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economic policy institute
Trump Attacks Public Service Workers With 'Blatantly Illegal' Loan Forgiveness Order
"Threatening to punish hardworking Americans for their employers' perceived political views is about as flagrant a violation of the First Amendment as you can imagine," said one critic.
Mar 10, 2025
Criticism of U.S. President Donald Trump's executive order intended to limit a program that forgives the federal student loans of borrowers who take public service jobs has grown since he signed it on Friday.
Opponents frame the order as yet another attempt by Trump to quash dissent. The Republican president directed Education Secretary Linda McMahon to propose revisions to the Public Service Loan Forgiveness (PSLF) Program, in coordination with Treasury Secretary Scott Bessent, to exclude "organizations that engage in activities that have a substantial illegal purpose."
The order targets employers "aiding or abetting" violations of federal immigration law and the administration's definition of illegal discrimination, engaging in a pattern of violating state law such as disorderly conduct and obstruction of highways, "supporting terrorism," and "child abuse, including the chemical and surgical castration or mutilation of children or the trafficking of children to so-called transgender sanctuary states for purposes of emancipation from their lawful parents."
Student Defense president Aaron Ament said in a statement that "when PSLF was created by a bipartisan act of Congress and signed into law by [President] George W. Bush, it was a promise from the United States government to its citizens—if you give back to America, America will give back to you."
"In the nearly two decades since, across administrations of both parties, Americans have worked hard and made life decisions under the assumption that the U.S. keeps its word," Ament continued. "Threatening to punish hardworking Americans for their employers' perceived political views is about as flagrant a violation of the First Amendment as you can imagine."
Nadine Chabrier, senior policy counsel at the Center for Responsible Lending, similarly highlighted "serious" First Amendment concerns, saying that "by penalizing individuals seeking loan forgiveness for their associations and the expressive conduct of their employers, new rulemakings could infringe on fundamental rights to speech and association."
"The executive order also undermines the very purpose of PSLF, which Congress established to encourage careers in public service across a broad range of fields," she said. "Stripping PSLF eligibility from nonprofit employees based on the nature of their work will deter skilled professionals from pursuing careers that benefit the public good, weaken critical services for underserved populations and hamper efforts to strengthen vulnerable communities."
American Federation of Teachers (AFT) president Randi Weingarten explained that "PSLF is based on the idea that borrowers who make 10 years of repayments, and who often forgo higher wages in the private sector, can avoid a lifelong debt sentence."
The teachers union sued the Trump's first-term education secretary, Betsy DeVos, "and rogue loan servicers for their failure to administer the program—and we won," Weingarten noted. "This latest assault on borrowers' livelihoods is a cruel attempt to finish the demolition job that DeVos started. The goal is to sow chaos and confusion—separately, the PSLF application form has already been taken offline, making it effectively inaccessible."
The Economic Policy Institute pointed out Monday that "since the creation of the PSLF program, more than 1 million borrowers have received student loan forgiveness, largely due to fixes made under the Biden administration."
"More than 2 million individuals currently qualify for the PSLF program, according to the Department of Education," the think tank added. "The executive order could potentially narrow which organizations qualify for the program."
Student Borrower Protection Center executive director Mike Pierce blasted the order as "blatantly illegal and an all-out weaponization of debt intended to silence speech that does not align with President Trump's MAGA agenda."
"It is an attack on working families everywhere and will have a chilling effect on our public service workforce doing the work every day to support our local communities," Pierce warned. "Teachers, nurses, service members, and other public service workers deserve better than to be used as pawns in Donald Trump's radical right-wing political project to destroy civil society. This will raise costs for working people while doing nothing to make America safer or healthier."
In addition to scathing critiques, some groups threatened to challenge the order. Weingarten vowed that "the AFT won't stop fighting, in court and in Congress, until every single public service worker gets the help the law affords them."
Ament declared that "if the Trump administration follows through on this threat, they can plan to see us in court."
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Jobs Report Seen as 'Calm Before the Storm' as Trump Chaos Rattles US Economy
"Donald Trump is on track to be the first president to deliberately engineer a severe depression," warned one observer.
Mar 07, 2025
Labor Department figures released Friday show that U.S. job growth was weaker than expected last month as President Donald Trump worked to eviscerate the federal government—the nation's largest employer—and whiplashed financial markets with his erratic tariff announcements and reversals.
