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Dr. E. Faye Williams

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School's Out Forever? New Regulations Could Hamstring President Obama's Education Goals

Posted: 09/15/10 07:14 PM ET

A decade ago, the U.S. graduated more students from college than any other country in the world. Now we've fallen to 12th when it comes to young adults with college degrees, while Canada has taken over the top spot.

It's more than a matter of pride; America's falling educational performance threatens our economic future.

President Obama characterizes this slip as "unacceptable." Speaking to the University of Texas in August, President Obama said, "Beyond a shadow of a doubt, countries that out-educate us today will out-compete us tomorrow." The President hopes to graduate five million more students by 2020 through his American Graduation Initiative.

So considering that higher education is critical to our economic future, why would we want to slam on the brakes just as the Obama administration wants to step on the gas? Why would some people want to limit Americans' access to a college education?

A new Department of Education rule known as "Gainful Employment" would do just that, using arbitrary measures of student loan repayment to deny federal financial aid for some 360,000 students at for-profit career colleges, which cater to underserved communities such as women, people of color, veterans and others. Worse yet, the rule effectively would unfairly single out lower-income students who carry more debt, thereby denying them the education and skills they need to get a better job.

The strangest thing about the Gainful Employment rule is that it only applies to the small percentage of students who attend for-profit career colleges, completely ignoring public, not-for-profit private, and community colleges. It would seem that any fair rule should apply to all colleges, regardless of funding.

In their rush to make a case, critics typically rely on anecdotal evidence to paint a grim portrait of for-profit colleges. Stepping back and seeing the big picture shows that these institutions are filling critical gaps in our higher education system.

For-profit colleges are educating underserved students that have been shut out of public and community colleges, either due to circumstances or simply lack of space.

It's no secret that, as education budgets decline, so do the number of spots available at taxpayer-funded community colleges. Increasingly, for-profit colleges are stepping in to fill the gaps left by state and federal funding cuts, educating qualified students who would otherwise have nowhere else to go.

Statistics show that for-profit colleges educate 13 percent more women and nearly 50 percent more minorities compared with public colleges. For-profit colleges have also welcomed non-traditional students, such as adults who cannot afford to drop their jobs or commute long distances to attend a community college. Career colleges offer unique flexible course schedules and online classes to meet the needs of adult learners - for instance, 30 percent of students at for-profit colleges are single parents, a much higher percentage than other schools.

Moreover, career colleges produce students who are immediately ready to enter the workforce in high-demand fields such as health care and computer/data processing, which are creating an estimated 1.8 million new jobs through 2016. And for-profit colleges boast a graduation rate nearly 20 percent higher than community colleges.

Critics also complain that career colleges make money from federal financial aid. But career colleges are better stewards of that money compared with their public and not-for-profit counterparts. Taxpayers receive a 9% return on each dollar per community college graduate and 18% per career college graduate. The typical career college student costs $7,000 less per year to educate compared with community college students. Moreover, students at the largest for-profit career institutions have loan-repayment rates virtually identical to those of community college students.

President Obama will have to overcome great obstacles if he wants to achieve his goal of graduating five million additional college students by 2020. However, the Department of Education must realize that for-profit colleges are part of the solution, not part of the problem.

Selectively applying the overly-harsh Gainful Employment rule to these institutions will slow progress towards the President's goals and deny a quality education to hundreds of thousands of students. These students are striving to make a new life for themselves - trying to grab a piece of the American Dream.

America's economic future is tied to theirs.