House Republicans are leading a charge to pull the funding from a Department of Education regulation designed to end abusive practices at the nation’s for-profit universities.
The attempt to defund the so-called “gainful employment” regulation comes amid new revelations of coercive recruiting tactics used by one such university.
The rule is designed to ensure for-profit schools prepare students for the workforce, not just saddling them with debt they can’t repay in exchange for useless degrees.
A number of for-profit schools reportedly have targeted Americans hit by the long economic downturn, including bogus offers of “Obama grants” from the 2009 economic stimulus program.
“These schools and their investors benefit from billions of dollars in taxpayers subsidies, and in return, taxpayers have a right to know that all of these programs are providing solid preparation for a job,” Education Secretary Arne Duncan says. “We want to be as thoughtful as possible as we move forward. We’re taking additional time to analyze all the feedback we’ve received to help us strike the right balance between holding these programs accountable to protect students and taxpayers from abuse and making sure we keep whole those programs that are doing a good job.”
A broad coalition of business groups, as well as the universities themselves, have objected to the regulation, leading to the effort to defund the rule.
Opponents claim the regulation unneccessarily punishes for-profit schools.
While the House works to undo the regulation, the rule has solid support in the Senate, led by Sen. Tom Harkin (D-Iowa), chairman of the Senate Health, Education, Labor and Pensions Committee.
Last September, Harkin released a report that showed drop-out rates of 60 and 70 percent at the larger for-profit schools, while $24 billion taxpayer dollars went straight from federal student loan programs to the schools’ Wall Street owners and private shareholders, accounting for 87 percent of their total revenue. Harkin has chaired several hearings on for-profit schools.
Meanwhile, the ProPublica news organization on Monday published a story which reveals the unsavory tactics used by one such school, Grand Canyon University, as exposed by a former recruiter who balked at high-pressure, coercive means the institution used to sign up potential pupils.
The recruiter in the story, reportedly had become disillusioned at another for-profit university, the University of Phoenix, and thought Grand Canyon would be better.
“I remember calling my Dad and telling him it was just like the University of Phoenix, except they’d implemented God into the mix,” Richardson says, according to ProPublica.
The publisher of the news site The Washington Current (formerly On The Hill), Scott Nance has covered Congress and the federal government for more than a decade.