As ever, Rick Hess offers useful insight into the debate over attaching strings to federal funds flowing for-profit colleges:
The answer is not to lash out at for-profits that have been responding to federal incentives and operating in accord with federal rules. It’s not to change the rules for some institutions while giving others a free pass. It’s not to covertly encourage institutions to turn away aspiring students even as the President insists that every American ought to attend some college. It is to rethink the incentives and rules, for public and private institutions alike, so that we’re encouraging good actors and addressing the bad ones–whatever their tax status.
Sometimes it makes sense to accept half a loaf, in the hope that it will lead to a full loaf. But in this case, my sense is that regulating for-profit operators wouldn’t be a way-station towards treating all colleges and universities equally. If anything, it might short-circuit the process by lulling us into believing that we’ve addressed the structural problem, which is that we haven’t fully figured out what it is we want colleges and universities to do for young adults at the margin.
Moreover, the regulation itself calls for the federal government to determine acceptable earnings ratios for graduates, which would be difficult in the best of times. By applying this regulation even-handedly, we’d at least create a lobby for sanity.
One is reminded of the Budget Repair Bill in Wisconsin. By exempting public safety workers, Gov. Walker chose not to fight the toughest political battle. Yet the ratios are reversed: whereas more dollars currently flow to public and non-profit schools than for-profit schools, there are more non-safety workers than public safety workers. This is why we don’t see public safety workers cheering on the governor. They are keenly aware of the fact that their CBR could go next.