Posted by: crudbasher | January 17, 2011

Why For-Profit Colleges Matter

This article talks about why it’s important to keep the for-profit college system strong.  I agree with the author that there have been some bad players in the industry.  That is to be expected when the country is awash in federal funding for loans.  In fact a lot of people are saying what is happening in the higher education market is exactly the same as just happened in the housing market.  The government made vast sums of money available to pretty much anyone with a pulse.  It’s the government’s policy that more people getting this thing is good.

The big difference is, at least with a house if you can’t afford making the payments you can get out of the house.  How do you get out of a college degree?  You can’t even go bankrupt.

This bubble has to pop.  When it does as a society we will have a choice.

a. Let some colleges which have been around for a long time go out of business

b. Have the government bail them out. (thus increasing the country’s debt again)

I would submit that the citizens of this country have about had it with bail outs. We will see what happens.

When this bubble pops, I agree with the author that the for-profit, lean model of colleges will be the survivor.  We will see.  We had this massive influx of new college students last year.  This fall, the first of them will be dropping out or failing out, also in massive numbers.  This will cause a reevaluation of colleges.  Then in five more years, we will have a huge influx of grads who are expecting jobs that might not be there.  Stuck with loans they can’t pay, the bubble pops. Seeing what happens to those grads, everyone else reevaluates college. Enrollments crash.

Could it happen?  I think it’s more likely than tuition continuing to go up at current rates. (see chart below)

Can this keep going?

  • Great article about for profits.

    tags: education highered credentials bubble nell

    • Does American higher education need a robust for-profit sector? What are the benefits of preserving it?
    • I argue that for-profit higher education adds a vital element of versatility to our system.
    • I contrasted the cost structure of the nonprofits with the for-profits.  The nonprofits have bound themselves hand-and-foot to enormously expensive practices that are practically impervious to rational budget-cutting. The for-profits—most of them—have bypassed these costs, and they are not bound by sentiment, politics, or interest groups to add them. Maybe the biggest danger that the for-profits face is the maneuvering by accreditors and federal officials to make them conform more to the standard model.
    • For example, I recently learned of a case in which a start-up for-profit university offering only narrowly focused masters’ degrees in a highly technical field was advised by the regional accreditor to which it had applied that it really ought to add a provost to its administration in addition to the university president and dean of faculty. Given the importance of accreditation as the gatekeeper for student loans, the for-profit university is complying without a murmur. But on the face of it, this is an increase in administrative overhead mandated not by the practical need of the university but by the accreditor’s sense of how things should be done.
    • If the for-profits can withstand such pressures to load themselves down with supernumerary expenses, they will be well-positioned to compete for students against the nonprofits.
    • If the higher-education bubble bursts, the for-profit sector is in a much better position to survive the damage.
    • There are over 2,000 for-profit colleges, many of them small, niche-specialists; and some with enviable reputations.
    • Full Sail University has nothing to do with boats; it specializes in the entertainment business and teaches students skills such as staging concerts and producing video games. For boat-building you need the International Yacht Restoration School, Inc.
    • None of these colleges pretends to offer anything like a liberal-arts education; each of them, however, focuses on sets of skills that have a direct connection to the workforce. And I can think of lots of students I’ve taught over the years at both a large research university and a small liberal-arts college who would have been better off as a matter of their actual interests in such a setting.
    • my own experience in a large university was that it was awfully tough to set up a specialized program that wasn’t hamstrung by the need to impose all sorts of academic regulations and requirements that had little to do with the purpose at hand.
    • If for-profit status liberates the college from the expensive folderol of the contemporary nonprofit liberal arts college, it might well prove viable.
    • I am not, however, counting on the for-profit sector to rescue real liberal learning in such a direct fashion. What seems to me a lot more likely is that the great American experiment of mass higher education will begin to dissolve over the next decade or so.
    • Despite President Obama’s call in February 2009 that the U.S. become by 2020 the nation with the largest percentage of college graduates in the world, we are likely to be entering an era in which large numbers of students will seek out alternatives to the established four-year baccalaureate degree as both the basic college education and the basic market credential.
    • The deep value of for-profit education is that it breaks the practical monopoly on what a college can be.
    • liberal education does have a stake in finding ways to carry on in a culture that is largely hostile to its purposes and in an institutional setting that is increasingly vulnerable to public disaffection.
    • More likely we will end up with a great culling out of colleges and universities and a willingness among the survivors to look to the for-profits for models of how to rebuild themselves.

Posted from Diigo. The rest of my favorite links are here.

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Responses

  1. […] This post was mentioned on Twitter by Dan Feinberg, Andrew Barras. Andrew Barras said: New Post: Why For-Profit Colleges Matter http://bit.ly/gZMPQE #edchat #highered […]


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