How College Financial Troubles Could Reshape Student Life
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Diverging Reports Breakdown
How Trump’s executive order could reshape college admissions and campus diversity across the US
The Trump administration recently issued an executive order requiring universities to publicly disclose detailed information about the race, test scores, and grade point averages of all applicants. This move intensifies an already heated national debate over college admissions, meritocracy, and campus diversity. The controversy touches on fundamental issues such as equal opportunity, racial justice, and the definition of merit. The debate continues as universities strive to balance fairness, diversity, and academic excellence in an evolving legal and political environment. The Trump administration’s push for more standardised, data-driven admissions decisions may narrow the path for many, especially disadvantaged and disadvantaged students from disadvantaged backgrounds. The Supreme Court ruled in 2023 that considering race in admissions decisions was unconstitutional. This ruling forced universities to overhaul their admissions policies to comply with the new legal framework. In the early 20th century, colleges prioritised intangible qualities such as character, leadership, and athletic ability. After World War II, as the United States faced global competition, universities shifted focus towards academic metrics like the SAT.
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This move intensifies an already heated national debate over college admissions, meritocracy, and campus diversity. According to
The New York Times
, the new data disclosure rules aim to increase transparency but could also shift admissions practices in ways that affect student diversity across the country’s most selective institutions.
A century-long debate over admissions
For more than a century, colleges have grappled with the question of how to admit students fairly.
The controversy touches on fundamental issues such as equal opportunity, racial justice, and the definition of merit. Traditionally, many colleges have used holistic admissions processes that consider applicants’ life experiences, including race and socio-economic background, to build diverse and inclusive campuses.
However, conservative groups argue that such subjective criteria can lead to unfair advantages for certain groups and discrimination against others, particularly white and Asian students.
Supreme Court ruling and new federal requirements
In 2023, the Supreme Court ruled that considering race in admissions decisions was unconstitutional. This ruling forced universities to overhaul their admissions policies to comply with the new legal framework. Building on that decision, the Trump administration’s executive order now requires colleges to report applicant data to a federal database called the Integrated Postsecondary Education Data System (IPEDS).
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Education Secretary Linda McMahon emphasised that this data will help the public see whether colleges admit students based on merit or race, stating, according to The New York Times, it “will enable the American public to assess whether schools are passing over the most qualified students in favor of others based on their race.”
The pressure to prioritise test scores
According to
The New York Times
, experts warn that this focus on quantitative measures like test scores and grade point averages could unintentionally favour wealthier students who often have access to better preparation and resources from an early age. James Murphy, director of postsecondary policy at Education Reform Now, told
The New York Times
, “I think the incentives that this creates are a big deal.
It is creating pressure on colleges to focus on higher G.P.A.s and higher test scores.”
The history and impact of standardised testing
The use of standardised test scores in admissions has a complex history. In the early 20th century, colleges prioritised intangible qualities such as character, leadership, and athletic ability. These factors sometimes served as barriers for certain groups, including Jewish students. After World War II, as the United States faced global competition, universities shifted focus towards academic metrics like the SAT.
However, this shift has been challenged by civil rights advocates seeking more inclusive admissions policies.
Income and racial disparities in test scores
Research highlighted by
The New York Times
shows significant disparities in test scores tied to family income. For example, students from affluent households are seven times more likely to score at least 1300 on the SAT compared to those from low-income families. Among the high school class of 2024, just 1% of Black students and 2% of Hispanic students scored between 1400 and 1600, the highest SAT range.
By contrast, 7% of white students and 27% of Asian students reached that score bracket.
Admissions beyond test scores
Given these disparities, very few elite colleges admit students solely based on test scores today. They also consider legacy status, special talents, and economic adversity to create a more balanced student body. Boston University professor Anthony Abraham Jack told
The New York Times
that the new order could push admissions towards a “quota system for wealthy and white students.” He cautioned, “If your class is too brown, too poor, then somehow you rigged the system.” Jack stressed the importance of context in evaluating applicants, telling
The New York Times
, “If you have a student who gets a 5 in A.P.
calculus, that doesn’t give you a relative understanding of how good they are. What if they’re the only young woman in the entire state to get a 5 in A.P. calc? That tells you how amazing that person is.”
