Obama cracks down on for-proft colleges

[BMBiology]

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"The new regulation, which would take effect in 2016, would flag programs as weak if their graduates’ average loan payments ate up 8 percent or more of their total earnings or 20 percent or more of their discretionary earnings. They would also be flagged if the default rate for former students exceeded 30 percent.

Any program that failed those tests two out of three consecutive years would face a crippling penalty: The Education Department would refuse to extend financial aid to its students. That would choke off the colleges’ primary source of revenue — and effectively force them to close the targeted programs."

Read more: http://www.politico.com/story/2014/...for-profit-colleges-104661.html#ixzz2vtydIj6q

 

[BMBiology]

I knew there was a reason why I voted for this guy!

 

[trailerpark]

Sounds too good to be true.

 

[asian pharm]

The policy is too lenient....30% default rate for former students!!! It should be more like 10-15%. Other then that, a very good policy. I can't wait for this to go after diploma mills in FL (Hint: a private college in South FL)

 

[Jibby321]

The policy is too lenient....30% default rate for former students!!! It should be more like 10-15%. Other then that, a very good policy. I can't wait for this to go after diploma mills in FL (Hint: a private college in South FL)

Which are you talking about?

 

[WVUPharm2007]

I...support this.

Bye bye Art Appreciation departments.

 

[Waffle Houzen]

Which are you talking about?

probly Nova.

 

[PharmerC]

For-profit colleges, however, rejected the regulation as an unacceptable — and possibly illegal — federal intrusion into the private sector.

Didn't this already happen when they took control of the majority of the lending that gives students the ability to even attend these institutions? At this point, if the government withdrawals lending support, who is going to pick up that slack and keep this train rolling ahead? This may not be a perfect solution to contain the monster that higher education has become, but it could be a start. If these scam schools don't comply, don't loan money to student who wish to attend and watch them crumble.

Or maybe even stratify each degree on job prospects and median income out of school, and place a maximum on how much can be loaned per degree.

 

[eagles22]

This probably won't affect pharmacy or professional schools (with the exception of law schools), but it should get places like U of Phoenix to stop hustling people out of their money.

 

[confettiflyer]

Easy, hire your graduates at minimum wage (beats unemployment) and put them on PAYE.

 

[NejixRockS]

probly Nova.

why NOVA? it might not be as "good" as UF, but its still way better and older than many of the schools in the country ._.

@Waffle Houzen

 

[dk00]

with the polar congress that we have today, this is not getting passed anytime soon 🙂

 

[BMBiology]

with the polar congress that we have today, this is not getting passed anytime soon 🙂

Obama is using his executive authority. This is not a bill that is going thru congress.

 

[Dr Wario]

I have to say that the spirit of this act (de-incentiveizing) is what needs to happen to fix our truly broken system. This idea should not just stay with students loans, but should spread to all aspects of government, most especially, social programs. If you commit a crime while on welfare? gone, don't show up for/fail a drug test? gone, have another baby while on the system? baby gone or no more money for baby. These things are harsh, but what else are you going to do to fix a massive budget problem?

 

[All4MyDaughter]

The impact of this on pharmacy schools will be minimal. May have some impact on for-profit pharm tech programs.

 

[fewaopi]

couldn't schools just accept students who don't need financial aid? so mainly kids with rich parents who are willing to foot the bill will pay for the costs of education. there could be further inequality caused by this no?

 

[confettiflyer]

couldn't schools just accept students who don't need financial aid? so mainly kids with rich parents who are willing to foot the bill will pay for the costs of education. there could be further inequality caused by this no?

But the counter argument is that for-profit schools often take advantage of lower income individuals and give them a high-cost/low-benefit degree.

 

[RedPill1785]

couldn't schools just accept students who don't need financial aid? so mainly kids with rich parents who are willing to foot the bill will pay for the costs of education. there could be further inequality caused by this no?

They don't go to University of Phoenix. Ever look at "celebs at ___ college" lists? or the ranking of top 100 schools producing millionaires? Or the top 10 schools producing billionaires. The rich value quality just as much as everyone else. Networking, partying, privilege, prestige. Rich--->Harvard---> get richer.

 

[Maplebar]

"The new regulation, which would take effect in 2016, would flag programs as weak if their graduates’ average loan payments ate up 8 percent or more of their total earnings or 20 percent or more of their discretionary earnings. They would also be flagged if the default rate for former students exceeded 30 percent.

Any program that failed those tests two out of three consecutive years would face a crippling penalty: The Education Department would refuse to extend financial aid to its students. That would choke off the colleges’ primary source of revenue — and effectively force them to close the targeted programs."

Read more: http://www.politico.com/story/2014/...for-profit-colleges-104661.html#ixzz2vtydIj6q

Just make sure all students select the Pay As You Earn Plan and the school won't be flagged?

 

[owlegrad]

have another baby while on the system? baby gone or no more money for baby.

I am curious what "baby gone" means?

 

[Sparda29]

I am curious what "baby gone" means?

I hope that it means that the baby is automatically taken into state custody for adoption.

 

[zelman]

I am curious what "baby gone" means?

King Solomon cuts it in half?

 

[Dr Wario]

I hope that it means that the baby is automatically taken into state custody for adoption.

Yes

 

[xiphoid2010]

Yes

You hit a core problem: subsidies for bad performance and lack of accountability of the system. I would go a step further. As the old chinese saying goes: meter rewards and punishments clearly and justly. Not just stop subsidizing bad behavior, we should reward the good.

Laid off workers who took a lower paying job instead of just collect unemployment? You earned a partial of unemployment check for the unemployment $ saved. On welfare but kept your kids straight A students? Here's a bonus check for contributing to a better societal future. Live in the ghetto but got a clean record? You get priority for subsidized housing and location, thanks for being responsible despite the situation.

 

[DiomedeaExulans]

This should be a tiered system based on the cost of the program. The most expensive programs should have to meet the lowest default criteria (say 10% or fewer defaults for schools charging $30,000/yr or more), with the default percentage increasing for lower-cost programs. The least expensive commnity or state colleges could even be exempt from this. I bet some of those expensive diploma mill COPs will soon see 10% or more of their graduates defaulting, if they haven't already. Any program that wastes taxpayers' money by producing highly educated burger flippers and welfare recipients should be cut off from the student loan cash cow. A tiered approach would also put a much needed downward pressure on tuition. This reform is long overdue.

 

[Reirrac]

It's certainly a start. Academia is long due for a check and balance system.

 

[BidingMyTime]

It's a start. I think it needs to go further, but at least its a start.