PBS Frontline to Air Report on the For-Profit Higher Education Scam

[WhipperSnapper]

Tonight, PBS's Frontline is going to report on the higher education scam that is being perpetrated by for-profit organizations.

http://www.pbs.org/wgbh/pages/frontline/collegeinc

[<Edit> I just finished watching the Frontline report and I thought it was an excellent presentation. I highly recommend it.]

The scam is that they are selling relatively worthless degrees to vulnerable, needy people who suffer from information asymmetry. The debt from the loans they incur could haunt the victims for the rest of their lives.

Hopefully Frontline will also report on the scam that is occurring at self-proclaimed non-profit legitimate colleges and universities that are knowingly producing far more graduates than the nation's economy can absorb. At least it is easier for people to recognize that the private for-profit schools do not necessarily have students' best interests at heart and may have a huge conflict of interest. Graduate schools (who need TAs, research assistants, and postdocs), business schools, and law schools are the exact same way in those regards but the sheeple assume that they look out for society's interests.

 

[Manchimp]

looks interesting. I wish that I saw something like this before I got my degree from ITT Tech. The amount I paid (~27k) was much more than the training and education was worth. The only had two teachers that knew what they were teaching. I now warn anyone who is thinking about going to that school.

 

[EagleKeeper]

looks interesting. I wish that I saw something like this before I got my degree from ITT Tech. The amount I paid (~27k) was much more than the training and education was worth. The only had two teachers that knew what they were teaching. I now warn anyone who is thinking about going to that school.

I have an (ex)son-in-law that was interested in ITT prior to being a SIL. He looked at them outside Ft Lauderdale and then his mother sent me a packet.

It was interesting that the price quoted matched up exactly to the amount of grants & loans that they felt you qualified for.

I then went to the local campus in Indianapolis and presented myself as a candidate. The costs were different for the same program; coincidentally covering what I would qualify for (age & VA were the big differences)

I, having a Masters in Engineering (not disclosed to them), started asking some tough questions which were responded to with boiler plate answers.

Then I called up some local shops regarding references.
Yes, they did hire grads from ITT but the 5 year retention rate was low.
It was also inferred that there was a tit-for-tat that went on, either pure economic or internships at the companies.

This was back 10+ years ago; but I would suspect that things have not changed much.

 

[Special K]

Tonight, PBS's Frontline is going to report on the higher education scam that is being perpetrated by for-profit organizations.

http://www.pbs.org/wgbh/pages/frontline/collegeinc

The scam is that they are selling relatively worthless degrees to vulnerable, needy people who suffer from information asymmetry. The debt from the loans they incur could haunt the victims for the rest of their lives.

Hopefully Frontline will also report on the scam that is occurring at self-proclaimed non-profit legitimate colleges and universities that are knowingly producing far more graduates than the nation's economy can absorb. At least it is easier for people to recognize that the private for-profit schools do not necessarily have students' best interests at heart and may have a huge conflict of interest. Graduate schools (who need TAs, research assistants, and postdocs), business schools, and law schools are the exact same way in those regards but the sheeple assume that they look out for society's interests.

Thanks for the reminder. I saw an advertisement for this program last week on Frontline's website and made a note to watch it. It should be interesting. Although the stated theme of the program is for-profit institutions, I also hope they take a look at many questionable degree programs at non-profit institutions.

 

[thegimp03]

I have an (ex)son-in-law that was interested in ITT prior to being a SIL. He looked at them outside Ft Lauderdale and then his mother sent me a packet.

It was interesting that the price quoted matched up exactly to the amount of grants & loans that they felt you qualified for.

I then went to the local campus in Indianapolis and presented myself as a candidate. The costs were different for the same program; coincidentally covering what I would qualify for (age & VA were the big differences)

I, having a Masters in Engineering (not disclosed to them), started asking some tough questions which were responded to with boiler plate answers.

Then I called up some local shops regarding references.
Yes, they did hire grads from ITT but the 5 year retention rate was low.
It was also inferred that there was a tit-for-tat that went on, either pure economic or internships at the companies.

