Putting Profits Before People

It is really, really difficult to mount effective opposition to even the stupidest, craziest policies of the Trump Administration, because there are so many of them. From the environment to the social safety net to the rule of law, the attacks just keep coming.

So if you haven’t heard about the variety of ways in which Betsy DeVos is protecting her for-profit pals while screwing over taxpayers, students and public schools, that’s unfortunate but entirely understandable.

Lest Betsy get buried in this administration’s growing mountain of excrement, let me share one  decision that highlights her priorities–priorities that perfectly align with those of her fellow Trumpian plutocrats.

Courtesy of the Brookings Institution, we learn

On a Friday in mid-August, Education Secretary Betsy DeVos quietly announced that she would abolish the Obama administration’s gainful employment (GE) regulation–a safeguard that protected students from for-profit career programs that left graduates with poor job prospects and unmanageable student debt.

Her decision means that hundreds of thousands of our nation’s students–chiefly minority students, single moms, veterans, dislocated workers, and working adults–will now be trapped in low-performing for-profit programs and burdened with unaffordable and often life-limiting debts. Her regulatory rollback marks a betrayal not only of our nation’s most vulnerable students, but an abandonment of traditional conservative principles about institutional accountability for taxpayer dollars.

You have to read this jaw-dropping description of how the Department of Education “oversees” for-profit institutions to see just how far this purportedly “conservative” administration has strayed from what used to be bedrock conservative dogma.

To see just how extreme Secretary DeVos’s departure is from conservative principles, we ask this litmus test question: What would it take for a career education program to lose its eligibility for federal student aid under Secretary DeVos’s plan? The answer: A for-profit institution cannot lose its financial lifeline, no matter how poorly it performs its statutory mission to train students for gainful employment in a recognized occupation. One hundred percent of students can drop out of their career program, or not a single graduate could land a job in their field of training, and still the federal government would be willing to keep the taxpayer money pipeline of federal student loans and Pell Grants flowing unabated to the school. It’s a federal free-money plan—“accountability” stripped of consequences.

When I characterize DeVos’ approach as a departure–a U turn!– from what used to be GOP orthodoxy, I’m not exaggerating. In my wildest imagination, I never thought I would point to Bill Bennett–a blowhard I detested–as an example of “doing it right.” (But then, I wouldn’t have believed that I would look back at George W. Bush with something close to fondness, either…)

Bennett, as most of you probably remember, headed up DOE under Saint Ronald Reagan.

When he realized that numerous for-profit colleges were performing abysmally, he proposed new regulations that forced more than 2,000 postsecondary institutions to immediately face a hearing to determine whether their default rate on federal student loans was over 20%. If it was, their participation in federal student aid programs was limited, suspended, or terminated. Bennett especially blasted shoddy trade school programs, calling their “pattern of abuses” “an outrage.”

Then there was Lamar Alexander, also a Republican. He spearheaded the 1992 amendments to the Higher Education Act (HEA), under which postsecondary institutions lost their eligibility for federal student aid if their student default rates exceeded 25 percent for three consecutive years. By 2000, more than a thousand postsecondary schools lost their eligibility–and more than 80% of them were for-profit.

When a political party reverses its longstanding position on an issue, the obvious question is why.

The first and most important cause of the Republican retreat from accountability is the growing power of the for-profit college lobby. By 2005, the eight largest for-profit college chains had a combined market value of $26 billion. For-profit colleges, which always had aggressive lobbying operations, started donating much more money to congressional representatives and switched more of their giving from Democrats to Republican lawmakers. When the Obama administration released its final GE rule, the for-profit lobby donated twice as much to Republican lawmakers ($1.17 million) as to Democratic lawmakers ($583,000).

You really need to read the entire report. And weep.

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For-Profit Education Is About Profit, Not Education

It will come as a surprise to exactly no one that Betsy DeVos is a fan of for-profit colleges. After all, she has championed voucher programs that take funding from public schools and send it to private ones, many of which are run or managed as for-profit enterprises. Unfortunately, her support is not shaken either by the data rebutting the belief that such schools actually provide an education (let alone a superior education), or by the documented fraudulent behavior of for-profit “colleges.”

The New York Times editorial board recently weighed in on DeVos’ roll-back of efforts to protect college students against that fraud.

