A Game Changer in the Fight Over For-Profit Higher Ed?

The Obama administration is expected to issue the final Gainful Employment rule tomorrow. Depending on how strong the final regulation is, the likely fallout from this action is fairly easy to predict.

Almost immediately after the final regulation is released, the Association of Private Sector Colleges and Universities — which was formerly and more accurately known as the Career College Association — will likely file its long-promised lawsuit seeking to stop the Education Department from implementing the regulation. The industry’s supporters in Congress will then probably attempt to achieve the same goal legislatively. House Republican leaders may even consider holding hearings to try and give credence to the conspiracy theories being cooked up by career college lobbyists about alleged improprieties at the Education Department and the Government Accountability Office (GAO).

But given recent developments, the industry’s Congressional champions would probably be wise to hold their fire. The Huffington Post revealed last month that attorneys general in 10 states have launched a joint investigation into the industry, looking particularly at allegations of misleading and deceptive recruiting and marketing practices. Since then, subpoenas to the giant for-profit school chains have been flying, and revelations of abuses are all but certain. Kentucky Attorney General Jack Conway, who has spearheaded the effort, recently told The Chronicle of Higher Education that the investigation will likely touch on “a lot of the major players” in the sector.

At Higher Ed Watch, we believe that the decision by state attorneys general (both Democratic and Republican) to join forces is a real game changer. Up until now, the battle over for-profit higher education has been waged mostly in Washington — where career college lobbyists and their allies in Congress have conducted a heavily orchestrated campaign to try to get Congress to stop efforts by the Obama administration and key Senate Democrats to rein in the industry’s very worst players and practices.

As part of this effort, industry officials have showered lawmakers with millions of dollars of campaign contributions. They have also hired legions of former lawmakers and Congressional staff to help make their case on Capitol Hill. So much so that Sen. Dick Durbin (D-IL) has said “half jokingly” that “the best way I can find to meet former Members of Congress whom I have served with over [the last] twenty years is to take on this issue because they have all signed up as lobbyists for these for-profit colleges.”

State Attorneys General, on the other hand, are generally far less susceptible than lawmakers to this type of influence peddling. And the fact that they are working as a group should further insulate them from these types of pressures. Of course, that doesn’t mean that the industry isn’t trying. According to a recent report in The Chronicle of Higher Education, the Apollo Group, Education Management Corporation, and the for-profit lobbying group the Coalition for Educational Success have all hired former state attorneys general to work on their behalf. Kentucky AG Conway told the Chronicle that the purpose of these new hires is perfectly clear: “There is a lobbying front that is expanding day by day.” But the fact that Conway and his colleagues are fully aware of this “lobbying front” should mitigate its effectiveness.

We at Higher Ed Watch do not understand how any Member of Congress — Republican or Democrat — could hear of the attorneys general joint investigation and not take pause, let alone how they could rush to the industry’s defense. Do they really want to go out on a limb for these companies before they know exactly what these top state prosecutors have found?