As I wrote on September 23 in this space, here, the Department of Education's (DOE) attempt to put more stringent regulations on for-profit colleges is an example of good intentions gone awry. Rather than expanding college opportunities and fighting fraud, the proposed new "gainful employment" ("GE") rules would instead limit college access especially for minority students, raise taxpayer costs, and create new obstacles for employers eager to hire qualified workers.
The new rules target only for-profit institutions, a relatively small section of higher education. And for reasons not explained by the DOE, it has made no effort at all to hold public and private non-profit colleges to any similar standard for student debt and repayment limitations and job placement outcomes -- particularly puzzling since these schools are subsidized by tens of billions of dollars of direct federal and state grants and are the beneficiaries of the largest share of federally-backed student loans.
Even so, there remains a problem in the debate on this important issue that is fundamental -- and that is respect for the difference between ideology and facts. To put it bluntly and to paraphrase a well-known pundit, those who criticize for-profit schools are "entitled to their own opinions, but not their own facts."
In this spirit, I challenge three important "assertions of fact" by proponents of these regulations, including leaders at the DOE as well as some Democrats in the U.S. Senate, that are false or misleading, or both.
First:
No wonder so many members of the Democratic Congressional Black Caucus have written letters of concern to DOE Secretary Arne Duncan, as well as many other leaders of minority communities who have expressed the same concerns, such as Rev. Jesse Jackson, and Rev. Al Sharpton, regarding these regulations as currently drafted and support serious changes before final issuance.
Isn't it troubling (at least to fellow liberal Democrats, such as myself) that a progressive Democratic administration seems indifferent or determined to go full steam ahead and ignore a disparate racial and economic effect of these regulations on a core Democratic Party base -- minorities and lower income people who comprise most of the for-profit colleges students adversely affected by these proposed regulations? And just before an election day when the president and Democratic Party leaders are seeking a large turnout from that base?
With $20 billion in annual student loans to students attending for-profit colleges, the DOE's own data calculates that the projected cost of student loan defaults at these for-profit colleges -- net of recoveries after defaults - is about one percent to be written off as entirely non-collectible, or less than $200 million - not the $26.5 billion or $24 billion misleadingly cited by the DOE and Senator Harkin, respectively.
Third:
As I wrote in this space several weeks ago, there is a vague and uneasy aroma of elitist double standards going on here. The Harvard or Stanford students majoring in ancient history or anthropology, with difficulty finding jobs in those fields, would be unaffected by these proposed regulations. Yet a minority or low-income student training to be a health care assistant or computer technician or chef would face two new debt and repayment rate tests that could have adverse effect on the institutions under the Department's rules. Why is there such a distinction?
Am I wrong in seeing a double standard here? Why can't Secretary Duncan fix the rule to eliminate its unintended but clearly discriminatory impacts? And why not apply any final rule to all schools -- even, if necessary, by seeking additional congressional authority to do so to ensure evenhandedness? Why not treat the low-income, full-time working parent studying at night at a for-profit college in a two-year program to be a medical assistant the same as a full-time Yale student majoring in philosophy?
By relying on problematic facts, the Department of Education has created a problematic policy. Before finalizing any new rules, it should first finalize its facts. The proposed rules need to be fixed to mitigate their effect on low income and minority students and to apply them across the board -- to for-profit colleges as well as non-profit and public colleges.
Certainly there should be no last minute rush to put into effect by November 1 even a portion of the gainful employment regulations, such as those applicable to new programs, without full review. To do so would be contrary to the spirit if not the letter of the commitment the Secretary made to take into account the more than 90,000 comments made about the gainful employment regulations. It would smack of a rush-to-regulate not becoming and not justified.
One thing we should all agree on -- it's time for Secretary Duncan to put the amber light on and be sure, no matter what, to base such far-reaching regulations on the facts, and only the facts.
Mr. Davis, a former special counsel to President Clinton in 1996-98, is a Washington D.C. principal at the firm of Lanny J. Davis & Associates and is a public spokesperson and registered paid lobbyist on behalf of the "Coalition for Educational Success," a group of 72 for-profit colleges in 37 states with more than 200,000 students. He is the author of "Scandal: How 'Gotcha' Politics Is Destroying America" (Palgrave MacMillan, 2006).
I remember when Lanny---who grew up in my neighborhood, and whose wonderful father was our family's dentist---was a young, brilliant, idealistic achiever, who truly was committed to making a better country and a better world.
Sadly, I can't see that person anymore.
If you can't don't wast your time and money.
Alma Morales Riojas
President and CEO
MANA, A National Latina Organization
My husband died working for a for-profit college and blaming its atmosphere of deceit and greed for ending his remission. The owner of that institution, which has, sadly, grown from its Kansas beginnings, decided to fire the computer science instructor when he insisted that every student need his/her own computer in class. The prez said the college could earn a lot more money if the students doubled up with one computer for every two. All he had to do was find a "computer teacher" who'd work under that condition.
If local employers really want people prepared by for-profits, they can behave the way they do with public and private colleges. They can provide scholarships, pay for schooling in return for a promise to work after graduation or repay, and send their current employees for specialized training.
