Congress' shrillest voices on waste refuse to even look at the industry. Despite sitting on the Senate committee examining for-profit fraud, Kentucky Republican Rand Paul has expressed no curiosity about this money pit. Nor have fellow committee members Lamar Alexander (Republican of Tennessee) or deficit hawk John McCain (Republican of Arizona). Not one responded to repeated interview requests for this story.
President Obama has stepped into the breach, though with customary timidity. In July, the Department of Education made it once again unequivocally illegal to base salespeople's pay on enrollment. But other reforms were so watered down they were meaningless. Taxpayers should probably be thankful Obama did anything at all. At hearings last year, Iowa Democratic Senator Tom Harkin called it the most intense lobbying campaign he'd seen in his 32 years in Washington.
To truly appreciate how weak the final regulations were, consider this: The day they were revealed, for-profit stocks soared. The stock prices of EDMC and ITT Tech in particular increased by 20 percent. In one day.
The government ignores the problem at the country's peril. Total student loan debt, now more than $1 trillion, has surpassed credit card debt. These burdens will limit students' ability to contribute to our consumer economy for years to come. Worse, unlike an underwater mortgage, Congress has made it illegal for people to walk away from student loans they can't pay. The debt will follow them the rest of their life.
"This is basically a parasitic industry that is preying upon not just some of the most vulnerable members of our society, but the best of these most vulnerable members, people who listen to the rhetoric we feed them and who are actually attempting to better themselves," Nassirian says. "This is an industry that takes people's hopes and dreams and cashes them out."
And they won't stop until they've emptied the till.
Guess writing about how sketchy these for-profit universities are is good enough. Because the full page ad for Argosy University on pg. 12 of this weeks Observer just doesn't send the same message. I get that the Observer needs funding, but you couldn't even make it two weeks? Village Voice ftw...
For-profit "schools" shouldn't even be legal, let alone able to get away with this level of fraud. Sad thing is, though, a lot of this doesn't sound that much different from my experience at UTD's Jindall School of Management.
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I was enrolled in a for profit school program for graphic design in the early 1990's. I decide after 4 months that it was not for me and was not on the up and up. Meaning there were computer graphics coming on the scene and this school (college) had no computers available and was not looking into getting any either.
I was told by the financial aid office that I was responsible for the loan that I had taken out and would need to pay that back to the government or to Sallie Mae.
I said forget about that and started researching the school and the members of the "Oklahoma State Board for Private Schools that served as the "watchdog" over these private school and any improprieties.
I found out that the people that owned the private colleges were no only on the Oklahoma State Board but the man that owned the school I was attending was the President of the Board!
So I decided to attend their meeting and state my case in front of the entire board!
Needless to say my loan was "forgiven" and I never heard from them or Sallie Mae again!
Perhaps if more students did something simular these school would close up and go away permanently...
Be careful what you ask for, you just might get it.
Why should neither the for-profit schools nor Congress be worried about the money? After all, it was someone elses money.
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...get your degreeeeeeee..... set yourself freeeeeeeee........
National-American-Universiteeeeeeeeeeeeeeeeeee!
*smiles, humming*
VVoice is just carrying water for lefty academics who don't like competition. The larger problem is not-for-profit colleges, many of which have the same danged problem, but are too poorly run to have any money over at the end of the day. The higher ed bubble will burst pretty soon and the cocooned & mostly un-hireable academics will be slapped in the face by reality. The various for-profit schools will be part of the solution after the bubble bursts.
@roo_ster You obviously didn't read the article but are just spouting typical, tired partisan rhetoric.
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sounds like a real redistribution of wealth underway.(taking from the poor and middle class to give to the rich)
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I'm not sure Bobby can be held to the contract since he was a minor when he signed it. Perhaps Bobby should speak with an attorney.
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"Higher Education" has become a scam on many levels, not just at the for-profit outfits. The UT Austin football program had operating profit with $70.1 million in fiscal 2010 and I still get phone callas asking for donations to support school academic programs.
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@Sotiredofitall Add to that the practice of high school administrators to push ill prepared students into ANY type of higher education in order to improve the school's stats and you have a real problem. There was a counselor at a school I taught at that comvinced an economically disadvantaged special ed student that she could go to community college on student aid. She could only take "developmental" classes and after two years had no college credits and a debt she will struggle a lifetime to repay.
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