What this means for students
As the admissions landscape shifts, students and families may find it harder or easier to understand what it takes to gain entry into selective colleges. The Trump administration’s push for more standardised, data-driven admissions decisions may narrow the path for many, especially students from diverse and disadvantaged backgrounds. The debate continues as universities strive to balance fairness, diversity, and academic excellence in an evolving legal and political environment.
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New Trump policy pushes colleges to prove race isn’t a factor in admissions: Here’s how it could reshape admissions and student opportunities
In 2023, the U.S. Supreme Court ruled that colleges could no longer explicitly use race as a factor in admissions decisions. However, the Court carved out an exception: applicants could share how race has shaped their personal experiences if they choose. Conservative critics argue that universities are using “racial proxies” such as personal essays and diversity statements to indirectly factor race into admissions. The Trump administration’s new policy targets these practices, requiring increased transparency and federal oversight. This directive follows the 2023 Supreme Court ruling that banned affirmative action but allowed limited consideration of race when applicants voluntarily discuss its impact on their lives. The new policy intensifies scrutiny on colleges’ admissions processes and raises questions about the future of campus diversity. Some institutions, such as MIT and Amherst College, experienced significant drops in Black student enrollment after the ruling. Many elite schools like Princeton, Yale, and the University of Virginia reported minimal changes. Many colleges have shifted toward alternative strategies to maintain campus diversity, including after the decision.
What does the new policy require?
Race and sex of applicants, admitted students, and enrolled students
Grade point averages (GPA)
Standardized test scores
Colleges’ challenges and concerns
How admissions changed post-ruling
Placing greater emphasis on applicants from low-income backgrounds
Admitting top students from every high school in the state, regardless of race (the “top percent” rule)
Increasing outreach programs and scholarships for underrepresented communities
Potential impact on admissions
Reduced emphasis on personal essays discussing race: Colleges might limit their use of personal statements to avoid scrutiny over racial considerations.
Colleges might limit their use of personal statements to avoid scrutiny over racial considerations. Increased focus on socioeconomic factors: To maintain diversity, schools may prioritize low-income or first-generation students rather than racial categories.
To maintain diversity, schools may prioritize low-income or first-generation students rather than racial categories. Changes in outreach and recruitment: Universities may invest more in programs targeting underrepresented communities without explicitly using race in admissions.
What it means for student opportunities
Fewer race-based preferences: Students may find that race is no longer considered, potentially impacting access to elite institutions.
Students may find that race is no longer considered, potentially impacting access to elite institutions. Greater competition based on other factors: Admissions might weigh academic performance, extracurriculars, and socioeconomic background more heavily.
Admissions might weigh academic performance, extracurriculars, and socioeconomic background more heavily. Possible challenges for diversity: Some universities may struggle to maintain racial diversity without affirmative action, affecting campus inclusivity.
