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Court Demands Student Loan Borrowers Pay More by David Dayen
Since the inauguration of Donald Trump for a second presidential term, a student loan borrower has fallen into default every nine seconds. A federal appeals court wants to accelerate that process.
Last week, a three-judge panel of the Eighth Circuit (which includes two Trump appointees and one appointed by George W. Bush) nullified the Biden administration’s income-driven repayment (IDR) program, versions of which have been in place under presidents of both parties for over three decades. The specific Biden-era version, known as Saving on a Valuable Education (SAVE), which nearly seven million borrowers have opted into, was authorized through 2028 by Congress and President Trump in the fiscal mega-bill passed just last year. Yet without any hearing on the merits, the Eighth Circuit unilaterally tossed out the program.
Since the Supreme Court’s ruling in Loper Bright put an end to the deference courts gave to regulatory agencies to interpret ambiguous statutes (which was known as the Chevron doctrine), there’s been an abiding fear that judges would now be able to determine entire sections of the law at their discretion. But even the most jaundiced court observer wouldn’t have been prepared for how the Eighth Circuit Court of Appeals is now operating. “This is the right-wing judiciary flexing its muscle in a way that we haven’t ever seen before,” said Mike Pierce, a former Consumer Financial Protection Bureau official and executive director of the advocacy organization Protect Borrowers. “This was not even a question presented to the judges. They just said, ‘We don’t like this so you can’t do it.’”
Perhaps the most interesting part of this saga is the reluctance of Trump and his Department of Education to follow the court’s orders, thereby keeping borrowers from having to resume payments. “Nobody wants to be seen jacking up costs on student loan borrowers in 2026,” Pierce said. “Donald Trump doesn’t want to send Republicans to the polls as the debt collector-in-chief.” Yet right-wing state attorneys general and courts drunk on their own power may force the issue.
Last week, a three-judge panel of the Eighth Circuit (which includes two Trump appointees and one appointed by George W. Bush) nullified the Biden administration’s income-driven repayment (IDR) program, versions of which have been in place under presidents of both parties for over three decades. The specific Biden-era version, known as Saving on a Valuable Education (SAVE), which nearly seven million borrowers have opted into, was authorized through 2028 by Congress and President Trump in the fiscal mega-bill passed just last year. Yet without any hearing on the merits, the Eighth Circuit unilaterally tossed out the program.
Since the Supreme Court’s ruling in Loper Bright put an end to the deference courts gave to regulatory agencies to interpret ambiguous statutes (which was known as the Chevron doctrine), there’s been an abiding fear that judges would now be able to determine entire sections of the law at their discretion. But even the most jaundiced court observer wouldn’t have been prepared for how the Eighth Circuit Court of Appeals is now operating. “This is the right-wing judiciary flexing its muscle in a way that we haven’t ever seen before,” said Mike Pierce, a former Consumer Financial Protection Bureau official and executive director of the advocacy organization Protect Borrowers. “This was not even a question presented to the judges. They just said, ‘We don’t like this so you can’t do it.’”
Perhaps the most interesting part of this saga is the reluctance of Trump and his Department of Education to follow the court’s orders, thereby keeping borrowers from having to resume payments. “Nobody wants to be seen jacking up costs on student loan borrowers in 2026,” Pierce said. “Donald Trump doesn’t want to send Republicans to the polls as the debt collector-in-chief.” Yet right-wing state attorneys general and courts drunk on their own power may force the issue.
https://prospect.org/2026/03/20/trump-biden-student-loan-borrowers-default-saving-on-valuable-education-save-act/