New York Times writer Joe Nocera details some of the problems with for-profit colleges: “Although for-profit colleges enroll 12 percent of the nation’s college students, they soak up about 25 percent of the federal government’s student-aid budget. Fewer than half the students who enroll in the four-year for-profit schools graduate. Roughly 47 percent of those who were paying back their loans in 2009 defaulted in 2010.” (The for-profit school loses nothing when a student defaults, but the student is saddled with the loan until it’s paid off.)
Sometimes it’s said that the high dropout and default rates are explicable by the fact that the recruited students are bigger academic and financial risks than students in the traditional system. That’s the part I’ll never understand, it seems. We believe that there are already too many students going to college; why do we want even more, and even less prepared, people to go? And we saw in the housing market that it was a mistake to extend mortgages to people unable and unprepared to handle them; why is it a good idea to give college loans to the academically and financially unprepared?
Be that as it may, Nocera believes that the for-profits need reforming, but opposes the recently released DOE regulations. Instead, he suggests the ideas of Robert Silberman, chairman of Strayer Education (an unfortunate name perhaps), “widely regarded as one of the better for-profit companies.” Silberman suggests two changes, according to Nocera: first, “the government should force the for-profits to share in the losses when a student defaults”; second, “the government should set up a national eligibility test to screen out students who lack the skills to attend college.” Those sound like sensible and even honorable ideas.