Faculty in public colleges are often mystified why students would choose to take out enormous loans to attend for-profit colleges whose degrees are mostly not respected either by industry or other colleges. In Confessions of a Community College Dean: Corinthian Learner “Dean Dad” explains why for-profit colleges managed to attract students, despite the low quality and ripoff financing:
Put simply, for-profits rushed in to fill the void left by the publics. Decades of relative neglect of public higher education, combined with a certain (ahem) narcissism within the sector itself, left entire populations underserved. Perhaps for impure reasons, for-profits figured out how to reach students nobody else bothered to reach. They pioneered evening, weekend, and online delivery. They built schedules around student needs. They focused on a few distinct majors that both students and employers could understand. And for a while, in some sectors, some of them got decent results. In the late 90’s, you could do a lot worse than graduating with a degree in CIS.
For-profits filled a void. If you want to prevent the next catastrophe, tend to the void.
That means consciously and aggressively using the public sector—both community colleges and four-year regional campuses—as hedges against future disaster. It means making a dramatic and sustained turn away from the long-term trend of austerity for the publics and an open spigot for for-profits. When you include the cost of bailouts, the “efficient” for-profits wind up inflicting a far greater fiscal burden on the public than more generously funded publics would have. That’s even more true when you factor in student loan debt from students who never graduated, or who graduated but never earned salaries commensurate with their debts.
If dampening demand isn’t really an option, and diverting demand to the private sector leads to financial catastrophe, maybe…stay with me…we could fund the public sector well enough to meet the demand itself. Keep student cost down, get quality up, and learn some valuable lessons from for-profits about meeting students where they actually are. Prevent the next wave of for-profit megagrowth by choking off its air supply.
That means getting away from flat or declining operating budgets supplemented by “targeted” grants that fade away in three years, and instead pouring a fraction of what a for-profit bailout would cost into the public sector. When I was at DeVry, I didn’t see fear of the government or fear of lawyers. I saw fear of the nearby community college. There was a reason for that.
As long as for-profits are considered in isolation, we’ll continue to miss the point. Yes, close loopholes, prosecute liars, and enforce regulations, but those amount to fighting the last war. If you want to prevent the next bailout instead of the last one, you have to address the demand side. Give community and state colleges the resources—and, yes, the flexibility—to flood the zone. It’ll cost some money upfront, but it’s cheaper, more humane, and far more productive than bailouts and legal fees after the next collapse. We don’t have a great record of learning from catastrophes, but this one should be easy.
His post was made in response to the failure of the Corinthian Colleges chain, where the investors had siphoned off all they could get away with and the federal government was not allowing them to be the recipients of student loan money any more. Other for-profit chains (Anthem Education, for example) are also on the ropes, now that the Federal spigot of infinite loans is being turned back a tiny bit. No attempt is expected to claw back the money from the “investors” who ripped off the students tricking them into taking out enormous loans for a fake education.
I think that his message is indeed correct. It is a lot cheaper to fund public universities well than to clean up the mess left by a completely unregulated for-profit education “industry”. Students should not need to take out enormous loans to get an education, particularly not the inferior one that the for-profits provided. Society is better served by having an educated populace that is not hugely in debt.