# OPEN LETTER: DOGE is destroying student aid — $1.7 trillion in loans at risk

> Let me be direct: DOGE, the department of government efficiency steered by Elon Musk, has just slashed 40% of the staff at

- Author: Maxime Marquette
- Publisher: MadMax (https://mad-max.co)
- Section: Open letter
- Published: 2026-06-26
- Canonical URL: https://mad-max.co/en/article/lettre-ouverte-doge-detruit-l-aide-aux-etudiants-1-700-milliards-de-prets-en-dan

## Introduction: when the state dismantles its own students

### An axe swung at the Federal Student Aid

Let me be direct: **DOGE**, the department of government efficiency steered by **Elon Musk**, has just slashed **40%** of the staff at **Federal Student Aid**, the federal agency that manages access to student loans for millions of Americans. This is not a reform. It is demolition.

Behind these **40%** in job cuts lies a brutal reality: the **federal student loan portfolio** today exceeds **$1.7 trillion**. **That colossal figure** represents tens of millions of life trajectories — families who bet on education to escape precarity. By massively eliminating **FSA** staff, the **Trump** administration is not "streamlining" — it is destabilizing a critical financial infrastructure.

### The Watchdog sounds the alarm

The report by the **Department of Education's Watchdog**, published on **June 25, 2026**, documents with relentless precision the extent of the cuts. This is not merely about civil servants deemed superfluous by DOGE criteria: contracts have been terminated, entire services have been hollowed out across **more than ten different departments**.

This report, cited by **Inside Higher Ed**, reveals a systemic picture: the internal machinery that allows students to access their loans, repay them, and benefit from forgiveness or relief programs is now dangerously understaffed. **Wait times are exploding**. Cases are piling up. And the students wait.

*I'll tell you what I really think: this policy is deliberately blind. It sacrifices millions of young Americans on the altar of an ideology that confuses efficiency with brutality. No one should have to fight for months to access a student loan because the administration decided to empty out the offices.*

## The DOGE logic: cut first, measure the damage later

### A doctrine of efficiency that ignores human consequences

The **DOGE** doctrine rests on a seductive premise: the American state is bloated, inefficient, wasteful. So **staffing must be cut**, contracts closed, operations streamlined. But this logic omits one essential thing — certain state functions cannot be replaced by an algorithm or a mobile app.

**Federal Student Aid** processes millions of complex applications each year, individual situations that require judgment, expertise, and human follow-up. Cutting staffing by **40%** at this agency is not eliminating useless bureaucracy — it is gutting the operational capacity of a system on which **43 million American borrowers** depend.

### The IRS: a misleading mirror

The administration frequently cites the **IRS** to legitimize its policy. The **Internal Revenue Service** has also seen its staff shrink by **40%** under DOGE's push — and the administration congratulates itself on a "largely successful" tax season. **But this comparison** is misleading.

Tax collection is a largely automated, traceable, standardized process. **Managing student loans**, with their income-contingent repayment plans, forgiveness programs, emergency situations, and appeals, is infinitely more complex. **Comparing the two agencies is like confusing an assembly line with a hospital.**

*The "largely successful" IRS is a communications argument, not proof of method. Waiting for the FSA system to collapse before measuring the damage means governing blindly. I am not an ideologue: I am simply worried by what I see.*

## The Big Beautiful Bill and the tax on wealthy universities

### A double penalty for higher education

The **Big Beautiful Bill**, the **Trump** administration's major legislative package, includes a particularly controversial provision: a **tax on the endowments of wealthy universities**. Major universities like Harvard, Yale, or Princeton, whose endowment funds run into tens of billions, would be subject to additional taxation.

**On paper**, this might seem fair — why shouldn't these ultra-privileged institutions contribute more? In reality, this tax hits revenues used to fund scholarships, research labs, and faculty positions. It is a fiscal pressure that risks flowing directly back to the least affluent students.

### The fracture between ideology and budgetary reality

There is a fundamental contradiction at the heart of the **Trump** administration's education policy. On one hand, it claims to want to **lighten the financial burden on students**. On the other, it eliminates the agents who process their files, reduces **FSA** capacity, and taxes the universities that fund their scholarships.

This contradiction is not accidental — it reflects a worldview in which education is a market like any other, where the state must step back. But **education is not an ordinary commodity**. It is the infrastructure of American social mobility. **Dismantling it** is to dig deeper the inequality of opportunity.

