How the Trump Administration Might Increase the Cost of College Education and Tuition

How the Trump Administration Might Increase the Cost of College Education and Tuition

As Donald Trump prepares to take office following his victory in the 2024 presidential election, speculation abounds about how his administration’s policies could reshape the landscape of higher education in the United States. One area of particular concern is the potential for rising college tuition and overall education costs. While Trump has not explicitly outlined a detailed higher education agenda for his second term, his past administration’s approach, combined with his stated priorities—such as reducing federal spending, deregulation, and promoting private-sector solutions—offers clues about what might lie ahead. These policy inclinations, alongside a Republican-led Congress, could create conditions that drive up the cost of college for students and families. Here’s how.

1. Cuts to Federal Education Funding

During Trump’s first term, his administration consistently proposed significant reductions to the Department of Education’s budget. For instance, the fiscal year 2020 budget proposal called for a $7.1 billion cut—a 10% reduction—targeting programs like Federal Work-Study and subsidized student loans. Although Congress largely rejected these cuts, a second Trump term with stronger Republican control could see such proposals gain traction. Reduced federal funding for higher education would likely shift more of the financial burden onto states and institutions, many of which are already strapped for cash.

Public colleges and universities, which educate roughly 70% of American undergraduates, rely heavily on state appropriations and federal support to keep tuition affordable. If federal grants or subsidies diminish, states might struggle to fill the gap, especially in an economic climate prioritizing tax cuts or other Republican-led initiatives. Historically, when public funding declines, institutions raise tuition to compensate. A 2021 study by the Center on Budget and Policy Priorities found that state disinvestment in higher education since the 2008 recession led to a 37% increase in tuition at public four-year institutions. A Trump administration doubling down on austerity could exacerbate this trend, pushing tuition costs higher.

2. Changes to Student Loan Programs

Trump’s first term also saw efforts to overhaul federal student loan programs, which could resurface in 2025. His administration proposed eliminating the Public Service Loan Forgiveness (PSLF) program, which cancels remaining debt for borrowers working in public-sector jobs after 10 years of payments. Additionally, Trump sought to cap the amount students could borrow through Parent PLUS and Graduate PLUS loans, while consolidating income-driven repayment plans into a less generous framework. Although these changes didn’t fully materialize, they signal a preference for reducing federal liability in student lending.

If such policies are enacted, students might face a double whammy: less access to affordable loans and higher out-of-pocket costs. Private lenders, eager to fill the gap, typically charge higher interest rates and offer fewer protections than federal loans. For example, private loan rates can exceed 13%, compared to the 5.5% fixed rate for federal undergraduate loans in 2024–2025. With less federal support, students and families might turn to these costlier alternatives, effectively increasing the total expense of a degree. Moreover, scrapping PSLF could deter enrollment in fields like teaching or social work, indirectly pressuring colleges to raise salaries—and thus tuition—to attract faculty in these areas.

3. Deregulation of For-Profit Colleges

Trump’s first administration rolled back Obama-era regulations on for-profit colleges, such as the Gainful Employment rule, which aimed to hold institutions accountable for graduating students with unmanageable debt relative to their earnings. Under Education Secretary Betsy DeVos, the administration loosened oversight, allowing many for-profit institutions to expand despite their track record of high tuition and low graduation rates. A second Trump term could further embolden this sector, particularly if deregulation remains a cornerstone of his economic strategy.

For-profit colleges often charge tuition far exceeding that of public institutions—sometimes two to three times higher for comparable programs. With fewer safeguards, students might enroll in these schools under misleading promises of job placement, only to face steep costs and limited career prospects. While this wouldn’t directly raise tuition at traditional colleges, it could strain the broader higher education ecosystem. Increased defaults on private loans from for-profit attendees might prompt lenders to tighten credit standards, making borrowing more expensive across the board and indirectly pushing traditional colleges to hike fees to offset lost revenue.

4. Immigration Policy and Workforce Impacts

Trump’s hardline stance on immigration could also ripple into college costs. His first term saw tightened visa restrictions, including changes to Optional Practical Training (OPT), which allows international students to work in the U.S. after graduation. International students, who often pay full tuition without financial aid, are a vital revenue source for many universities. In 2023, they contributed $40 billion to the U.S. economy, according to NAFSA: Association of International Educators.

If Trump reinstates or expands these restrictions, fewer international students might enroll, reducing institutional income. Colleges could then raise tuition for domestic students to compensate. Additionally, stricter immigration policies might shrink the pool of graduate teaching assistants and adjunct faculty—roles often filled by immigrants—who help keep instructional costs low. Replacing them with higher-paid domestic workers could further drive up operating expenses, and thus tuition.

5. Economic Policy and Inflationary Pressures

Trump’s broader economic agenda, including tax cuts and tariffs, could indirectly fuel inflation, raising the cost of everything from campus utilities to faculty salaries. His 2024 campaign promised to extend the 2017 Tax Cuts and Jobs Act and impose new tariffs on imports—policies economists warn could increase consumer prices. Colleges aren’t immune to these pressures. Higher operational costs, from construction materials for dorms to energy bills, often translate into tuition hikes. During Trump’s first term, inflation remained relatively low, but a more aggressive trade policy in a post-pandemic economy might change that, squeezing institutional budgets and passing the burden onto students.

Counterarguments and Uncertainties

Not all signs point to rising costs. Trump has occasionally criticized “overpriced” colleges and championed vocational training, suggesting a push for cheaper alternatives like trade schools. However, without a clear plan to fund or scale these options, their impact on traditional college tuition remains uncertain. Additionally, some Republican-led states might resist tuition increases by boosting local funding, though this would depend on regional politics and economic conditions.

Conclusion

While the exact policies of Trump’s second term remain speculative as of March 12, 2025, the trajectory of his first administration and current rhetoric suggest a higher education landscape marked by reduced federal support, deregulation, and economic shifts that could elevate college costs. Students and families might face steeper tuition bills, pricier loans, and fewer affordable options, particularly at public institutions. As these changes unfold, the affordability crisis that has long plagued American higher education could deepen, challenging the notion that a college degree remains a viable path to economic mobility. Only time will reveal the full scope of these impacts—but for now, the warning signs are clear.