Sen. Harkin wants to protect you from for-profit schools

Sen. Tom Harkin, D-Iowa, wants to protect you from for-profit colleges.  Really.

University of Phoenix, with more than 200 locations across the country, and DeVry University, with 90 schools, have graduated hundreds of thousands of students nationwide in the past 10 years.  But Harkin doesn’t care.  Beholden to teacher unions and non-profit college administrators, the chairman of the Senate Health, Education, Labor and Pensions (HELP) Committee is waging a war against for-profit schools.

He wants to ensure you don’t take out a loan you can’t repay for a college degree you can’t parlay into what he deems meaningful employment. He, and the Obama administration, who just released proposed new rules banning loans to students who attend the wrong schools (by their standards) have determined that for-profit universities don’t always give students their money’s worth. In other words, Harkin wants to limit your options so you don’t make the “wrong choice.”

Of course, Harkin has no idea who you are or any idea what you, or anyone, wants to do with your lives. But that’s never mattered to meddling politicians, so he’s trying to make you dependent on traditional, non-profit colleges, whether they fit your needs or not.

The assertions he’s made would be damning, if he could prove them. Instead of setting out to prove them, however, he enlisted the help of someone who figures to profit massively if for-profit schools lose their federal loan-dependent students and suffer financially. Harkin held a hearing of his committee in an attempt to prove his case, but a funny thing happened on the way to self-righteousness.

He brought in Steven Eisman, a Wall Street short-seller with no experience in education policy, who acknowledged he and his investors stand to benefit if efforts to restrict federal loans to students who choose for-profit universities is successful. Eisman testified that for-profit college industry is as “socially destructive” as the subprime mortgage industry that nearly brought down the U.S. financial system.

Bringing in a witness so brazenly positioned to profit from legislation that could grow out of such a hearing didn’t even pass muster for progressive groups, such as Citizens for Responsibility and Ethics in Washington (CREW), whose executive director, Melanie Sloan, said, “Congressional hearings are intended to air issues of national significance – not line witnesses’ pockets.”

But let’s not just impugn the witness. Let’s examine the claims.

Harkin says these schools spend far more to recruit and attract students than traditional colleges. Of course they do. They don’t have football teams with million dollar coaches or Nobel laureates or award-winning theater departments to do their recruiting for them. If they don’t make students aware of the opportunities they offer, students won’t know. If students come to believe these marketing efforts mean they don’t receive sufficient value for their tuition dollar, they will signal it in the most unarguable way possible – by attending school elsewhere.

Harkin says he’s become alarmed that 23.6 percent of Pell Grant money flowed to for-profit schools in 2008-2009 – double the percentage of 1999-2000. He’s also concerned that 80 percent of the revenue of some for-profit schools comes from federal student loans. This may mean – may – traditional colleges receive less in Pell Grant and other student loan money.