The future of admissions and diversity
In a bold move targeting the nation’s most elite universities, the Trump administration has mandated colleges to submit detailed admissions data to the federal government, aiming to prove that race is not a factor in their admissions decisions. This directive follows the 2023 Supreme Court ruling that banned affirmative action but allowed limited consideration of race when applicants voluntarily discuss its impact on their lives. The new policy intensifies scrutiny on colleges’ admissions processes and raises questions about the future of campus diversity.In 2023, the U.S. Supreme Court ruled that colleges could no longer explicitly use race as a factor in admissions decisions. However, the Court carved out an exception: applicants could share how race has shaped their personal experiences if they choose, and colleges could consider those personal stories if tied to character or unique contributions. This nuanced ruling was meant to preserve some avenues for diversity without explicit racial preferences.Despite this, conservative critics argue that universities are using “racial proxies” such as personal essays and diversity statements to indirectly factor race into admissions.The Trump administration’s new policy targets these practices, requiring increased transparency and federal oversight.Under an executive memorandum signed by President Trump, the U.S. Department of Education, led by Secretary Linda McMahon, will compel colleges to provide comprehensive admissions data to the National Center for Education Statistics. This includes:Colleges must submit timely, complete, and accurate data or risk losing federal financial aid eligibility under Title IV of the Higher Education Act. The government will also audit these institutions and require public release of admissions statistics, fostering what the administration calls “adequate transparency.”Some experts question how effective this policy will be in practice. Federal laws already restrict colleges from collecting race information during admissions, except through voluntary disclosure after enrollment. Many students opt not to report their race once enrolled, making demographic data less comprehensive.Jon Fansmith, senior vice president of government relations at the American Council on Education, noted, “Ultimately, will it mean anything? Probably not.” He pointed out that this policy continues the administration’s narrative that affirmative action-like preferences remain despite the Supreme Court ruling.Since the Supreme Court decision, colleges have shown varied trends in student diversity. Some institutions, such as MIT and Amherst College, experienced significant drops in Black student enrollment. Meanwhile, elite schools like Yale, Princeton, and the University of Virginia reported minimal changes.Many colleges have shifted focus toward alternative strategies to maintain campus diversity, including:The University of California system, after banning affirmative action in 1996, saw a drastic drop in Black and Hispanic enrollments at its most selective campuses, Berkeley and UCLA. Though Hispanic representation has increased since, Black student presence remains low, reflecting ongoing challenges in achieving racial diversity without explicit affirmative action.The requirement to report detailed admissions data could pressure colleges to alter how they evaluate applicants. Some possible effects include:For prospective students, especially those from historically underrepresented racial groups, the new policy could shift the landscape of college admissions in several ways:On the other hand, colleges may explore creative strategies to continue fostering diverse student bodies while complying with legal requirements.The Trump administration’s policy adds a new layer of oversight to the ongoing national debate over race and college admissions. Its full impact remains uncertain but will likely influence how colleges design admissions processes and support diverse student populations.As universities adapt, students and families should stay informed about changes and prepare for a more competitive admissions environment where race may no longer be a factor.
Trump Seeking Changes to a Major Student Loan Relief Program
The Public Service Loan Forgiveness program offers tax-free loan forgiveness for government employees and eligible nonprofit workers. More than a million borrowers have had their student loans cancelled through PSLF since December 2024, including 700,000 whose loans were forgiven under adjustments made by the Biden Administration. A draft proposal of the changes would prevent organizations engaged in “illegal activities” from benefiting from the program. Critics argue that the proposed adjustments would specifically target employees working for organizations that oppose the Trump Administration’s agenda, which in part includes more aggressive immigration enforcement and the targeting of gender-affirming-care. The White House has framed the proposed changes as a way to correct “abuse” of the program following the Biden-era amendments that it said “has increased the cost of tuition, burdened students with debt, and encouraged them to join organizations that undermine national security and the societal good.” The Department of Education did not respond to a request for comment on the changes. The changes could take effect next year.
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President Donald Trump directed that PSLF be reshaped in a March Executive Order that claimed the program aided “activist organizations” that harm “national security and American values.” Trump asked federal officials to propose revisions to exclude certain organizations that he said “engage in activities that have a substantial illegal purpose” from being eligible for forgiveness under the program. The order noted that such activities would include “aiding or abetting” violations of federal immigration law or “illegal discrimination” and providing gender-affirming care for those aged 18 or under, among other things. A draft proposal of changes has since been released by the Education Department, which is now putting together a formal proposal that could take effect next year. Critics argue that the proposed adjustments would specifically target employees working for organizations that oppose the Trump Administration’s agenda, which in part includes more aggressive immigration enforcement and the targeting of gender-affirming-care.
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The Department of Education did not respond to TIME’s request for comment. Here’s what to know about the program and how the Administration is seeking to change it. What is the Public Service Loan Forgiveness program? The Public Service Loan Forgiveness program, established under the College Cost Reduction and Access Act of 2007, offers tax-free loan forgiveness for government employees including teachers and firefighters and eligible nonprofit workers after they make 10 years of monthly payments towards their debt. The forgiveness is only available for full-time employees. It has been viewed as a strong incentive for those considering a public service career. More than a million borrowers have had their student loans cancelled through PSLF since December 2024, including 700,000 whose loans were forgiven under adjustments made by the Biden Administration to help more people earn forgiveness, according to the Department of Education.
