What would it take to save a scab industry from leaving the market place? The sorcerous of Grand Rapids Betsy DeVos has the answer.
Betsy DeVos’s Department of Education reversed the Obama-era crackdown on vocational and career schools thereby allowing new and inexperienced entrants into the field and alleviating pressure on old participants to have meaningful programs leading to “gainful employment in a recognized position” for which they were trained. Making the words “gainful employment in a recognized position” disappear is what made prior scammers nervous when the government would take action and refunded the fees paid and loans alleviated.
Redundancy alert . . . precisely, the Western Michigan sorceress of charter schools removed the one regulation for “non-profit” and for-profit schools offering programs leading to careers and which allowed the Department of Education to crack down on fraudulent educational programs or programs which did not result in those meaningful words “gainful employment in a recognized occupation.” Ms. DeVos made this one requirement disappear because she did not want to “target schools simply by their tax status” such as “for-profit.” Her assumption was in error as the regulation covered “all” schools whether for-profit or nonprofit and was looking at the offered programs. Our current president even had to ante up when his real estate school did not produce results in gainful employment in a recognized occupation.”
Upon knowing this exclusion by DeVos, I would think even Joe Biden might change his message to Millennials telling them to “tough it out” and he may begin to have some empathy for them after campaigning for Republican Congressional Representative Fred Upton in Betsy’s backyard of Grand Rapids. But then he has been in the pocket of MBNA and Delaware Incorporated banks forever and has made it impossible to discharge student loans through bankruptcy. Maybe???
Now if these six words “gainful employment in a recognized occupation” magically disappeared (psst and they did), what would it take for a career education program to lose its eligibility for federal student aid under DeVos? . . . a for-profit institution could not lose its financial lifeline or federal student aid no matter how poorly it performed its mission as spelled out in a statute to prepare students for “gainful employment in a recognized occupation” resulting from that education as stipulated previously.
One hundred percent of students could be dropped from their career program with all of them deeply in debt, or perhaps no single graduate landing a job in their field of training, and still . . . still the federal government would keep the pipeline of guaranteed federal student loans and Pell Grants flowing in to the school.
With DeVos’s reversal, the NYT surmised: “Executives in the for-profit education industry would be sleeping better, secure in the knowledge that even the worst schools and programs were no longer at risk of “magically” being thrown off the taxpayer-backed gravy train, no matter how epically they failed and robbed their students.” This AB author took liberty and added words to make his point.
Under Obama, “the Job Training industry was on its heels. Under DeVos, they had been given a magical new life, a second chance by the department,” said Eileen Connor, the director of litigation at Harvard Law School’s Project on Predatory Student Lending.
Ms. DeVos, who invested in companies with ties to for-profit colleges before taking office, has made it an agency priority to unfetter schools offering training in professional jobs and trades by eliminating restrictions on them and also nonprofits. She also allowed a growing number of for-profit schools to magically evade those loosened rules by converting to nonprofits.
That is what the Los Angeles Pentecostal megachurch’s affiliate Dream Center wanted to do in 2017 when it asked to buy the remains of Education Management Corporation . . . change it from for-profit to nonprofit and use the profits to fund its other programs. One year after taking over a chain of for-profit schools, dozens of Dream Center schools are near bankruptcy and others have been sold with a hope they can survive.
Collectively Argosy University, South University and the Art Institutes have ~26,000 students in programs resulting in associate degrees in dental hygiene and doctoral programs in law and psychology. Fourteen campuses of mostly Art Institute schools have a new owner after an arranged transfer involving private equity. Another 40 or so others are now under the control of a court-appointed receiver who has accused school officials of trying to keep the doors open by taking millions of dollars earmarked for students to pay operating expenses.
Federal funding for Argosy ceased from the Department of Education when the court-appointed receiver discovered school officials had taken about $13 million owed to students at 22 campuses and used it for payroll expenses, etc. Lauren Jackson seeking a doctorate at Argosy’s Illinois School of Professional Psychology in Chicago did not receive the $10,000 she was due in January. She was paying expenses for herself and her 6-year-old daughter with borrowed money and GoFundMe donations.
26,000 students being defrauded by schools offering programs meant to teach them a skill leading to “gainful employment in a recognized occupation” is only a start to which DeVos has failed to account for in the Department of Education. DeVos does profit by this failure due to her own dabbling in areas feeding off of these failures. There is money to be made in preying on defrauded students, so many of them, and larger than the baby boomer generation. The most tragic consequence of conservatives’ abandonment of federal accountability of career programs is just that and the devastating personal toll it will take on hundreds of thousands of hopelessly indebted students” for whom there is no relief.
Millions in Student Loan Cash Disappears, Tejas Sachdeva, “Tasks”