Once Again, Obama Is Protecting His Cronies — This Time in the Academy

Did you know that Obama’s Department of Education has been waging a war on for-profit post-secondary institutions? Last year, in fact, the DOE issued a new regulation called the Gainful Employment Rule that is targeted specifically at for-profit vocational colleges. According to the rule, such schools would lose access to federal student aid if it could be demonstrated either that too many of their graduates are in default or that those graduates are using more that 30% of their discretionary income – or 12% of their total income – to pay off their student loans.

This regulation was designed in response to calculations – again promulgated by the Department of Education – that appeared to show that graduates of for-profit colleges were disproportionately defaulting on their loans. But as someone once said, there are lies, damned lies, and statistics. The populations served by for-profit and non-profit colleges are far from identical. Indeed, proprietary colleges like the University of Phoenix or ITT serve more minorities, immigrants, and low-income students than do the non-profits — and as politically-incorrect as it might be to point this out, students from these groups are more likely to go into default no matter where they go.

Genuine justice demands that we hold all post-secondary schools accountable. Genuine justice demands that we scrutinize the worth of every degree program. But it appears the current Department of Education is not interested in genuine justice — and as the National Black Chamber of Commerce has noted, this could have devastating consequences. In focusing its sights solely on for-profit colleges, the DOE risks destroying an industry that provides more than its fair share of educational opportunities to historically under-served, non-traditional students. But for the Obama Administration, this is probably a feature, not a bug. After all, the non-profit educational sector represents a huge stronghold of support for Obama. It makes sense that the president would seek to protect his backers from their chief competitors.


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