Ever since President Trump was elected and sworn in, he’s made it his mission to hack and slash federal spending. We’ve seen attempts to make critical cuts to important programs, like public television and Meals on Wheels.
Sadly, the proposed cuts don’t end there, and it’s bad news for millions of students trapped under a mountain of debt. The programs he really wants to cut into are the student aid programs passed through during the Obama administration.
Last year, Trump set out to cut as much as $4 billion from those programs, but in a compromise move by the president, those cuts have been put on hold. For now.
The 2019 budget has the same proposals they wanted pass in 2018.
The 2019 proposal includes:
-Cutting loan forgiveness programs for public servants.
-Move the current five income-driven repayment programs into one where the monthly payments are higher, but takes much less time to pay back.
-Graduate students would take longer to repay their loans under this plan.
-Stops paying the interest on loans taken out by low-income students.
-No more debt forgiveness for social workers and teachers after 10 years of repayment.
“At a time when millions of students are struggling under the crushing burden of student debt, it speaks volumes that President Trump and Secretary DeVos are proposing $200 billion in cuts to financial aid,” said Democratic Senator Patty Murray this week. “This is a complete 180 from the agreement Republicans and Democrats made last week.”
2018 Budget Keeps Funding in Place
As President Trump begrudgingly signed the spending bill into law to keep the government from shutting down, it protected a lot of the existing programs he wants to cut. Rather than cutting the work-study program, the White House proposed using $300 million of the extra bill money to go towards it.
They’ve also decided not to cut programs like Gear UP that is designed to help poor students starting in middle school get prepared for college. Instead, it combines Gear UP with TRIO into a $500 million grant given to the states to dole out to kids in need.
Also, Pell Grants are safe for the time being. Part of the 2018 proposals looked to take $1.6 billion from the program, but the current budget leaves it alone. Instead, the budget aims to prevent more money from being pumped into Pell Grants by keeping the numbers right where they are. That means no adjustment will take place to account for later inflation of tuition.
That’s not a good deal, according to Jessica Thompson. She’s the Policy and Research Director at the Institute for College Access and Success. She says the Pell Grant right now barely does a good enough job at keeping needy students afloat.
“They aren’t making any of the critical investments in Pell grants, which is a huge missed opportunity. The current max grant is covering the lowest share of college costs in over four decades,” she said.
While President Trump wants to make cuts to Pell Grants, he also desires to expand the program to cover different trades and short-term certificates/degrees. He hopes this will spur on employment growth in skilled labor markets, such as manufacturers and construction workers.
The overall goal of Trump and Education Secretary Betsy DeVos is to bring back the Higher Education Act, which includes a lot of these cuts to student aid. At least for the next year, students have an opportunity to take advantage of the current laws to get assistance in paying their debts down.
To learn more about reducing your debt and how we can help, please call (844) 899 7540 today. We’d love to hear from you before the laws change for good.