Latest news with #HigherEducationActof1965
CNBC
27-05-2025
- Business
- CNBC
Court order challenges Trump's plan to move federal student loans to Small Business Administration
A federal judge's recent order may foil President Donald Trump's plans to transfer the country's more than $1.6 trillion student loan portfolio from the U.S. Department of Education to the Small Business Administration. U.S. District Judge Myong J. Joun wrote in his May 22 preliminary injunction that the Trump administration was required to reinstate over 1,300 Education Dept. employees and was blocked from carrying out Trump's directive "to transfer management of federal student loans and special education functions out of the Department." In other words, federal student loans will stay with the Department of Education, for now. Trump had announced on March 21 a plan to transfer over 40 million student loan accounts to the SBA. "They're all set for it," the president said of the SBA at the time. "They're waiting for it." More from Personal Finance:House Republican bill calls for bigger child tax creditStudent loan borrowers in default may see 15% of Social Security benefit garnishedHow college savers can manage 529 plans in a turbulent market Madi Biedermann, deputy assistant secretary for communications at the Education Department, slammed the judge's decision. "Once again, a far-left Judge has dramatically overstepped his authority, based on a complaint from biased plaintiffs, and issued an injunction against the obviously lawful efforts to make the Department of Education more efficient and functional for the American people," Biedermann wrote in a statement to CNBC on Thursday. The Trump administration requested the order be stayed pending an appeal of the decision. The development that student loans will remain in the Education Dept. for now is good news for borrowers, said Sarah Sattelmeyer, a project director at New America and senior advisor under the Biden administration. "Instead of increasing efficiency, the movement of the Department's core functions would have increased confusion and decreased the effectiveness of programs that students depend on to access education," Sattelmeyer said. Consumer advocates are worried that a mass transfer of accounts between federal agencies could trigger errors, or compromise federal student loan borrowers' privacy. Those problems have occurred during much smaller transfers between loan servicers. Advocates also raise concerns about how a change in agency might affect borrower protections and programs such as Public Service Loan Forgiveness. The Small Business Administration has no experience relevant to the management of federal student loans, said higher education expert Mark Kantrowitz. It would ultimately require an act of Congress to move the loan portfolio to the SBA, Kantrowitz said. The Higher Education Act of 1965 spells out that that the Education Department's Federal Student Aid office is responsible for the debt, he said. Adding to advocates' criticism over Trump's proposed transfer was his administration's announcement in March that the SBA's workforce would be reduced by 43% — leaving fewer people to manage this new responsibility.
Los Angeles Times
18-05-2025
- General
- Los Angeles Times
Opinion: Education is a right, has America done enough to make it one?
When nearly 40% of high school graduates from the wealthiest nation in the world don't pursue college, the question arises: What are we doing to ensure that education is a right for all, not a privilege for a few? Financial barriers are the largest obstacle to accessing higher education in America. A study from 2023 found that 55% of adults without a college degree cited program cost as the top reason for not enrolling. To understand why so many young people are left behind, we must look at the history of higher education in the United States. American colleges originated as a privilege reserved for wealthy white men. In the early 17th century, institutions like Harvard, Yale, and Princeton were founded to train future clergy and civil leaders and were not meant to serve the general public. But change began in the mid-19th to early 20th centuries. The G.I. Bill, passed in 1944, represented a turning point in education by granting lower socioeconomic groups with funds for education and loans. For the first time, individuals from working-class backgrounds, rural areas, inner cities, and first-generation immigrant families could pursue doors to education that were previously closed. The reality of financial aid being an important asset to many high school seniors is echoed by Esha Wooten, a graduate of Penn Foster College. 