President Trump has slammed the previous administration for “profiteering” on student loans, and has vowed to end the “student loans scam”.
In an interview with The Hill, Trump laid the blame on the student loan crisis firmly on the shoulders of the federal government – which he says will come to an end on his watch.
“That’s probably one of the only things the government shouldn’t make money off. I think it’s terrible that one of the only profit centers we have is student loans,” he said.
Trump Student Loan Forgiveness
Trump also discussed how he would help solve the student loan problem by creating jobs in the private sector.
“I don’t want to raise the minimum wage. I want to create jobs so people can get much more than that, so they can get five times what the minimum wage is,” said Trump.
While this is a long-term solution, Trump offered no information on what he would do immediately to help reduce the burden of student loans for millions of borrowers. Specifically, he has not given any information on what will happen with the Student Loan Forgiveness programs that are currently offered by the Department of Education.
Student Loan Forgiveness Programs
With the popularity of the Student Loan Forgiveness programs and enrollment into these programs skyrocketing, Trump could find it very hard to be vocal against these programs or face losing the student vote. Though Trump is a conservative, his position on student loans seems to be somewhat liberal, and we expect that, if elected, he will continue to promote the loan forgiveness programs.
By improving the job market borrowers will be able to make their payment rather than using their deferment and forbearance. If Trump really feels that the government should not be profiting on student loans, then there is a possibility that he will elect to use the profits to expand the loan forgiveness programs as well as offering relief to borrowers who need immediate relief.
Trump’s Position on Student Loans
While Trump has been extremely vague about his plans for student loans if elected, here’s what we do know so far:
- Trump has stated that he does not want the federal government profiting off of student loans any longer (and blames government for driving up tuition costs)
- He thinks the Department of Education could “largely be eliminated,” but did not elaborate on how the $28 billion spent on Pell Grants for students would be affected
- He wants to restructure student loans but says government “can’t forgive these loans” outright…
- He wants to return student lending to private banks and away from the federal government (in order to improve salary data and allow students to make more informed decisions about whether the tuition costs are worth it)
- Proposed tying student loan decisions to the borrower’s future job prospects, an assessment likely based on the student’s major
- He wants to punish schools financially when their students fail to repay their loans, adding that he wants colleges themselves to have “skin in the game” and would be on the hook if too many of their former students defaulted on their loans
- He wants colleges to set more stringent standards for who is admitted, denying access to those it deems unlikely to succeed
As Trump continues to discuss his “plan” to fix the student loan crisis, we will continue to update this page with additional information to keep you informed.