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President Barack Obama, at daily briefing.
The Obama administration is making another run at limiting how badly for-profit colleges can scam and rip off their students. Since 90 percent of revenue at some for-profit colleges comes from federal student aid, threats to cut the schools off from eligibility for that aid are serious, and the for-profit higher education industry has pushed back aggressively, getting a previous Obama administration plan thrown out by a judge.

Stronger requirements for for-profit colleges to qualify for federal aid are clearly needed:

Education Department reports show for-profit programs account for about 13 percent of all college students but 46 percent of all loan defaults.

At the same time, 22 percent of for-profit student borrowers defaulted on their loans within three years. At public colleges, that number is 13 percent of borrowers.

Remember those figures when you hear for-profit college flacks squealing about how great these schools are for their students. The current plan:
... would require that the estimated loan payments of typical graduates not exceed 20 percent of discretionary income or 8 percent of total annual income.

Programs in which loan payments exceed 30 percent of discretionary income or 12 percent of total annual income would be deemed failing. Those in which loan payments amount to 20 to 30 percent of discretionary income, or 8 to 12 percent of total annual income, would be placed in a warning zone. Either way, colleges would be required to improve performance rapidly, or the programs would be ineligible for federal aid.

Also, the proposal would require colleges to ensure that the loan default rate for former students does not exceed 30 percent. Like the earlier regulation, the proposal threatens to shut low-performing colleges out of federal student aid programs.

These are sensible and badly needed plans to rein in a predatory industry. Let's hope they're upheld in court when the for-profit colleges inevitably challenge them.

Originally posted to Daily Kos Labor on Fri Mar 14, 2014 at 07:54 AM PDT.

Also republished by Daily Kos.

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Comment Preferences

  •  They need to cut off student loans for all (21+ / 0-)

    for-profit institutions. Period. It's another case of socializing losses and privatizing profits.

    If knowledge is power and power corrupts, does that mean that knowledge corrupts?

    by AoT on Fri Mar 14, 2014 at 08:29:37 AM PDT

    •  At the same time, this is better than nothing n/t (1+ / 0-)
      Recommended by:
      dclawyer06

      If knowledge is power and power corrupts, does that mean that knowledge corrupts?

      by AoT on Fri Mar 14, 2014 at 08:31:17 AM PDT

      [ Parent ]

      •  Agreed on both points...n/t (2+ / 0-)
        Recommended by:
        AoT, mcstowy
      •  There is something better (1+ / 0-)
        Recommended by:
        JuliathePoet

        The education system continues to overlook serving students who do not have a means or desire to attend college.  At least not in the foreseeable future.
            When will we wise up and establish Technical High Schools where someone who meets the above situation or is a person "at risk" of leaving HS and give them some skills and tools that when they leave HS they can go into a job and not just flip hamburgers.  Think of it:  your parents do not want to foot the bill for college like Mitt Romney suggests, you do not want the debt and you study for 4 years to do what?  The curriculum in the average HS assumes you will go to college.
            I'm a product of a Technical HS.  It was Federal, State and City financed, a holdover from Post WWII.  Freshman year was "Trade Exploratory" where you tried out 3 or more fields.  You decide what you wanted and the school evaluated you for competency.  I did 3 years in Electronics and carried the same basic curriculum as a City HS with the addition of  technical training.  I carried enough credits to attend any College and during my working career graduated from College and also completed my Masters when I could 14 years later.  I was offered several well paying jobs before HS graduation.  In my 40 year career, I was as high in pay as was possible in the organization.
            Last, there is a study that suggests someone who attends a quality Technical High School and goes directly into the job market can earn more in by their 65th birthday than most college grads.  Think, immediate income and no student loans to pay off.  A career that does not get stale and requires more formal education unlike engineering and the medical fields.  Someone on the ball can break away and start his own business a lot easier than most.
            What fields should be considered?  The sky is the limit.  Coordinate with industry and the Chamber of Commerce.  Electronics techs, Software techs, Computer techs, Electrician, plumbing, auto, architectural graphics on a Cad Cam machine. Many soft sciences in medical fields such as lab techs, X-Ray techs and operators, you name it.  What cannot be completed to earn a State or Federal certificate they will be years ahead of their peers completing the education.

        •  Yes! Technical HS, that still have academics: (0+ / 0-)

          My 1st husband went to a tech high school that still had high standards. He graduated in the mid 907,  and along with acceptance letters to college, he was a trained CNA.  We wouldn't have had health care in college, without his ability to work for employers who needed his skills and provided real health plans, not just plans that most colleges offer that only cover major medical.

          My 2nd husband graduated from a trade high school in the early 800.  He was both a skilled carpenter and mechanic, who got a strong math background. A broken leg, while in the Air Force, got him sent to a computer school, since he wasn't much use to his commander, who needed mechanics whose legs didn't get in the way of being a mechanic. The math from high school paid off, and he kept learning as he went, in the military and for employers with military contracts who needed guys who understood why military computers worked the way they did. I don't think he ever worked as a master carpenter, his specialty in high school, but he loves making and fixing, beautiful furniture.

          So few schools have technical and vocational programs these days, and it is a huge loss. I am always glad when I hear of a new one opening, and hope that people start seeing them as an important part of making sure that everyone has a skill to fall back on.

    •  You need to get the Belgian system (3+ / 0-)
      Recommended by:
      AoT, mcstowy, brentut5

      Students pay €600 a year, less if they are poor.