'Without the financial aid provided as a result of filling out a FAFSA year after year, I wouldn't be a senior in college right now,' she said. More financial aid and scholarships for education have become available today through federal programs such as the Higher Education Act of 1965 and the Pell Grants. Yet, despite these changes, the vision of education as a universal right remains only partially fulfilled in America. Recent data emphasizes the persistent crisis of pursuing higher education. College enrollments declined by 5% in 2024 compared to the previous year, with four-year colleges seeing drops of over 6%. Moreover, in 2023, 89% of students from top quintile families — the highest-earning 20% of households — attended college, while just 64% of students from middle quintile families and 51% from lower quintile families did the same. This trend is supported by the fact that students in the top socioeconomic quintile are three times more likely to enroll in a four-year institution than those from the lowest quintile, despite similar academic preparation. These data reveal the ugly truth: socioeconomic differences play a major role in deciding who gets to pursue higher education. While America has shifted to provide more opportunities for higher education, equity in educational pursuit has still not been met. To make education a right for all, we must focus on better affordability. This means reforming financial aid systems, such as increasing funding for need-based financial aid programs and even simplifying processes like FAFSA applications to make them more accessible. If we are serious about advancing the promise of higher education, we must take immediate action to make it fair. America can no longer afford to deny the next generation the education they deserve: education is a right, and more needs to be done to make it one. Related
Epoch Times
09-05-2025
- Business
- Epoch Times
University of Pennsylvania Under Investigation for ‘Inaccurate' Foreign Funding Disclosure: ED
The Department of Education's (ED) Office of the General Counsel (OGC) is investigating the University of Pennsylvania (UPenn) over the receipt of foreign funds and has sent a request for records to the institution, the ED said in a May 8 The 'records request' was sent after a review of reports submitted by the university allegedly showed that foreign funding disclosures were 'inaccurate and incomplete,' the department said. Under Section 117 of the Higher Education Act of 1965, universities and colleges in the United States receiving financial aid from the federal government are obligated to disclose any gifts, contracts, or restricted agreements from foreign sources that are valued at $250,000 or more in a year. Colleges and universities should also report any foreign ownership or significant control in their institutions. These measures are in place to protect the country's higher education from foreign influence. Despite this obligation, 'UPenn has a troubling Section 117 compliance history, having failed to disclose any foreign funding until February of 2019 despite a decades-long statutory obligation to do so,' said Acting General Counsel Tom Wheeler. 'Although the previous Administration degraded the Department's enforcement of universities' legal obligations to disclose foreign gifts and contracts, the Trump Administration will vigorously uphold the law and ensure universities are transparent with their foreign gifts and investments.' Related Stories 5/6/2025 5/5/2025 The ED sent a letter to UPenn on May 8, informing the university about the investigation. The department asked the university to produce relevant records within 30 days, which include tax records from January 2017, copies of written agreements with foreign governments or entities detailing admission agreements for international students, and a full list of all foreign gifts, grants, and restricted contracts from January 2017. The institution must also submit a copy of its written procedures and administrative systems aimed at achieving compliance with the foreign funding disclosure requirements under Section 117. 'OGC will investigate this matter thoroughly, ensuring that universities cannot conceal the infiltration of our nation's campuses by foreign governments and other foreign interests,' Wheeler said. 'The American people and Congress have a right to know the impact of foreign funding on our universities, including some of our critically important research universities.' The Epoch Times reached out to the University of Pennsylvania for comment. This isn't the first time UPenn is facing scrutiny over foreign funding. A Investigating Universities The Education Department is investigating the foreign ties of multiple other universities. Previous to this announcement, multiple agencies had asked the university to adopt certain policies to continue receiving federal funding. This included eliminating DEI initiatives, prioritizing merit over race or gender in hiring and admission, and screening out applicants during the international admission process who are 'hostile to American values.' Harvard refused to conform to these requests. 'We are going to be taking away Harvard's Tax Exempt Status. It's what they deserve!' Trump said in a May 2 social media ED is also investigating the University of California–Berkeley, sending a records request for foreign funding disclosures, the department In a statement to The Epoch Times, the institution said that 'over the course of the last two years, UC Berkeley has been cooperating with federal inquiries regarding 117 reporting issues, and will continue to do so.' Aaron Gifford contributed to the report.
USA Today
08-05-2025
- Politics
- USA Today
Trump has been defunding university research. Does China benefit from it?
