loan borrowers to cancel their debt if they were defrauded.
A panel on the 5th U.S. Circuit Court of Appeals—composed of judges appointed by former Republican Presidents Ronald Reagan and Donald Trump—granted a temporary nationwide injunction requested by Career Colleges & Schools of Texas (CCST), a group representing dozens of for-profit colleges.
The panel said it will consider the group's case against the rules in the fall and did not explain their reasoning in the two-page ruling, but the Debt Collective, a union of student loan borrowers that has advocated for student debt cancellation for years, said the three judges simply "don't care" that for-profit colleges "literally committed crimes."
"We have a judicial problem," said the group.
The rules—which took effect on July 1 and are separate from President Joe Biden's thwarted student debt cancellation program—were finalized late last year by U.S. Education Secretary Miguel Cardona. The new policy reformed the government's "borrower defense to repayment" standards, which govern the Education Department's authority to discharge loans due to colleges' misconduct.
Under the rules, the Education Department was able to review claims filed by individual borrowers or large groups of student who said they had been defrauded. They also compelled colleges to cover the cost when students' loans were cancelled due to fraud and made it easier for borrowers to obtain relief if an institution closed suddenly after promising them an education.
Peter Mills, a legislative assistant to U.S. Sen. Chris Murphy (D-Conn.), demanded to know how CCST had legal standing when it requested the injunction.
"They got their money and defrauded students," he said on social media. "Why does it matter at all what happens to the loans we should've never allowed to go to criminal organizations like these colleges in the first place?"
As the ruling was handed down, The Washington Post reported that the Project on Predatory Lending (PPSL) has accused the Education Department of violating its new policy of requiring loan servicing companies to issue full refunds to borrowers whose student debt has been cancelled.
"There should be parity in the department's policy on these refunds," Eileen Connor, president and director of PPSL. "If it was willing to make a change going forward, why not apply that policy to everyone?"
The Debt Collective said that ongoing litigation regarding student debt cancellation denotes "problem" with the Biden administration as well as with the courts.
The administration "should simply stop funding predatory colleges," said the group. "They can do this without Congress."
- Organizers Warn Biden Against 'Doing Nothing' If Supreme Court Blocks Student Debt Relief ›
- GOP Resolution to Block Student Debt Relief Would Have 'Ruinous Impact,' Report Warns ›
- Biden Admin Halts Student Debt Relief Applications After Right-Wing Judge's Ruling ›
- 100+ Groups Urge Senate to Build 'Federal Judiciary That Works for All of Us' ›