Senate HELP Committee Chairman Bill Cassidy has unveiled a key provision of President Donald Trump’s ‘big, beautiful bill,’ targeting the former President Joe Biden’s student loan policies. The legislation, released late Tuesday, is part of the broader Senate reconciliation process aiming to pass a sweeping agenda with bipartisan support. The bill seeks to end what Cassidy and other Republicans describe as Biden’s ‘student loan schemes,’ particularly the expansion of Borrower Defense to Repayment regulations and Closed School Discharge rules, which they argue shift financial burdens from institutions to taxpayers.
Cassidy’s focus is on limiting the impact of Biden’s student loan forgiveness initiatives, which he claims have disproportionately affected non-college-educated Americans. The bill’s provisions, if passed, would eliminate the federal Grad PLUS loan program, which is frequently used by graduate students to cover the full cost of attendance. In its place, the legislation proposes to impose stricter lending caps, such as a $20,500 annual limit for Federal Direct Unsubsidized Loans for graduate degrees, capped at $100,000, and a $50,000 annual limit for professional degrees with a $200,000 total cap.
Another key objective of the bill is to curtail taxpayer funding for degrees from underperforming universities. The legislation would block institutions where graduates earn less than the typical high school graduate in their state from participating in federal loan programs. This is part of a broader effort to address the perceived misalignment between higher education and job market outcomes, ensuring that federal support is directed toward programs that yield higher returns on investment.
Additionally, the GOP proposal introduces a Workforce Pell Grant to encourage non-collegiate education paths, such as vocational training and trade certifications. This initiative is modeled after the current Pell Grant program, which provides financial aid to low-income students pursuing undergraduate degrees. Cassidy highlights the potential for such grants to support career-oriented education, such as preparing students for commercial driving licenses, with the promise of lucrative careers like earning $100,000 annually in a few years.
Financial analysts predict that these measures could generate significant taxpayer savings, estimated at around $300 billion. The bill also seeks to eliminate federal subsidies for degrees from lower-performing universities, a policy that has been criticized as a way to reduce educational costs for taxpayers while aligning higher education with labor market needs.
Cassidy has acknowledged that the final version of the bill, while largely aligned with the House’s version, will require adjustments. The Senate and House must agree on a unified version before it can be signed into law by President Trump. Despite the challenges, Cassidy remains optimistic about the legislation’s potential to reshape the U.S. education system and reduce the financial burden on taxpayers.
As the legislative process continues, the focus remains on the broader goals of Trump’s agenda: tax reform, immigration policy, energy independence, and debt reduction. The reconciliation process, which allows the majority party to bypass the normal Senate approval hurdles, is seen as a critical tool to implement these changes. However, the final outcome will depend on the ability of both chambers to reconcile their differences and present a cohesive legislative package by the Fourth of July.