Trump has been defunding university research. Does China benefit from it? The White House has targeted students and cut off funding from major American research universities. Some critics are wary it could lead China to beat the U.S. to more scientific discoveries. Show Caption Hide Caption Trump says he will revoke tax-exempt status for Harvard University The Trump administration has threatened to freeze $2 billion in federal funding after not agreeing to a list of demands from the administration. WASHINGTON – In 1957, a U.S. senator from Texas named Lyndon B. Johnson anxiously watched from his ranch as the Soviet Union became the first country to launch a satellite into orbit around the Earth. The angst from those days and the Eisenhower administration's early setback in the space race helped push Johnson to sign the Higher Education Act of 1965 after he became president. The landmark law flooded the higher education system with federal money (and, eventually, lots of student loan debt) with the goal of training generations of new engineers. Seven decades later, some politicians and college leaders are becoming increasingly anxious that another president might cause a different world power to bypass the United States. They fear President Donald Trump's pressure campaign to restrict funding to American universities, while trying to influence their programming and campus cultures, could cause the country to fall behind in key areas of research, from rocket science to biomedicine, as China pulls ahead. Despite Trump's public antagonizing of colleges, they're hoping their concerns might resonate with a president who cares deeply about maintaining America's competitive edge. Read more: A new phase begins in Trump's battle with higher education 'China is already trying to seize the moment and recruit some of the brightest talent,' Sen. Patty Murray, D-Washington, said at a recent congressional hearing. 'The United States is the world leader in medical research, but creating that was not an accident and maintaining it is not inevitable.' Since Trump regained the White House, his administration has revoked the visas of hundreds of international students. Federal agencies have refused to cover the costs of federally supported research projects. At prestigious universities like Harvard, research funding has been repeatedly frozen over concerns about antisemitism and diversity, equity and inclusion programs. In a statement to USA TODAY, Madi Biedermann, a spokesperson for the U.S. Department of Education, said those actions will ultimately help colleges. "American universities that are committed to their academic mission, protect students on campus, and follow all federal laws will have no problem accessing generous taxpayer support for their programs," she said. "Ending the antisemitic violence, harassment, and disruptions that have convulsed elite institutions will strengthen the research enterprise by allowing faculty and graduate students to focus their attention on advancing science.' Read more: Trump administration deems Harvard ineligible for new federal research grants College presidents have compared their stress since Jan. 20 to the panic they faced at the height of the COVID-19 pandemic. Like congressional Democrats, they're worried the United States could fall behind China's research capabilities. A former president of the Massachusetts Institute of Technology warned in Foreign Affairs magazine that China could fill the void of a looming 'brain drain' of scientific talent from the United States. 'Through its recent initiatives to cut federal funds for university research, the Trump administration risks draining a crucial source of new ideas for industry and the military, even as the geopolitical threats it faces continue to grow,' L. Rafael Reif wrote on May 6. Some Republicans who've been loath to disagree publicly with Trump in recent months seem to share those concerns. Sen. Todd Young, R-Indiana, wrote in a co-authored Washington Post editorial in March that more federal investment should be made in scientific research – not less. 'Just as China's commitment to research and development has grown, the U.S. government's has waned,' the article said. 'Just as we did when the Soviet Union drew ahead in the space race, the U.S. must meet the moment by accelerating strategic investments in scientific research and development of future technologies.' Echoes of the space race Throughout the early 20th century, Washington politicians were conflicted about increasing federal support for higher education. But after the launch of Sputnik, a 'logjam broke,' said Josh Mitchell, the author of 'The Debt Trap: How Student Loans Became a National Catastrophe.' 'LBJ was able to convince Congress that we needed to finance higher education from a national security standpoint,' he said. The Soviets' ability to put the first human-made object into space had major implications for keeping the United States safe. It shocked millions of Americans and underlined the country's need to educate more smart scientists who could build weapons and invent new technologies faster than their counterparts in rival countries. In the ensuing decades, the federal government massively boosted funding for university research. At the same time, it propped up systems that encouraged students to take out loans to pay for college. As the cost of a degree soared, and a crisis over student debt came into view, politicians (and Republicans in particular) became more skeptical about letting federal dollars flow to universities. As the Cold War faded, so did LBJ's argument that colleges played a key role in keeping the United States