      I ride the wild horse .

      by BelgianBastard on Fri Mar 14, 2014 at 09:01:16 AM PDT

      [ Parent ]

      •  For a while (3+ / 0-)
        Recommended by:
        AoT, susakinovember, mcstowy

        Tuition in France was completely subsidized. The government later introduced a charge of about 100 euros, just to discourage perpetual students.

      •  In California it was less than that (4+ / 0-)
        Recommended by:
        mmacdDE, RadGal70, mcstowy, RUNDOWN

        for a long time. The goal was to make it free.

        If knowledge is power and power corrupts, does that mean that knowledge corrupts?

        by AoT on Fri Mar 14, 2014 at 09:15:23 AM PDT

        [ Parent ]

        •  Thanks to St. Ronnie (4+ / 0-)
          Recommended by:
          AoT, mcstowy, annieli, RUNDOWN
          Ronald Reagan made the University of California a major punching bag of his 1966 campaign for governor of California, with the encouragement of FBI director J. Edgar Hoover, who saw campus peace activists as dangerous subversives. Upon taking office, Reagan managed to have UC president Clark Kerr fired—he had been the architect of mass higher education not just in California, but across the country—and hiked fees at the UC colleges to the approximate levels of tuition charged elsewhere.
      •  Some state universities actually cost less (0+ / 0-)

        2 year community colleges are usually much less and the credits transfer to Universities knocking off 2 years of higher costs for a four year degree.
        Students in the US are also eligible for private, federal and privet grants that do not have to be paid back.
        There are also scholarships that pay everything for athletes, academic scholars and in some cases deserving low income students.
        The US military academies are free to those who plan to be officers in the various branches of the US armed forces.
        Also the military will pay for their own enlisted and offers to get a degree and for veterans the military has benefits that help pay for school.
        The bottom line is there are many ways to get a free or highly subsidized education in the US.

        •  At least for a while... (0+ / 0-)

          My son had to "pay" to be eligible for the GI Bill. They deducted an extra hundred dollars from his pay for all for years because he wanted to go to college after his hitch. That was in peace time so not sure about now. He went in Jan. of 1999 and got out just before we invaded Iraq. So he ended up paying just under $5k to get about $10k in benefits for serving four years. That most assuredly is not free money but was a good deal for him. Hopefully, since we are in combat, we are offering "free" benefits to those surviving combat that are still able to function passed their PTSD! That is a real bad lottery if they are still charging the folks $100 per month to all of them when most will never benefit.

    •  At least for all for-profit, not degree granting (7+ / 0-)

      institutions

      Those are the worst. Absolute worst. They get students in the door with the promise of a job that never materializes, and they can't even transfer the credits to a regular, degree granting college.

      Nor can they discharge the student loans in bankruptcy. They're completely screwed.

      Ban them, for sure.

      •  Right, if all they give is "certificates" (3+ / 0-)
        Recommended by:
        AoT, mattc129, RUNDOWN

        rather than degrees, it's even worse.

        "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

        by lgmcp on Fri Mar 14, 2014 at 09:29:49 AM PDT

        [ Parent ]

      •  If it's not degree granting (3+ / 0-)
        Recommended by:
        dinotrac, mcstowy, RUNDOWN

        it's probably already not eligible to offer federal financial aid.  Those poor students are stuck with private education loans, which are even less forgiving than federally-guaranteed loans.

        "Education is the key to unlock the golden door of freedom." -- G.W.Carver

        by northbronx on Fri Mar 14, 2014 at 09:56:48 AM PDT

        [ Parent ]

        •  Can private loans be discharged? (0+ / 0-)

          I suspect not, but they should be dischargable.

          That does, however, put a heavy burden on would-be students.

          LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

          by dinotrac on Fri Mar 14, 2014 at 10:05:22 AM PDT

          [ Parent ]

          •  No, private student loans cannot be discharged (1+ / 0-)
            Recommended by:
            dinotrac

            in bankruptcy. There are some conditions under which you can discharge a student loan, but they are very strict and apply to both public and private loans the same.

            If knowledge is power and power corrupts, does that mean that knowledge corrupts?

            by AoT on Fri Mar 14, 2014 at 10:46:23 AM PDT

            [ Parent ]

          •  Private loans (0+ / 0-)

            typically have worse terms, you have no grace period after graduation, and there's no such thing as a forbearance.  So if you're just barely above water, these guys are going to make it that much harder to keep bailing.  They may or may not be dischargable debt, but they probably will help you get to that point more quickly.

            "Education is the key to unlock the golden door of freedom." -- G.W.Carver

            by northbronx on Fri Mar 14, 2014 at 10:53:15 AM PDT

            [ Parent ]

            •  I had a couple of private loans going through (0+ / 0-)

              law school, and they gave the same grace period as my federal loans.  Terms were a bit worse, though.

              LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

              by dinotrac on Fri Mar 14, 2014 at 11:04:40 AM PDT

              [ Parent ]

              •  Different states often have different rules (0+ / 0-)

                Private loans can vary between states, and between kinds of institutions. I looked at one program that was run for people who had an AA/AS and wanted a graduate degree. You were guaranteed a spot in the graduate program going in, which seemed great, until the fine print showed that you couldn't leave with just the bachelor's degree, and since the whole program was considered "graduate school," all of the financial aid was private student loans, with no grant or federal subsidized loans while an undergrad. When I talked to a few other schools, it became obvious that I would pay more than twice as much in the "guaranteed" program, than if I stuck to finishing my BA/BS,  and then applied to grad school.

