SoylentNews is people
SoylentNews
Education Secretary Arne Duncan says the Education Department wants to make sure that loan programs that prey on students don’t continue their abusive practices. Now Kimberly Hefling reports at PBS that for-profit colleges that don’t produce graduates capable of paying off their student loans could soon stand to lose access to federal student-aid programs. In order to receive federal student aid, the law requires that most for-profit programs, regardless of credential level, and most non-degree programs at non-profit and public institutions, including community colleges, prepare students for "gainful employment in a recognized occupation." To meet these “gainful employment” standards, a program will have to show that the estimated annual loan payment of a typical graduate does not exceed 20 percent of his or her discretionary income or 8 percent of total earnings. "Career colleges must be a stepping stone to the middle class. But too many hard-working students find themselves buried in debt with little to show for it. That is simply unacceptable," says Duncan . "These regulations are a necessary step to ensure that colleges accepting federal funds protect students, cut costs and improve outcomes. We will continue to take action as needed."
But not everyone is convinced the rules go far enough. "The rule is far too weak to address the grave misconduct of predatory for-profit colleges," writes David Halperin. "The administration missed an opportunity to issue a strong rule, to take strong executive action and provide real leadership on this issue." The final gainful employment regulations follow an extensive rulemaking process involving public hearings, negotiations and about 95,000 public comments and will go into effect on July 1, 2015
(Score: 1) by jmorris on Friday October 31 2014, @09:42PM
The problems in higher education won't be fixed by minor tweaking. The problems are systemic.
1. They costs are rising far faster than inflation for degrees worth less and less.
2. Too many degrees are for majors that offer no measurable increase in future earning potential.
3. Both of these are the result of the government funding. Offer virtually unlimited 'other people's money' and students have little interest in a hard major vs an easy one that leaves plenty of time to party. Universities do not need to worry about rising prices since it won't impact enrollment.
4. Since student debt isn't actually 'free' anymore, it is the one debt that bankruptcy can't even discharge, there is a collision coming between myth and reality. Reality will win in the end, as it always does.
(Score: 3, Informative) by VLM on Saturday November 01 2014, @01:46AM
If the prices were reasonable, "education as a hobby" wouldn't be much of a problem.
Lets contemplate "American History from the beginning to the civil war" which I took at the local private college on saturday mornings.
Today it costs $355/credit and it was a 4 credit course, so each kid paid about $1600 by the time you're done with BS addon fees and surcharges (technology fee, although we used nothing more advanced than a TV and DVD player one time, etc) Being a private college we only had about 30 people in our class. So the revenue side of the ledger looks like $50K or so.
Lets come up with the most ridiculous possible expense side of the ledger. From what I read on google and from coworkers working part time as adjunct profs, $1K/credit is considered Very Generous, so being a fancy private college we'll assume 3X that. So they paid $12K to the adjunct. He was a heck of a great instructor. Looking at the stats, "most PHD history grads" are probably serving coffee so he's likely at starbucks, but he was a heck of great instructor. So we'll pay him triple what would be considered generous wages.
Now classes are roughly Sept, Oct, Nov, and half of Dec. So we'll call that 14 weeks, or 14 saturday morning meetings. I've been tangentially involved in renting space for meetings and the nicest waterpark hotel in the area with tons of free parking and an "executive learning center" that makes any college campus look like a dump is about $1000/day. Your generic hotel basement is much cheaper, like $300. So for space we'll book 14 slots at the executive learning center, which is an absolute palace of a facility. Thats $14K.
So the balance sheet for a ridiculously over the top class experience looks like $50K in , $12K to the adjunct, and $14K to the waterpark/hotel/convention center, leaving a mere $24K of profit. So the profit rate for an accredited private college is far over 100%.
More realistically lets see how much school should cost per credit. Well, the adjunct is only realistically going to get $4K as a median-ish income, it is after all only a median-ish school. And you can rent a dumpy room at a dumpy hotel with crap parking and no amenities (still better and cleaner than any college...) for about $300/day but since its only half a day and we can book 14 weeks at a time I think $250/day is totally fair. I mean the parks service books for $75 and that includes 3rd party cleaning services, so we're not being stingy here. Lets say the management overhead is 100% for adjuncts, for every $1 in pay, mahogany row distributes $1 among themselves. Corrupt and worthless but probably about right. So we'll round that up to $8K total to realistically run a class for about 30 kids.
So a "fair price" for a 4 credit course should be about $260 or about $67/credit. The gap from the actual cost of about $60 to the actual charge of about $400 per credit is all gross corruption revolving around credentialism and .gov regulation to eliminate competition, etc.
