Missouri AG files lawsuit over Biden's latest student loan handout attempt: It's 'illegal'

One day after President Biden touted new sweeping student loan bailouts on the campaign trail, one Republican attorney general initiated legal action against the administration.

"So the last plan that Biden put forward would have cost Missouri taxpayers $44 million, more than a half trillion dollars nationally. And we anticipate this plan is going to cost Missouri exactly the same amount, if not more. We know nationally it costs more," Missouri Attorney General Andrew Bailey said during an exclusive interview on "Varney & Co" Tuesday.

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Missouri Attorney General Andrew Bailey's lawsuit argues that Biden's "SAVE" plan, announced in February, is illegal and would cost American taxpayers $475 billion. Bailey's lawsuit comes just weeks after Kansas and 10 other states sued the Biden administration over the same plan.

Joining Bailey in the lawsuit are the attorneys general of Arkansas, Florida, Georgia, Ohio, Oklahoma and North Dakota.

During a campaign event Monday in Wisconsin, President Biden unveiled a new plan for canceling student loan debt despite earlier efforts being struck down by the Supreme Court. It is expected to impact up to 30 million Americans who will see sizable portions of their student debt slashed before the November election, according to the Wall Street Journal.

The plan's central pillar focuses on cutting loans that have exceeded their principal amount due to interest. It would cut up to $20,000 in accrued interest, while borrowers who make less than $120,000 or couples who make less than $240,000 would be allowed to cut all of their accrued interest beyond the principal amount, WSJ reported.

"We can't let Joe Biden saddle working Missouri families with Ivy League debt. That's why we've got to keep pushing this suit forward. We're excited to fight to protect from this illegal redistribution of wealth," Bailey said.

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The result would see roughly 23 million Americans having their loans cut down to the principal amount.

The plan would also further cancel debt for borrowers who have held onto their loans for decades without fully paying them off. The forgiveness would apply to any undergraduate debt lasting more than 20 years and any graduate debt lasting more than 25 years, according to WSJ. 

"The Constitution gives the power of the purse to the legislative branch, not the executive branch. And unless Congress explicitly authorizes this redistribution of wealth, it's illegal," Bailey explained.

"President Biden keeps pointing to these vague references in statutes, saying that somehow he has authority to redistribute this wealth, but the court has found that Congress never explicitly authorized this. And when you have a program on this order of magnitude, this enormous political, social and economic impact that Congress has to be explicit. So it's a rule of law issue. It's a constitutional issue. And that's why we're fighting so hard to put a stop to it."

Missouri and Arkansas both participated in the lawsuit that ultimately brought an end to Biden's previous student loan plan last year. The Supreme Court decided 6-3 that Biden's plan was unconstitutional.

In conjunction with his new student loan program, President Biden also vowed to make community college tuition free during his remarks Monday. 

"I also want to make, and I've been pushing this, and if I'm reelected, I'm going to push it hard. We're going to get it done next time is I want to make community college tuition free," Biden said. 

"We won't need loans at all. We'll cut in half the cost of going to college. If we do this, the economic gains will far outweigh the cost. And that's not hyperbole. That's the truth."

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Bailey stated he would further sue the administration over the effort, again citing concerns over separation of powers.

"If [Biden] does so illegally without any congressional authorization, we absolutely will. I mean, that's the whole point of this. It's a separation of powers issue," Bailey said.

FOX Business' Anders Hagstrom contributed to this report.