Behind the scenes, the Trump administration has reportedly been fighting for months about how to devise a student debt plan that could compete with proposals from progressive leaders. It’s not clear yet whether it will achieve this. What is clear, however, is that the draconian cuts to higher education programs in the new White House budget proposal would heap debt on millions of students in this country.
The FY 2021 budget proposal, released Monday, would cut more than $2 billion in spending just next year in financial aid, the Federal Work-Study Program, and other forms of support, much of which is geared toward low-income students and students of color. It would saddle borrowers with an extra $70 billion in costs over a 10-year period by ending subsidized loans and eliminating Public Service Loan Forgiveness. And it would put college further out of reach for American families by allowing the value of the Pell Grant to decline. Like previous budgets, it also proposes some measures that could mitigate some student debt, such as a proposal that would seek to hold colleges accountable by sharing some of the risk in student loans. However, risk sharing has mixed support among members of Congress. There are other small, positive proposals such as restoring Pell Grant access for incarcerated students and automatically enrolling severely delinquent borrowers into income-driven repayment plans, but these are outweighed by the harm done with other moves.
This is no way to reject “the downsizing of America’s destiny,” as Trump claimed to be doing in his State of the Union address last week. This budget does quite the opposite. It is an overt bid for the higher education system to abandon any aspiration to offer access and equity to all students. Continue reading.