*I understand the appeal of anti-establishment university rhetoric — those campuses where the elite reproduces among itself. But using this rhetoric to justify cuts that penalize first-generation students is a fraud. And I think many know it.*

## Student loans: a $1.7 trillion time bomb

### A portfolio under critical management

The **$1.7 trillion** in federal student loans constitutes one of the largest financial exposures of the American state. **This figure has nearly tripled in fifteen years**, driven by the relentless rise in tuition fees and the expansion of federal aid programs. Properly managing this portfolio requires considerable human and technological resources.

With **40%** of **FSA** staff eliminated, the capacity to process files, respond to complaints, keep databases up to date, and manage repayment plans is seriously compromised. The risk is not theoretical: borrowers could find themselves in default not because they refuse to pay, but because the system is no longer capable of processing their files in time.

### Mass default as a credible scenario

Economists and higher education experts have been sounding the alarm for weeks. **A collapse of** the administrative capacity of the **FSA** could trigger a wave of technical defaults — not willful defaulters, but borrowers trapped in untenable processing delays.

**Such a wave** would directly affect the credit scores of millions of Americans, their ability to obtain a mortgage, to rent an apartment, to finance a car. The collateral damage of a failing **federal student loan portfolio** could be measured in lost points of economic growth.

*This is not an alarmist hypothesis. It is a logical extrapolation from real numbers. When you cut 40% of the administrative capacity of an institution managing $1.7 trillion, you are playing with fire — and it is the students who get burned.*

## The institutional response: timid and belated

### Congress facing inertia

Where is the **United States Congress** in all this? **Democratic lawmakers** have multiplied indignant declarations, hearings, and reports. But the Republican majority, disciplined behind the **Trump**-DOGE banner, has blocked any legislative initiative aimed at restoring **FSA** staffing.

**The American political system**, in the absence of a parliamentary opposition capable of weighing on the executive, finds itself powerless against an administration determined to reduce the state at any cost. The institutional checks exist on paper — but in practice, they struggle to counterbalance the current dynamic.

### Judicial recourse: the last line of defense

**Student associations**, teachers' unions, and civil rights organizations have begun exploring legal recourses against the cuts at the **FSA**. These lawsuits could slow the dismantling process, but they will not restore lost operational capacity overnight.

**American courts** have already suspended several DOGE measures in other agencies. But judicial timelines are such that the damage can be considerable before a court decision is rendered. **Time is working against American students.**

*I remain convinced that institutions resist — but they resist slowly. And in that interval, thousands of young Americans see their future mortgaged by bureaucratic decisions made in offices whose very existence they don't know about.*

## DOGE across departments: a systemic pattern

### Beyond the FSA: ten departments struck

The **Department of Education Watchdog** report does not limit itself to the **FSA**. It documents cuts across **more than ten different departments**, affecting functions as diverse as education research, programs for students with disabilities, language education, and international exchange programs.

This scope reveals that DOGE cuts in education are not surgical. They follow a volume logic: eliminate a fixed percentage of staff in each department, without serious analysis of functional impact. **This is governance by Excel spreadsheet**, not by **strategic** vision.

### The Pentagon as a troubling parallel

**The GAO report on DOGE cuts** at the **Pentagon**, cited by **DefenseScoop** on **June 24, 2026**, offers a troubling parallel. Same logic, same method: brutal staff reductions without adequate assessment of critical missions. The difference is that failures at the **Pentagon** can cost lives.

**In education**, the damage is less immediate but just as real. It accumulates silently, file by file, student by student. **The slow violence of failing bureaucracy is less visible than that of a failing military system — but it is no less destructive.**

*There is something profoundly revealing in the Pentagon-education comparison. Both are treated with the same technocratic indifference. But in one case, failure immediately triggers alarms. In the other, no one moves until the crisis is visible to the naked eye.*

## The voice of students: absent from the debate

### Forty-three million borrowers without representation

**There are** in the United States **43 million borrowers** tied to the federal student loan system. This figure represents a considerable political force — and yet their voice is remarkably absent from the debate on DOGE cuts at the **FSA**.

Why? **Because student debt** is experienced as a private matter, an individual shame, a personal burden one does not shout from the rooftops. This culture of silence around debt works in the administration's favor: it is easier to cut a service whose beneficiaries do not march in the streets.

### The moral obligation to denounce

This is precisely why columnists, journalists, and academics have an obligation to bring this question into the public sphere. **The numbers** are there: **40%** in cuts, **$1.7 trillion** at stake, millions of files in backlog, a Watchdog report documenting the extent of the damage. These data points are not abstract — they correspond to real lives, projects, and hopes.

