Stories
Slash Boxes
Comments

SoylentNews is people

posted by LaminatorX on Friday October 31 2014, @08:55PM   Printer-friendly
from the underwater-basketweaving dept.

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

 
This discussion has been archived. No new comments can be posted.
Display Options Threshold/Breakthrough Mark All as Read Mark All as Unread
The Fine Print: The following comments are owned by whoever posted them. We are not responsible for them in any way.
  • (Score: 3, Informative) by VLM on Saturday November 01 2014, @01:46AM

    by VLM (445) Subscriber Badge on Saturday November 01 2014, @01:46AM (#112093)

    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.

    Starting Score:    1  point
    Moderation   +1  
       Informative=1, Total=1
    Extra 'Informative' Modifier   0  
    Karma-Bonus Modifier   +1  

    Total Score:   3