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Prior to the changes, student loan forgiveness advocates criticized the program for its slow-moving application process that they said set back borrowers. An NPR report found that some borrowers enrolled in PSLF would make repayments towards the program for years before being told they didn’t qualify due to having the incorrect loan or employer or failing to consolidate their loans. The Biden Administration sought to remedy “past administrative failures” through an account adjustment plan that would allow borrowers to receive credit for previous months of repayment that were previously ineligible. That meant that payments made during periods of deferment or forbearance qualified towards the 10-year payment plan. More than 780,000 borrowers submitted an application for PSLF from July 2024 through December, per Federal Student Aid data. What changes is the Trump Administration proposing?
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The Trump Administration is seeking to alter the types of nongovernmental employees whose loans are eligible for forgiveness through PSLF. A draft proposal of the changes would prevent organizations engaged in “illegal activities” from benefiting from PSLF. Its definition of activities that could bar organizations from eligibility, like that in Trump’s Executive Order, would include violations of federal immigration law and providing gender-affirming care for minors, as well as “child trafficking”—apparently also meant to target transgender minors—and discrimination. It defines “illegal discrimination” as violations of the Civil Rights Act, which could include engagement in diversity, equity, and inclusion policies. In contrast with his predecessor, Trump has been a staunch critic of broad student loan forgiveness efforts. The White House has framed the proposed changes as a way to correct “abuse” of the program following the Biden-era amendments that it said “has increased the cost of tuition, burdened students with debt, and encouraged them to join organizations that undermine national security and the societal good.” Trump’s Executive Order, the White House said in a March fact sheet, “corrects this abuse by ensuring only legitimate public servants benefit, not those engaged in illegal or harmful activities.”
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Critics of the effort to narrow eligibility, however, say the impact of the changes could be widespread, punishing borrowers for legal actions. “If the proposed changes take effect, the Secretary of Education will be able to disqualify millions of borrowers from PSLF as retribution for their employers’ actions, even if those actions are legal,” Winston Berkman-Breen, legal director at the Student Borrower Protection Center, a nonprofit advocating for student loan forgiveness, wrote in a statement to TIME. Berkman-Breen warns that the “illegal” actions the Administration appears to be targeting could be broad in scope. “Public school systems that teach the history of slavery in the United States could be disqualified for ‘aiding and abetting illegal discrimination.’ Fire departments and other first responders could be disqualified if they serve in the local government of a Sanctuary City providing support to undocumented children and families,” he says.
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In order to assess eligibility, officials would review court judgements or other orders. A panel of experts was convened by the Department of Education to review the proposal from June 30 to July 2 and drafted potential amendments. These included limitations on the proposed changes including protections for actions that fell within employees’ First Amendment rights. Ultimately, however, the panel failed to reach a consensus on recommendations. The department will next prepare a formal proposal, which will undergo a public comment period before potentially being finalized. Who could be impacted? The proposed changes could potentially affect any public service worker enrolled in the program, according to experts. “The biggest concern is the amount of grey area that leaves room for the Department of Education to subjectively purge program participants,” says Jonathan Collins, assistant professor of political science and education at Teachers College, Columbia University.
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The draft proposal would nullify payments made while a worker was employed at an organization that was found to engage in an “illegal purpose,” forcing them to find a new job if they want to be eligible for forgiveness.
Berkman-Breen of the Student Borrower Protection Center calls the proposed amendments an attempt to “attack civil society” and free speech. “The proposal gives the Administration broadsweeping authority to play ideological politics with people’s financial and professional lives,” he says.
New Endowment Tax Could Reshape College Finances, Aid, and Access
A tax on college endowments is part of President Donald Trump’s sweeping tax-and-spending bill. The legislation replaces the previous 1.4% flat tax on endowment income with a tiered structure that climbs as high as 8%. Smaller institutions are exempt from the tax, which the Joint Committee on Taxation estimates will generate $761 million over the next decade. Yale University, one of several elite schools facing the highest rate, said it expects to pay $280 million in the first year alone. Other universities are expected to follow suit, leading to concerns about ripple effects across campus operations and student support.