This was back 10+ years ago; but I would suspect that things have not changed much.

That's interesting. I never thought about going there but seeing their cheapo commercials on TV always made me think ITT looked like a scam.

 

[TruePaige]

People need to do their research first.

US News and World Report is a great starting point. Post Graduation employment statistics are another (check your industry and it's major players). See who recruits on campus.

It is a very large monetary investment and many people do less research than they would buying a car.

 

[StageLeft]

I don't blame these schools. They are indeed, to my understanding, churning out too many people and charging too much. I believe it strongly. I went to school in Canada not all that long ago and an undergrad degree ran less than $10k/year tuition. Maybe it was $6500 and that was very typical. Yes, schools received money from the government, but I can't believe that the tuition + government subsidy comes anywhere close to what many pay in the US.

I can tell you my kids will not be racking up $20-40k/year in tuition (plus expenses) unless it's in a guaranteed high income job such as medicine. I will otherwise push them to something cheaper or, more likely (if I can influence it) tell them to go to Canada. Probably even as out of state they'd be cheaper than the US.

Coming out with a mortgage-equivalent in loan debt and the earning power of $35k/year out of school is absurd.

All I see for ITT tech is minority students on the commercials who look like they probably have illegitimate children saying how much it helped their career.

I did spend $22k, insanely, on a 9 month IT diploma back at the turn of the century but, very luckily, it did in fact turn out to be exactly what I wanted and has paid for itself many times over, something my useless BSc would not have done, since it wasn't applicable to a single fvcking job on the planet.

I will tell my kids they can do what they want but I am not going to, as many parents seem to find acceptable, tell them it's ok to "just get a degree" if that degree is as useless as tits on a nun as so many are. And then what, go teach English in Japan because you realize you are not actually capable of doing a damn thing?

 

[Infohawk]

I don't blame these schools either. They are meeting a demand. In a lot of ways I wish correspondence schools and the like would take off. Or that major universities would offer correspondence / internet degrees. There's really no reason people have to go to what are effectively country clubs to get an education. At the university level, you really should be learning by reading and writing. The sciences may realistically require more than that for labs.

But there's no denying that frequently these degrees are useless or looked down upon by people with better pedigrees.

 

[JSt0rm]

its actually brilliant. Con the dumbest people in society to think they can have a future and milk the government teet for whatever the grants will allow. As American as apple pie!

 

[cmf21]

Always thought schools like this were a scam. When I went to school, my best friend at the time got our employer to pay for his education at University of Phoenix. He somehow got our company to send him to school because he claimed he couldn't afford it with having a family at all and that he needed to go to a school that he thought was the best. He would always tell me how great the school was and the school I was attending was a waste of time because he was attending a real school and that he was learning 1000 times more stuff in one year then I was in the 5yrs I went to school.

Funny thing about this was that his "professional" teachers, wouldn't show up half the time, assign any type of homework, have class, give test, and just give a's for doing nothing, so they could pull in an extra paycheck. I kept telling he's an idiot if he thinks he was learning more what I was but I couldn't get it through he's thick skull.

All these schools might not be a scam but from my experience, I think they all are.

 

[IndyColtsFan]

Always thought schools like this were a scam. When I went to school, my best friend at the time got our employer to pay for his education at University of Phoenix. He somehow got our company to send him to school because he claimed he couldn't afford it with having a family at all and that he needed to go to a school that he thought was the best. He would always tell me how great the school was and the school I was attending was a waste of time because he was attending a real school and that he was learning 1000 times more stuff in one year then I was in the 5yrs I went to school.

Funny thing about this was that his "professional" teachers, wouldn't show up half the time, assign any type of homework, have class, give test, and just give a's for doing nothing, so they could pull in an extra paycheck. I kept telling he's an idiot if he thinks he was learning more what I was but I couldn't get it through he's thick skull.

All these schools might not be a scam but from my experience, I think they all are.

I knew two guys that worked on grad degrees at UoP. One guy, who was a friend, was also an arrogant SOB (he admitted it too, so it was all good) and went around bragging that he had a 4.0 GPA there. He was spending insane amounts of time at night "studying;" little did he know that had he done a little research, he would have still gotten that 4.0 with little effort.