Say this for Betsy DeVos: The secretary of education has shown an impressive commitment to rescuing her friends in the for-profit college business from pesky measures to rein in their predatory behavior. As pet projects go, it lacks the sulfurous originality of her emerging idea to let states use federal dollars to put guns in schools. But it is a scandal nonetheless. Given the choice between protecting low-income students — and, by extension, American taxpayers — and facilitating the buck-raking of a scandal-ridden industry, Ms. DeVos aggressively pursues Option B.

The Obama-era regulations basically required “truth in advertising.” If too many students at the for-profit school racked up massive student debt–financed, after-all, by We the Taxpayers– and then were unable to qualify for decent jobs, and if the ratio of such failures exceeded a certain level for two out of three years, those schools became ineligible to receive taxpayer-backed loans and grants. The regulation also required for-profit programs to include whether or not they meet federal job-placement standards in their promotional materials.

DeVos said the regulation unfairly targeted for-profit schools, even though–as the Times reported-

A recent review of “borrower defense claims” — requests for loan relief filed with the Education Department by students asserting they were defrauded or misled by their schools — found that almost 99 percent involved for-profit institutions.

There is, in fact, plenty of evidence that for-profit educational institutions are much more interested in profit than in education. DeVos herself doesn’t seem very educated about data, education or the department she presumably runs. Nor is she winning many converts.

A federal court has ruled against her effort to delay implementation of the Obama rules, calling it “arbitrary and capricious.” And California just became the first state in the nation to ban for-profit charter schools. The law was inspired by a newspaper investigation confirming allegations of profiteering at the expense of children’s educations. For-profit charter schools currently operating in California “must convert to non-profit management prior to each school’s renewal deadline.”

Although I absolutely support both the regulations DeVos is attacking and California’s  requirement that for-profit institutions become nonprofit,  the problem isn’t limited to institutions that are organized as private, for-profit enterprises. Any business lawyer can explain the ways in which the line between for-profit and non-profit can be blurred. Create a corporation to provide an arguably publicly- beneficial purpose, and distribute what would otherwise be “profits” as salaries, and voila! (Take a look at some of your local “nonprofit” hospitals…)

And that brings me to Purdue University’s recent acquisition of Kaplan University, a for-profit enterprise now re-branded as public.  I think the Century Foundation got it right, when it charged that Purdue University Global Is a For-Profit College Masquerading as a Public University.

In April, the for-profit Kaplan University officially became an arm of Indiana’s public university system. With its new home and new name, Purdue University Global is the first public university to share control with a for-profit company answerable to investors. When the deal was announced last year, Purdue’s president said that critics of for-profit colleges “should be happy” that Purdue was turning Kaplan into a public rather than for-profit institution. Critics, however, wondered whether the for-profit company’s large ongoing role meant, instead, that Kaplan’s history of predatory practices would simply re-emerge under a “public” moniker.

One answer to that question arrived last week, when Purdue faculty members revealed that the online school is requiring instructors to sign a four-page nondisclosure agreement. The pledge, required for Purdue Global employees, prohibits professors and staff from discussing anything they know about the university’s operations with anyone else, including their colleagues (unless those people already have access to the information). Officials at the American Association of University Professors (AAUP) describe the pledge as “unprecedented for a public, non-profit university” and “breathtakingly inappropriate in higher education.”

Now, The Century Foundation has new documents showing that predatory practices at Purdue Global were baked into the plan from the very beginning.

Those documents–described in detail at the linked article–reveal a number of ways in which Purdue Global was designed to be much more of a for-profit college obligated to its investors than a public institution serving students.

I am a big believer in markets, profits, and capitalism…in the economic sectors where markets and profits are appropriate. Education is not one of those sectors.

Rather than strengthening performance of education’s public function, rather than recognizing the critically important role of education in producing a literate and informed polity, the Republicans running our government–and the Republican running Purdue University–are elevating profit over purpose, and moving us in precisely the wrong direction.

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What Is WRONG With These People?

I don’t know why I constantly ask that question–I know what’s wrong with them. They are greedy and unethical, none too bright, and they lack both human empathy and any concept of justice. The better question is why are they this way? (There used to be a theory about punitive toilet training…)

Are you wondering what has set me off this time?