The legislation replaces the previous 1.4% flat tax on endowment income with a tiered structure that climbs as high as 8% for the largest endowments. Smaller institutions—those with fewer than 3,000 tuition-paying students—are exempt from the tax, which the Joint Committee on Taxation estimates will generate $761 million over the next decade.
Yale University, one of several elite schools facing the highest rate, said it expects to pay $280 million in the first year alone.
“Although the endowment tax is lower than what the House passed originally, it still means that Yale will pay an estimated $280 million in the first year it is in effect, and likely more in subsequent years,” President Maurie McInnis said in a July 3 statement.
In anticipation of the financial hit, Yale had already enacted a temporary hiring freeze, reduced annual salary increases, and postponed several construction projects. Other universities are expected to follow suit, leading to concerns about ripple effects across campus operations and student support.
“This is no longer an endowment tax—it’s a research university tax,” said Rick Grafmeyer, a partner at Capitol Tax Partners in Washington, told CNBC. A Forbes analysis found at least 11 universities will be taxed at the 8% or 4% rate beginning in 2026—a significant jump from the 56 institutions that previously paid a uniform 1.4% rate totaling about $380 million.
Experts say the financial burden could shift directly onto students.
“Colleges, both private and public, are facing unprecedented fiscal challenges this year and en masse,” said Robert Franek, editor in chief of The Princeton Review. “Most concerning, for prospective students, is these factors may cause tuitions to be higher and reduce the amount of financial aid schools award.”
Higher education analyst Mark Kantrowitz noted that, in some cases, the endowment tax could exceed a college’s total financial aid budget, making it harder to maintain generous aid packages that support low-income students.
Phillip Levine, an economist at Wellesley College and fellow at the Brookings Institution, predicted rising tuition prices. “It doesn’t seem like 5% or 6% [increases] is out of line or beyond what schools are willing to do,” he told CNBC.
As institutions brace for these changes, critics of the tax argue that it may ultimately undercut access to higher education, particularly for students who depend on robust financial support.
Trump to reshape student loan forgiveness program
Government resumes collection on debt from millions of default student loans. Experts warn scammers could be looking to take advantage of borrowers. Check the status of your loan and whether it was turned over to collection by verifying directly with your student loan servicer. If you’re contacted by *** company asking you to pay for an enrollment, maintenance or subscription fee to help manage your loans, you should walk away. Trump is reshaping a student loan forgiveness program into what some fear will become a tool for political retribution, taking aim at organizations that serve immigrants and transgender youth. More than 1 million Americans have had loans canceled through the program, including nurses, college staffers and park rangers. The Education Department is preparing an overhaul that would strip the benefit from organizations involved in “illegal activities,” with the final determination left up to the U.S. education secretary. It could also give the administration another tool in its campaign against universities that run afoul of the president’s politics, says Alyssa Dobson, financial aid director at Slippery Rock University.
