Home Education NY Times: “Scrutiny Takes Toll on For-Profit College Company”

NY Times: “Scrutiny Takes Toll on For-Profit College Company”


As much as a few loud, vociferous Brian Moran apologists want to shut up people like Paul Goldman and me about the heinous, despicable for-profit “education” industry – for which Brian Moran is a top lobbyist – they’re not going to succeed. Especially since articles keep pouring out about how truly horrible this industry is, and how badly in need of shutting down (or at least reforming in a big way).

Just today, for instance, we’ve got a superb article in the New York Times that is a “must read” if you care about this topic in the least bit — and, frankly, whether you give a rat’s hindquarter’s about who becomes the next DPVA chair.

Oh, and for anyone who (bizarrely, falsely) think this is all some sort of anti-Brian Moran jihad by crazed and hateful bloggers, I’d point out that in my case, I’ve been after this slimeball industry for a lot longer than Brian Moran’s been a candidate for DPVA chair. Last May, for instance, I highlighted a FRONTLINE expose on this topic, without mentioning Brian Moran’s name once in the diary. I did the same in August, this time in response to an ABC News story by Chris Cuomo that ripped the industry and made its lead lobbyist, our old pal (and long-time lobbyist for shady causes) Harris Miller, look like a liar and a scam-artist. Then, of course, there are harsh critiques of this industry by the United Negro College Fund and others, like Sen. Tom Harkin and Sen. Dick Durbin. Of course, they all might be part of the anti-Brian Moran conspiracy as well, hateful/obsessed bloggers that we all know they are. Same thing with the Obama administration, which is attempting to crack down on this industry, while being opposed by Harris Miller’s group and Congressional Republicans – the usual suspects, in other words.

Anyway, with that intro, I refer you to the New York Times article, “Scrutiny Takes Toll on For-Profit College Company.” Here are some excerpts, but I encourage everyone to read the entire article, as well as the Harkin report and other materials out there. It’s quite an eye opener on an “industry” that, de facto, is a scam ripping off taxpayers – and students – to the tune of tens of billions of dollars a year.

…over the last few months, Kaplan and other for-profit education companies have come under intense scrutiny from Congress, amid growing concerns that the industry leaves too many students mired in debt, and with credentials that provide little help in finding jobs.

Reports of students who leave such schools with heavy debt, only to work in low-paying jobs, have prompted the Department of Education to propose regulations that would cut off federal financing to programs whose graduates have high debt-to-income ratios and low repayment rates.

Though Kaplan is not the largest in the industry, the Post Company chairman, Donald Graham, has emerged as the highest-profile defender of for-profit education.


Kaplan is facing several legal challenges. The Florida attorney general is investigating eight for-profit colleges, including Kaplan, for alleged misrepresentation of financial aid and deceptive practices regarding recruitment, enrollment, accreditation, placement and graduation rates.

Kaplan is also facing several federal whistle-blower lawsuits whose accusations dovetail with the findings of an undercover federal investigation of the for-profit industry this summer, including video of high-pressure recruiting and unrealistic salary promises.

This is just the tip of the iceberg, there’s a lot more “muck” out there to be “raked.” In short, this is an industry that’s among the worst of the worst. What it has going for it, unfortunately, is powerful friends in high places. That includes the Washington Post, which “has editorialized against the regulations.” Given that Kaplan accounts for 75 percent of the Post’s operating income, that’s not exactly a surprise. But we should all keep that fact in mind when we read the Post’s apologias for corporate wrongdoing in this industry, and in others as well. Just remember, the Post is not some pristine group of monks in the desert, it’s a company desperately trying to stay in business and to turn a profit for its shareholders. There’s nothing wrong with that, except when it claims to be practicing “objective” and “unbiased” journalism. When it comes to the for-profit “education” industry, it most certainly is not doing so. Just remember that going forward…

  • jack russell

    That I really understood exactly how these outfits worked, and what slimeballs they all were.

    I have stopped buying the Post on a daily basis.  The conservative bias was just too much to take.

  • I’d like to hear your case for why this does NOT matter in choosing a new DPVA chair. So far, all I’ve heard is personal attacks on the messengers and utter nonsense about how this issue is “irrelevant” (which it most certainly is not, based on the DPVA’s frantic – and half baked, shoddy, sloppy – responses to it!), absolutely nothing substantive whatsoever. To me, that says it all…as soon as you’ve got to attack the messenger, that means you have no argument. There was a superb comment on NLS the other day, from a “respected attorney”, that everyone should read:

    The bottom line conclusion about this particular statute being intended only for Virginia lobbyists is probably correct.

    A really good law firm would have written a 5 to 15 page memo that would have discussed what the purpose of this lobbyist ban was supposed to be, and would have raised the possibility that the people who adopted this law would have included federal lobbyists if they had been confronted with that situation at the time.

    In addition, a really good law firm would have asked for and found out all the facts about how Harris Miller’s lobby shop works, and would have explored Brian’s role in managing lobbyists in Virginia. They then would have issued guidelines to keep Brian behind a “Chinese Wall” as it related to Virginia.