Lets look at the corrosive effect of student loans in a non-corrupt educational system. $70/credit * 128 credits would mean a BS degree costs about $9K to provide. My new commuter car, possibly the cheapest japanese car on the road, was about $20K almost exactly one year ago. Another way to look at it, is at minimum wage working 4 months per year, never while school is in session, only for part time, 7.25*20*16*4 also equals about $9K. Now I got thru school going part time while working part time to basically full time with no real problem. So I never had saturday morning off or I was in class tue and thrs nights, whatever. Also I made a heck of a lot more than minimum wage once I nearly had a CS degree. Obviously a history grad is going to be continuing his employment at Starbucks. But even they pay a little more then minimum wage.
I'm just saying if the marketplace were not horrifically corrupt and screwed up, "wasting time and money" on a womens lib degree or philosophy or whatever is simply an affordable hobby, well worth the time and money, not an economic death penalty.
After the bubble pops and everything goes back to normal, (of course this might be 2 or 3 decades) I probably will go back for a philosophy or history degree. OR finally go back and finish chemistry. I wonder if my quant and ochem classes from 1990 will still transfer in 2030 or so when this is all settled down. Looking at the cost of providing it, education is somewhat more expensive than becoming a private pilot, but cheaper than taking up golf or ham radio or "computing" as a hobby.
(Score: 1) by SplawnDarts on Friday October 31 2014, @09:55PM
I'll believe something useful's being done when the same standard is applied to the "Gender Studies", "Secularism", "Climatology" and "Puppet Arts" majors at supposedly respectable not-for-profit colleges.
(Score: 4, Insightful) by keplr on Friday October 31 2014, @10:28PM
Employment is not the purpose of education. It's a side effect.
The problem is not that students can't repay their loans through gainful employment, it's that they have to take out loans to begin with. It's making less and less sense to expect people to pay for their own education, and it's only going to become more untenable as permanent structural unemployment creeps inexorably upward. As a property owner, I'd much rather have idle minds in classrooms than roving the streets looking for trouble because there's no opportunity.
I don't respond to ACs.
(Score: 1, Interesting) by Anonymous Coward on Friday October 31 2014, @11:23PM
> Employment is not the purpose of education. It's a side effect.
For the for-profit colleges employment is 100% of their sales pitch. All the other problems with college loans are dwarfed by the billions of dollars of fraud perpetrated by the wallstreet-owned for-profit colleges.
(Score: 0) by Anonymous Coward on Friday October 31 2014, @11:51PM
This is nothing new. Even in the late 80s I got the same pitch. That was for state schools. Go take advantage of their 'job placement' which my parents thought was the bees knees. It was a wall with about 50 of 3x5 cards pinned to a wall and a lady showing you a couple of pointers on making a resume. Now they just point you at a website and do not even bother to have the room in the alumni center.
If you goto school you better have a goal. If it is 'just to go', then dont, you are not ready. You 'might' get some contacts. I got maybe one guy I could contact... maybe. The rest never kept in touch.
(Score: 1) by Anonymous Coward on Saturday November 01 2014, @01:12AM
Sounds like Work and Income New Zealand. Originally, they were there to assist you in finding employment, but under the current neo-liberal government (and their predecessors in the 1990s) you are contractually obliged to accept any job offered to you (confusingly, under neo-liberal doctrine it was your choice to accept the job) and these days, they offer you no help.
When you ask what they do, they will tell you that they are there to "faciliate " you into work. Ask what that means, and they'll just tell you that their job is to faciliate you into work. Curiously, they get paid around $50k/year to insult and belittle you and demand that you disguise your disabilities so you can find work.
Then they get all shitty when someone snaps and kills one of them after all of their bullshit. If you treat people like crap, one day it will come back to you.
(Score: 2) by aristarchus on Saturday November 01 2014, @02:33AM
Is Digital Gardener [youtube.com] a recognized gainful employment occupation? Are thought coins and panera bread gainful?
(Score: 1, Insightful) by Anonymous Coward on Saturday November 01 2014, @10:53AM
We raised them with the mantra 'you must goto college! you don't want a job flipping burgers do you!'
So they all listened to the advice and career counselors. ran off and got degrees like they were told.
Racking up thousands in debt.
And come out.. There are no jobs. We knew there weren't enough. There weren't going to be enough.
So we tell them all 'why don't you get a job flipping burgers you lazy fuck'.
And we wonder why they're so cynical and jaded...
(Score: 2) by darkfeline on Sunday November 02 2014, @04:33AM
>There are no jobs. We knew there weren't enough. There weren't going to be enough.
