U.S. Education Secretary Betsy DeVos’ effort to scrap Obama administration regulations on for-profit colleges will cost students and taxpayers huge sums and damage lives.
We hope a suit by Democratic state attorneys general including California Attorney General Xavier Becerra succeeds in blocking DeVos’ shortsighted effort.
DeVos claims that the Obama-era rules are muddled and unfair to students and to the for-profit corporations that run the schools. In reality, many students who attended the for-profit colleges racked up huge student loan debts in the pursuit of useless degrees, and could not repay their loans, leaving taxpayers holding the bag. If DeVos succeeds in suspending existing regulations, taxpayers ultimately will be on the hook again.
Her action, while disappointing, cannot come as a surprise. Her boss, President Donald Trump, understands the swampy side of for-profit college industry, having lent his name to a questionable for-profit college and having settled a suit by students for $25 million shortly before he took office.
Despite Trump’s claims that he would “drain the swamp,” one of DeVos’ early hires was a lobbyist for for-profit colleges. He stepped aside after the nonprofit investigative journalism operation Pro Publica detailed his hiring. Now, a former attorney for a for-profit college is senior counsel to DeVos.
Clearly, for-profit colleges understand the ways of Washington, having spent $13 million on lobbying there since 2015, according to the nonpartisan Center for Responsive Politics, which tracks lobbying and campaign spending. The corporations that run chains of profit-making colleges rely on proceeds of federal loans and grants given to their students to inflate their bottom lines.
A trade group representing for-profit colleges sued the federal government over the Obama administration rules. DeVos caved to the suit, citing it as a reason for placing the rules on hold.
One regulation, which was to take effect this month, would have given students an easier path to loan forgiveness if their schools were found to have misled them with glittery promises of employment.
Another rule, now suspended, was known as the Gainful Employment Rule. It sought to ensure vocational programs helped students get jobs so they could repay their loans. The rule was a priority of Obama’s from his early days in office and finally took effect in 2015 after years of development, The Sacramento Bee’s Alexei Koseff wrote.
California took an outsized role in helping formulate the Obama-era regulations, in part because of Sen. Kamala Harris’ efforts. As attorney general, Harris sued the Santa Ana-based Corinthian Colleges, obtaining a $1.1 billion judgment last year. The federal government forgave $247 million in loans to more than 15,000 affected students.
Attorney General Becerra is taking up where Harris left off, joining 18 Democratic state attorneys general in the suit filed in Washington, D.C., to compel DeVos to let the rules go into effect.
If DeVos believes the Obama administration’s rule are muddled, she should come up with her own. Alternatively, she could simply admit that the swamp is teeming with creatures, and that the federal government’s policy is to let for-profit colleges cheat students seeking to better themselves – and to use taxpayer-subsidized loans and grants to do so.