July 2, 2014

EDITORIAL: Add another problem to list facing the next VA secretary

Corporate executive Robert McDonald, who was nominated Monday to be the new secretary of Veterans Affairs, faces a gargantuan task to get the agency back on track.

Corporate executive Robert McDonald, who was nominated Monday to be the new secretary of Veterans Affairs, faces a gargantuan task to get the agency back on track.

It's not just fixing unacceptably long waiting times for patients at some VA hospitals, or speeding up disability benefits.

It's also cracking down on for-profit colleges that are raking in millions from the post-9/11 GI Bill, while veterans — and taxpayers — are not getting anywhere close to their money's worth.

California is the "epicenter" of what can only be called a scandal, according to a story from the Center for Investigative Reporting. Of the $1.5 billion in federal GI Bill benefits spent in California since 2009, more than 40% — $638 million — has been scooped up by for-profit schools that offer such a substandard education that they have been cut off from receiving state financial aid at least once in the last four years, the center's Aaron Glantz reports.

Four of those schools were campuses of the University of Phoenix, by far the biggest beneficiary. They took in $225 million. Over the last five years, the campus in San Diego alone reaped $95 million in GI Bill money — more than the entire University of California system received to educate veterans.

A top University of Phoenix official told Glantz: "The programs we offer are the ones that (veterans) desire and lead to careers that they want to aspire to."

That might well be true. But a Phoenix education is expensive — up to 10 times the cost of credits at a community college. More troubling is that University of Phoenix officials won't say how many veterans graduate or find jobs. The overall graduation rate at the San Diego campus is less than 15%, according to the U.S. Department of Education, and more than 25% of students default on their loans within three years of leaving school, Glantz reported.

Those rates fall far short of the standards set by the California Student Aid Commission. Those standards, however, don't apply to federal GI Bill funds that give veterans as much as $19,000 a year for college.

Lawmakers in Sacramento and Washington, lobbied heavily by the for-profit colleges, are not standing up for veterans. Earlier this year, legislation to prevent for-profit schools with substandard graduation and loan default rates from receiving GI Bill money was gutted before its first committee hearing in the Assembly. Even after a 5,000-page report issued in 2012 detailed the problem, Congress failed to block schools without academic accreditation from receiving GI Bill money.

This is the morass McDonald marches into. For veterans' sake, we hope he's up to the job.

He's a surprising pick by President Barack Obama to replace Eric Shinseki, who resigned under fire. The president is betting that the VA mess is mostly a management problem and can be turned around by McDonald, who is a former CEO of Procter & Gamble and served in the Army.

McDonald's executive experience might give him insight into how to rebrand the VA, but he does not have experience running a huge health care system that serves more than 8 million veterans a year.

During the confirmation process, senators will need to make sure McDonald has the right background and approach to tackle the VA's challenges with health care, disability benefits and student aid.


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