Frankly, Mr. Davis, when Good Housekeeping magazine dubs for-profit colleges the "Scam Even Smart Women Fall For," you need to find another group to lobby for. The complaints have gone mainstream. Where are the happy graduates of for-profits jumping up to rebut them?
I will say one thing about University's and Community colleges. They really do need to get with it and realize that not every student is an 18 year old kid what can attend class between the hours of 8-4 pm. They need to start offering more night and weekend classes. More and more students are non traditional and working adults. State University's are the worst. They outright refuse to offer classes past 3 pm. They aren't serving the community, so the for-profits are coming in and taking advantage of the underserved. The same way the payday loan and check cashing guys come in and take advantage of poor, underserved, welfare dependent community's. Its sickening.
I have have always had to go Private schools (not for profit) because I have always had to work during the day, and state school refuse to offer classes at night. I wasn't stupid though, I knew better than to go get a junk degree from the University of Phoenix or Kaplan. I went to SLU. There are some good schools who will accommodate a working adult.
Community colleges are a little better, but their night classes fill up very fast.
Its time for the DOE to take a look at why the for profits are so successful from another angle. They need to make some changes to ensure that the community colleges and state schools are actually meeting the needs of the community.
The facts, as Mr. Davis makes clear, picture for-profit institutions rather differently than recent media attention. As schools of choice for minority and working class students, for-profit colleges and universities have loan repayment rates that are expected for students from these backgrounds. For-profit institutions are less demanding on our tax dollars than traditional four-year schools when all sources of public funding, including loans, are taken into account, and their graduation rates are better than traditional community colleges’ rates.
For-profit schools are very market focused. They understand that they have to be innovative, offer convenient class locations and provide schedules that correspond to working adults’ needs. And their market orientation has led them to provide educational opportunity for students who otherwise would not attend traditional colleges and universities.
Like Mr. Davis, I encourage the Department to work toward lowering student loan rates, but at the same time, let us acknowledge that for-profit scshools are playing a critical role for students in the higher education industry.
Regional accreditation is what you need. 18 year old kids don't know this. Heck, most educated adults dont know this. These students just think, "Oh Nationally accredited, must be good because it sounds good."
Students are often shocked and to discover, after the fact, that the associates degree, or even worse bachelors degree, they worked so hard for, and went into debt for, and were proud of, is a degree that nobody will recognize, employers don't take seriously, and cannot transferred into a 4 year university or any other program at an accredited institution. If they want to further their education, they have to start all over again.
Its really really sad.
Yes I understand that the for-profit institutions need to exist to serve a certain population. However that population is not everyone out there who can qualify for a loan. The focus needs to be returned to the students. Any student who has the ability to get into a competitive college should opt for that route. We need to stop deluding people into thinking that everyone needs a college degree...and hold the institutions (both for-profit AND non-profit) for the ongoing support that they offer to their alumni.
Anyway, what you said about the job placement services at more traditional public and private Universities just isn't true. They do much more than just cut out and tape up want ads.
I don't know if you can compare career placement of traditional colleges vs.. non tradition for profit career colleges. Its not a fair comparison. Non traditional colleges are placing graduates into jobs that are low/semi skilled, paying (12/14hr) University's are trying to place entry level professionals (40-55K/yr) which take longer to place. Also a lot of students don't enter the workforce immediately after getting their BA, instead they go to Grad school.
Also is it really ethical to saddle somebody with 30K or more in debt for a degree in medical Assisting? Medical assisting pays $14/hr. How you going to pay all that back with a job that pays $14/hr, that will always pay $14/hr, and that you got with your degree that will only get you as far as that $14/hr job? You can get BSN, RN or LPN from a community college for a few thousand dollars. The Pell grant covers nearly all the tuition for most students, and RN's earn 62K.
If you really want to be a Medical Assistant, Chef, or Motorcycle Mechanic, there is a much better way-Its called Job Corp.
However to clear some things up, I am not an elitist. Yes, I did graduate from college...but as a late bloomer (I earned my BA when I was 29). I received my AS degree from a non-profit, but technical school. They basically charged me a ton of money for skills that would have been better learned on the job (but you live and you learn). Since they were a very small school, they also had very agressive recruitment efforts...similar to what the for-profit universities engage in.
I also work for a state university. I am also a minority (I'm Black).
People can better themselves through a variety of means. You can study many great fields cheaply at a community college...if you wish to go that route. You can also study wherever you want if you have an employer (or maybe a family) that is willing to foot the bill for your tuition. My whole issue is not about the rights that people have to education and/or jobs. Education and jobs are an individual thing that depends a lot of personal abilities. My issue is that for-profit universities are getting a mint from people going into debt for fields and majors that are not suited for them.
For profit schools accept a much higher percentage of students who have financial and educational problems, and then want a pass because these students often default on their student loans. These schools take in students that many times cannot even get into a junior college, and then require them to carry a full course load because that is required to get a student loan. When the student later defaults, its the student's and government's problem, not the school.
I used to know people who taught at for profit schools. They said that more factor to admission was to see if the potential student qualified for a student loan.
If you can get into a formal, campus-grounded junior college or university, do that - even if you can only take a few courses a semester. Otherwise you can kill yourself to make A's, and yet have them mean next to nothing in the job world. Remember, many degrees from nationally known colleges are worth little in today's job market, why would anyone hire someone from an "air school."