Prostitution in the industry is nothing new, you have to take what you can get even if that means devouring struggling non-profits or whoring yourself out for otherwise wholly un-big-business-like busywork (I’m staring directly at you, Big 4).
Daniel Golden of Bloomberg reported yesterday that “ITT Educational Services Inc. paid $20.8 million for debt-ridden Daniel Webster College in June. In return, the company obtained an academic credential that may generate a taxpayer-funded bonanza worth as much as $1 billion.”
With education little more than a vague directive to “teach” at this point (except for the chosen few professors who put their hearts into it, of course), schools are being encouraged to “convert a school to a charter school or a similar education management organization, a for-profit or nonprofit organization that provides ‘whole school operation’ services” (via firedoglake) in California districts where schools have fallen way short of federal education “guidelines”. Hint: that’s when you know it is bad. Firedoglake implies that recent protests and riots by California state university students facing severe class cuts and hikes in tuition are directly related to the push to privatize education.
In the case of small but favored not-for-profit educational institutions, they don’t have much of a choice but to end up recycled into the ITTs and the DeVrys if they can’t make it. For-profit education is the way to go, ask DeVry. They didn’t make $369 million last year for nothing.
Said Karen Pletz in the Kansas City Star, “the not-for-profit mission, whether it be in education, health care, or other human services, is really about values and is intrinsically focused in bettering lives and community.” Not to carelessly go name-calling but what can a for-profit, publicly-traded institution possibly know about that mandate or education for that matter? Its first loyalty is to the shareholders, not the students.
Perhaps not coincidentally, in December of 2009 WSJ pointed to a Department of Education report revealing a 21% default rate in the first three years for those coming from for-profit institutions like ITT over there gobbling up broke Daniel Webster College. For-profit education institutions are accused of aggressive loan procedures to get students through their programs; meanwhile non-profit private education remains picky about who they’ll take and for good reason. It’s a sweeping generalization to say default rates somehow correlate with the quality of instruction but one can assume loans are easier to pay off when the debtor is not just gainfully employed but paid well.
Company’s purchase of N.H. college could earn it $1 billion [Bloomberg via Boston Globe]