President-elect Donald Trump has repeatedly said he plans to shut down the U.S. Department of Education once he takes office.
The department provides approximately 10% of K-12 funding and enforces federal civil rights in schools. However, it plays a much larger role in the financing of higher education. By managing approximately $1.5 trillion in student loan debt for more than 40 million borrowers, the Department of Education represents one of the largest holders of consumer debt in the country.
“I’m going to shut down the Department of Education and bring education back to the states,” Trump promised at a campaign rally in September. Already, about 90% of school funding comes from state and local education departments, and the federal Department of Education does not set school curriculum.
However, Trump has made closing the Education Department part of his Agenda 47 plan, saying “we’re going to do it quickly” in the first weeks of taking office for a second term.
Conspiracy theories about what will happen if the department is shut down are thriving on social media.
On X, the social networking site formerly known as Twitter, viral posts claim Trump may have inadvertently canceled all student loan debt by closing the department. Or that Project 2025, a policy wish list from the conservative think tank Heritage Foundation, would force students who have already received student loan forgiveness to still pay off their loans.
Neither statement is true, but it’s clear that some borrowers are worried about what might happen to the Department of Education and their student loans under the Trump administration.
Could Trump shut down the Department of Education?
Experts warn that disbanding the department would have unintended consequences not only for K-12 and higher education, but also for the economy as a whole. If it had to happen. And that seems to be a pretty big if.
“Abolition of the U.S. Department of Education is extremely unlikely,” says Michael Itzkowitz, president of the HEA Group, an education policy consulting firm.
Itzkowitz, a former Obama-appointed Education Department official, tells Money that Trump can’t dismantle the department on his own. Congress would have to pass legislation to do so, and it would require the support of Democratic senators to reach the 60-vote threshold to overcome a filibuster. (In the US House of Representatives, it is still unclear whether Republicans have won control, with several races still undecided, although this is looking increasingly likely.)
However, technically this has been done before. The current version of the Department of Education was created by former President Jimmy Carter and opened in 1980. But this was not the first Department of Education.
More than a century earlier, President Andrew Jackson’s administration created the Department of Education in 1867 during the Reconstruction era. By 1869 the agency had virtually closed down. Congress cut funding and the department merged with the Department of the Interior, becoming the Bureau of Education.
The reasoning then was much the same as it is today: opponents of the department say it is wasteful and ineffective, and that states should administer solely their own education programs.
Project 2025 makes this argument almost verbatim.
“Federal education policy must be limited and, ultimately, the federal Department of Education must be eliminated,” Lindsay Burke wrote in the education policy section of Project 2025.
Burke, director of education policy at the Heritage Foundation, goes on to say that states and local governments should have direct control over all federal education funding. And that families should have education savings accounts where they can deposit funds and use them for a variety of educational options.
Where will the $1.5 trillion in federal student debt go?
In the unlikely event that legislation to shut down the Department of Education is successful, the big question that will need to be addressed is: What happens to all that student loan debt?
Trump has not addressed the issue directly, but the loans almost certainly will not be forgiven as Trump has repeatedly criticized the Biden administration’s efforts to forgive student loans.
Project 2025 offers one possible way forward.
The Conservative Action Plan recommends transforming the Department of Education’s current Office of Federal Student Aid into an organization with a board of trustees appointed by the president. This group will oversee the federal student loan portfolio on behalf of the U.S. Treasury Department.
Under the proposal, the Treasury Department would oversee collections, defaults and borrower relations on federal student loans, much as the IRS does with federal income taxes.
It is unclear whether Trump will follow this strategy. During the campaign, he sought to distance himself from Project 2025, as did Vice President-elect J.D. Vance. However, both Trump and Vance have some connections with the authors of the project and the Heritage Foundation.
For example, Vance wrote the foreword to the Heritage Foundation president’s new book, calling the think tank “the most influential engine of ideas for Republicans from Ronald Reagan to Donald Trump.” government budget director during Trump’s first term.
What to Expect from Trump’s Education Department
While President-elect Trump will not have unilateral control over dismantling the Department of Education, he will have significant power to influence how it operates.
He has the authority to appoint a new education secretary, for example replacing President Joe Biden’s appointee Miguel Cardona. Trump’s choice must be approved by the Senate.
Under Trump, the department’s day-to-day priorities are expected to take a 180-degree turn.
“We’re likely to see a repeat of Trump’s first term,” Itzkowitz says. “Basically, this included rescinding all regulations put in place by the Obama or Biden administrations.”
Biden has placed significant emphasis on student loan forgiveness through the Public Service Loan Forgiveness (PSLF) and Income-Driven Repayment (IDR) options. For example, Biden created an entirely new loan repayment plan called SAVE, which aimed to forgive remaining student debt after borrowers had made qualifying payments for at least 10 years. In the meantime, it set monthly payments to millions of borrowers at $0.
SAVE is currently on hold while it is being challenged in federal court. Assuming she survives the trial, Itzkowitz says the Trump administration could simply divert resources away from her, as well as the PSLF, once it takes office, without any action from Congress. For example, during Trump’s first term, his budget requests included cuts to several federal student aid programs, including PSLF.
In this case, many of the Department of Education’s ongoing initiatives could be in danger of dying due to neglect.
“It is likely that the new administration will eliminate forgiveness programs,” he says, “when and where possible.”
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