Willfully Blind

The
Republican Party’s stance on for-profit higher education resembles the one it has taken on climate change. Despite voluminous
evidence that a significant share of for-profit colleges have defrauded
students and taxpayers, Republican lawmakers refuse to acknowledge that there
have been any problems. The G.O.P. has become, over the past two decades, a
party of for-profit-college-abuse deniers.

The
lawmaker who appears to be most in denial is Rep. Virginia Foxx, the North
Carolina Republican who is now in charge of the House Committee on Education
and the Workforce. Speaking to Inside Higher Ed in November, Foxx said
that she wasn’t aware of any evidence that for-profit college students have
been defrauded. Of course, you’re never going to see evidence of abuse if you willfully
turn a blind eye towards it.

Republicans
have not always taken a see-no-evil and hear-no-evil approach to the for-profit
higher education sector. As our colleagues at the Century Foundation wrote last week, “Republicans,
including those in the White House, frequently took more aggressive steps than
Democrats to protect students and taxpayers” from sham for-profit schools in
the past.

The
Eisenhower administration, for example, conducted an investigation in the mid-1950s into
for-profit trade schools’ exploitation of the original G.I. Bill. In the 1980s,
President Reagan’s Education Secretaries Terrel Bell and Bill Bennett championed efforts to
bar schools with high student-loan default rates from participating in the
federal student loan program. And in the early 1990s, Republican Senator
William Roth joined forces with Democratic Senator Sam Nunn to lead a high-profile, bipartisan investigation into for-profit schools’
exploitation of the federal student aid programs and low-income students.

In
contrast, when the Democratic Senator Tom Harkin led a similar investigation
into for-profit college abuses in 2011, the Republican members of the Senate
Health, Education, Labor, and Pensions (HELP) Committee staged a walk-out of one of the hearings, complaining that he
was conducting a witch hunt.

So,
what changed in the 20 years between the Nunn and Harkin investigations?

The
answer is that the for-profit higher education sector transformed itself. The
old generation of mom and pop trade schools died off, and a new breed of
for-profit colleges – mostly huge, publicly traded corporations – began to
dominate the industry. These corporations were not only much larger, serving
tens of thousands of students, they also had much deeper pockets than their
predecessors, allowing them to shower campaign money on their Capitol Hill supporters. At the same time, the
Republican Congressional leadership began the infamous “K-Street Project,” rewarding industries
that were generous to their members. Republican lawmakers who pushed
legislation to deregulate these giant for-profit college companies—such as
Representatives John Boehner and Howard (Buck) McKeon and Senators Mike Enzi
and John McCain—were richly rewarded (as were Democrats like Rep. Alcee Hastings, who shilled for the
industry). In fact, campaign contributions from the student-loan and for-profit
college industries helped propel Boehner’s rise to House Speaker.

Republicans
responded to these companies’ largess by taking the reins off the industry,
leaving students vulnerable to abuse. In 2002, the Bush administration, for
instance, took the teeth out of a law that Congress had passed
a decade earlier to prevent schools from compensating recruiters based on their
success in enrolling students. Under Bush, the Department of Education issued
new regulations creating giant loopholes that allowed for-profit colleges to
easily circumvent the law. As a result, many of these companies, in their desire to keep on
growing
to lift their stock prices and receiver ever-larger amounts of federal
financial aid, encouraged their employees to deliberately recruit and admit unqualified
students,
who ended up taking on significant amounts of debt for training from which they
were unlikely to benefit.

And
then, in 2006, Republican lawmakers succeeded in striking down another
important consumer protection law that limited the growth potential of these
companies. By eliminating the “50 percent rule,” which had prohibited colleges
from participating in the federal financial aid programs if they enrolled more
than half of their students in distance education courses, Congress allowed
these companies to carry out their “growth at any cost” strategies. From 2005 to 2010, Bridgepoint
Education, for example, expanded its enrollment by over 7,800 percent, from 968
to 77,179 students, according to the final report from Senator Harkin’s investigation. Unsurprisingly,
considering its extremely rapid growth, the company in recent years has been
the subject of multiple federal and state investigations over allegations that it
engaged in deceptive recruiting and student aid practices. In September,
Bridgepoint agreed to return to
students
$23.5 million on private loans the company had pushed them to borrow. The
company took this action after the Consumer Financial
Protection Bureau accused it of inducing students to take out these loans by
lying to them about how much the loans would ultimately cost them. Bridgepoint admitted to some guilt, but said that its
schools “acted in good faith.”

Given that actions taken by the Bush administration and
Republican lawmakers helped lead to widespread abuses throughout the for-profit
college sector and put students and
taxpayers in harm’s way, is it any wonder that G.O.P. legislators continue to
refuse to acknowledge that there have been any problems? Unfortunately, it
appears that the Trump administration and Republican Congressional leaders are once
again planning to take the
reins off
this often-unscrupulous industry by eliminating consumer protection rules that
the Obama administration put in place. Students beware.