**Democracy does not survive indifference**. **It demands that those** with a platform use it for those who have none. **This open letter is addressed to all those who still believe the state has a responsibility toward its most vulnerable citizens.**

*I am not a student. I am not in debt. But I am a citizen of a world where what happens in the United States reverberates everywhere. And I watch with growing unease an administration that treats its own youth as a budgetary adjustment variable.*

## Tariffs and education: the double pressure

### CNBC and the debate on manufacturing tariffs

On **June 23, 2026**, **CNBC** reported the debate between Senators Warren and Kelly on the impact of **Trump**'s tariffs on the American manufacturing sector. On the surface, this debate seems unrelated to education. In reality, it reveals the same logic: economic decisions made in Washington without serious analysis of consequences for citizens.

**Students in engineering**, technology, and applied sciences fields see their employment prospects directly affected by industrial supply chain disruptions. **Simultaneously weakening their access** to student loans and the job market prospects they are targeting is a double economic penalty.

### The paradox of an America that calls itself pro-work

The Trump administration prides itself on being pro-worker, pro-industry, pro-America. But an America competitive in the 21st-century global economy requires a highly skilled workforce. And a highly skilled workforce requires an accessible and functional higher education system.

Dismantle the **FSA**, tax universities, weaken loans — and in ten years, we will wonder why America has lost ground to **China** in the talent race. Today's decisions are tomorrow's competitive deficits. **This is an obvious point the Trump administration chooses to ignore.**

*There is no contradiction between being patriotic and demanding a robust educational system. On the contrary: education is the foundation of any real national sovereignty. Gutting the FSA means weakening America from within — far more effectively than any external threat.*

## The international comparison: what other nations do differently

### Europe: investment, not dismantling

While the Trump administration cuts **40%** of **FSA** staff, countries like Germany, France, and the Scandinavian nations are increasing their investments in access to higher education. **These nations** have long understood that the return on investment in education is one of the best available to a state.

**The comparison is cruel but necessary**. While the United States dismantles itself, its competitors build. **This divergence in trajectory** will have measurable consequences in terms of innovation, productivity, and economic power in the decades to come.

### China: massive investment in brainpower

**China**, the United States' major strategic rival, is massively investing in its universities, research programs, and student aid systems. **Meanwhile**, Washington is scuttling its own federal aid system. It is hard not to see this as a strategic gift offered to Beijing.

The 21st-century competition will be won on brains, patents, and algorithms. **A country that dismantles its student aid system is not playing the same game as its strategic adversaries.** It is, in reality, playing in a different — and inferior — league.

*I don't want to fall into catastrophism. But when I look at the numbers — 40% in cuts, $1.7 trillion at stake, and facing a China investing billions in its universities — I tell myself that a power never falls all at once. It erodes, decision by decision, cut by cut.*

## To whom this open letter is addressed

### To Republican lawmakers who can still act

This letter is addressed first to **Republican lawmakers** who still have some room to maneuver against the Trump-DOGE apparatus. You know, better than anyone, what these **$1.7 trillion** mean for your constituents. You know how many students in your districts depend on **Federal Student Aid**.

History will judge those who chose party discipline over the interests of their fellow citizens. **It is not too late to take a stand**. The **Watchdog report** provides you with the data. The ground-level reality provides you with the legitimacy. All that remains is finding the political courage.

### To the millions of students who must mobilize

This letter is also addressed, and perhaps above all, to the **millions of indebted students and former students** who are suffering from this policy without seeing it coming. You are **43 million**. That is a considerable electoral force, provided you organize, vote, and pressure your representatives.

**Democracy is not a spectator sport**. It is a collective practice. **Those who do not participate let others decide for them.** And as we can see today, the decisions made in their absence are not necessarily in their interest.

*I know that this call to mobilize can ring hollow when you are exhausted by debt, part-time jobs, and uncertain prospects. But precisely: that exhaustion is the product of a system that has worn you down. Acting politically is refusing to let it continue.*

## The alternatives: what could have been done differently

### A smart reform rather than a pillaging

No one will deny that the **federal student loan system** is imperfect. **Tuition fees** have exploded partly because easy access to credit allowed universities to never constrain themselves. A serious reform could have addressed these root causes while maintaining operational services.

There are intelligent models of administrative rationalization: digitalization of repetitive processes, pooling of back-office functions, controlled outsourcing of certain tasks. **These approaches** allow efficiency gains without gutting service capacity. **But they require time**, expertise, and a genuine will to improve the system — not to demolish it.

### The price of short-sighted ideology

**What is happening** at the **FSA** is not a reform. It is the product of an ideology that considers the state a problem in itself, to be reduced at any cost. This vision has its merits in certain contexts — but applied to a critical infrastructure like student aid, it produces real and lasting damage.

