Dismantled and Decentered

In early March 2025, the US Department of Education announced that it was laying off half of its workers. It began the year with some 4,100 employees and by mid-March was down to around 2,200. Essential offices that administer financial aid and field civil rights complaints lost hundreds of staffers. 

Then, on March 20, President Donald Trump issued an executive order to fully eliminate the US Department of Education, even though the president cannot legally take such an action without an act of Congress.  

In May, a federal judge ordered the department to rehire 1,300 employees, but on July 14, 2025, the Supreme Court issued an order that allows the department to proceed with laying off employees while the terminations are challenged in lower courts. 

These actions have built on a longstanding conservative push to hobble the Department of Education since it was established in October 1979 by an act of Congress and signed into law by President Jimmy Carter. From that time, conservatives have argued that eliminating the department would reduce nonessential federal spending and rightly put education oversight fully under state and local management. The conservative Heritage Foundation has more recently bolstered the effort, advocating in its Project 2025 policy blueprint—which aims to reshape the federal government and which the Trump administration’s actions have been closely following—for the elimination of the department. The current push also focuses on parental rights and values, an issue that intensified with backlash to school shutdowns during the COVID-19 pandemic and growing resistance to inclusive policies for LGBTQ+ students and to diversity, equity, and inclusion initiatives. 

Presently, the Education Department serves students at all grade levels but occupies an important place in the higher education landscape. It administers federal financial aid, giving out $120 billion annually in the form of grants, work-study funds, and low-interest loans. Its Office of Civil Rights investigates complaints of discrimination at colleges and universities. The department also manages millions of dollars in federal grants that support historically Black colleges and universities (HBCUs) and other minority-serving institutions. And it captures data on higher education, including through national surveys, that policymakers use to improve outcomes for students. 

But under the Trump administration’s plans, many of these responsibilities would be transferred to other government entities or discontinued, and opponents fear that shrinking or altogether eliminating the department would undermine federal oversight of public education, reduce protections for vulnerable students, and accelerate the privatization of learning. These changes, critics say, could allow political leaders to concentrate power, limit access to education, and erode the democratic principle of equal opportunity for all.

“We’re just at the beginning, and that’s why this is monumentally scary for me,” says Martha Kanter, who served as under secretary of education during the Obama administration.

Adds Gloria L. Blackwell, the CEO of the American Association of University Women (AAUW): “This potential dismantling of the Department of Education, we know that it’s not just a structural shift in the government, but it really is a direct threat to students. It’s a direct threat to students’ futures and . . . the economic opportunities for millions.”

Across the United States, some thirteen million students benefit from the loans and grants the Department of Education’s Federal Student Aid Office gives out each year.

The infrastructure that makes this possible, however, is now under duress. On top of the layoffs that weakened the aid office’s capabilities, after Trump signed his March 20 executive order, he suggested that student loan servicing and management responsibilities could be shifted to the Small Business Administration (SBA), an effort a federal court blocked in May 2025. This would be a new role for SBA as it has not traditionally handled large-scale consumer loans. Should this become reality, it would replace student-centered oversight with a debt-collection approach, weakening borrower protections and increasing the risk of delays in students’ ability to access funds. 

The Trump administration has also suggested that the Department of the Treasury could administer federal student loans. Critics have expressed the same concerns over that move as with a shift to the SBA and contend that both the Treasury Department (which has also cut staff under the Trump administration) and the SBA are not set up to handle the complexities of the federal student loan program. And despite statements from the executive branch that imply otherwise, an act of Congress is required to transfer the student loan program out of the Department of Education. 

The management of Pell Grants, which support undergraduates from low-income households, has been another concern. Although the July 2025 omnibus reconciliation package (a.k.a. the “One Big Beautiful Bill”) preserved funding for Pell Grants—sidestepping an earlier proposal to slash the maximum award from $7,395 to $5,710 while still tightening full-time eligibility rules—the Education Department layoffs may still cause serious problems. Experts at the National Association of Student Financial Aid Administrators warn that with fewer staff at the Federal Student Aid office, which processes Pell distributions, delays in processing applications, resolving errors, and verifying eligibility are more likely—especially during peak enrollment periods in late summer and early fall, when millions of students depend on timely aid to pay tuition and secure housing. And even though the July 2025 omnibus reconciliation package provides stopgap funding to address the Pell program’s short-term needs, it does not resolve the projected long-term shortfall, leaving the program’s financial stability uncertain without additional congressional action. 

At Hunter College, a public institution in New York City where thousands of students rely on Pell Grants, President Nancy Cantor is deeply worried about how this situation could ultimately play out. “It’s just very upsetting to see what potentially would be changing,” Cantor says. While Hunter benefits from strong state support as a public institution, Cantor recognizes that state budgets will also be strained, making for a challenging path forward.

Taken together, these changes could reshape who has access to higher education and have long-term effects on people’s lives and society as a whole. If “we pull away that ladder, we pull away that funding, it would really lock millions of people . . . on the wrong side of the opportunity gap, and certainly it would starve our economy of the talent that [it] needs to grow,” Blackwell says.

The reductions in force at the Education Department’s Office of Civil Rights could also present a significant threat to college access and equity—as would the plans to eliminate that office and move its civil rights enforcement role to the Department of Justice, stripping away education-specific expertise and introducing more complex legal procedures. If this happened, students may find it more difficult to report discrimination, and civil rights protections on campuses may become less robust, leaving, in particular, women, people of color, and LGBTQ+ students at greater risk of discrimination.

Currently, the office is responsible for enforcing federal civil rights laws in all institutions that receive federal funding. It fields and investigates discrimination complaints from students, faculty, staff, parents, and organizations—providing a way for them to address issues administratively without going to court. 

