Public Schools to Take the Heat in Government Shutdown, But Loans Will Stay Intact For Now

Work safety inspections? Cut. The IRS? Shut. National Museums? Chucked right out the window.

The ominous shadow of government shutdown touches more than the lives of those working who work directly with the Obama administration, but also those who are dependent on the benefits that have suddenly fallen to the wayside. Arguably most damaging is the shock this bears on our already struggling primary, secondary, and ever-crucial university level education.

In a surprising turn of events, while about only 20 of 1,600 Head Start Programs will be crippled in their ability to help low-income families and their children in education, most other educational institutions will remain afloat. Private universities are of course more or less buffered from the full effects of the shutdown, but public universities are not nearly as lucky, losing potentially 20% of district funding coming from the Education Department's funds.

One of the primary worries leading up to the shut down surrounded the issuing of government grants, including money dedicated to students in need of financial aid. This number is somewhere around the 80% range. The exact number is unavailable because the website announcing details on federal financial aide has been ironically shut down.

Nonetheless, and to the relief of hundreds of thousands of college students aching to scrape by, the vast majority of federal financial aid operations will continue with a "limited impact" to the FAFSA process, delivery of aid and repayment of student loans.

Other grants, like Pell Grants and federal direct student loans, also carry their own shield, since they are permanent and multi-year funded programs. Some innovative grants like Race to the Top, Investing in Innovation and Promise Neighborhoods, can only last until Dec. 31 when they’ll finally succumb as well.

The Department of Education overall unfortunately holds a low priority in this time of crisis. Federal aide may continue on shaky terms yet the high majority of the Department of Education has run into a brick wall, leaving 90% of its 4,225 employees on furlough, according to a contingency plan.

Until the budget reaches a compromise resolving the shutdown issue, we can expect that no more than 6% of total staff at a time will be called back to work in the Education Department. The next upcoming and uncertain hurdle still remains the debt ceiling that is slated to hit in mid-October. Even a brief hesitation in that department could shake the overall economy; meaning public schools could feel some serious aftershocks.