The short-term savings obtained by eliminating positions at the **FSA** will be far outweighed by the long-term costs: defaults, loss of future income, damage to the credit ratings of millions of citizens, weakening of American human capital. **You cannot save money by investing less in people.**

*This is the paradox of any poorly designed austerity policy: it costs more than it saves. The gains are immediate and visible in DOGE's Excel spreadsheets. The costs are deferred, diffuse, invisible in the statistics — until the day they become a crisis.*

## What this crisis reveals about the state of American democracy

### A state turning against its own citizens

There is something profoundly troubling in what we observe. A democratically elected government that deliberately chooses to degrade the services its own citizens have contributed to through their taxes. This is not efficiency — it is a form of breach of the social contract.

**Federal Student Aid** was created to allow millions of Americans who could not afford higher education to access it. It enabled remarkable social mobility. **Gutting it** in the name of efficiency means reserving higher education for those who can pay for it themselves. **This is a profound societal choice — and it was not put to voters.**

### The Supreme Court: the last safety net?

**The Guardian** reported on **June 25, 2026** that the **U.S. Supreme Court** is closely monitoring several cases related to DOGE actions across different federal agencies. **Constitutional challenges** are underway, arguing that these staff eliminations violate the budget authorization laws passed by Congress.

**These challenges could** result in partial restorations. **But again**, justice moves slowly. And in the meantime, thousands of student files remain in administrative limbo. **The rule of law does not operate on the timelines that human urgency requires.**

*I place much hope in American institutional checks. But institutions are not enough if citizens do not fuel them with their vigilance, engagement, and constructive anger. Democracy is a muscle that atrophies when not used.*

## International resonance: when Washington sends the wrong signal

### America: model or cautionary tale?

**The American educational system** has long been a global reference. American universities attract the best students from around the world, contributing massively to the country's innovation power. The DOGE-FSA policy sends a catastrophic signal: America no longer cares about its own human capital.

International students who were considering studying in the United States look with concern at cuts to university resources, administrative instability, and taxes on endowments. **Some are now choosing Canada**, the United Kingdom, Australia, or even Asian countries. **The decline in American university attractiveness is not an abstract statistic — it is a measurable trend.**

### Ukraine and besieged democracies: the striking contrast

While Washington dismantles its student aid system, **Ukraine** is keeping its universities open under bombs, evacuating its students, organizing online courses during missile alerts. **Volodymyr Zelensky** has made educational continuity a national priority, a symbol of civilizational resistance.

**The contrast is striking**. A democracy at war for its survival protects its educational system. A democracy at peace, the most powerful in the world, chooses to dismantle it. Priorities reveal values. And those values, right now, say something worrying about the state of America.

*I am not comparing the suffering — Ukraine is living a tragedy of a completely different magnitude. But this parallel reveals something essential: education is not a luxury that can only be afforded when everything is going well. It is precisely in difficult times that it constitutes the foundation of national resilience.*

## The immediate future: what will happen in the coming months

### Fall 2026: the back-to-school season under strain

**The American university fall semester** of **2026** is approaching. Hundreds of thousands of students will submit their federal aid applications, fill out their FAFSA forms, and await their aid notifications. And they will encounter an administrative system running at **60%** of its normal capacity.

Delays in processing files will produce real situations of distress: students who will not know if they can afford the semester that is starting, families who will have to make irreversible decisions with incomplete information. **This administrative crisis will translate into concrete human dramas before the end of 2026.**

### The systemic risk: when the portfolio cracks

**In the medium term**, if administrative failures at the **FSA** multiply, confidence in the federal student loan system risks being shaken. **Borrowers may** adopt defensive strategies — suspending repayments amid uncertainty, litigating, resorting en masse to forgiveness programs — creating additional pressure on an already weakened system.

The **stability of the $1.7 trillion portfolio** ultimately depends on borrowers' confidence in the system and its ability to serve them properly. Eroding that confidence means weakening the entire financial edifice. **This systemic risk deserves to be taken seriously by markets — and by regulators.**

*I have no crystal ball. Perhaps the system will absorb the shock, new technologies will fill the void, private actors will compensate for public failures. But betting on improvisation to manage $1.7 trillion in student loans is a risky bet — and we are all its guarantors.**Ultimately, what I observe in 2026 resembles a historical turning point whose full implications we have yet to measure. The decisions being made now — diplomatic, economic, military — will define the world in which our children grow up. This responsibility should weigh on every decision-maker.*

## Conclusion: this letter will remain open

### A call to collective responsibility

This open letter is not a rhetorical exercise. It is the expression of a concern grounded in documented facts: **40%** in cuts at the **FSA**, **$1.7 trillion** in loans weakened, millions of files in backlog, a Watchdog report documenting the extent of the damage. These data points do not lie.

