Liberal, Irreverent

Tuesday, May 17, 2011

For-profit colleges business: education

the title of this article below (after I finish my rant) should be "For profit colleges fight for their "right" to keep milking taxpayers and students". As someone ( I dont remember where I read it) wrote, education and privatization dont mix, as the purpose of a for profit business is to maximize profits by charging the highest price while keeping production cost as low as possible. In education this translates to charging the highest possible tuition while providing the least possible amount of education.  And this is exactly what we see not only in for profit colleges but also  in many for-profit K-12. Studies are showing that performance of for-profit schools is not better when compared to the performance of non-profit or public schools funded and staffed at comparable levels (apples to apples comparison). What Republicans and conservatives have been doing for decades is systematically defunding public schools, so performance drops and justify their scheme of privatization, shifting taxpayers dollars to the private companies that are also the funders of their political campaigns. Ok, the article below. 

From AmeticaBlog News

For-profit colleges fight back against gov’t attempt to make them deliver education

Every now and then, I see an "issue ad" for an issue I've never heard of. Those "union boss card check" ads that turned up almost a year (it seems) before the Employee Free Choice Act (EFCA) became news are a prime example. But there are others. 

Lately I've noticed a two-pronged assault against "government" limiting "education choices" — in which the actor-advocate pretends to be a lower-middle class person (and is well cast to look it) who is working in the health care field and wouldn't have had a chance in the world to earn a living, she says sincerely, without the education she received. From some unspecified somewhere. 

"Somewhere" in these ads is a for-profit college. 

Turns out there's a brewing controversy in the for-profit college world. Surprise — many, perhaps most, for-profit colleges exist to vacuum as much money as they can, often from the government, and deliver the least education possible. 

How do we know they don't deliver? Grad rates. From the HuffPost (my emphasis throughout): 

For-profit colleges graduated an average of 22 percent of their students in 2008, according to a new report from Education Trust

That average palls [sic] in comparison to bachelor's-seeking graduation rates at public and private non-profit colleges and universities for the same year, which averaged 55 percent and 65 percent, respectively. 

The report, titled "Supbrime Opportunity" (PDF) [properly spelled, of course] also reveals that for-profit colleges increased their enrollment by 236 percent from 1998 to 2009. 

The median debt of for-profit college graduates -- $31,190 -- far outpaces that of private non-profit college graduates, which stands at $17,040, and is more than triple the median debt for those from public colleges, which is $7,960.
So, low grad rates, high debt-to-student ratios, high debt-to-default ratios, andgovernment subsidiesMission accomplished, as we business types like to say. 

The graduation rate for the "University" of Phoenix is 5%, to give a well-advertised example. (But hey, they have this great pretend football stadium, thanks to corporate naming rights.) 

To its credit, the Obama Dept. of Education is pushing back. Pat Garofalo, who knowsabout this stuff (h/t Dictynna): 

Late last month, an organization called the Coalition for Educational Success (CES) announced its intention to formulate a new code of conduct to govern for-profit higher education institutions. CES said that, in conjunction with former Govs. Ed Rendell (D-Penn.) and Thomas Kean (R-N.J.), it plans to develop standards that “will improve and ensure transparency, disclosure, training, [and] provide strong new protections for students” attending “career colleges.” 

Sounds great. But what is CES and why is it proposing a higher education code of conduct right now? To understand that, one has to dive into a hotly-contested federal policy battle: the attempt by the U.S. Department of Education to implement new rules governing the for-profit college industry, which the coalition represents. 

Since late last year, for-profit colleges—schools like the University of Phoenix and Devry University—have been ferociously lobbying against a new Education Department regulation (known as “gainful employment”) that would cut higher education programs off from federal dollars if too many of their students can’t find good jobs and default on their students loans. ... “While a majority of career colleges play a vital role in training our workforce to be globally competitive, some bad actors are saddling students with debt they cannot afford in exchange for degrees and certificates they cannot use,” U.S. Education Secretary Arne Duncan said last September.
Note the multi-pronged attack — Dem. Rendell and Repub. Kean lending their sellable names to an industry "self-regulation" maneuver (you can see those ads too, from time to time). Plus a strong push-back against the Dept. of Education. Plus attack ads criticizing government intrusion into education "choice." 

You can bet there will be action in Congress as well; after all, why have money if you can't buy stuff with it? 

If you remember just one thing, remember this (Garofalo again): 

Many for-profit colleges make up to 90 percent of their revenuefrom the government through various avenues of aid used by their students, including federal student loans, as I reported earlier this year. They have profit margins as high as 30 percent and their CEOs make millions annually—almost all of which comes courtesy of American taxpayers.
All you need to know? They're thieves. 

For the latest, read the article; it's excellent and rich in detail. This isn't over, and while it's under the radar, it shouldn't be — there's billions at stake, and lives.

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