Trump Transfers Student Loan Oversight to Small Business Administration, Plans Education Department Dismantling

President Trump announced a significant restructuring of federal education oversight, proposing the transfer of student loan management to the Small Business Administration (SBA) and special needs programs to the Department of Health and Human Services (HHS). This move comes as Trump signed an executive order aimed at dismantling the Department of Education, which currently oversees over $1.6 trillion in student loans affecting 43 million borrowers. Trump asserted that the SBA would manage these loans more efficiently, despite concerns regarding the agency's capacity following recent staffing cuts. Education Secretary Linda McMahon indicated that while the transition will not happen overnight, plans are in place to reassign the department's core functions to other agencies. Critics warn that this overhaul could lead to confusion and worsen existing challenges faced by borrowers, particularly in light of stalled forgiveness programs. Democratic leaders have voiced strong opposition to these changes, threatening legal action and suggesting they could negatively impact educational quality.