No, Trump Isn't Banning Student Loans for 'Useless Degrees.' Here's What the Rule Actually Does.
A new federal rule cuts aid to college programs whose graduates earn too little. No major is banned, and it's expected to start in 2027.
A new federal rule cuts aid to college programs whose graduates earn too little. No major is banned, and it's expected to start in 2027.
Posts claiming that President Trump is "banning student loans for useless degrees" have racked up millions of views this week. The real policy is narrower than that, and it works differently than the viral version suggests.
## What the rule actually does
The Education Department's earnings-accountability rule doesn't ban any major. It looks at **specific programs at specific schools** and asks one question: do their graduates earn more than people who never went to college, or never went to graduate school?
Programs that repeatedly fail that test lose access to federal student aid. The rule is expected to take effect in **2027**.
## The earnings test
- **Undergraduate programs** are compared with the typical high school graduate ages 25–34 in the same state. Nationally, that group's median earnings were about **$41,800** in 2022.
- **Graduate programs** are compared with the typical bachelor's degree holder ages 25–34. That national median was about **$66,600**.
Because the comparison uses state-level figures, the bar is higher in some states than in others.
## What happens to programs that fail
- A program that fails the test in **two out of three years** loses access to federal **Direct Loans**.
- A program that fails **three years in a row** also loses access to **Pell Grants** and other federal student aid.
Losing federal loans doesn't shut a program down, but for many schools it makes the program much harder to fill.
## Which fields could be hit
Reporting on the rule points to fields where graduates often earn modest salaries early in their careers: **social work, early childhood education, cosmetology, counseling and mental health services, and the arts**. Whether a given program is affected depends on how its own graduates actually earn, not on the subject alone.
## Why the viral version is misleading
"Useless degrees" suggests the government is judging which subjects are worthwhile. The rule doesn't do that. A low-earning program in one field can lose aid while a program in the same field at another school keeps it, because each is judged on its own graduates' earnings.
## What it means for students
- **Already enrolled?** Nothing changes for the current school year. The rule is not expected to take effect until 2027, and programs only lose aid after failing for multiple years.
- **Choosing a program?** You can look up what a specific program's graduates earn on the Education Department's College Scorecard at collegescorecard.ed.gov before you take on loans.
- **Worried about your field?** Check your program's numbers rather than the headlines. The same major can produce very different outcomes at different schools.
*NextGen America will update this story as the rule takes effect.*