Peeling Back Still More Layers of the Scams Perpetuated by and through the Online For-Profit Universities

David Dayan’s article “’Chipping Away At My Soul’: Insiders Detail The Decline And Fall Of Corinthian’s For-Profit College Empire” was the lead item in yesterday’s HuffPost College daily newsletter.

If you have been following the coverage of the rise and fall on the online for-profit universities, the article does not contain a great deal of information that is startling, or even new.

That said, Dayan’s article does include a few details that are very revealing.

Indeed, the following paragraph is a very succinct summary of the information most critical to a full understanding this whole boondoggle: “The goal was simple: profits. Smaller chains like Lincoln Tech or DeVry used to dominate the for-profit college industry. But toward the end of the last decade, larger, publicly traded companies took over. By 2009, three-quarters of all U.S. students enrolled in for-profit colleges were at schools owned by a corporate conglomerate or private equity firm. Goldman Sachs owns around 40 percent of Education Management Corporation, another operator of for-profit colleges.”

So, the comparisons between sub-prime mortgages and the educations offered by these “universities” have not been hyperbole after all, as many proponents of privatized public education have long and strenuously insisted.

In fact, the tremendous profits generated from the spurious bundling of sub-prime mortgages were going directly into these online for-profits. And the timing of the investments into the online for-profits means that as the financial conglomerates deemed to be “too big to fail” were being bailed out by the federal government and at the expense of the American taxpayer, not only were many Americans who had been convinced to take on sub-prime mortgages losing everything that they had, but many others with marginal economic means were being convinced to take out loans for university educations that they would never complete and that would be close to worthless if they did somehow manage to complete them.

So this was not just “predatory capitalism” or even “predatory capitalism squared”; it was predatory capitalism taken to some unprecedented higher factor.

Beyond that very significant insight, which unfortunately is somewhat buried in the article, Dayan makes several other points that caught my attention.

For instance, apparently Corinthian Colleges took the concept of competency-based education to absurd lengths: “It illegally padded job placement statistics and gave students college credit for ‘externships’ at fast-food restaurants.” The use of the word “externships” demonstrates that it is much easier to invent new educational jargon (and scams) than it is to actually “reinvent” education.

The testimony of former Corinthian students on the lack of just about any academic standards and these “externships” is as compelling as it is both absurd and infuriating: “’Several students felt like the coursework was too hard, but a junior high student could do what we were doing. A simple Google search could get the homework done,’ Hornes [a former student] said in an interview. ‘I had several finals where I was playing board games. I was thinking, “Why am I going here? Are you kidding me, we’re playing Monopoly right now?”’

“Students could also receive course credit through externships, unpaid positions in their fields that career services personnel often promised would lead to full-time work. After running up $26,000 in debt in one year of study, Catrina Beverly obtained an externship in medical office administration. ‘For four hours a day, on top of a 40-hour workweek, all I did was scan documents into the computer,’ she said. ‘I went above and beyond, straightened up the office, so they’d want to hire me. At the end, I found out they would not consider me because I wasn’t fluent in Spanish.’

“’My externship was a job I had for two years,’ Hornes said. His school told him that the carhop job at fast-food chain Sonic qualified for course credit. ‘They started calling my manager, asking about getting people hired at Sonic. It’s a joke,’ he added.”

By the way, is it any surprise that “temp” agencies and fast-food restaurants would be in on these sorts of exploitative practices?

In contrast to the testimony provided by former students, the testimony of former employees—in particular, former recruiters and advisers—leaves me, at best, feeling extremely ambivalent. I am always skeptical about the value of “insider” accounts that are provided after the fact. Ironically, to the degree that the accounts themselves have credibility, I wonder about the motives of those offering the accounts. Even if there is some legal advantage to these “confessions,” they generally seem to me to have very dubious ethical or moral value.

Any sort of comparison to the Nazis has become very hackneyed, but, allowing for some vast differences in scope and impact, these after-the-fact confessions generally remind me of my reaction to reading Albert Speer’s memoirs. Speer benefitted greatly from being one of the few members of the Nazi leadership to admit culpability, but given the number of conscripted and slave laborers who suffered and died in the construction projects and munitions plants that he oversaw, no atonement that Speer attempted to make was ever going to be enough.

In this instance, the “insiders” who have testified on the abusive practices of the online for-profits do also benefit from the contrast between their ostensibly regretful revelations and the obstinate denials of culpability that have been made by most of Corinthian Colleges’ executives. Dayan quotes this nonchalantly outrageous statement made—fairly recently–by Jack Massimino, the CEO of Corinthian Colleges: “’Colleges like ours fill an important role in the broader education system and address a critical need that remains largely unmet by community colleges and other public sector schools. Overall, our schools did a good job for the students they served.’”

In the end, even if Dayan’s article offered nothing new, the media spotlight cannot shine often enough on these sorts of gross abuses of students and taxpayers—and political influence.


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