      •  And promise outrageous earnings from those jobs (0+ / 0-)

        In vocational fields, like medical assistant, or auto mechanic - whose earnings never reach the levels advertised.

        While charging the equivalent of professional degrees.

        “Those who can make you believe absurdities, can make you commit atrocities.” ... Voltaire

        by RUNDOWN on Fri Mar 14, 2014 at 08:30:45 PM PDT

        [ Parent ]

    •  The true crime here.... (1+ / 0-)
      Recommended by:
      AoT

      is that a major portion of this problem is impacting poor and minority students, lured by TV ads holding out the promise of higher education.

      It is not that that promise isn't worthwhile....just that those holding it out have far less interest in making it reality than they do in getting those prospective students to sign up for federal loans.

      There have been earlier attempts to crack down on this problem and sadly, the Congressional reaction came heavily from GOP members of Congress, often fueled by campaign contributions from the industry, claiming that it was an effort to deny educational opportunity to the poor and minorities.

      The above link is to a 2011 Op-Ed piece in Roll Call by the Chairman and CEO of one of those schools, repeating GOP claims of a witch hunt.  Incidentally, he was paid over $3 MILLION a year for that job in cash and stock.

      It also rounded up political support by making contributions....to the Urban League, for example, even as its practices were questioned by numerous state attorneys general.

      Controls are badly needed, but under the present structure of Congress, there is lots of money floating around and the screwing of student loan programs continues.

      Free markets would be a great idea, if markets were actually free.

      by dweb8231 on Fri Mar 14, 2014 at 10:20:39 AM PDT

      [ Parent ]

      •  God, I just had a horrible thought (0+ / 0-)

        I won't be surprised if we start seeing these loans going to people to enroll in more expensive charter schools, thus completing the cycle of horribleness.

        If knowledge is power and power corrupts, does that mean that knowledge corrupts?

        by AoT on Fri Mar 14, 2014 at 10:47:23 AM PDT

        [ Parent ]

        •  I don't think Federal money should be used to (1+ / 0-)
          Recommended by:
          AoT

          support ANY post secondary school (college, etc) unless the institution is certified by some reputable body. I know the loans are supposed to be supporting the students, but when a student graduates without the skills needed to get a keep a decent job, all the support has really accomplished is cheating the student by trapping him in serious debt.

  •  And free t-shirts for the administration! (2+ / 0-)
    Recommended by:
    AoT, annieli

    "The people who were trying to make this world worse are not taking the day off. Why should I?”---Bob Marley

    by lyvwyr101 on Fri Mar 14, 2014 at 08:34:15 AM PDT

    •  I take it you means the administrators of (3+ / 0-)
      Recommended by:
      beauchapeau, lyvwyr101, unclebucky

      for-profit colleges and not the executive branch administration of the federal government.
      Love the tee shirt.  The first ones should be sent to Sarah Palin and Ralph Reed.

      "In this world of sin and sorrow there is always something to be thankful for; as for me, I rejoice that I am not a Republican." - H. L. Mencken

      by SueDe on Fri Mar 14, 2014 at 09:09:49 AM PDT

      [ Parent ]

      •  Absolutely. (2+ / 0-)
        Recommended by:
        annieli, SueDe

        I'm glad the President is tackling this issue.

        But, people are making money from it---so he has his work cut-out for him!

        Palin and her people were like locusts everywhere they went, when she was on the ticket.

        There's just no way to defend Reed.

        All you need to do is put the letter "G" in front of his last name, and you've got the entire picture---and it's accurate.

        "The people who were trying to make this world worse are not taking the day off. Why should I?”---Bob Marley

        by lyvwyr101 on Fri Mar 14, 2014 at 09:29:03 AM PDT

        [ Parent ]

  •  Non-profits should be held to same standards (5+ / 0-)

    I generally agree with the prescriptions here, but in theory a potential student shouldn't care whether a school is for-profit or not-for-profit.

    Now, for-profits are massive offenders in this regard and non-profits are generally not. But a potential student should just care about the economics.

    (-5.50,-6.67): Left Libertarian
    Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

    by Sparhawk on Fri Mar 14, 2014 at 08:43:03 AM PDT

    •  they should care about the education (7+ / 0-)

      Reducing everything to dollars makes us all poorer.

      But the larger problem here is that these for profit schools screw people over constantly. They're horrendous. They have more reason to screw people over because they're in it for the profit, they're legally required to maximize profit, as such they have incentive to be a sketchy as possible while remaining in business.

      If knowledge is power and power corrupts, does that mean that knowledge corrupts?

      by AoT on Fri Mar 14, 2014 at 08:48:00 AM PDT

      [ Parent ]

      •  Re (0+ / 0-)
        Reducing everything to dollars makes us all poorer.
        This is a quote that sounds appealing but I would argue is meaningless. Certainly where education is concerned the economics are critical given the size of the commitment you are making. I would argue that quotes like this do a disservice to students who "don't reduce everything to dollars and sense" and end up working at Starbucks after college with their double major in Medieval French and Art History.  I'm sure that people in this position wish they'd done a little more reducing to dollars.
        But the larger problem here is that these for profit schools screw people over constantly. They're horrendous. They have more reason to screw people over because they're in it for the profit, they're legally required to maximize profit, as such they have incentive to be a sketchy as possible while remaining in business.
        Who cares what their incentives are? As a student I would much rather (hypothetically) get a top quality education from a for-profit institution than a mediocre one from a non-profit.

