Student Loan Changes, AI Push: Trump’s Plans for the New School Year

This back-to-school season, things are looking different.

President Donald Trump revealed his plans to reshape the US education system in his first months in office. They included expanding school vouchers, overhauling the trillion-dollar student-loan repayment system, and influencing how public schools function, including a plan to promote artificial intelligence usage.

The changes follow periods of uncertainty as teachers and administrators were gearing up to reopen their doors. Over the summer, Trump’s administration withheld billions of dollars of funding for public schools for a month, including money for after-school programs and English language learning. While the administration released the funds at the end of July, it left schools scrambling just weeks before the new school year.

Meanwhile, Linda McMahon, Trump’s education secretary, is continuing to work toward the president’s aim of dismantling the Department of Education. She said on a tour leading up to the start of the school year that she wants to give states more control over their schools.

“I think every school system needs to work within its own community to decide what curriculum works best there,” McMahon said earlier this month. The federal government does not control school curriculum. “What are the ways that their students can learn? And that’s why it’s imperative that education be returned to the states.”

Here are the changes to K-12 and higher education that Americans can expect in the coming school year.

An AI push

Trump signed an executive order in April to advance AI education in public school classrooms.

“To ensure the United States remains a global leader in this technological revolution, we must provide our Nation’s youth with opportunities to cultivate the skills and understanding necessary to use and create the next generation of AI technology,” the order said.

It called for the establishment of a task force that would look into ways students and educators can use AI in classrooms and secure public-private partnerships with AI industry organizations. It also said the task force should look at where funding could be directed from existing federal programs toward this AI initiative.

AI is increasingly becoming a hot-button issue in education. While some teachers have reported using AI to help them develop lesson plans and save them time with administrative tasks, others are concerned with AI’s impact on how their students learn. Alex Green, a Harvard professor, previously told Business Insider that pushing AI in classrooms without proper guardrails is harming his students.

“We need actual committed educators who are not the bible salesman version of AI at the front of the room, opening up space for ideas about its judicious use in the classroom,” Green said. “We could really end up with some incredible amounts of junk here, and at the expense of our young people actually learning skills that you do need in the real world.”

Expanded school vouchers

The school voucher movement is continuing to grow, with more states adopting and expanding programs that give families public funds to send their kids to private school. While parents say those options are better fits for their kids, it’s leaving public schools scrambling as their funding wavers and enrollment declines.

Pushing for school vouchers has long been a priority for Republican lawmakers and a cornerstone of the Trump administration’s education platform. An executive order that Trump signed in January said that “too many children do not thrive in their assigned, government-run K-12 school,” and it called for federal agencies to determine whether they could redirect funding meant for public school programs to private school initiatives.

There are political limitations to Trump’s plan — he’ll need congressional approval to make any changes to federal funding. Still, the push to expand school vouchers is emblematic of a shift in the way the education system functions in the US. Parents are dissatisfied with the public school system, and it could mean that students and parents will start to see their local public school struggling with fewer resources and fewer students.

Student-loan repayment overhaul

Federal student-loan borrowers are facing fewer repayment options due to Trump’s “big beautiful” spending bill. The bill eliminated existing income-driven repayment plans and replaced them with two options.

The first plan is a standard repayment plan, during which borrowers pay off their loans over a fixed period of time at an amount set by their servicer. The second plan is a new Repayment Assistance Plan, which sets borrowers’ payments at 1% to 10% of their discretionary income and allows forgiveness after 30 years.

The plans are less generous than former President Joe Biden’s SAVE plan, which Trump’s bill eliminated. SAVE allowed for lower monthly payments with forgiveness after as little as 10 years of payments.

Trump restarted interest charges for borrowers enrolled in SAVE on August 1. Borrowers can either remain on SAVE while interest grows or switch to an existing income-based repayment plan. The new plans in Trump’s spending law will go into effect by July 1, 2026.

Federal funding battles

Funding uncertainty remains for both K-12 and higher education institutions as the new school year begins. While Trump’s administration released the $7 billion in funding it withheld for public schools in July, it said it would place guardrails on the funding going forward to ensure schools are not using funds that violate Trump’s policies and executive orders. This likely refers to schools teaching a “woke” curriculum that the administration would oppose.

Meanwhile, Trump continues to withhold — or threaten to withhold — federal funding for higher education institutions that do not comply with the administration’s demands. This includes canceling research grants at schools studying areas that the administration does not support, including topics related to gender or vaccines.

The funding battles are pushing some researchers to leave the US in favor of a country that would support their work. Business Insider previously spoke to Danielle Beckman, a scientist at the University of California, Davis, who said her NIH grant was pulled because it contained the word “COVID.” She’s planning to move to Germany to continue her research.

“I still think I can contribute a lot. It’s just that there is no opportunity here anymore, and I don’t want to waste my time,” Beckman said. “It’s not worth staying here.”