    The issuance of this legal opinion in the way it was rolled out is an acute embarassment to Cranwell and DPVA because they failed to understand the importance of having a lawyer licensed to practice in Virginia sign the opinion. Having associates in the firm who are licensed in Virginia working on it may have helped them get to the right answer, but for an issue of this sensitivity, a first class political party would never have subjected itself to this embarassment. Every objective and savvy lawyer out there who is not a DPVA apologist will recognize this for what it is: a legal PR disaster.

  • martinlomasney

    Prince Mark, if you want Brian as chairman, find him a day job that is so repulsive!

  • KathyinBlacksburg

    Lobbyists are king and fundamentally undermine and subvert citizen voices, the public interest, and good judgment.  Brian Moran didn’t invent the system, but he was quick to capitalize upon the revolving door.  But he is responsible for staking his future against public education, one of the pillars of every Democratic plank since I have been alive.  

    I supported Moran for gov until I realized some of his positions I cared about were built on quicksand. I was also troubled by some of the same things that concerned Lowell back then, which All of that made me wonder about Brian’s ability to unify the party. Watching his performance in the governor’s race, I doubt his ability to represent all of us.I take no pleasure in this because many of my friends support Brian.  I still like the guy.   But that is not the issue.  Who is best for DPVA is. I believe another candidate to offer us better leadership than Brian.

    I too am troubled by such for-profit diploma mills. I do not agree that the industry in question  should be completely shut down.  It does need significant regulation and serious enforcement.  Now! The industry seems motitated to get its hand in the tuition funding conduit.  It seems also motivated to crush and de-fund public schools.  I  think that, given his conflict of interest on education,  which will exist even if he steps down from his lobbying job, Moran cannot represent Democratic Party values.  That also makes him a liability. Affordable public education is a right in

    today’s society. Anyone subverting that should not head DPVA.  


  • Jeb Stuart

    So do you blame the ants who ruin the picnic or the idiots who spread food out on the grass? I read the New York Times story and I wonder if the answer isn’t reform or regulation but just a recognition that the days of the free (or deficit financed) gravy train need to end.  Dozens of government programs have the same issues — the service “providers” are enriched, the grant administrators stay busy, busy, busy, and the supposed beneficiaries are no better off at the end.

    Which is not to say that some of these firms apparently are especially sleezy.  

  • KathyinBlacksburg

    And I may well make a diary of it later.  But this is bothering me.  Why do so many of those who represent us, look only for the most lucrative lobbying revolving door when they leave the statehouses or Congress?  We could stop this whole thing (the over-influence of lobbyists) if 1) current legislators refuse lobbyist and astroturf money and 2) former reps do the right thing and either go back to what they were doing before–OR do something constructive that is in the public interest, where they could still get paid pretty darn well.  Why do so many look upon service as our reps as the ticket to great riches?  Not all of them do this, of course, but if the ones doing it would knock it off, the corruption would take a serious and positive hit.

    When one looses elective office it is a moment of truth.  What happens next defines who they are.  Are they honorable in their retirements or not?  Do they try to accomplish something good or not?  Do they maintain their integrity or not?  It will be interesting to see how all our candidates who lost this time out comport themselves and what choices they make.  I’d like to think they will make good choices.  Unfortunately, too many (incl Brian) do not.

  • Tom

    One the the things I respected most about Webb the candidate, and now Webb the Senator is that he refused to accept a penny from any lobbyist, and so far as I am aware has stuck to that strict prohibition the 4 years he has served as my Senator.

    I have to believe that Webb would not want a lobbyist to be DPVA chair, even if he might think the lobbyist is working for an ethical company, because of the obvious appearance of impropriety and clear conflict of interest problems.

    I also don’t think Webb, whenever he retires, would ever become a lobbyist no matter how much money he might be offered.

    One more thought about whether being a Federal lobbyist violates Va. law with respect to being elected DPVA chair: I believe that the Party Plan (which means By-Laws) must be amended to prohibit a lobbyist serving as chair.  

  • mechenvy

    I don’t know if it still works this way today, but here is how it worked many years ago when I took a job as a “college admissions representative” (for one month) that turned out to be a recruiter for a for-profit school: When a for-profit school targets low-income kids for enrollment, it’s really the Pell grants they want. They don’t have to be re-paid, and once the kid is in class for enough of the semester or trimester or octomester or whatever hyped-up cycle of classes they run at the school, the school gets 100% of the grant money. If the kid leaves too early in the semester, the school only gets a portion of the grant. So the routine was: Hey, kid, get in school — classes are just about to start! (They were always just about to start because there were 6 to 8 cycles a year.) Make sure you enroll. Make sure you come to classes for the first few weeks. And once the grant money came in at 100% — well, some made it through and some didn’t, stuff happens, we took a chance on saving a kid, no harm no foul. Maybe today the loans are more lucrative, or maybe someone should be tallying all the Pell money going out the door, too, if Pell grants are still allowed at for-profit schools. Either way, this is all just another example of how efficent the private sector has been at vacuuming out our national treasury as part of the largest involuntary transfer of wealth in human history. As Willie Sutton said when he was asked why he robbed banks, so might for-profit “educators” say if they were asked why they rob the taxpayers: “That’s where the money is.”