competitive and safe. The GOP, meanwhile, fractured over foreign policy issues. And it became increasingly frustrated over the perceived lack of conservative thinkers on campuses. The number of Democratic voters without college degrees started shrinking, as the coronavirus pandemic ushered in a broader sense of skepticism among conservatives about the value of scientific research. In the last few years, a new lightning rod – campus unrest amid the Israel-Hamas war – prompted Republicans, in the name of curbing antisemitism, to ramp up federal oversight of colleges. Read more: How the 'diploma divide' helped steer Trump back to the White House 'Now, there's this huge antagonism between the leaders in Washington and higher education,' Mitchell said. Mass. governor: 'China is on our campuses recruiting' Maura Healey, the governor of Massachusetts, has risen as one of the most passionate voices to criticize Trump's recent funding cuts to college research. Healey – whose state is home to Harvard, a favorite punching bag for the president – was one of the first Democrats to portray Trump's pressure campaign against universities as a threat to national security and the economy. 'Donald Trump's misguided attacks on our universities and on research are benefiting China,' she said on MSNBC on April 23. Massachusetts is among the top five states for international study, according to data from the Institute of International Education. Nearly a third of foreign students come from China, which is second only to India (a trend mirroring the larger makeup of international students in the United States). The concept of students leaving to study elsewhere is no longer theoretical, Healey later said on CNN. 'China is on our campuses, recruiting our scientists,' she said. 'That makes America less safe, less competitive, and it also has tremendous ripple effects for our economy.' On April 16, the Department of Homeland Security threatened to impede Harvard's ability to enroll students from abroad – an unprecedented move that would devastate the campus if the White House moved forward with it. Amid the uncertainty, the Ivy League school's undergraduate college allowed international students the option of accepting admissions offers for next fall at Harvard and a second university in a different country. Leo Gerdén, an international student at Harvard from Sweden, said the anxiety among his peers is palpable. 'A lot of international students are definitely thinking twice about going to the U.S.,' he said. Zachary Schermele is an education reporter for USA TODAY. You can reach him by email at zschermele@ Follow him on X at @ZachSchermele and Bluesky at @
Int'l Business Times
06-05-2025
- Business
- Int'l Business Times
Education Department Urges Colleges to Aid Student Loan Borrowers as Collections Resume
WASHINGTON — The U.S. Education Department issued a "Dear Colleague Letter" to colleges and universities Monday, reinforcing their role in supporting student loan borrowers under Title IV of the Higher Education Act of 1965. The guidance, released as involuntary collections on federal student loans resume after a pandemic-era pause, underscores institutions' responsibility to help graduates manage repayment amid rising college costs. The department emphasized that while borrowers are primarily responsible for repaying loans, colleges play a key role in improving repayment outcomes. Institutions are urged to ensure former students understand their obligations and can access accounts for resources. The department will publish nonrepayment rates by institution on the Federal Aid Data Center later this month, using College Scorecard data to promote accountability. "As we begin to help defaulted borrowers back into repayment, we must also fix a broken higher education finance system that has put upward pressure on tuition rates without ensuring that colleges and universities are delivering a high-value degree to students," said Education Secretary Linda McMahon. "For too long, insufficient transparency and accountability structures have allowed U.S. universities to saddle students with enormous debt loads without paying enough attention to whether their own graduates are truly prepared to succeed in the labor market." Under the Higher Education Act, colleges with high cohort default rates risk losing eligibility for federal aid, including Pell Grants and loans. The department called for proactive outreach to delinquent or defaulted borrowers before June 30, 2025, to address loans not in deferment or forbearance. The resumption of involuntary collections affects approximately 195,000 defaulted borrowers, who will receive 30-day notices from the Treasury Department starting Monday. These notices indicate federal benefits, including June checks, will be subject to the Treasury Offset Program. By summer, all 5.3 million defaulted borrowers will face administrative wage garnishment. The Federal Student Aid office is bolstering support with extended call center hours and increased capacity to guide borrowers toward income-driven repayment plans, loan rehabilitation, or affordable payments. Resources are available at Guaranty agencies are also authorized to resume collections on Federal Family Education Loan Program loans, with all actions adhering to legal requirements for notice and repayment opportunities. The department's guidance reflects a broader push for transparency in higher education, leveraging repayment data to ensure colleges prioritize student success and financial literacy. Institutions' engagement with borrowers will be critical to maintaining federal funding eligibility. Originally published on University Herald