The Hill reports that

The GOP bill to reauthorize the Higher Education Act, introduced by Rep. Virginia Foxx (R-N.C.) on Friday, would eliminate the Public Service Loan Forgiveness program, which erases student debt for those who work for qualifying employers after making payments for 10 years.

The qualifying employers include government organizations and nonprofits, according to the federal student aid website. Those who volunteer for the Peace Corps or AmeriCorps are also eligible.

God forbid we should offer people an incentive to enter into (underpaid) public service! No, we should reserve government positions for people who are able to take advantage of the opportunities–people who can use those positions to line their already-overflowing pockets.

People like Betsy Devos.

The Washington Post reports that DeVos recently awarded her department’s debt-collection contracts to two firms, one of which she had invested in shortly before becoming Secretary of Education.

A company that once had financial ties to Education Secretary Betsy DeVos was one of two firms selected Thursday by the Education Department to help the agency collect overdue student loans. The deal could be worth hundreds of millions of dollars.

Previously, the Department has used as many as seventeen companies to collect overdue student debt. Suddenly, they need just two.

DeVos presumably divested her stake in the successful bidder as a condition of her appointment, but of course, once she leaves, she will be perfectly free to reinvest or engage in other business dealings with a company that now owes her big time.

What makes this “deal” worth hundreds of millions of dollars–and what makes me so livid–is that DeVos is methodically engaging in a process of overturning Obama-era regulations that were–by any measure–efforts to be fair to the students DOE presumably is there to serve.

It was DeVos who proposed eliminating the Public Service Loan provision. It is DeVos who has reversed the Obama Administration’s decision to forgive loan indebtedness from students who were defrauded by predatory for-profit “universities.”

CNBC took a look at some of the DeVos policy changes, noting that terminating the Public Service Loan Forgiveness program would “drastically impact public servants who have made significant financial and career decisions based on PSLF provisions.”

CNBC also reported that

Under the Obama administration, the Department of Education was incentivized to award Federal Student Aid contracts to debt collection companies with the strongest records of helping borrowers and the lowest rates of loan defaults.

One of Education Secretary Betsy DeVos’ first major moves was to revoke this policy, making it more likely for the government to award Federal Student Aid contracts to companies that sell their services for the lowest price. These low-cost collection companies often offer riskier loans and provide less support to individuals trying to navigate the student loan maze.

Betsy DeVos is a poster child for an administration in which absolutely no one has the slightest concept of “the public good”– or, for that matter, ethical governance.

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Stuck In The Swamp

Can you stand one more diatribe about Betsy DeVos?

According to Gail Collins at the New York Times, DeVos isn’t just devoting herself to the destruction of public elementary and high schools. She’s after public universities too.

DeVos is the superrich Republican donor who once led a crusade to reform troubled Michigan public schools by turning them into truly terrible private ones. Now she’s in the Trump cabinet, and she seems to be dedicating a lot of her time to, um, lowering higher education.

When no one was watching she hired a lot of people that come from the for-profit colleges,” complained Senator Patty Murray of Washington, who feels the additions are far more interested in protecting their old associates than in overseeing them. Murray is the top Democrat on the Health, Education, Labor and Pensions Committee, otherwise known as HELP. These days it’s hard to tell whether that’s a promise of assistance or a cry of distress.

To oversee the critical issue of fraud in higher education, DeVos picked Julian Schmoke Jr., whose former job was a dean of — yes! — a for-profit university. Specifically a school named DeVry. Last year, under fire from state prosecutors and the Federal Trade Commission, DeVry agreed to pay $100 million to students who complained that they had been misled by its recruitment pitch.

Over the past several years, we have learned that students attending these for-profit institutions pay far more, and get far less, than they would at a public college. They have huge dropout rates, and even larger rates of default on the government grants that almost all of them take out. (On the other hand, they have very low rates of employment, despite the rosy promises made by these institutions.)

Although there are some legitimate private colleges, the statistics are pretty devastating.

“The outcomes for people who take out loans at for-profits are abysmal,” said Ben Miller of the Center for American Progress. He added that almost all the students borrow, for courses they could sometimes get for one sixth the price at a community college. And about half the people who borrow default.

As the stories about deceitful for-profits mounted, the Obama administration came up with regulations making it easier for students to refuse to pay their loans if a school had misrepresented their chances of graduating and getting a lucrative career. The rules were supposed to go into effect in July, but DeVos has delayed their implementation.

