The Wrongologist

What’s Wrong Today:

The US Department of
Education reported
that the average cost of attending a 4 year For-Profit college surpassed costs at
both U.S. state and private nonprofit universities. Full-time students paid an
average of $30,900 annually at the For-Profit schools in the 2007-2008 academic
year, almost double the average of $15,600 paid at public universities. The
average cost of attending a private nonprofit college was $26,600, the study
said.

Consider graduation rates:  According to the Education Trust, among open-access institutions
that admit 100 percent of their applicants, the 6 year graduation rate is 36% at
private nonprofits, 31% at publics, and just 11% at For-Profits. Worse,
for those who graduate, the median debt associated with a bachelor’s degree
from a For-Profit college is $31,190,nearly twice what it is at a private,
nonprofit institution and almost four times greater than the average debt load
accumulated at a public university.

So,
What’s Wrong?

According
to reports, Mitt Romney really likes For-Profit
colleges. At a town hall meeting in New Hampshire last month, when asked
about the soaring cost of higher education, Romney said students should
consider For-Profit colleges like the
little-known Full Sail University in Florida.

A
week later in Iowa, Mr. Romney offered another endorsement for Full Sail, saying
that For-Profit institutions can “hold down the cost of education” and that
they help students get jobs without saddling them with excessive debt.

If
students look at the For-Profit option, Mr. Romney said, “you’re going to find
students saying: ‘You know what? That’s not a bad deal. I’m not willing to come
out of college with a hundred thousand dollars in debt.’ The alternative is to
say the government is going to pay for that.”

He
added: “I just like the fact that there’s competition. I like the fact that
institutions of higher learning will compete with one another, whether they’re
for-profit or not-for-profit.” (emphasis by the Wrongologist)

Well
friends, what Romney really likes is finding another way to privatize
taxpayers’ funds.  Bloomberg reported For-Profit colleges
received about $30.2 billion dollars in revenue from government student loans and grants, called
Title IV funds, in the 2009-2010 school year, according to the Education
Department.

Nearly 25% of 1,890 For-Profit institutions
got from 80% to 90% their revenue in federal student aid in 2007 and 2008.

The Feds knew that there was an opportunity
for the For-Profits to abuse the system, so federal law requires they receive not
more than 90% of their revenues from federal student-aid programs. Well,
right now, eight For-Profit colleges are above the limit (including University of
Phoenix, Corinthian Colleges and Kaplan) and an additional 257 of them took in
nearly the legal limit, exceeding 85%, a report released in February
2011 by the Department of Education shows.

And there should be no surprise that Full
Sail’s chief executive, Bill Heavener, is a major Romney campaign donor and
co-chair of his funds raising team in Florida. Maybe it is no surprise
that Full Sail got $205.6M in federally
sourced revenue in 12 months ending 6/30/2010. 

The Pew Research
Center did a survey of students at For-Profit colleges. Among their key findings:

• One-quarter
  (24%) of 2008 bachelor’s degree graduates at For-Profit schools borrowed
  more than $40,000, compared with 5% of graduates at public institutions
  and 14% at not-for-profit schools.
• Graduates of For-Profit
  schools are demographically different from graduates in other sectors. Generally,
  For-Profit school graduates have lower incomes, and are older, more likely
  to be from minority groups, more likely to be female, more likely to be
  independent of their parents and more likely to have their own dependents.

The Wrongologist isn’t against for-profit
education,
his experience with DeVry graduates is excellent. The ability of a student to
work full-time and get a certification or a degree, possibly on-line, has value.

The questions are: 1). How is it that these
firms get such a high percentage of their revenue from the Feds? and 2). Why is
it that their programs generally cost more than the not-for-profits, even
though they do not incur the costs of those pesky buildings and
extra-curricular activities?

Finally, what is it with Mitt? Along with his Republican brothers, he wants to privatize public schools by taking tax
dollars and funneling them to for-profit grammar and high schools. They want to
privatize prisons, roads, parts of the military, social security and oh yeah,
medicare.

Privatize the taxpayers’ money. Tear down
the commons. Taxpayers take the risk, capitalists get the rewards.

Like TBTF banking, this is simply another
example of welfare-driven capitalism.

And
it is just as WRONG!