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| English: Uncle Sam recruiting poster. (Photo credit: Wikipedia) |
The for-profits reportedly have gobbled up some $36 billion in loans and grants in recent years, while their student-loan default rate is at 22%, essentially double the rate in the public & non-profit higher ed world. How can this happen? It's easy:
1. Entice anyone and everyone to sign up for courses from your corporation.
2. Charge high prices.
3. Get the students to borrow the money.
4. Suck in those dollars, and reward your executives and shareholders handsomely.
5. Watch as the students fail out, ultimately doing no better in the job market than high school drop outs, and
Presto… you've pocketed billions that might have really made a difference for poor young Americans if that money had gone from Uncle Sam to the not-for-profit colleges and universities where it belongs.
Speaking of those gainful-employment rules, some of those stolen billions were diverted into the lobbying effort that resulted in the rescission of the first DOE rules… that plus a misguided federal judge who enjoined them. Let's hope the rules coming out today have teeth and fair better in our plutocratic, lobby-laiden capital.
Meanwhile, many of those failed for-profit students would do better with a stint in the Army. Of course, the for-profits are circling veterans' education benefits like the vultures they are, as well.
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