President Obama is confused about his college goals, opines Rick Hess. The president wants more Americans to earn college degrees and everyone to get at least a year of postsecondary education. But his administration is trying to shut down for-profit colleges, “the only institutions eager to help fulfill his grand ambitions.”
Obama’s Justice Department is suing Education Management Corp., the nation’s second-largest for-profit college company, charging it violated federal law by paying recruiters based on students enrolled. Obama’s Department of Education has pushed “gainful employment” regulations that could “stifle for-profit institutions whose graduates don’t earn enough.”
Between 2000 and 2009, for-profit institutions increased enrollment by 300 percent, while public colleges and universities grew by 27 percent. For-profits have rapidly grown capacity and customized services for nontraditional students, even as public colleges and universities have shown little appetite for revamping established routines.
To meet “gainful employment” rules and reduce defaults, for-profit colleges will have to turn away bad risks, Hess writes. For example, blacks and Hispanics are more likely to enroll in for-profit colleges. Overall, 54 percent of students in for-profit two-year colleges are classified as “high-risk,” compared to 36 percent in community colleges.
Graduates of for-profit college programs that last two years or less, report a 50 percent increase in annual income, according to U.S. Education data, Hess notes. Of course, community colleges could provide the same boost — if students could get in and get the classes they need.
Unfortunately, where for-profits are growing like kudzu, community colleges are turning away students. In California, for instance, the community college system turned away 140,000 potential students this year.
Why would financially pressed community colleges turn away students, given that more students bring more dollars? . . . California’s community colleges cost students $1,080 per year, but they also cost the state another $5,000 in subsidies. When those state subsidies aren’t forthcoming, community colleges slam the doors on would-be students.
It’s the for-profits that have a selfish, practical incentive to find ways to add students, even those with families, obligations and unpredictable schedules. Of course, this aggressive competition can result in unseemly, unsavory or outright fraudulent behavior — but you’d think a president championing post-secondary access would be a lot less willing to toss out the baby along with the bathwater.
Obama is trying “to drive a car with one foot on the gas and one foot on the brake,” Hess writes.
We need for-profit colleges, adds New York Times columnist Joe Nocera. State universities are too expensive for poor and working-class students. Community colleges are too crowded.
The for-profits can offer class times that are convenient for students, rather than for professors. They can offer online classes, which many traditional universities have been reluctant — or unable — to dive into. They pay professors to teach, not conduct research. A well-run for-profit college could teach its nonprofit counterparts a thing or two about efficiency and innovation. That’s the part of the profit motive that grades well.
Nocera endorses two ideas floated by Robert Silberman, CEO of Strayer Education. Force the for-profits to share in the losses when students default and set up a national test to screen out students who lack the skills to attend college.