        Now, it just so happens that just about every non-profit is vastly superior to just about every for-profit, I agree, and that for-profits have awful incentive structures (I also agree). I'm just saying there should be a level playing field for all institutions that receive student loans or federal funding regardless.

        (-5.50,-6.67): Left Libertarian
        Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

        by Sparhawk on Fri Mar 14, 2014 at 09:00:04 AM PDT

        [ Parent ]

        •  I would argue that dollars as a measure (3+ / 0-)

          of value are meaningless. Sure, there's also a question of survival, but in the economy that we've created there's no good choices. I'll say it again, money is not an indicator of value. The reason it isn't is because so much of it is concentrated. If we take money as an indicator of value then the rich get to determine what's valuable, and that's a bad plan.

          Who cares what their incentives are? As a student I would much rather (hypothetically) get a top quality education from a for-profit institution than a mediocre one from a non-profit.
          If you want a top quality education then you should care. These schools lie about what they provide then pump students for as much loan money as possible. You are thinking of the mythical rational actor. That person doesn't actually exist.

          If knowledge is power and power corrupts, does that mean that knowledge corrupts?

          by AoT on Fri Mar 14, 2014 at 09:09:05 AM PDT

          [ Parent ]

          •  Also: (1+ / 0-)
            Recommended by:
            AoT

            The fact that a difficult field of study like Medieval French is considered to be a "useless major" is a crying shame. At the very least, a degree like that should be the equivalent of a business degree: "I know how to do a lot of different kinds of things, learn things that are difficult, and understand ways of thinking that are very different from my own."

            When the scribbling devil is got into a man's head, he falls to writing and publishing, which gets him as much fame as money, and as much money as fame. ~ Cervantes

            by scribblingTiresias on Fri Mar 14, 2014 at 11:01:05 AM PDT

            [ Parent ]

            •  And yet... (0+ / 0-)

              ...the market does not agree.

              (-5.50,-6.67): Left Libertarian
              Leadership doesn't mean taking a straw poll and then just throwing up your hands. -Jyrinx

              by Sparhawk on Fri Mar 14, 2014 at 02:01:31 PM PDT

              [ Parent ]

              •  And while I get that (0+ / 0-)

                It's still a crying shame.

                "The Market" isn't a god and can be made up of bloody stupid people. In this case, I'd say it probably is.

                When the scribbling devil is got into a man's head, he falls to writing and publishing, which gets him as much fame as money, and as much money as fame. ~ Cervantes

                by scribblingTiresias on Sat Mar 15, 2014 at 10:04:16 AM PDT

                [ Parent ]

                •  The market only tells what others are willing (1+ / 0-)
                  Recommended by:
                  Sparhawk

                  to. buy or sell something for, you may value something differently for a range of reasons.

                  A couple may decide that paying $1000 for a wedding photographer is a good idea because those photos will mean a great deal to them.  At the same time, nobody outside the family would be willing to pay even $1 for those photos.

                  You may decide that paying $150,000 and going to classes for 4 years to get a degree in some area maybe the right thing to do, even if your expected employment compensation is no greater than a high school graduate.  Some people may decide that other education choices are better because of the cause and expected earning power of the education. What is important is that people do this in a way they are properly informed about what their choices mean financially.

                  The most important way to protect the environment is not to have more than one child.

                  by nextstep on Sat Mar 15, 2014 at 01:54:57 PM PDT

                  [ Parent ]

        •  No reason for for-profits to even exist (0+ / 0-)

          Many years ago when I was a student, there was no for-profit "college" industry.  It is a recent phenomenon. They spend huge money on promotion, not on education.

          And it's a sucker's game.  Few graduate, but if they do, the degrees aren't worth much.  If I were a hiring manager and some guy shows up with a University of Phoenix or similar degree, I'd totally discount it, and probably demerit the guy as an obvious sucker lacking in good judgment.  The only time these degrees matter, I suspect, are in public sector jobs where the pay scale is based on simply having a degree, no discretion allowed, period.  That's just a dumb remnant of googooism.

      •  And yet there are a number of students who attend (0+ / 0-)

        for-profit schools and get jobs.

        For-profit schools that screw students over should be publicized and should be banned from federal loans just as not-for-profit schools should be publicized and banned from federal loans.

        LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

        by dinotrac on Fri Mar 14, 2014 at 10:08:10 AM PDT

        [ Parent ]

    •  A lot of those for profits schools (1+ / 0-)
      Recommended by:
      scribblingTiresias

      don't grant degrees. Their courses don't transfer to any other school.

      That's the bigger problem.

    •  Non-profits are offenders too (1+ / 0-)
      Recommended by:
      Sparhawk

      Plenty of students come out of non-profit institutions with crushing debts and poor earnings potential.  It's marginally more palatable that the institutions are not-for-profit, but they still have to meet their operating budgets, including payroll, and they still depend heavily on (loan-supported) tuition for the majority of their income.

      "Education is the key to unlock the golden door of freedom." -- G.W.Carver

      by northbronx on Fri Mar 14, 2014 at 09:54:48 AM PDT

      [ Parent ]

      •  You completely missed the point (0+ / 0-)

        of the article.  Yes some students at non-profit colleges default on loans (and that number has grown thanks to the recession and the 1% only recover) but the numbers are much smaller than the for-profits, and even if they default, they at least got an education, which is not true of the for-profits.  That's because the goal of a non-profit university is to provide the best education possible for the lowest cost, wile the goal of the for-profit "college" is to provide the least it can get away with at the highest cost to maximize profits.    

