This article is the final installment of a three-part series examining the prospective transformations within the U.S. Department of Education and the federal student loan system under President-elect Donald Trump’s administration, alongside the initiatives of the Department of Government Efficiency (DOGE), co-led by Elon Musk. This final piece examines the impact on students–the very core of the educational system–and how these changes may reshape their pursuit of higher learning. Find Part 1 here; find Part 2 here.
Impact on students pursuing higher education
Eliminating the U.S. Department of Education would fundamentally alter the landscape of federal student aid, leaving students in higher-learning institutions to navigate a more fragmented and inconsistent system. The Department administers critical programs like Pell Grants, subsidized loans, and federal work-study programs, which collectively help millions of students afford higher education. Removing the federal role could result in a state-driven patchwork of financial aid policies, with wide disparities in funding and eligibility depending on geography. This decentralization risks creating “education deserts,” where students in underfunded states face more significant financial hurdles to access higher education opportunities (National Center for Education Statistics).
Moreover, the lack of centralized oversight could erode protections for borrowers, including those with existing loans. Borrowers benefit from federal safeguards, such as income-driven repayment plans and temporary forbearance options during financial hardships. Without the Department, these protections could be weakened or eliminated, leaving millions of students vulnerable to predatory lending practices or insurmountable debt burdens.
Eliminating programs like Parent PLUS loans and income-driven repayment plans, as outlined in the Heritage Foundation’s Project 2025 policy blueprint, would disproportionately affect students from low-income families. Without PLUS loans, many families would be forced to turn to private lenders with less favorable terms, compounding the financial challenges of pursuing higher education. Such changes could deter students from enrolling altogether, leading to decreased college attendance rates and widening socioeconomic disparities in educational attainment.
Additionally, the rollback of relief initiatives like the Saving on a Valuable Education (SAVE) plan could burden borrowers with higher monthly payments. The elimination of these programs creates a dual financial strain, impacting current students and graduates alike as they navigate repayment under less favorable terms.
The shift would also jeopardize funding for vital support services, such as college preparation programs and retention initiatives, which have helped students from disadvantaged backgrounds succeed in higher education. Federal programs like TRIO and GEAR UP, which provide academic and financial support to underrepresented students, could be eliminated or drastically scaled back, thereby undermining progress in closing achievement gaps and limiting access to higher education for historically marginalized groups.
Strategies to address challenges
To counter these challenges, educational institutions, policymakers, and students must take proactive steps:
- State-led financial aid programs: States can develop comprehensive financial aid packages to offset reduced federal support. Partnerships between state governments and private sectors could also create innovative scholarship opportunities.
- Institutional action: Colleges and universities must increase institutional aid, streamline operational costs, and focus on equity-based admissions to address potential funding gaps.
- Technology integration: AI-driven platforms can offer personalized financial planning, helping students identify alternative funding sources and manage debt more effectively.
Ending the series: A call for innovation
The transformations within the U.S. education system demand innovative, forward-thinking solutions. While eliminating the Department raises valid concerns, it also presents an opportunity to reimagine education funding and delivery. A potential game-changer involves leveraging artificial intelligence to create a National Education and Finance Network (NEFN)–a decentralized but interconnected system that integrates real-time data from states, institutions, and students.
Through NEFN, students could access a universal platform offering:
- Real-time financial assistance: AI could assess individual student needs and connect them to available state, institutional, and private funding sources.
- AI-driven career pathways: Integrating workforce trends, AI could guide students toward programs with strong job placement prospects, ensuring their education translates into economic mobility.
- Customizable loan repayment options: Using machine learning, NEFN could offer dynamic repayment plans tailored to a borrower’s financial situation, reducing default rates.
The U.S. education system stands at a crossroads. By embracing innovative technology and fostering stakeholder collaboration, America can overcome these challenges and ensure a brighter, more equitable future for its students. The responsibility lies with educators, policymakers, and the public to push for a system that prioritizes accessibility, adaptability, and the transformative power of learning.
- Higher education in flux: Students at the heart of change - January 8, 2025
- Higher education in flux: Challenges and strategies for the teaching community - January 7, 2025
- Reshaping higher education: The impact of proposed federal changes on institutions - January 6, 2025