Senate Bill Will Drastically Raise Costs on American Families, Push Higher Education Further Out of Reach, Gut Consumer Watchdog Threatening Financial Security of Millions
July 1, 2025 | WASHINGTON, D.C. — Today, in a 51-50 vote, Senate Republicans passed their reconciliation bill that shreds vital programs American families rely on—all to fund $4.5 trillion in tax breaks for billionaires and big corporations. The bill includes $300 billion in cuts to federal education programs that will raise costs for students and working families with student debt and limit access to higher education. The legislation also makes unprecedented cuts to the budget of the Consumer Financial Protection Bureau (CFPB)—slashing the funding of an agency that has returned at least $21 billion to consumers since opening its doors in 2011.
In response, SBPC Policy Director Aissa Canchola Bañez released the following statement:
“Senate Republicans chose to deliver tax cuts to billionaires on the backs of students and working families seeking relief from the rising costs of healthcare, food, and education across this country. Today’s vote is a crushing blow to the millions of Americans already struggling to cover the skyrocketing costs of college and will push higher education even further out of reach while also pushing millions even further into debt. This bill represents a generational robbery of the American Dream—slashing investments and critical protections that working-class families rely on all to make the richest Americans even richer.
“This bill is a dangerous attack on students, working families, and communities across the country. By gutting financial aid programs, shredding the student loan safety net, weakening protections, and pushing millions of students and families into the riskier and more expensive private student loan market, policymakers are doubling down on a rigged system where a quality higher education is reserved for the richest Americans while the rest of us are left to fend for ourselves and forced to take on a lifetime of debt. Americans won’t forget this betrayal.”
SBPC Executive Director Mike Pierce added:
“Today, Republicans broke their promise to voters to lower costs, instead radically reshaping the way American families pay for the basics while sidelining the federal enforcement officials who hold big corporations accountable for treating families fairly. This bill will drive patients deeper into medical debt, borrowers deeper into student debt, and working families deeper into debt to pay for higher energy costs, higher grocery bills, and more expensive cars and trucks. Across the economy, the CFPB was supposed to watch out for these families, recognizing that in moments of massive economic or policy change, corporations prey on our precarity, trying to make an easy buck.
“The CFPB costs taxpayers nothing yet but has returned billions to people ripped off by their student loan servicer, mortgage lender, or credit card company. It’s clear what the move to slash the CFPB’s funding is all about—the deep-pocketed honchos on Wall Street and in Silicon Valley who helped put Trump in office and who want to be able to operate with impunity. Slashing the CFPB’s funding to deliver tax cuts to billionaires and big corporations is not only revolting but short-sighted.”
The Senate bill makes $300 billion in cuts to higher education and guts critical protections by:
- Limiting borrowers’ ability to pause payments when experiencing unemployment or financial hardship.
- Gutting the Graduate PLUS loan program and limiting access to Parent PLUS loans, pushing families into predatory private debt or out of higher education entirely.
- Making monthly student loan payments even more expensive for new borrowers by eliminating the SAVE plan and replacing all other Income-Driven Repayment plans with a new, more expensive Repayment Assistance Plan (RAP) that forces new borrowers to repay their loans for 30 years. Beginning on July 1, 2028, current borrowers enrolled in SAVE and other Income Contingent Repayment (ICR) based plans will be pushed into Income-Based Repayment, which is even more expensive for some borrowers.
- Weakening Borrower Defense to Repayment and Closed School Discharge protections, making it easier for predatory for-profit schools to cheat students and saddle them with mountains of debt.
- Allowing Pell Grants to fund shady, extra-short workforce training programs that have been found to leave students with low wages and high debt loads.
- Eliminating Pell Grant eligibility for low-income students with certain other grant aid, making higher education even more expensive for low-income families.
- Dramatically slashing the CFPB’s funding by capping the amount of money, at 6.5 percent down from 12 percent, that the agency can request from the Federal Reserve.
Further Reading
SBPC release of letter to HELP committee with preliminary analysis of impact of Senate bill proposal: Senate Republicans Double Down on House’s Cruel Agenda, Push Reconciliation Bill That Jacks Up Costs for Students and Families to Bankroll Billionaire Tax Breaks
SBPC statement on House reconciliation bill passage: House Republicans Rush Passage of Massive Reconciliation Bill Delivering Tax Cuts to Billionaires on the Backs of Students and Working Families
SBPC Deep Dive on the House reconciliation bill’s impact on student loan repayment: House Reconciliation Bill Makes Paying for College More Expensive and Risky for Students and Working Families
SBPC’s economic analysis of the student loan provisions in the House Republican draft budget reconciliation bill is available here: https://protectborrowers.org/wp-content/uploads/2025/04/Economic-Analysis-of-EW-Recon-Markup_04-29-2025.pdf
The Century Foundation and SBPC Deep Dive on the implications of the proposals on the private student loan market: Private Lenders Would Cash In on Congress’s Student Loan Changes
SBPC blog on elimination of Grad PLUS loans: Eliminating Grad Plus Loans Without Making Higher Education More Affordable Would Be a Disaster for Students and Borrowers
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About Student Borrower Protection Center
Student Borrower Protection Center (SBPC) is a nonprofit organization focused on eliminating the burden of student debt for millions of Americans. We engage in advocacy, policymaking, and litigation strategy to rein in industry abuses, protect borrowers’ rights, and advance racial and economic justice.
Learn more at protectborrowers.org or follow SBPC on Twitter @theSBPC.