        •  As someone that works in higher education (6+ / 0-)

          at some big name private universities, I can tell you that the goal is hardly to provide the "best education possible for the lowest cost."

          If it were, faculties across the country wouldn't be up in arms and the Chronicle of Higher Education wouldn't be buzzing about the problems of higher education and higher education administration in every other issue.

          The goal at the for-profits is to turn a profit, full stop.

          The goal at the not-for-profits is to grow enrollments, use the resulting revenue to expand the endowment and the institution by the largest amounts possible. This requires minimizing costs, maximizing tuition and the ability to fund it with student loans, and luring students in with costly "perks" that have little to do with education but that do drive up COA significantly in the end.

          People often ask "why would a nonprofit have goals like this?"

          The answer has nothing to do with the institution as such and everything to do with the way in which administration is increasingly drawn from the world of business and finance.

          The new generation of CEO-class presidents don't have commitments to education, but to their careers. "President of University of Anytown" is just another position in their career ladder climb. Since they may later on be targeting "CEO of Megacorp" as their next career move, the metrics that they care about having on their resumes are not educational outcomes, but overseeing periods of strong revenue growth, institutional growth, market share growth, and the consolidation of financial positions. This is what will land them their next job, not a bunch of smart, employed graduates.

          And it's a phenomenon with its own logic. Once one university in a region employes one of these types at the top, the relentless pursuit of growth and the competitive mindset begins to drain enrollments (and thus threaten the endowments and futures) of other schools in the same tier and geographical area. So they have to bring in a growth-oriented and competitive administration as well to begin to "win" some of those "customers" back or risk "going out of business."

          The result is a shift in the logic of the university, from a bearer and developer of cultural canons and scientific knowledge to a business in a highly competitive "market" of higher education vying for "customers."

          Not-for-profits absolutely should be held to similar standards. Fine if fewer of them would be affected than is the case with for-profits; they should still not be allowed to grow into institutions of stealing-from-the-students, and those that do should still be regulated or threatened in some way.

          -9.63, 0.00
          "Liberty" is deaf, dumb, and useless without life itself.

          by nobody at all on Fri Mar 14, 2014 at 10:39:25 AM PDT

          [ Parent ]

          •  ^^^^This. (3+ / 0-)
            Recommended by:
            charliehall2, Sparhawk, HCKAD

            A thousand times this, and thank you so much for saying it better than I could!  I too work for a brand-name private university, and the corporatization of this place is not to be believed.  Our president happens to be an academic, but his entire senior management team are from the corporate world, and the Board of Trustees (which like a corporate board, makes all the senior hiring and compensation decisions) is entirely captains of industry.

            "Education is the key to unlock the golden door of freedom." -- G.W.Carver

            by northbronx on Fri Mar 14, 2014 at 11:11:35 AM PDT

            [ Parent ]

  •  Please clarify, (1+ / 0-)
    Recommended by:
    mcstowy

    whose income are we talking about? DeVry's income or the graduates' income?

    "YOPP!" --Horton Hears a Who

    by Reepicheep on Fri Mar 14, 2014 at 08:55:47 AM PDT

  •  I'm pretty sure this is evil... (1+ / 0-)
    Recommended by:
    mcstowy

    That guy is black! If I had a purse I woukd clutch it, if it weren't for all the guns and bibles!

    I ride the wild horse .

    by BelgianBastard on Fri Mar 14, 2014 at 08:57:22 AM PDT

  •  For-profits view students as customers (4+ / 0-)
    Recommended by:
    lgmcp, AoT, mmacdDE, mcstowy

    Which is the wrong attitude to have for someone who believes you are trying to make them a better and more marketable worker.  You're not a customer, you are an investor in yourself.  The money you provide to a school should be measured in the same manner.

    $20,000 in loans over two years at a public institution got me a master's degree backed by the full faith of the school's faculty.  It's not an Ivy league, but it's a brand name in education in its own right.  I immediately scored a job that paid five times what I paid in tuition each year, making the ROI on my education a mere six months after taxes.  I'll have my loans paid off by the end of 2017 if I push myself.  (Operational expenses, e.g. life, prevent me from going any faster.)

    For profit schools can only dream of their students having those kind of numbers, so they simply don't disclose them or publish misleading figures instead.

    Schools that don't provide an ROI in a reasonable amount of time to their students don't need federal funds.   At the very lease, you should get a salary that is triple one year's tuition (if not five times like mine was.)

    The Cake is a lie. In Pie there is Truth. ~ Fordmandalay

    by catwho on Fri Mar 14, 2014 at 09:01:26 AM PDT

    •  I'll all for reining in predatory practices (2+ / 0-)
      Recommended by:
      mattc129, catwho

      but degrees even from for-profit diploma mills with lower standards, can STILL have an excellent ROI, depending on the person and the circumstances.

      If the for-profit schools were required to function as screens and admissions officers as well as just sales reps, they could easily apply themselves to detect which persons and which circumstances would be disproportionate to expected earnings.

      I had a Ivy-League bachelors and several incomplete graduate degress from public universities.  I reached a point in my life when I needed a quick-and-dirty Masters asap to qualify for me for the level of hiring suitable to my actual training and skills.  I borrowed $15K, shelled it to the University of Phoenix for a not-terribly-satisfactory year or so, and doubled my salary within a month of getting the diploma.  My ROI was around 9 months.