The other guy was an assbag who graduated from Kentucky with a math degree and barely had a 2.0 GPA. He went to UoP for his Master's and -- sure enough -- he magically had a 4.0 GPA too! This guy honestly was not very smart and that confirmed my suspicion about UoP. My suspicion was that as long as you showed up, did your work (which often consisted of posting on forums), and turned things in, you too would have a 4.0 unless you were a complete idiot.

The funny thing is that the second guy above was also a notorious liar, so one day I found his LinkedIN profile. He said he has a Master's from University of Arizona.

 

[CycloWizard]

A fool and his money are soon parted. I've never seen a university warrant that a degree has any intrinsic value. I have seen one community college make a money-back guarantee that a graduate would find a job in his/her degree area within 1 year of graduation.

The university takes your money to teach you skills but, more importantly, to teach you how to learn. When you incur debt to get an education, you are making an investment in yourself. That investment has risks just like any other. If you take that risk, then that's your choice. The scam is that these risks are inflated for those of us in the middle class by government doling out arbitrarily large grants to people that meet some equally arbitrary basis for need, thereby inflating the cost of the education of everyone else.

 

[IamDavid]

A fool and his money are soon parted. I've never seen a university warrant that a degree has any intrinsic value. I have seen one community college make a money-back guarantee that a graduate would find a job in his/her degree area within 1 year of graduation.

The university takes your money to teach you skills but, more importantly, to teach you how to learn. When you incur debt to get an education, you are making an investment in yourself. That investment has risks just like any other. If you take that risk, then that's your choice. The scam is that these risks are inflated for those of us in the middle class by government doling out arbitrarily large grants to people that meet some equally arbitrary basis for need, thereby inflating the cost of the education of everyone else.

Agree with the first part.. Nothin after that... Anyone who spends more than the tuition of there local CC is a fool. I've had the fortune/misfortune of hiring and firing many "ivy league" grads.. Complete waste of their parents money.... All this from a high school drop out... You are who you are.. Succeed in life or not, it's up to you.. An idiot is an idiot and always will be one... And so on...

 

[Tab]

A fool and his money are soon parted. I've never seen a university warrant that a degree has any intrinsic value. I have seen one community college make a money-back guarantee that a graduate would find a job in his/her degree area within 1 year of graduation.

The university takes your money to teach you skills but, more importantly, to teach you how to learn. When you incur debt to get an education, you are making an investment in yourself. That investment has risks just like any other. If you take that risk, then that's your choice. The scam is that these risks are inflated for those of us in the middle class by government doling out arbitrarily large grants to people that meet some equally arbitrary basis for need, thereby inflating the cost of the education of everyone else.

I think the documentary is focused on such institutions such as Devry University, Phoenix and other on-line degree programs. Basically, it's borderline false advertising and now the government is getting heavily involved.

For-Profit-Universities - NYT-OP-ED

 

[Kappo]

All I see for ITT tech is minority students on the commercials who look like they probably have illegitimate children saying how much it helped their career.

I'm going to hell for laughing at that.

 

[StageLeft]

I'm going to hell for laughing at that.

Haha, they are just like this: http://www.youtube.com/watch?v=eZAdv7Qziik

 

[SlickSnake]

Realistically, the only 3 groups that are still hiring the most people for decent paying jobs are government, health care, and service industries. Service industries would include such schools as technical training schools. And a lot of supporting role health care jobs require such technical training schools to even get hired, too. And as the economy continues to shrink, most of these supporting position types of jobs are the first to be cut back or shifted to part time, too.

However, and unfortunately, any school out there is primarily in the business of educating more people than there are available jobs to support.

And the available jobs for graduates will be unevenly dispersed, too. It would be logical that the places where these technical school trained grads would be most in demand are going to be farther away from a city offering the training. So if anyone expects to make a good living after one of these tech schools, the graduates need to figure in the fact they most likely will have to relocate to a city that needs their skills away from the training centers, and that might be 100s or 1000s of miles away, or even in another country.

