Trump administration plans major overhaul of education department impacting student loans
- The Trump administration proposed major changes to the Department of Education, which manages $1.6 trillion in student loans.
- There are concerns that dismantling the Department could hurt educational opportunities, especially for women and girls.
- Ultimately, these changes reflect a significant shift in how educational funding is managed, raising questions about economic impacts.
In 2025, significant changes were proposed by the Trump administration regarding the U.S. Department of Education, which has been responsible for managing a massive portfolio of $1.6 trillion in student loans. The administration's concerns stemmed from seeing the United States lagging behind other countries, particularly China, in educational rankings. As a result, various policy plans were discussed, including transferring the management of student loans to the Treasury Department or privatizing the entire student loan system. However, such drastic measures would require congressional approval, making outright abolition of the department unlikely. Additionally, many borrowers were left uncertain about the future of debt relief programs established by former President Joe Biden, which provided significant relief to millions of borrowers. Many voices, including education experts, have pointed out the potential negative economic consequences of dismantling the Department of Education, especially regarding gender equity and access to education. Without this department, critical programs aimed at improving educational opportunities for women and underprivileged groups could severely diminish, exacerbating existing gaps in education and employment. The situation continues to develop as the Biden administration faces challenges in defending its policies, leading to ongoing debates about the future of educational funding and support in the U.S.