Advertisement Trump is reshaping a student loan forgiveness program. Some fear politics will decide who qualifies Editorial Standards ⓘ
President Donald Trump is reshaping a student loan cancellation program into what some fear will become a tool for political retribution, taking aim at organizations that serve immigrants and transgender youth.Public Service Loan Forgiveness allows government employees, such as teachers and firefighters, plus many who work for nonprofits, to have their student loans canceled after they’ve made payments for 10 years. The Education Department is preparing an overhaul that would strip the benefit from organizations involved in “illegal activities,” with the final determination left up to the U.S. education secretary. A draft proposal released by the department includes definitions of illegal activity that center on immigration, terrorism and transgender issues.Several advocates invited to weigh in on the draft proposal raised concerns it would give the department subjective authority to decide if an organization is engaged in anything illegal — a power that could be used to remove entire hospital systems or state governments from the program.“That’s definitely an indicator for me that this is politically motivated and perhaps will be used as a tool for political punishment,” said Betsy Mayotte, president of the Institute of Student Loan Advisors and one of the advocates asked to review the policy as part of a rulemaking process.Plan could block many from loan reliefMore than 1 million Americans have had loans canceled through the program, including nurses, college staffers and park rangers.Congress created the program in 2007 to encourage college graduates to work in the public sector, where salaries are often lower than at for-profit companies. The program promises to cancel all remaining debt after borrowers make 120 monthly loan payments while working for any level of government. Currently, nonprofits also are eligible if they focus on certain areas including public interest law, public health or education.A federal database of eligible nonprofits currently includes some that provide grants to transgender youth and their families so they can travel to states that permit gender-affirming care for minors. It also includes some that provide legal services to immigrants regardless of their legal status.Trump ordered changes to the program in March, declaring it had “misdirected tax dollars into activist organizations” that harm national security. He directed the Education Department to remove organizations tied to illegal activities, singling out those that work with immigrants or transgender youth or those that support terrorism — a label he often applies to pro-Palestinian activists.His plan has the potential to block huge numbers of student loan borrowers from cancellation. Those who work for an ineligible employer would no longer be able to make progress toward cancellation, effectively forcing them to find a new job or forgo loan forgiveness.Hospitals, schools, and nonprofits could be at riskThe proposal’s definitions of illegal activity largely mirror those laid out by Trump. They include “aiding or abetting” in the violation of federal immigration law, and supporting any group designated as a foreign terrorist organization. Also on the list are violations of the Civil Rights Act of 1964, a law Trump officials have invoked to root out diversity, equity and inclusion policies.Also considered illegal is “engaging in the chemical and surgical castration or mutilation of children in violation of Federal or State law.” It says that includes the use of hormone therapy or drugs that delay puberty. It defines children as those under 19.It raises concerns that entire hospital systems could become ineligible if a single department provides certain care to transgender youth. Likewise, the federal government could potentially strip the benefit from entire cities that limit cooperation with federal immigration officials.“I could see entire cities and entire civil structures being targeted,” said Alyssa Dobson, financial aid director at Slippery Rock University and a member of the rulemaking panel. It could also give the administration another tool in its campaign against universities that run afoul of the president’s politics, she said.“This unfortunately may allow them to further chase the undesirable institutions, in their view,” she said.When determining if an employer should be deemed ineligible, the department’s proposal would take into account court judgments and other legal findings. But it leaves room for at least some degree of subjectivity, giving the education secretary the authority to exclude organizations without proof of a conviction or settlement.Only one negotiator opposed the proposal, the Education Department noted. Several negotiators on the rulemaking panel said they took issue with the proposal, but voted in favor of tweaks they felt improved the rule.An Education Department spokesperson said the agency “has an obligation to prevent unlawful conduct and ensure that employers in the PSLF program are not complicit in illegal activities.”Advocates see ambiguity in the definition of illegal activityIf used widely, the policy could worsen shortages of doctors and nurses, said Emeka Oguh, CEO of PeopleJoy, a company that helps employers provide student loan relief. A member of the panel, he encouraged the Education Department to use the power surgically, going after individual hospital divisions rather than systems as a whole.Oguh said department officials were unable to provide examples of organizations that might be found to be involved in illegal activities. When pressed for detail, officials said it would not be considered illegal for a hospital to treat an immigrant in the country illegally, he said. Less certain was how the department would handle teachers or schools teaching lessons considered DEI.“There was a lot of ambiguity there,” Oguh said.Some others raised concerns with a provision that requires employers to certify they do not engage in illegal activities. Failure to certify could also render an organization ineligible, raising the risk that paperwork problems could jeopardize cancellation for huge numbers of borrowers.The department said it’s open to making changes based on the panel’s concerns. Ultimately, it’s free to shape the proposal as it pleases. The agency is now preparing a formal proposal that will undergo a public comment period before it’s finalized. It would be expected to take effect in July 2026.Last week, the Education Department thanked the experts and said they “helped fulfill one of President Trump’s promises to ensure that PSLF does not subsidize organizations that are breaking the law.”
Source: https://www.nytimes.com/2025/08/12/us/college-financial-troubles-student-experience.html