Let's say I'm one of those jaded youths. Populations are rising everywhere. Technology is making things millions of times more efficient. In the classic economic model, how can everyone make money to support themselves if there aren't enough jobs to do? Pay the wages of thousands of factory workers to the man who owns the machines that displaced them. And you can't just innovate jobs endlessly, human wants are limited, despite what economists would like to tell you. I simply cannot desire more food/entertainment than I can consume in my 16 hour waking period per day nor take up more shelter room than a small house (1% sub-humans notwithstanding). So after we've filled up all of the practical and necessary jobs (agriculture, construction, etc.), all of the entertainment jobs (the world doesn't need, and cannot pay, one thousand authors all writing the same teenage vampire romance drama), all of the innovative jobs (the world doesn't need one thousand tech startups all trying to be the next Facebook), what do the rest of us do? Maybe we can just hire half of them to lay down rails from one coast to the other, and the other half to dismantle them. Gotta pay the somehow, right?
Let's say I'm one of those jaded youths. What do I do? Compete for a job in the corrupt system so that one of my peers can go hungry?
Join the SDF Public Access UNIX System today!
(Score: 2) by PizzaRollPlinkett on Saturday November 01 2014, @11:54AM
The for-profit colleges have fattened themselves at the taxpayer trough for a long time, delivering a substandard education at inflated prices, so they're an easy target for ego-driven Education Secretary Arne Duncan (remember that he once had a Q&A session with teachers and never let them ask any questions) to get positive press for himself. If you're going to take money from the government, you're going to play by their rules, and by all accounts these for-profit schools mainly derive their profits from government loans - the schools get the money up front, and the students are stuck with the loans forever. For-profit schools are in the same category as payday loans, rent-to-own companies, and other scum, so they're a plump, inviting target.
(E-mail me if you want a pizza roll!)
(Score: 1, Interesting) by Anonymous Coward on Saturday November 01 2014, @06:07PM
Substandard how?
Back up a bit. The for-profits exist because the difference between the cost of delivering a standardized morsel of education (1 credit) is smaller than the apparent cost of delivery as expressed by frustrated Community and Public College administrators. In short, it probably costs between $100 and $150 per credit hour to deliver a credit (yes, VLM, I read your post and it was basically correct, but you missed a few necessary cost centers...), but the break even point at so many non-profits is somewhere between $300 and $350. The difference in those numbers is the profit!
So what drives up the price? Accreditation. You have to have it. Call it Credentialism for colleges.
To address this, the for-profits sought accreditation by national bodies (since they are often national, or at least interstate in their scope). To which the non-profits replied, with lobbyists and advertisements and journal articles, that NATIONAL accreditation was a joke - only REGIONAL accreditation should count. Regional accreditation committees are formed by the incumbent players and judge based on their own programs and facilities. Don't have a big library at your college? The big university librarians on the committee won't accredit you. Don't have big open fields for competitive or intramural sports and a gym with all of the latest equipment? No accreditation for you. Ditto every department and sub-specialty. You may want to teach quadrapalegics to be computer programmers, but you WILL have a football program!
But it turns out that it is possible to BUY regional accreditation in ~8-9 year lumps by buying and incorporating colleges with existing accreditation. Funny that.
The last bit is the students. It turns out that all of the geniuses want to go to MIT or CAL Tech or whatever. And the connected kids are gonna go to Harvard or Yale, or whatever. And everyone else with clear potential has been told by their counselors to go to state schools (because that's where high school counselors come from). So that leaves those with ambiguous potential, those with economic disadvantages despite any potential, and those who would not have been well served by the state schools...
In short, so many students in the for-profits do poorly after college because they were destined (by economics, not fate or God or whatever...) to do poorly. But some do great and would not have had the opportunity otherwise.
But are the schools predatory? More predatory than a miscellaneous non-profit? Not really. They all want full classrooms and to get paid. And the government has a wonderful PROGRAM to help with this... which is the problem.
A new class of debt was created that cannot be dismissed by a judge. And the the schools (profit and not) encourage students to use this type of debt. They call this encouragement "FINANCIAL AID". And that's the problem.
Education should be free blah blah blah. Bull. Even in the places where it is, it's done for the geniuses, of course, and then those with the clearest potential. "Those who qualify." Looking at you Germany. And you Finland.
Abolish regional accreditation. Prevent those with a background in "Education" from accrediting educational institutions. Consider abolishing education accreditation altogether. Prevent ALL education institutions from recommending debt financing in ANY form. No "financial aid night"at the local high school. No "click here to apply" for a loan on the college site. Even at the non-profits. That's my take.
FWIW