“Congress really entrusted the Department of Education and [its] Office of Civil Rights to actually open doors in education,” Blackwell says, noting that the office resolves tens of thousands of discrimination complaints every year. She describes the office as “a lifeline for women, for students of color, for LGBTQ+ students, and students with disabilities.”

The office also performs an important role in collecting data that serves researchers and policymakers whose goal it is to make education more accessible. Every other year, it conducts the Civil Rights Data Collection survey of all K–12 public schools in the country to assess “students’ access and barriers to educational opportunity.” Outside of the office, the Education Department is  responsible for the Integrated Postsecondary Education Data System, which collects data about higher education. 

Blackwell says that both data collections reveal important gaps—whether in college completion, or student debt, or campus safety—that can inform policy solutions. “Without that data, you really do have sort of this blank slate that isn’t giving the proper information to support the students and the communities that need it the most,” she says.

In June 2025, a federal judge ordered the White House to stop layoffs at the Office of Civil Rights and reinstate its employees. But whether the office will regain its former capabilities remains to be seen, especially after the July Supreme Court ruling that allows the administration’s layoffs at the department to proceed for now.

In the meantime, Blackwell urges institutions to strengthen campus-level civil rights protections and civil rights offices. Even without a federal mandate or enforcement, colleges and universities must continue to investigate claims of discrimination and enforce civil rights policies, she says.

Another area that could be affected is the department’s grant funding role. Critics fear that a diminished Education Department with weakened oversight over the process or a transfer of grant management to another government entity would cause grant administration to become less transparent and more bureaucratic, leaving colleges and universities vulnerable to sudden, unfillable funding gaps. In addition, many institutions are scrambling to figure out how to respond to current and looming cuts to other federal education funding.

The concern is especially acute at federally designated minority-serving institutions, which rely heavily on money from the US government to survive. The Education Department distributes $3 billion a year to support HBCUs, tribal colleges, and Hispanic-serving institutions, among others.

Tribal colleges are facing major funding cuts under the Trump administration’s proposed budget, which would slash their federal support from approximately $127 million to just $22 million, a reduction of more than $105 million, or 83 percent. Some estimates place the total loss even higher, approaching $160 million. These institutions rely on federal appropriations, grants, and contracts for up to 75 percent of their operating budgets.

“When funding is paused, it has an immediate impact on student services,” says Ahniwake Rose, president and CEO of the American Indian Higher Education Consortium. “The storms that larger institutions can weather, we cannot weather.”

The Education Department also administers Title III federal funding, which provides flexible funding support for tribal colleges that, according to Rose, is critical to their infrastructure. Many of these campuses offer students no- or low-tuition programs and can’t simply raise fees in communities that have low incomes to begin with, Rose says. Foundation money is also limited or focused on specific programs rather than operating expenses.

Similar challenges exist for HBCUs and Hispanic-serving institutions. Funding cuts could “threaten the very presence and long-term sustainability of some HBCUs,” Terrell Strayhorn, director of research at the Center for the Study of HBCUs at Virginia Union University, told Higher Ed Dive in May.

If federal education funding is lost or delayed, state and local governments have few options for filling financial gaps. States and cities are facing their own funding challenges in the Trump era, with grants for infrastructure and essential services at risk. “The states are going to be hamstrung. Therefore, the cities will be hamstrung. Therefore, everyone will be looking for alternative funding streams,” says Kanter, the former Education Department under secretary.

She sees an opportunity to rely more on philanthropy as an alternative to government funding. While philanthropic funding is typically competitive, she says institutions might be able to make a collective, rather than individual, pitch for more support. “The time has come for people to band together and make their larger case to the funders that can help them weather this horrendous storm that’s already started,” she says.

Despite the Trump administration’s continuing efforts to eliminate the Department of Education, Congress gave it new responsibilities as part of the July 2025 omnibus reconciliation package. The legislation directs the department to reshape certain financial aid programs and to do more to hold colleges accountable for graduates’ future earnings by making access to federal student loans contingent on meeting new standards. “How are they going to do that successfully and smoothly with no interruptions?” says Emmanual A. Guillory, senior director for government relations at the American Council on Education. In his view, implementing these new accountability metrics will be the biggest hurdle for the hobbled department.

These changes also add to the confusion for university and college leaders, who have been trying to deal with a rapidly shifting landscape in Washington, DC. Regardless of how the finer details play out, it’s clear that higher education as a sector will need to get creative to navigate these challenges.

One piece of the solution may lie in greater partnership among colleges and universities. “We should be asking, who can our partners be?” says Cantor, the Hunter College president. “This is a moment for collective collaboration . . . certainly between all segments of the educational ecosystem but also well beyond that.”

This spirit of collaboration is beginning to take hold. In one example, more than 660 higher education leaders signed a statement opposing “undue government intrusion in the lives of those who learn, live, and work on our campuses,” developed by the American Association of Colleges and Universities in collaboration with the American Academy of Arts & Sciences and with university and college presidents and other educational leaders. A growing number of academic faculty senates have also passed “mutual academic defense compacts,” with the goal of creating a web of networks to share information and strategies in the fight against government overreach. 

This collective resistance is where Blackwell, the AAUW chief executive, sees potential to convince Congress to safeguard the Education Department for funding and civil rights protections. “Silence really does invite cuts. Collective pressure has more of a potential to stop them,” she says.

“When the Department of Education was originally created, it was to expand opportunity,” Blackwell continues. “So weakening it and scattering its duties really does jeopardize civil rights enforcement, and the workforce pipelines. It clearly jeopardizes the financial lifelines that help millions, especially women and students of color, earn degrees. And what do those degrees do? They power America’s economy.”