For-profit institutes of higher education, namely online colleges such as the University of Phoenix, wanted the government to stop limiting the amount of debt students are allowed to carry. These for-profit schools lost that battle, though, and the Obama administration refused to raise the debt limit, much to the chagrin of for-profit online colleges everywhere.
The news that for-profit institutions won’t be allowed to suck college students dry came at a bad time, as many such schools are currently embroiled in lawsuits, regulatory scrutiny, and dwindling student enrollment numbers (most likely caused by the realization that attending a for-profit school is the equivalent of buying a college degree instead of earning one).
Two lawsuits had been filed in an effort to block President Obama’s new rules for colleges offering career training programs (namely said for-profit schools), and the first has already been shot down by U.S. District Judge Lewis Kaplan in Manhattan, who said her decision is based on the fact that the Education Department,
“…has a strong interest in ensuring that students ? who are, after all, the direct (and Congress’s intended) beneficiaries of federal aid programs ? attend schools that prepare them adequately for careers sufficient for them to repay their taxpayer-financed student loans.”
The Education Department was pleased with the decision in the case, with Education Department spokeswoman Dorie Nolt saying,
?These regulations will hold career colleges accountable for the programs they offer and promote improvements that protect students, benefit consumers and honor taxpayers? investment…Every student deserves to graduate from higher education with a degree or certificate that equips them for success.”
And the statistics back this up, too, the Washington Post reports:
“Attending a two-year for-profit institution costs a student on average four times as much as attending a community college, according to the Education Department. More than 80?percent of students at for-profits borrow, while less than half of students at public institutions do the same. Students at for-profit colleges represent only about 11?percent of the total higher-education population but 44?percent of all federal student loan defaults.”
It should be noted, however, that not all online colleges are for-profit, and not all for-profit colleges are online. Campus-based ITT Tech, for example, is a for-profit college that is not based online. There are a plethora of online colleges, along with traditional universities offering online degrees, that are public or not-for-profit, that offer working, non-traditional students the chance to earn their college degrees. These schools include schools such as Indiana State University and Southern New Hampshire University, as well as prestigious institutions like Harvard.