The call to responsibility is addressed to all: to the elected officials who have the power to act, to the students who have the numbers to matter, to the citizens who have the voice to denounce. **Democracy does not save itself**. **It saves itself through the engagement of those who still believe in it.**

### Education as a red line

There are lines that democracies should not cross. One of them is the deliberate dismantling of the systems that allow their least advantaged citizens to access education and social mobility. **Crossing this line** means choosing a more unequal, less mobile, less open society.

This letter will remain open until the damage is acknowledged and repaired. It will remain open until **43 million American borrowers** have the guarantee that the system managing their loans has the necessary resources to do so properly. **Education is not a budget line. It is the foundation of everything else.**

**By Maxime Marquette, columnist**

## Columnist's transparency note

### Editorial stance

I am not a journalist but a **columnist and analyst**. My expertise lies in observing and analysing the geopolitical, economic and strategic dynamics that shape our world. My work is to take political strategies apart, to understand global economic movements, to put the decisions of international actors in context and to offer analytical perspectives on the changes that are redefining our societies.

I do not claim the cold objectivity of traditional journalism, which stops at reporting facts. **I claim analytical clarity**, rigorous interpretation and a deep understanding of the complex issues that concern us all. My role is to give meaning to the facts, to place them in their historical and strategic context, and to offer a critical reading of events.

### Method and sources

This text keeps the basic distinction between **verified facts and interpretive analysis**. The rule never changes: a factual claim is published only when a verifiable source supports it, and the sources this article actually used are listed under **Sources**, never here.

**Primary source families** used by the publication, when the story has them: official statements from governments and international institutions, public statements by political leaders, reports from intergovernmental organisations, dispatches from recognised international news agencies.

**Secondary source families**: specialised publications, internationally recognised news media, analyses from established research institutions, reports from industry organisations.

When an article cites statistical, economic or geopolitical data, it comes from the institutions that produce it (intergovernmental organisations, central banks, national statistics offices), and the exact institution is named under **Sources**.

### Nature of the analysis

The analyses, interpretations and perspectives in the analytical sections of this article are a **critical, contextual synthesis** based on the information available, the trends observed and the expert comments cited in the sources consulted.

My role is to interpret these facts, to set them in the context of today's geopolitical and economic dynamics, and to give them a coherent meaning within the larger story of the changes shaping our time. These analyses reflect expertise built through continuous observation of international affairs and an understanding of the strategic mechanisms that drive global actors.

This article describes a documented state of affairs on its publication date, not a prediction: later developments may shift its outlook. No update is promised in advance; when an article is corrected or completed, the change is dated in the text.

## Sources

### Primary sources

- [Benzinga — DOGE cuts 40% of FSA staff, $1.7 trillion at stake — June 24, 2026](https://www.benzinga.com/news/education/26/06/60066601/trumps-doge-cuts-slashed-federal-student-aid-staff-by-40-and-its-raising-alarms-over-americas-1-7-trillion-loan-system)

- [Inside Higher Ed — Department of Education Watchdog details the extent of cuts — June 25, 2026](https://www.insidehighered.com/news/government/2026/06/24/ed-dept-watchdog-details-extent-layoffs-contract-cuts)

### Secondary sources

- [NOTUS — IRS tax season despite DOGE cuts — June 25, 2026](https://www.notus.org/agencies/tax-season-irs-doge-cuts)

- [DefenseScoop — DOGE cuts at the Pentagon, GAO report — June 24, 2026](https://defensescoop.com/2026/06/23/pentagon-workforce-cuts-doge-impacts-gao-report/)

- [CNBC — Trump tariffs, Warren-Kelly debate on manufacturing — June 23, 2026](https://www.cnbc.com/2026/06/23/trump-tariffs-manufacturing-warren-kelly.html)

- [The Guardian — Trump news, Supreme Court — June 25, 2026](https://www.theguardian.com/us-news/2026/jun/25/trump-news-at-glance-supreme-court)

- [x] ≥150

- [x] links only in Sources

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- [x] Primary + secondary sources ≥6 links

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Source: Maxime Marquette, MadMax. When citing, name the author and link https://mad-max.co/en/article/lettre-ouverte-doge-detruit-l-aide-aux-etudiants-1-700-milliards-de-prets-en-dan