      So, the cheesy for-profit degree program did what I needed it to do, and I was glad that student loans were available.  

      "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

      by lgmcp on Fri Mar 14, 2014 at 09:20:32 AM PDT

      [ Parent ]

  •  PIMA medical college (4+ / 0-)
    Recommended by:
    chimpy, Reepicheep, EastcoastChick, catwho

    was among the worst offenders when I was teaching introductory computer skills, back in the 90s.  Some of the students they enrolled and took out huge loans for, could barely read, and PIMA was promising to train them as medical assistants.  It was a disgrace.  

    "The extinction of the human race will come from its inability to EMOTIONALLY comprehend the exponential function." -- Edward Teller

    by lgmcp on Fri Mar 14, 2014 at 09:04:06 AM PDT

  •  Marian Wang or Pro Publica (2+ / 0-)
    Recommended by:
    AoT, Mother Mags

    Has done excellent reporting on this for a couple of years.

    Hit the link and start reading:

    http://www.propublica.org/...

    No one is coming to save us, the future is in our hands.

    by koNko on Fri Mar 14, 2014 at 09:11:37 AM PDT

  •  Promote community colleges to students (10+ / 0-)

    coming out of high school.  They are a much better deal than the for-profit school companies.

    •  And fully fund community colleges (5+ / 0-)

      One of the reasons people have been going to for profit institutions is because community college budgets have been drastically cut and because of that many classes have been cut making it harder to get through programs.

      If knowledge is power and power corrupts, does that mean that knowledge corrupts?

      by AoT on Fri Mar 14, 2014 at 09:22:47 AM PDT

      [ Parent ]

    •  Great Idea (2+ / 0-)
      Recommended by:
      mmacdDE, Elizaveta

      IF - and that is a big IF you have the support staff at community colleges to support it.  In NC  - our CC system is woefully underfunded and some classes are full for semesters on end - the IT classes and even the basic 'first two years' classes that will transfer to a 4- year institution.

      Community College professors are also woefully underpaid in NC which doesn't help the situation.  In order to utilize our CC system we need to support it financially.

      Why do Republicans Hate Americans?

      by Caniac41 on Fri Mar 14, 2014 at 09:23:42 AM PDT

      [ Parent ]

      •  Fully funding community colleges (2+ / 0-)
        Recommended by:
        AoT, catwho

        is a win-win solution for students and for the community--makes the first two years of college or earning a certificate affordable, provides opportunities for continuing education, provides jobs in staffing and teaching, provides a venue for other community meetings and activities.

    •  you'll need to expand them too (1+ / 0-)
      Recommended by:
      Elizaveta

      When I was an adjunct at a CC the funding got cut because the economy was doing worse. Of course at the same time people that were laid off  and wanted to go to school in hopes of finding a better job.

      Instead of loans we could just support CC so anyone could go there and tuition would be very low or free.  

  •  asdf (6+ / 0-)

    Credit card companies are now required to clearly lay out the terms of the loan: the interest payments, the monthly payment required, how long it will take to repay and how much it will cost to repay.  Student loans are exempt from this requirement.  They are also exempt from bankruptcy.

    So, when you are peddling student loans for your dodgy curriculum, you don't care whether the customer can afford the loan.  The customer cannot discharge the debt. Ever.  
    If customers default, the debtmasters can garnish their pay.
    There is simply no way out of this debt, no matter what the customer's circumstance.

    Schools can charge absolutely outrageous tuition, because the student loan system guarantees those tuitions will be funded. The people making the loans have no incentive AT ALL to be responsible about who they lend to, because payment is guaranteed.

    "YOPP!" --Horton Hears a Who

    by Reepicheep on Fri Mar 14, 2014 at 09:16:28 AM PDT

    •  The people making the loans are us, the taxpayers (0+ / 0-)

      The government guarantees these loans through the Title IV program. The government (taxpayers) gets stuck with the student loan defaults. As usual, they privatize the profits and socialize the losses. The problem is that these schools shouldn't even be able to qualify, or continue to qualify, for Title IV funds with their track records, and that is hopefully what they will fix this time.

      "When people show you who they really are, believe them." - Maya Angelou

      by Pennsylvanian on Fri Mar 14, 2014 at 09:38:49 AM PDT

      [ Parent ]

    •  I'd also like to point out (0+ / 0-)

      that student loans are collaterized and sold to investors, just like mortgage backed securities.  Which means there is even more incentive to originate the loans, because the originator can turn around and sell them off as bundled securities.  The banks have every incentive to make tons of loans available, and no incentive whatever to follow underwriting standards.  

      Bubbles get fueled by over-leveraging and easy credit.  They pop when the credit dries up, and investors can't toss the hot potato to the next guy.

      "YOPP!" --Horton Hears a Who

      by Reepicheep on Fri Mar 14, 2014 at 12:52:57 PM PDT

      [ Parent ]

  •  for profits are awful. Sen Harkin has done some (3+ / 0-)
    Recommended by:
    badscience, AoT, RadGal70

    investigations on this, as has the watchdog group CREW.

    Some of them get 90% of their income from government money - PELL grants or loans. One college in Philadelphia was recruiting students from homeless shelters and then paying them to show up to avoid federal scrutiny.

    College overall may be too expensive, but for profits are as bad as car title loan corporations.

