Ken Steele's 10th annual higher ed "year in review" continues with part 3, a look at the fall – and rise – of for-profit fortunes in 2016.
In the previous two episodes, we looked at the proliferation of free college tuition policies across North America, the rise of anti-intellectualism and protectionism, and some of the implications for international education. (Check out part 1 https://youtu.be/CZ6nuznRV_I , and part 2 https://youtu.be/AWuE7EhoejI ).
6) FOR-PROFITS
For decades now, massive for-profit schools like the University of Phoenix and Kaplan University have been rewriting the rules of higher education, and transforming the landscape. Last year was their annus horribilis, but also likely marks a turning point to much better times ahead.
For 8 years, the Obama administration aggressively prosecuted for-profit colleges and universities for deceptive marketing, fraudulent enrolments, and high rates of student loan defaults. The GAO’s undercover agents caught recruiters on hidden camera, encouraging students to lie on their loan applications. Major online universities like Phoenix were apparently targeting homeless shelters, and encouraging students with little chance of academic success to apply for substantial financial aid. There was a Senate hearing into For-Profit School recruitment practices, and new, tougher regulations.
Between 2011 and 2015, for-profit universities saw declines of 30% or more in enrolment. Corinthian Colleges faced legal challenges by state and federal agencies, and finally declared it was closing more than 100 campuses in April 2015. In August 2016, ITT Technical Institute lost its accreditation, and it declared bankruptcy within a month, closing 130 campuses and laying off 8,000 employees. In September 2016, Washington revoked the accreditation of ACICS, the Accrediting Council for Independent Colleges and Schools. And just last week, in the final days of the Obama administration, it was announced that more than 800 programs failed the Department of Education’s “gainful employment” standards, and therefore risked losing student aid eligibility – 98% of them at for-profit institutions.
But it seems pretty likely that 2016 marks the nadir of fortune for America’s for-profit colleges and universities. President-elect Trump hasn’t articulated his higher education policies, but it seems obvious that the founder of Trump University will have sympathies with other for-profits. The president-elect has made it clear that he is a strong supporter of school choice and charter schools, promising to repurpose about a third of the federal education budget. It seems likely that his administration will deregulate the for-profit sector. He may grant a reprieve to ACICS. In the past, he has threatened to eliminate the federal Department of Education entirely. Federal legislation like Title IX may be weakened. And competency-based degrees will continue to gain momentum.
Trump’s nominee for Education Secretary, Betsy DeVos, is a reformer of elementary and secondary schools, a strong believer in charter schools, school choice, and voucher systems. She is likely to promote privatization, performance-based government funding, and legislation to further reduce the power of faculty and staff unions. She has been a supporter of religious schools and free speech on campus, and an opponent of political correctness, affirmative action, and same-sex marriage.
Decades of growth in for-profit higher ed were largely undone under two terms of Obama’s administration. Whether you think that’s a good thing or not, the Trump administration is poised to reverse much of the regulation and enforcement that has held back the multinational expansion of for-profit colleges and universities. In Canada and around the world, we need to prepare ourselves for a resurgence of corporate players in higher education.
Excerpts:
Dan Rather Reports – https://youtu.be/Pa1DxUWMsEU
Frontline 2010 – https://youtu.be/08_AuakqdXs
Frontline 2016 - https://youtu.be/Cew6EutvAjE
Fox 5 Atlanta - https://youtu.be/2vhFcKIhm4Y
GAO - https://youtu.be/9PbevtrhEKM
MSNBC - https://youtu.be/JUaMFVDV9PQ
NBC - https://youtu.be/S1XUwbtMxfE
Corinthian hearings - https://youtu.be/tkKmjyuoKyY
Betsy Devos highlights - https://youtu.be/Mc2n9uacQq4
Trump’s school choice proposal - http://www.politico.com/story/2016/09/donald-trump-school-choice-proposal-227915
Next time, we’ll look back at campus challenges and controversies of 2016, in our annual review of higher ed headaches!
