Trump Expands Power Over Public Service Loan Forgiveness, Prompting Backlash
Trump's proposed changes to the Public Service Loan Forgiveness (PSLF) program would exclude employees of organizations labeled "illegal," potentially penalizing groups serving immigrants, transgender youth, and DEI efforts, and drawing strong criticism from advocates
US President Donald Trump
President Donald Trump has unveiled sweeping revisions to the Public Service Loan Forgiveness (PSLF) program, raising concerns that the changes could be wielded as a political weapon to target specific nonprofit and government organizations.
Established in 2007, PSLF cancels federal student loans for workers in government or eligible nonprofit roles after 120 qualifying monthly payments. Under Trump’s proposal, the Education Department would gain authority to disqualify organizations involved in what it deems “illegal activities”—language that critics say effectively targets groups aiding immigrants, serving transgender youth, or promoting diversity, equity, and inclusion initiatives.
Advocates warn the criteria are dangerously subjective, giving the Education Secretary unchecked power to revoke relief retroactively, even without convictions. Entire hospital systems, school districts, or city agencies could be swept up, disrupting loan forgiveness for nurses, teachers, firefighters, and other public servants.
Over a million Americans have already benefited from PSLF, which aims to support public interest careers where salaries tend to be lower. But critics fear the proposed rule could undermine public services, discourage recruitment, and burden essential workers with debt.
The Education Department defends the changes as a measure to prevent taxpayer dollars from supporting “unlawful conduct.” However, lawmakers and borrowers argue the move is a targeted political tactic disguised as administrative reform. The rule is expected to be finalized by July 2026, following a public comment period.
