WHAT’S HAPPENING
The Trump administration just finalized a provision cutting off federal student loans for college degree programs that fail to deliver a return on investment.
Under a new "Do No Harm" earnings standard finalized in June, programs whose graduates earn less than high school diploma holders will lose access to federal Direct Loans starting as early as the 2028-29 academic year.
THE FACTS
Graduates of more than 800 college programs make less money than the average high school graduate four years after graduation.
Music majors from USC, Juilliard, and the New School earn just $32,842–$34,124 four years out, below high school graduates.
Fine and Studio Arts graduates from The Cooper Union in NYC earn just $24,920 on average four years after graduation.
Only 6 percent of higher-ed programs are projected to fail the earnings test, but 29 percent of undergraduate certificate programs are at risk.
Cosmetology (92.5 percent), religious studies (53.3 percent of bachelor’s programs), and mental health services (64.3 percent of graduate programs) are among the biggest losers.
Cosmetology graduates earn just $16,600 a year on average, about $9,000 less than high school graduates, while carrying $10,000 in student debt.
The rule revives Obama-era “gainful employment” regulations rescinded under Betsy DeVos in 2019 and rebuilt under Biden in 2023.
Programs failing the “Do No Harm” earnings test in both 2027 and 2028 will be labeled “low-earning outcome programs” and lose federal loans.
The Department of Education noted that it wasn't "banning" any program but "holding colleges accountable for leaving students worse off than if they never enrolled."
OUR TAKE
In his first term, President Trump killed the original gainful employment rule, arguing it unfairly singled out for-profit colleges while letting public and nonprofit programs with equally bad outcomes off the hook. Biden then revived a version of it in 2023 that applied to nearly all institutions.
Now Trump's "Do No Harm" standard keeps that broader scope, but this time there's no special carve-out for elite nonprofits like USC or Cooper Union. Instead of gutting accountability measures again, his administration is doubling down on them with a blunter, simpler earnings test.
It's smart politics since student debt is now a massive bipartisan issue. Cutting off aid to programs that leave graduates poorer than a high school diploma is a far easier sell than it was a decade ago.
