Trump Administration Addresses Plan to Cut Student Loans for Some Degrees
Summary
The Department of Education clarified that it is not banning students from certain college degrees but is creating a rule to hold colleges responsible if their programs leave students with heavy debt and poor job prospects. The rule compares graduates’ earnings to those of people with less education to decide if programs qualify for federal student loans.Key Facts
- The Department of Education denied reports that the Trump administration plans to ban some college degrees.
- The new rule aims to stop colleges from offering programs that leave students worse off financially than if they had not attended.
- The rule compares graduates’ median earnings four years after completing a program to those with only a high school diploma or a bachelor’s degree.
- Programs failing this test may lose access to federal student loans.
- Some degrees like social work, art, religious studies, music, teaching assistance, and cosmetology might be more affected due to lower earnings.
- About 3% of programs at public and nonprofit colleges and one-third of those at for-profit colleges may fail the earnings test.
- The Department of Education says this policy will protect taxpayers and help students avoid unmanageable debt.
- A study showed that liberal arts degrees produce the lowest financial gains over 15 years but still return a positive benefit on average.
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