The U.S. added 151,000 jobs in February, fewer than the projected 170,000. But economists stressed that the numbers don't yet show the full extent of the damage Trump has done in the opening weeks of his second White House term.
"Unfortunately, this is the calm before the storm as trouble is clearly brewing and the pain will be felt across the economy in coming months," said Elise Gould, senior economist at the Economic Policy Institute.
While Gould stressed that "it's too soon" for jobs data to reflect the impact of the Trump administration's effort, in concert with billionaire Elon Musk, to gut the federal workforce—which has impacted some 100,000 government employees thus far—she said emerging numbers are still cause for concern.
"Nominal wage growth continues to hold steady, rising 4% over the year," Gould noted. "After falling steadily since its peak in June 2022, inflation has hovered around 3% for 20 months. As a result, average real wages have been rising. These gains could all be lost with the proposed tariffs and deportations."
The jobs data comes a day after Trump declared on his social media platform that "the Golden Age of America has just begun"—a message that appeared incongruous with economic trends and the perceptions of small business owners, investors, and working-class Americans facing a potentially massive tax hike and looming cuts to food assistance, Medicaid, and other benefits.
"Just one month on the job, warning signs are flashing across the Trump economy," Alex Jacquez, chief of policy and advocacy at the Groundwork Collaborative, said in a statement Friday. "Inflation is rising, consumer confidence is plummeting, business investment is pulling back, and now, the labor market is stalling."
"Instead of focusing on tax breaks for billionaires and giant corporations," Jacquez added, "Trump should find a way to get the economy back on track for working families before it spirals into recession."
"Trump has the power to issue commands in the domains that he controls, but he can't command the stock market to levitate, or prices to moderate, or consumers to feel confident, or people who have just been laid off to go out and shop."
Treasury Secretary Scott Bessent, a billionaire, conceded Friday that the U.S. economy is showing signs of wavering but insisted it's a "natural adjustment as we move away from public spending to private spending."
"We've become addicted to this government spending, and there's going to be a detox period," Bessent told CNBC.
But economists have warned that Trump's instability and constantly changing whims could result in a prolonged reduction in private investment. The president's tariff policy has been so chaotic that it has some wondering whether he's trying to wreck the economy on purpose.
"If we don't get clarity by the back half of this year, economic uncertainty can be like a deer in the headlights," Nancy Lazar, chief global economist at the investment bank Piper Sandler, toldThe New York Times on Friday. "Things just stop. Business confidence is muted, employment is muted, and capital spending is put on hold."
Richard Trent, executive director of the Main Street Alliance, said in a statement Friday that "small business owners don't need more chaos."
"In the past month alone, market turmoil has frozen hiring, disrupted key programs, and rattled confidence," said Trent. "There's still time to correct this, but that requires President Trump and Elon Musk to work with Congress, follow the law, and restore stability. Main Street needs steady leadership, not chaos and cutbacks."
In a column earlier this week,The American Prospect's Robert Kuttner wrote that less than two months into his second term, "Donald Trump is on track to be the first president to deliberately engineer a severe depression."
"Trump has the power to issue commands in the domains that he controls, but he can't command the stock market to levitate, or prices to moderate, or consumers to feel confident, or people who have just been laid off to go out and shop," Kuttner wrote. "In a couple of weeks, the budget talks will reach the point of an increasingly likely government shutdown. Closing the government will be even more of a hit to total demand and consumer and investor confidence."
"In agreeing to reopen the government, Democrats are in a good position to demand that Trump reopen the whole government, starting with the parts that Musk has illegally shut down," he added. "In the meantime, this engineered crisis is entirely Trump's."
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Faith Leaders Blast GOP's Attacks on Poor and Tax Cuts for the Rich
"We are releasing this powerful report to expose for the American people how immoral, dangerous, and insane the administration's proposed economic decisions are," said Bishop William Barber.
Mar 05, 2025
Leaders from various faiths came together in Washington, D.C. on Christians' Ash Wednesday to share an open letter and report calling out efforts by U.S. President Donald Trump's administration and Republicans in Congress to rip resources away from the working class to fund tax giveaways for the ultrarich.