 

[WhipperSnapper]

People need to do their research first.

US News and World Report is a great starting point. Post Graduation employment statistics are another (check your industry and it's major players). See who recruits on campus.

It is a very large monetary investment and many people do less research than they would buying a car.

People need to be very careful about employment statistics produced by the educational institutions themselves! These institutions are greedy, self-interested businesses whose profit-earning shareholders are college deans, professors, and administrators. Also, all institutions only want to get bigger and wealthier. Their interests are NOT the interests of students and society at large. They do NOT have students' and society's best interests at heart. They would not feel badly knowing that their students are going into large amounts of debt with awful job prospects. This must be doubly true at the avowed for-profit institutions.

Self-reported statistics that come from surveys of graduates may be very misleading and inaccurate. For example, survey responses from unemployed or underemployed-out-of-field graduates earning low salaries might be mysteriously misplaced. Also, unhappy people who are angry and indignant or perhaps embarrassed are less likely to complete and return those surveys than the success stories. Furthermore, graduates who work at McDonalds might be counted as "employed 9 months after graduation". In contrast, the schools will bend over backwards to make sure that known successes complete and return the surveys. Income statistics might only reflect the 20% of graduates who actually returned the surveys and who were happy to complete and return them since they found decent jobs. Thus those income statistics from survey respondents might have no relationship to what graduates are actually earning.

This is a huge issue in the legal industry where law school graduates have observed for years that the employment statistics are unrealistic and completely misleading; they contradict their first-hand experiences. Many JDs have observed that 90% of their 3L class is unemployed while their law schools claim employment percentages of 90%. Some even argue that a fraud is occurring and that it's a scam sanctioned by the American Bar Association. Today the cost of attending law school could easily reach $140,000. The law schools and the ABA are fully aware of the fact that most law school graduates will not find jobs in the legal profession (this has been a problem for at least two decades) and yet they continue to approve more and more law schools and admit more and more students. It isn't because they have students' and society's best interests at heart. Rather it's because they are greedy self-interested businesses.

Why don't students do their research? They often do conduct some research but much of the information is fraudulent or misleading. Much of the information is propaganda.

Why do students continue to flood into graduate and professional school? Why are the lemmings still flocking to the law schools? Because we have all been indoctrinated since Kindergarten to believe that higher education is a guarantor of at least solid middle class economic success. Inexperienced young people's beliefs are no different than if they had been indoctrinated into a religion except the indoctrination is coming at them from all directions--the schools, their parents, society at large, the news media, pundits, and politicians. Just open a newspaper and you'll find an op-ed somewhere or a news story where someone says that we need more and better education and that education is ultimately the solution to our nation's economic problems.

What we are going to discover is that education will not solve our nation's economic problems nor magically make jobs materialize into existence. In reality, only a fraction of all the jobs that need to be done in our society make any direct use of higher education. The Bachelors degree has essentially become the new high school diploma.

 

[WhipperSnapper]

I think the documentary is focused on such institutions such as Devry University, Phoenix and other on-line degree programs. Basically, it's borderline false advertising and now the government is getting heavily involved.

For-Profit-Universities - NYT-OP-ED

I was just going to post a link to that story, but you put it up first. Thanks.

 

[WhipperSnapper]

Realistically, the only 3 groups that are still hiring the most people for decent paying jobs are government, health care, and service industries. Service industries would include such schools as technical training schools. And a lot of supporting role health care jobs require such technical training schools to even get hired, too. And as the economy continues to shrink, most of these supporting position types of jobs are the first to be cut back or shifted to part time, too.

However, and unfortunately, any school out there is primarily in the business of educating more people than there are available jobs to support.

