President Donald Trump is poised to fulfill his pledge to dismantle the federal Department of Education, a crucial agency that plays a significant role in funding public schools, enforcing anti-discrimination laws, and managing the Student Aid Program. This move could impact the nearly 43 million individuals holding federal student loans, raising questions about the future of their loans and repayment arrangements. While Trump has not detailed his dismantling strategy, experts suggest that congressional approval may be necessary, although alternative routes could be explored.

In response to Trump’s plans, newly appointed Education Secretary Linda McMahon expressed support for transferring federal aid responsibilities, including student loans and Pell Grants, to another government entity, acknowledging the need for collaboration with Congress. Trump proposed that oversight of student loans could shift to the Department of the Treasury, Department of Commerce, or the Small Business Administration, emphasizing that the Department of Education might not be the most suitable entity for this task.

Andrew Gillen of the Cato Institute highlighted the logistical advantages of the Treasury Department handling student loan programs, citing its existing infrastructure and data resources. While concerns have been raised by various advocacy groups representing students, parents, and educators, Trump’s proposal has sparked debate and criticism within the education community. As the administration moves forward with potential changes, the implications for borrowers and the education system remain a topic of ongoing discussion and scrutiny.