Not only has DeVos “delayed” implementation of the new regulations, under her management the Department of Education has stopped approving new fraud claims against for-profits, leaving a backlog of more than 87,000.

Give her credit for one educational advance, though: Betsy DeVos is giving us all a lesson on what happens when big political contributions buy a cabinet position for a theocratic ignoramus.

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Don’t Confuse Her With Evidence….

Students at one of America’s historically Black colleges recently booed Secretary of Education Betsy DeVos, who had (inexplicably) been invited to deliver the graduation speech. Many of the graduates also turned their backs when she spoke.

This behavior was rude–but it was understandable.

Like most of Trump’s Cabinet, DeVos is manifestly unfit for public office. She is an ideologue in the Pence tradition; a theocrat with a rigid and limited worldview who has demonstrated a lack of engagement with, let alone understanding of, the issues that face the department she’s been tapped to head.

DeVos has been a “Betsy One-Note,” focused on voucher programs that despite misleading rhetoric, actually replace public schools with religious ones. She insists that private schools do a better job, despite mounting evidence to the contrary. As the New York Times recently reported,

The confirmation of Betsy DeVos as secretary of education was a signal moment for the school choice movement. For the first time, the nation’s highest education official is someone fully committed to making school vouchers and other market-oriented policies the centerpiece of education reform.

But even as school choice is poised to go national, a wave of new research has emerged suggesting that private school vouchers may harm students who receive them. The results are startling — the worst in the history of the field, researchers say.

Voucher advocacy has gradually become part of GOP ideology, and as Republicans have assumed power in the states, voucher programs have expanded–especially in Indiana. That expansion has allowed researchers to make comparisons that had been less reliable when there were fewer schools to compare, and the results of that research began to emerge in late 2015.

Here are some of those research findings–conclusions that would make an intellectually honest educator revisit her preconceptions:

The first results came in late 2015. Researchers examined an Indiana voucher program that had quickly grown to serve tens of thousands of students under Mike Pence, then the state’s governor. “In mathematics,” they found, “voucher students who transfer to private schools experienced significant losses in achievement.” They also saw no improvement in reading.

The next results came a few months later, in February, when researchers published a major study of Louisiana’s voucher program. Students in the program were predominantly black and from low-income families, and they came from public schools that had received poor ratings from the state department of education, based on test scores. For private schools receiving more applicants than they could enroll, the law required that they admit students via lottery, which allowed the researchers to compare lottery winners with those who stayed in public school.

They found large negative results in both reading and math. Public elementary school students who started at the 50th percentile in math and then used a voucher to transfer to a private school dropped to the 26th percentile in a single year. Results were somewhat better in the second year, but were still well below the starting point.

This is very unusual. When people try to improve education, sometimes they succeed and sometimes they fail. The successes usually register as modest improvements, while the failures generally have no effect at all. It’s rare to see efforts to improve test scores having the opposite result. Martin West, a professor at the Harvard Graduate School of Education, calls the negative effects in Louisiana “as large as any I’ve seen in the literature” — not just compared with other voucher studies, but in the history of American education research.

It is important to note that these results come from voucher proponents as well as voucher skeptics. As the Times article noted,

In June, a third voucher study was released by the Thomas B. Fordham Institute, a conservative think tank and proponent of school choice. The study, which was financed by the pro-voucher Walton Family Foundation, focused on a large voucher program in Ohio. “Students who use vouchers to attend private schools have fared worse academically compared to their closely matched peers attending public schools,” the researchers found. Once again, results were worse in math.

DeVos has been an outspoken opponent of even minimal efforts to regulate schools that accept vouchers, but it has become clear that such regulation is necessary and salutary:

The new voucher studies stand in marked contrast to research findings that well-regulated charter schools in Massachusetts and elsewhere have a strong, positive impact on test scores. But while vouchers and charters are often grouped under the umbrella of “school choice,” the best charters tend to be nonprofit public schools, open to all and accountable to public authorities. The less “private” that school choice programs are, the better they seem to work.

If DeVos has seen these studies or addressed their findings, I haven’t seen it reported.

Betsy DeVos is certainly entitled to live in her own alternate universe. What she isn’t entitled to is a public position that allows her to inflict considerable damage on the rest of us.

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