One of the interesting issues is, will student loans become the next housing bubble? Since our economy is either going to worsen (my prediction) or stay about the same as it is now (a jobless "recovery"), it's unlikely that all of these college graduates will be able to find jobs that will allow them to pay off their student loans. (I think I have read in various places that only about 40% of all student loans are being repaid.) What happens when people begin defaulting on these loans in mass? Will we have a Student Loan Bubble? After all, graduates who live in their parents' basements and who sling lattes or work unpaid internships can only stay in deferment for so long. What would happen to these greedy, tuition-engorged institutions of higher debt when the lenders no longer want to dish out loans, in mass? Will the federal government have to bail out the student loan companies?

 

[Carmen813]

One of the interesting issues is, will student loans become the next housing bubble? Since our economy is either going to worsen (my prediction) or stay about the same as it is now (a jobless "recovery"), it's unlikely that all of these college graduates will be able to find jobs that will allow them to pay off their student loans. (I think I have read in various places that only about 40&#37; of all student loans are being repaid.) What happens when people begin defaulting on these loans in mass? Will we have a Student Loan Bubble? After all, graduates who live in their parents' basements and who sling lattes or work unpaid internships can only stay in deferment for so long. What would happen to these greedy, tuition-engorged institutions of higher debt when the lenders no longer want to dish out loans, in mass? Will the federal government have to bail out the student loan companies?

Last time I checked, unemployment for college graduates is just a tad under 5%, which is perfectly acceptable.

For what it's worth, the government is the student loan company now.

 

[ProfJohn]

The easy solution would be to set a cap or completely eliminate student loans for 'for-profit' schools.

 

[Blackjack200]

The easy solution would be to set a cap or completely eliminate student loans for 'for-profit' schools.

Wow, you're about the last poster I would expect to suggest that. I think that ideally, there's no reason for-profit schools shouldn't be able to access government backed loans for their students, but clearly it's being abused right now, and it's an issue that needs to be addressed.

I would favor putting more money toward Community Colleges. That's where I got my education back on track after fucking up the first go around, and that's where I am again today, taking courses to stay fresh and possibly set up a career change. I think CCs are tremendous.

 

[ProfJohn]

Wow, you're about the last poster I would expect to suggest that. I think that ideally, there's no reason for-profit schools shouldn't be able to access government backed loans for their students, but clearly it's being abused right now, and it's an issue that needs to be addressed.

I would favor putting more money toward Community Colleges. That's where I got my education back on track after fucking up the first go around, and that's where I am again today, taking courses to stay fresh and possibly set up a career change. I think CCs are tremendous.

Maybe I should have said "limit federally backed loans" ??


If these companies want to loan their own money then go for it. What makes the whole 'scam' work is that the loans are federally guaranteed which means that there is almost no way for someone to avoid paying for them (including bankruptcy)

Take away that federal insurance policy and the schools would be forced to ensure that their graduates are able to make enough money to pay back the loans etc.

Would be a win-win for everyone. (except the schools who could no longer take advantage of idiots.)

BTW I know people who made it half way through ITT before flunking out with $10,000 in schools loans. And people who made it to the end only to not find any jobs available etc etc. That $20,000 (this was 1990) they spent at ITT would have got them a BA from the local state school at the time. But the state schools don't run advertisements similar to the for profit schools.

 

[Blackjack200]

Maybe I should have said "limit federally backed loans" ??


If these companies want to loan their own money then go for it. What makes the whole 'scam' work is that the loans are federally guaranteed which means that there is almost no way for someone to avoid paying for them (including bankruptcy)

Take away that federal insurance policy and the schools would be forced to ensure that their graduates are able to make enough money to pay back the loans etc.

Would be a win-win for everyone. (except the schools who could no longer take advantage of idiots.)

BTW I know people who made it half way through ITT before flunking out with $10,000 in schools loans. And people who made it to the end only to not find any jobs available etc etc. That $20,000 (this was 1990) they spent at ITT would have got them a BA from the local state school at the time. But the state schools don't run advertisements similar to the for profit schools.

I think you could expand that to all schools, for-profit, traditional private, and public.

Also, for some reason I just realized that all this lobbying money that the for-profits are using to prevent the Government from increasing regulation is just Federal guaranteed loan money passed through the students in the form of tuition to the institutions and lobbyists and finally into the pockets of the legislators. How revolting is that?