The federal government’s war on for-profit education providers has intensified in recent years. Politicians such as Senator Tom Harkin of Iowa have denounced for-profits for seducing students into taking out substantial loans for degrees that in many instances provide poor job prospects upon graduation (that is, if students actually graduate; many do not). New “gainful employment” rules at the Education Department are aimed at these “failing” schools.

Under the rules, a school “fails” if its graduates’ average loan payments are greater than 30 percent of their discretionary earnings or 12 percent of their annual earnings (the Department says that if the rules were in place right now, 1,400 programs and about 800,000 students would be affected). In today’s Pope Center Clarion Call, George Leef argues that the latest regulatory blitz is the result of blanket hostility toward for-profits. It’s a futile attempt to deal with a dismal job market that’s been prolonged by the current regime. Rather than recognizing that “easy money” and the third-party payer problem have created bad incentives for both students and colleges and distorted the job market, the government is compounding such problems. It mistakes the symptoms for the disease.

One faulty assumption is that if students at for-profits are graduating with big debt and minimal job prospects, the educational quality at such schools must be low. But entry-level job training tends to be standardized. The real problem is that there is a shortage of entry-level job opportunities that traditionally have been available to individuals with some level of postsecondary education. And that’s a problem faced by everyone, including those who attended nonprofit schools.

Now that the effects of years of federal subsidization are becoming visible to all and wreaking havoc at the macro level, the very people who have perpetuated the problems are proposing to “do something,” even if such policies will come with their own set of unintended consequences and eliminate educational opportunities.