"Unscrupulous colleges," watered-down legislation, clueless voters

     Today, the Chronicle of Higher Education reported that

DeVry Inc., which owns a variety of for-profit colleges, said Friday that its earnings had grown 93 percent in the fourth quarter of its fiscal year, thanks to increasing enrollment and soaring revenue, according to The Wall Street Journal. The company's profit in the three months ending June 30 totaled $71.6-million, or 99 cents a share, compared with $37-million for the same quarter a year earlier. The company's revenue climbed 28 percent, to $506.7-million. The company said enrollment was up throughout its colleges.

     CHE also reports that the Dept. of Ed, which has belatedly taken an interest in “unscrupulous colleges” (um, like DeVry’s?) “that collect federal student-aid dollars but provide little useful education in return,” is developing a way to determine whether these colleges are following existing laws.
     They announced this “day late and dollar short” measure in a letter to Sen. Tom Harkin, who recently held noisy and dramatic hearings on for-profit colleges. He even showed home movies of GAO stings.
     It was ugly.
     It was wonderful!
     According to the Chronicle, the department today released “data showing the effects that its proposed ‘gainful employment’ rule would have on institutions of higher education.” The rule requires that colleges that receive federally guaranteed loans achieve some degree of employment success among their graduates. As the Chronicle explains,

The proposed rule would cut off federal aid to programs whose students have the highest debt burdens and lowest loan-repayment rates, and could limit enrollment growth at hundreds of other programs. ¶ …[T]he Institute for College Access and Success did analyze the data and found that 54 percent of borrowers who attended public colleges and 56 percent who attended private, nonprofit institutions were paying down the principal on their loans, compared with only 36 percent of those who attended for-profit colleges.

The upshot: students who attend for-profits—and, oddly, more and more students are flocking to them—are a particularly serious drain on federal coffers. As the Chronicle explains, for the U of Phoenix alone, the figure of student loan debt that “isn’t being paid down” is $2.8 billion (according to an expert they quote).
     Legislators keep tinkering with the gainful employment rule. I fear that, by the time they’re done, the legislation will be pretty feeble. That's 'cause the public fails to pay attention. But highly-organized interest groups (in this case, the for-profits) pay careful attention. And they do what they've gotta do to preserve their gravy trains. Meanwhile, the public sleeps.
     They're sleeping right now.
     Today's Inside Higher Ed has a fine article reviewing the apparent Sturm und Drang caused by Sen. Harkin’s hearings and the recent GAO stings. You’d swear these people really had something to worry about!

That sound you heard Friday at 5:15 p.m.? That was the collective thud of the heads of for-profit college executives hitting their desks in dismay when they got a first look at the sort of loan repayment data the U.S. Education Department expects to use in its proposed new regulatory scheme, aimed at ensuring that vocational programs prepare their graduates for "gainful employment." ¶ The numbers were lower than many observers (supporters and critics of the for-profit college sector alike) expected, and while officials of the companies immediately disputed the legitimacy of the department's data and again challenged the government's underlying regulatory approach, they also seemed to recognize that the statistics presented yet another threat.

     The article is lengthy and quite good. Check it out.
     I do wish that, for once, we do the sensible thing.
     Little hope of that.
     Go back to sleep.