Momentum is growing in a nationwide effort to crack down on for-profit colleges, which are getting rich at the expense of low-income and military students, while robbing the government of funds that could be better spent to provide free public higher education. Groups including Rolling Jubilee, The Debt Collective, and the new Corinthian 15 are fighting back against crippling student loan debt with creative crowdsourced funding solutions, litigation, and outright refusal to pay back loans that led to worthless degrees or, worse, no degree and no job.
Debt for student loans of all types – including legitimate colleges and universities – has reached the $1.3 trillion mark. Only home mortgage debt is greater in the United States, and soon student loan debt will exceed that, and will be greater than the subprime home mortgage debt that tanked the economy in 2008. That’s a scary prospect. Student loan debt is endangering our economy.
Efforts to reform student loan programs offer a patchwork of fixes that don’t really fix anything – requirements for transparency on graduation employment rates, income-contingent repayments, and a stricter gainful employment rule. That last one, proposed by President Obama, seeks to hold the for-profit college industry’s worst performers accountable by cutting off federal funding to colleges that have a high percentage of students who don’t graduate, accrue heavy debts or finish the program so poorly educated they are unable to find a good enough job to repay their loans.
Even that modest – and entirely sensible – plan has been blocked by politicians in the pocket of for-profit college industry lobbyists. While the U.S. Department of Education adopted the gainful employment rules in October 2014, the for-profit college mouthpiece Association of Private Sector Colleges and Universities (APSCU) almost immediately filed suit in Washington, D.C., alleging the new rules are unconstitutional. In February APSCU filed a motion for summary judgment in the suit (APSCU v. Arne Duncan.)
Make no mistake. For-profit colleges are definitely an industry. Mass-market college conglomerates are the nation’s fastest-growing provider of higher education. Just one of these behemoths, Apollo Education Group, which operates the University of Phoenix, collected more than $200 million in profit in 2014. I will be shocked if any of our readers haven’t seen this school advertised on television.
The for-profit college industry is doing so well financially, and so determined to keep its foothold on the private investment dollars from Wall Street and the taxpayer dollars from federally funded student loans, it has quadrupled its lobbying budget in the last 10 years. The industry made $4.4 million in political contributions in the 2012 presidential and congressional campaigns, and spent nearly $3 million in the 2014 congressional elections alone. The number one recipient of for-profit college lobbying dollars is Rep. John Kline – chairman of the House Education Committee.
Groups like Rolling Jubilee, The Debt Collective and Corinthian 15 are demanding the return of public, tuition-free college education. Objectors say the cost of free higher education will be too steep, with the burden entirely on the taxpayer. But taxpayers already spend more than $120 billion a year to fund education, most of it in the form of Pell grants and other student loan programs. If that money could be redirected – with red tape and pork barrel projects eliminated – it would go a long way toward funding education for everyone.
We cannot continue on our current path. It is a danger to the U.S. economy and, worse, a danger to the future success of our nation. If we do not place a higher priority on ensuring our people have access to good, affordable educational opportunities – including learning trades – we are cutting off our potential at the roots.
Source: The Hightower Lowdown and The Huffington Post
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