  •  So happy to see this push renewed. It is needed. (1+ / 0-)
    Recommended by:
    mmacdDE

    I worked for one of the now-larger for-profit "educational" conglomerates for a couple of years and quit because of how disgusted I was with their tactics.

    The "admissions" group were hard core sales people and, at that time, were compensated with things like trips to Hawaii for getting asses in seats and federal student loan money in the coffers. The rules have changed on how they can reward these people, but I have no doubt they are working the rules to reward the same "success" rate. There were no real "admissions" requirements, they were more of a wink-wink "application" process.

    In addition to the shoddy practices on admission of students, with qualification for student loans weighing heavy in the "decision" process, there was aggressive pursuit to get parents into privately administered PLUS loans with high interest rates and low qualifying terms.

    Former students were tracked and hounded during the 3 year post-school period to aggressively try to keep them out of default with deferment or forbearance assistance. After that tracking period? They were on their own.

    I won't even get into the reporting of student placement or campus crime statistics here.

    I hope they do something this time about these vultures.

    "When people show you who they really are, believe them." - Maya Angelou

    by Pennsylvanian on Fri Mar 14, 2014 at 09:25:46 AM PDT

  •  Big story this week in the AZ Republic about (2+ / 0-)

    Grand Canyon University. Used to be a nonprofit Christian school, but like a lot of others they were bought by a Wall Street investment firm that buys struggling colleges. All of a sudden they're advertising like crazy around town, their enrollment jumps a lot because they recruit very heavily, they're building and building on campus, and their CEOs are earning a tidy sum. Only problem: they're doing more but not better. Like most for-profit schools (we have Univ of Phx of course) their graduation rate is declining, they pay professors crap wages, and their job placement rate sucks.

    Next big test: They want to join the Pac-12. The other schools are fighting it, fearing, I guess, that GCU could just go out and buy a winning team.

    I wrote about the for-profit university support for Romney in the run up to the election.

    stay together / learn the flowers / go light - Gary Snyder

    by Mother Mags on Fri Mar 14, 2014 at 09:31:33 AM PDT

  •  the BIGGEST rip off in higher ed...."for profits" (0+ / 0-)

    oh I wonder why the Republicans love them?

  •  What about relief for existing debtors? (2+ / 0-)
    Recommended by:
    AoT, middleagedhousewife

    My daughter has about $200,000 in loans for law school, and unless she makes a LOT of money, she'll be paying them the rest of her life.

    High interest rates, not discharged in bankruptcy, and most from banks which got to make profits to do nothing but distribute government money as the middleman without any risk. This system will have real costs to the economy down the line, as these students won't be buying houses, and will be limited in many other purchases which would help the GDP.

    Obviously, students should not get off scott free, but there has to be a fairer system.

  •  So -- do these requirements apply to all colleges (0+ / 0-)

    or just for-profits?

    If they make sense for one group, they make sense for the other.

    LG: You know what? You got spunk. MR: Well, Yes... LG: I hate spunk!

    by dinotrac on Fri Mar 14, 2014 at 10:03:26 AM PDT

  •  PSLF (0+ / 0-)

    This doesn't make up for his proposed $57,500 cap on Public Service Loan Forgiveness (PSLF); which removes a huge incentive for our best and brightest to pursue lower-paying jobs serving the public.

    Sign the Petition to Make Ben Ghazi release his Birth Certificate https://petitions.whitehouse.gov/petition/force-ben-ghazi-guy-release-his-long-form-birth-certificate/bwJPPt9b

    by whereistony on Fri Mar 14, 2014 at 10:07:21 AM PDT

  •  Good - really good for students (1+ / 0-)
    Recommended by:
    middleagedhousewife

    suckered into the fly by night schools with promises of short term training and jobs or a four years degree at 3x the cost of any public university.  

     Still doesn't address, I don't think, the public university and students who can't even afford them anymore - thanks to GOP governors and cuts, cuts, cuts to education.  

    I will not vote for Hillary. What we need is a Democrat in the White House.

    by dkmich on Fri Mar 14, 2014 at 10:12:28 AM PDT

  •  This doesn't fix the problem (0+ / 0-)

    I don't think this will fix the problem.  First of all, student loans are made on an annual basis, not for an entire multi-year course of study.  So, upon initial enrollment, how do you determine whether the applicant is going to be able to meet the "estimated loan payments of a typical graduate"?  Or do you apply the formula every year, which risks a student running out of money short of graduating?  (I've seen this and it's tragic.)  And then there are all sorts of problems with calculating discretionary vs. non-discretionary income and the definition of a "typical graduate".

    I'm absolutely not apologizing for for-profit colleges.  The entire idea of for-profit education is offensive to me, but this feels a bit like trying to hold the colleges accountable for an outcome that they can't really control.  Yes, they can influence the outcome -- a graduate being gainfully employed -- by turning out a good product, but they can't control the other aspects of the economy that determine whether a person is employed, at what salary, and how much the rest of their life costs.

    With this set of regulations, I feel like the for-profits are going to deflect blame onto their graduates for not meeting the "typical" parameters.  This isn't tough enough on the for-profits, and regulations need to focus on the quality of the graduates turned out in addition to whether or not students can afford the education they're signing up for.

    "Education is the key to unlock the golden door of freedom." -- G.W.Carver

    by northbronx on Fri Mar 14, 2014 at 10:30:04 AM PDT

    •  They can be forced to tell the truth (0+ / 0-)

      They can't predict the future, but they can give accurate statistics regarding their graduation rates and the salaries of their graduates (as reported to the school by graduates.)

