President
Donald Trump
is anticipated to take action shortly on his commitment to abolish the federal Department of Education, which provides a minor portion of financial support for public schools, implements discrimination regulations, and manages the Student Aid Program.
It also manages federal student loans for approximately 43 million individuals, which equates to about one out of every six adult Americans.
as per the Congressional Research Service
. With
Trump
With the proposed closure of the department, borrowers are uncertain about how this will affect their loans and repayment strategies.
If it closes, they won’t disappear. Trump mentioned they would probably come under the supervision of another federal agency instead.
Begin your day with more knowledge. Receive all essential news directly in your mailbox every morning.
“Students would barely be aware of this for the most part,” stated Andrew Gillen, a research fellow at the Cato Institute for Economic Freedom. “The location where you send your FAFSA application or payment checks could vary.”
Trump has not detailed how he plans to eliminate the department. Gillen noted that many believe such an action would require legislation passing through Congress; however, certain legal scholars argue there might be methods to achieve this without obtaining Congressional consent.
Linda McMahon, who was recently appointed as the Secretary of Education, stated on “Fox & Friends” on Friday her support for President Trump’s intention to abolish the education department. She also expressed this view during another interview.
,
She
told NewsNation
Federal assistance, such as student loans and Pell Grants, might be more appropriately handled within another agency,” she stated. She also noted that Trump recognizes the necessity of collaborating with Congress.
“I believe my role is to persuade Congress that the measures we’re implementing are in the children’s best interests,” McMahon stated to NewsNation.
How the Trump administration affects you:
Sign up
For USA TODAY’s On Politics Newsletter.
In the absence of the Department of Education, which entity manages student loans?
Trump
told reporters
at the White House on March 6, it was announced that student loans would come under the purview of either the Department of the Treasury, the Department of Commerce, or the Small Business Administration (SBA).
“I believe student loan management shouldn’t fall under the education department’s jurisdiction. It’s not their responsibility,” Trump stated.
He mentioned that he believed it would be sensible for the SBA to handle student loans, adding that the agency’s newly appointed administrator, Kelly Loeffler—a former Republican senator from Georgia—supported this notion.
“That is, incidentally, the most complex aspect of relocating, but it becomes quite straightforward once you handle it,” Trump stated.
Gillen suggested that transferring the responsibility for managing federal student assistance to the Department of the Treasury would result in a smoother handover process.
For many student loan repayment plans, income verification is required,” Gillen stated. “The Treasury Department already possesses this information. Therefore, from an administrative standpoint, the Treasury already holds much of the data needed to carry out these student loan initiatives.
Gillen noted that the Treasury Department already possesses the infrastructure needed to manage millions of borrowers.
“Bringing in 40 million additional borrowers would not be unusual for them,” he stated.
Gillen noted that it’s improbable for student loans to be managed by multiple organizations. However, supervision of additional programs within the Department of Education might be shared among various agencies.
Supporters from groups advocating for students, parents, and educators—including
Educators for Excellence
, the
Association of Parents and Educational Lawyers
,
The National Center for Youth Law
, and the
American Federation of Teachers
Have all issued declarations opposing Trump’s intentions to reduce the budget of the department.
Contact Rachel Barber at rbarber@SofTech and connect with her on X using @rachelbarber_.
The article initially appeared on USA TODAY:
What becomes of student loans if Trump shuts down the Education Department?
