Schools and the Bottom Line: Grants, Materials, and the Growing Cost of Learning

Historic Lines of Funding Between Schools and Financial Institutions

An Interwoven System of Support and Stress American schooling, from the public K–12 systems to the best universities, has long relied on federal institutions and banks for stability. Supplying partnerships, government-backed student loans, and research grants have underpinned schools to expand and to experiment. That connection is now, however, subject to new stresses: mounting political interference, tariff-linked cost pressures, and the rising price of classroom essentials have allied together to produce a perfect storm at the intersection of finance and education.

Current Federal Struggles with Universities

Loss of Federal Grants and Political Consequences In 2025, colleges across the country—particularly Ivy League colleges—have experienced federal disapproval. Columbia and Harvard both had federal research grants stopped because of allegations of civil rights violations, primarily related to antisemitism and on-campus protests. Although Columbia ultimately accepted a $220 million settlement in order to resume funding, Harvard remains engaged in a court battle at the threat of long-term financial limbo. These moves have destabilized university budget models premised on stable, long-term federal funding. Similar threats have been made to other institutions, like Brown, Penn, and Northwestern, triggering concerns about a chilling effect on academic speech and the fiscal independence of higher education.

Tariffs and School Supply Expenses Continue to Increase

From Crayons to Calculators: Classrooms Feel the Pinch It's not only colleges that are hurting. Primary and secondary schools are hurting as well, especially when it comes to basic supplies. Tariffs levied in late 2024 on Chinese products—such as electronics, paper products, and basic school supplies—have caused prices to spike everywhere. School districts are seeing higher costs for everything from dry-erase markers to Chromebooks. Parents are paying for it in most locations, with back-to-school shopping lists growing longer and more expensive. In low-income school districts, shortages of supplies have widened achievement gaps and further strained local funding agencies.

Continuities in Educational Finance

What’s Remained the Same Amid Disruption In spite of the churn, some things remain the same. Institutions of financial aid such as FAFSA are still dispensing federal student aid. Private endowments and charitable giving are still streaming, particularly to elite universities. Large banks and lenders aren't abandoning the education market—though they're observing federal tensions carefully. Under K–12 education, Title I funding and state education grants have not seen sharp declines. As the cost of supplies rises, core government support for public schools continues to be a stabilizing force.

Looking Ahead: Invention or Instability?

Surviving the New Economics of Education Universities, colleges, and banks are facing a new day of uncertainty. For higher education, the challenge is remaining autonomous while battling to maintain access to vital funding. For K–12, the issue is equity—ensuring increasing costs do not exacerbate educational inequity. Some are filling the gaps by tapping local manufacturing, online tools, and grassroots donations. Others resort to lobbying: trade policy changes, greater federal funding, and new collaboration with private industry.