"Budgets are moral documents," said Bishop William J. Barber II, president and senior lecturer of Repairers of the Breach, in a statement. "We are releasing this powerful report to expose for the American people how immoral, dangerous, and insane the administration's proposed economic decisions are and how they are going to hurt people."
"At this critical moment in our nation's history, we need a government that promotes unity and love towards all members of the human family, not division and hatred," added Barber, whose group released the report in partnership with the Economic Policy Institute (EPI) and the Institute for Policy Studies (IPS).
"The Trump-GOP agenda would tilt the playing field even further away from poor and low-income people in favor of the wealthy and big corporations."
The report—titled The High Moral Stakes of the Policy Battles Raging in Washington—explains that "social safety net and housing programs are under attack from two fronts," pointing to both Republican lawmakers' pursuit of cuts and Elon Musk, the unelected leader of Trump's so-called Department of Government Efficiency (DOGE).
The document details attacks on Medicaid, Medicare, Social Security, and the Supplemental Nutrition Assistance Program (SNAP), commonly called food stamps. It also warns that other "vital" initiatives such as the early childhood education program Head Start and federal rental assistance "could be on the chopping block."
EPI president Heidi Shierholz said that "as this report shows, these cuts will be profoundly destructive to incomes and economic security for this country's most vulnerable households—and they are being done for the sole purpose of providing tax cuts that will go overwhelmingly to the wealthiest households."
"This is an upside-down agenda that literally takes from struggling families to line the pockets of billionaires," she stressed. "We stand against this—and we stand for moral economic policies that lift up the most vulnerable, strengthen our communities, and ensure prosperity is shared by all."
Specifically, the GOP aims to extend expiring provisions of the 2017 Trump-GOP tax law that, as the report notes, "delivered huge windfalls to the rich and large corporations and contributed to the exploding wealth and power of our country's billionaire class."
"The Trump-GOP agenda puts recent improvements in the U.S. unemployment rate, low-income workers' real wages, and labor protections at risk. They have already rolled back some gains and indicated opposition to raising the federal minimum wage," the report continues, highlighting that while some states have higher hourly rates, the nationwide minimum wage has been $7.25 since 2009.
The publication also blasts Trump's anti-immigrant policies, emphasizing that "immigrants are a vital part of our communities and economy," and the president's mass deportations "would devastate undocumented and authorized immigrants and citizens alike."
The document concludes with a section on Trump's "alarming moves toward more widespread use of the U.S. war machine both around the world, and within the United States," citing his declaration of a national emergency at the Mexican border, attempt to dismantle the United States Agency for International Development, and proposed takeovers of the Gaza Strip, Greenland, and the Panama Canal.
"This report's data make clear that the Trump-GOP agenda would tilt the playing field even further away from poor and low-income people in favor of the wealthy and big corporations," said IPS executive director Tope Folarin. "We will see more families go hungry, lose healthcare, and struggle to pay rent while Republicans give huge tax windfalls and unprecedented political power to the wealthiest Americans and throw more tax dollars into the machines of war and mass deportation."
Former IPS director John Cavanagh, who is now a senior adviser, joined faith leaders outside the U.S. Supreme Court in D.C. for a gathering to discuss the new report and the letter, which Barber read to the crowd and which can be signed on his group's website.
"We write to issue this call for repentance and truth-telling because our most basic moral commitments have been betrayed by our political leaders," the letter declares. "We have struggled to realize a republic committed to equality and freedom for all of us."
"We write today to confess that we have become subject to the tyranny of technology," it continues. "Awed by the possibilities of progress and the promise of limitless growth, our political leaders have allowed corporate power to go unchecked for decades. Our courts have ruled that corporations should be treated like people while everyday people have been increasingly treated like things. In the richest nation in the history of the world, poverty has become epidemic as the fourth leading cause of death."
"As people of faith, we stand together in the public square to say, 'We repent.' We are not afraid of the false god of efficiency, and we will not bow to any tyranny that claims control of our common life," the letter states. "We invite our colleagues to assemble on the town square, at city hall, or on the state house lawn in communities across this land and join this call. As we have in Washington today, we invite communities to study the report on the true state of our nation."
The livestreamed event was followed by a march to the U.S. Capitol to deliver the documents to congressional leadership.
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