The discussion took place in the East Room of the White House on Thursday, March 20, 2025, where President Donald Trump outlined his vision for transforming the educational landscape of the country. The crux of his plan lies in the restructuring and eventual dissolution of the Department of Education, a step that Trump perceives as necessary in weeding out the wasteful and ideologically biased elements within the system.
Under the new scheme, the Small Business Administration (SBA) would inherit the responsibility of managing student loans. Simultaneously, all special needs and nutritional programs under the DOE’s purview would be shifted to the Department of Health and Human Services (HHS). This decision comes on the heels of Trump signing an executive order touted to initiate a phased shutdown of the DOE.
In accordance with the impending changes, Trump turned to the office to share his decision, elaborating that the student loan portfolio would pass under the administration of the SBA, overseen by Kelly Loeffler. In his words, Loeffler is ‘a terrific person’ poised to handle the vast complexities of the loan system and ensure its smooth functioning.
The current loan portfolio, containing tens of thousands of loans, would be extricated from the Department of Education and begin operating under the SBA. The enormity of the portfolio makes the move substantial, but Trump appears confident in the capabilities of the SBA, particularly Kelly Loeffler, to manage it effectively.
A parallel change was announced regarding the handling of special needs funding, which would fall into the domain of Health and Human Services. Notably, the Secretary of this department, Robert F. Kennedy Jr., will be at the helm of these operations, overseeing everything from special needs programs to nutritional initiatives.
The closure of the DOE won’t be an instantaneous process. It requires Congressional approval, something that Trump acknowledged when he issued the executive order to Education Secretary Linda McMahon to commence dismantling the department.
While the sphere of operation of the Department of Education is broad, much of its work is focused on managing funds. Among other responsibilities, the DOE oversees a $1.6 trillion student loan portfolio and disburses billions of dollars every year to public schools. The proposed changes will see these duties redirected.
The financial aids managed by the DOE are largely governed by federal law, targeting low-income schools, students with disabilities, and those with special needs. The restructured landscape will see these programs under the HHS’s charge, marking a significant shift in their administrative structure.
Another core DOE responsibility is administering student financial aid, including but not limited to Pell grants and the Free Application for Federal Student Aid (FAFSA). Through this reshuffle, the management of these programs will move into new hands, but the aim will remain unchanged – to support students and education.
Even prior to the executive order, the Department of Education began streamlining its workforce and operations, effectively slashing half of its staff through buyouts and layoffs. Along with the human resources, various contracts adjudged as wasteful or excessively liberal have also been reduced.
The impending changes are a reflection of the Trump administration’s efforts to cut through excessive bureaucracy and perceived ideological bias. The president has been outspoken about his belief of liberal slant and wasteful expenditure within the DOE, regarding these as impediments to delivering quality education to students.
The extensive distribution of responsibilities from the Department of Education to other agencies marks a major shift in the administration’s approach to governing education. With entities such as the SBA and HHS assuming significant roles, it remains to be seen how this will impact the educational landscape in the future.
Trump’s actions represent his continued commitment to his long-standing belief that the Department of Education needs a revision. Irrespective of controversy, the administration is forging ahead with a plan that places significant portions of the current DOE’s responsibilities on the shoulders of other departments.
Although the student loan portfolio’s migration to the SBA and special needs funding’s transition to HHS are seminal moments in the restructuring of the DOE, these changes are only a part of a broader plan to reform education in America. The executive order marks the beginning of this ambitious journey.
In conclusion, the restructuring of the Department of Education represents a landmark moment in Trump’s presidency. By allocating key responsibilities to the SBA and HHS, the administration aims to drive efficiency, cut waste, and ultimately deliver a more effective education system to the nation’s students.