      They also need to accurately report their graduation rates.  Sure, 90% of your graduates got a job within six months.

      But only 20% of the people who started your program finished it within two years.  Out of a hundred people who started, 20 of them finished the program.  18 of them got a job in six months.

      The other 82 now have debt with no job.

      Doesn't sound so great in those terms.

      The Cake is a lie. In Pie there is Truth. ~ Fordmandalay

      by catwho on Fri Mar 14, 2014 at 11:15:19 AM PDT

      [ Parent ]

      •  Yes indeed (1+ / 0-)
        Recommended by:
        catwho

        Accurate attrition and on-time graduation rates are an important gauge that the program is both enrolling students who can handle the material and that the program is structured appropriately.  Other measures that start to get at the quality of the program include standardized test outcomes (for instance, licensing exam first-time pass rates), number of graduates who are working in their field, and starting salary vs. the industry average.  The latter two are graduate-reported, which I can confirm from first-hand experience is a PIA to gather, but it does yield useful data.

        There should also be some sort of way for prospective students to learn about these numbers.  That they exist and why they're important, not just where to find them.  I think a lot of people go into the process of selecting a school totally blind.  Not everyone has the benefit of family wisdom and a well-staffed career-guidance office.  NYC -- I think it was the Consumer Affairs department -- ran some ads about this sort of thing a while ago, focusing on GED-prep programs.

        "Education is the key to unlock the golden door of freedom." -- G.W.Carver

        by northbronx on Fri Mar 14, 2014 at 01:23:59 PM PDT

        [ Parent ]

  •  I worked for one of these... (1+ / 0-)
    Recommended by:
    catwho

    "for-profit college debt factory" slimeballs for a short time.

    I left. Now I know.

    ANYONE who agrees to a contract for education from one of these places where the actual corporate owner is some creep behind many layers...

    Ought to get their head examined for putting ink to paper.

    Even for PUBLIC institutions, there is no guarantee that you will get a decent enough job to pay off your school debt. But at least there, you got something for your money.

    Not so in these for-profit nightmares.

    Ugh. --UB.

    Money is property, not speech. Overturn Citizens United.

    by unclebucky on Fri Mar 14, 2014 at 10:50:01 AM PDT

  •  There is a much simpler solution (0+ / 0-)

    regulate for-profit colleges like not-for-profit colleges. That is what is done in New York, and it works. Anyone wanting to create a degree program has to get approval from the University of the State of New York. It is difficult to tell the for-profit colleges from the not-for-profits.

  •  This is easy, (0+ / 0-)

    if the 'institution' is one of those that has "credits earned are unlikely to transfer" warnings in the fine print, they are automatically ineligible for any government assistance.  No loans, no grants, no state aid, nada, zero zip zilch.

    Provide assistance to students attending accredited schools only.

  •  To the gallows with them (0+ / 0-)

    As Republiclowns want to push public school reform thereby enriching their corporate benefactors we should apply the same standards to for profit schools. If less than 80% of their students don't get degrees any money owed to that school is zeroed out. Heads up DeVry, ITT. Because the consumer was sold a defective product. Furthermore, if less than100% of graduating students don't find employment in their "degreed" field, earning 300% poverty level the schools lose again. I can't even call these shill companies diploma mills. But their ads always carry the disclaimer that their students can find work at "entry level" aka low pay positions.  So prospective employers get to foot the bill for the "education" these people didn't get. In reality, most 2 year CC graduates, and surely 4 year graduates come better equipped to do the job. The reality is these for profit schools are in bed with Republiclowns. Creating a new generation of low wage workers that will never get out of debt.

  •  Affordable Public Colleges are the best remedy (0+ / 0-)

    to these predators.  

    In California, their budgets are finally being restored after years of damaging cuts.  The UC & CSU systems have been so starved for cash that they are no longer able to accept all of the CC transfers they are required to.  The CSU schools have been so impacted that they could not actually teach (provide seats in classrooms) for all of the students they admitted.  It will take a decade of restored funding to bring them back to being able to fulfill their intended roles.

    Meanwhile, CA's community colleges are building more vocational programs - and competing against some of those 'tech schools.'  A lot of CC's have programs in EMT/Paramedic, Pharm-Tech, Dental Assistant, Nursing, Electric-Tech, Automotive tech.  Etc.

    Interestingly, in CA the Prison & Lawn Forcement systems didn't have make such drastic cuts.  Good to know that here, in CA, we're at least building the gallows for the men.

    -- illegitimi non carborundum

    by BadBoyScientist on Sat Mar 15, 2014 at 09:14:00 AM PDT

  •  Not accredited (0+ / 0-)

    I went to a for profit college when I first got out of the Army.  I used up most of my GI bill doing it only to find out that the degree was not accepted by the Southern Association of Schools and College. It is the southeastern region accrediting agency for all real Universities.  
    None of the credit hours were any good.  In order to go to grad school I had to go to an accredited university to get an acceptable degree which used up what was left of my GI bill.  The GI bill was what the military called their benefits for vets for serving.
    They were a rip off and obviously still are.  Be sure you know that the school you are going to is accredited by the regional accrediting agency.  Don't ask the people at your school. Call a state university and ask them or the Department of Education.

  •  tea party drop-outs (0+ / 0-)

    America offers the freedom to be stupid...

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