http://www.ed.gov/news/press-releases/department-education-b...
An non-paywalled link.
ITT is no longer allowed to enroll students who rely on federal loans and grants
31–40 of 142 posts
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#32The original title is actually "This really might be the end of ITT" which I thought was clickbaity and didn't really explain the story.
On the other hand cutting off Title IV is basically the death penalty for a university ... So the original title might not be that far off from reality.
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#33This is incremental progress, it's just one school. But a crazy step in the right direction. For-Profit institutions are a plague on our nation (high-cost low-value educations) allowed to rise up out of the failings of our strained public institutions (not enough capacity to meet demand). What really blows my mind is that this seems to come after the justice department discontinues for profit federal prisons. It's li…
> What really blows my mind is that this seems to come after the justice department discontinues for profit federal prisons.
The Administration has been heightening scrutiny of colleges receiving federal aid money, particularly for-profit institutions, for some time. The ITT action echoes the prior action against Corinthian.
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#34Earlier quoted context omitted.
I think the government has a right to ensure that the aid it pays out for an education is actually going towards an education, and not a front for siphoning federal aid for the enrichment of executives and shareholders.
>not a front for siphoning federal aid for the enrichment of executives and shareholders. So many public and private non-profit universities are going to wet themselves if anyone starts enforcing that rule. Ok, they don't have shareholders, but it's well documented that the increasing cost of university and college educations is largely driven by administrative overhead and not paying professors, adjuncts and lecture…
The increase in administrative overhead and such is more a case of the modern customer. Comparing private non profit universities and these BS places is stretching too far.
On the customers - the ability to attract modern students rests more on amenities like dining halls and dorms, not on the academics. Sad, but ultimately true.
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#35The original title is actually "This really might be the end of ITT" which I thought was clickbaity and didn't really explain the story.
On the other hand cutting off Title IV is basically the death penalty for a university ... So the original title might not be that far off from reality.
Clickbaity titles are "true" in the sense of being accurate. The issue with them is that they don't explain what the article is about (forcing you to click on them and then to figure out whether you are interested in the topic).
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#36What took so long? No seriously. With all the articles we read about predatory practices, and various TV segments, what takes so long for things to fall into place? I wonder if there is a good way to distribute information about school quality. And that applies to not-for-profit schools as well. Collect metrics, make sure you give them to the purchaser at decision time. Akin to labels on food. If the for-profit or no…
> What took so long?
The Education Department action actually is a late part of the process, and a result of the accreditation problems the school is having, which result from the financial problems they are having, which are in part due to the SEC (2015) and CFPB (2014) lawsuits they are dealing with over different kinds of fraud related to student loans, which were the earlier parts of the government action against ITT.
And this article isn't even about the first step in the Department of Education action, but an escalation of that action.
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#37Haven't read the piece. This is a very interesting headline, though, since as I understand it the federal nondiscrimination requirements for universities are tied to the fact that students receive federal funding, and when universities tried to point out that they can't tell whether a student's bank account has been filled by a government loan or some other means they got shot down.
They cannot see if the student is getting financial assistance in the way of food stamps, for example, but the student loan and grant program isn't like that. The federal money goes to the school first, and then anything above and beyond that will be deposited in the student's account. Which means students at this school now can either pay cash or get unsubsidized, non-garunteed funding through the private market, pr…
This is directly contradicted by https://www.justice.gov/crt/title-vi-legal-manual#Direct :
> Federal financial assistance may be received directly or indirectly.(11) For example, colleges indirectly receive Federal financial assistance when they accept students who pay, in part, with Federal financial aid directly distributed to the students. Grove City College v. Bell, 465 U.S. 555, 564 (1984)
Here's a summary from wikipedia ( https://en.wikipedia.org/wiki/Title_IX ) of Grove City:
> The Court decided that since Grove City College was only receiving federal funding through the grant program, only that program had to be in compliance. The ruling was a major victory for those opposed to Title IX, as it made many institutions' sports programs outside of the rule of Title IX and, thus, reduced the scope of Title IX.[3] The ruling, however, was short-lived. The Civil Rights Restoration Act was passed in 1988 which extended Title IX coverage to all programs of any educational institution that receives any federal assistance, both direct and indirect.
(emphasis mine)
So, you're just plain wrong as to the state of the law; if the government gives somebody a big pile of cash, and they use it to pay for college, all federal regulations apply to the school. It is not necessary for the school to receive, distribute, or know about the federal money.
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#38Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#39Earlier quoted context omitted.
What's wrong with someone educating people and making a profit while doing it?
The problem with for-profit prisons is the misalignment between what's good for profit and what's good for prisoners. Where the prisoners can't "vote with their wallets" to counter-balance this misalignment. I don't see a similar issue with for-profit schools. In order to attract students they need to to provide good education and foster a good reputation.
Hmm, is that really true though? If so, ideally, people would choose an institute that teaches them as well as possible for as little as possible money. But that's not at all what people do: they prefer prestigious schools that (hopefully) lead to good job prospects.
Prestige is a funny thing - the fact that a school is hard to get into and expensive may well raise prestige, regardless of educational outcomes.
Don't forget, it's very hard for students and (future) employers/investors/business partners to tell how good an education is. It's quite difficult even for the institutes themselves and any oversight that may exist.
That means incentives aren't as simple as you suggest. Sure, at some very, very long term horizon, better education helps an institute. But that may well be multiple generations away; much too far away to work well in an open market. Especially since there is so much other noise that can be optimized instead.
By constrast, the state's interest in decent education is much more straighforward (not that the politicians making the choices have their incentives straight, but that's another story). In particular, whereas it's clearly in the for-profit institutes interest to milk students no matter how and no matter how unfairly. This is a normal risk in any organisation - but the point is that for-profit organisations aren't magic optimization bullets. These downsides don't need to be a problem, but they do need to be dealt with, and there needs to be some upside to the deal too. What's the upside here?
I think you're clearly right for short-enough courses with clearly demonstrable and measurable outcomes. And I bet you're right in the abstract too, in the sense that "it should be possible to align incentives such that..." - but I'm not sure it holds given the current way education is structured.
Real-world evidence certainly doesn't seem to suggest profit-motive works very well here.
Re: ITT is no longer allowed to enroll students who rely on federal loans and grants
#40Earlier quoted context omitted.
In principle there's nothing wrong with for-profit schools which train people on specific job skills or certification programs. There are some valuable skills that non-profit community colleges can't practically teach. But still the federal government should only support financial aid for such schools if they demonstrate a high rate of job placement for students who complete the program.
You're right, there are many examples of great for-profit institutions. The problem is there's little differentiating them from "predator" schools. One issue is information asymmetry.
There is informational asymmetry in every transaction (as well as in non-profit schools); this is a red herring (unless you can show that it is causing a specific, large, unsolved problem). The current administration has repeatedly demonstrated hostility towards for-profit schools, and has chosen to use discretionary enforcement of rules against them rather than enforcing standards universally, because they know that the standards would hit many non-profit schools as well. I am not sure about the specifics of this case, but the Department of Education has been looking at for-profit schools much harder than non-profits.