With Lobbying Blitz, For-Profit Colleges Diluted New Rules

Last year the Obama administration vowed to regulate for-profit colleges and their unscrupulous practices that frequently left students with huge debts, non-transferable credits and dashed dreams .

In an opening volley that shook the $30 billion industry officials proposed new restrictions to cut off the huge flow of federal aid, the industries main source of funds and profits, to unfit programs. The gainful employment regulation was designed to deny federal funds to programs that did not result in employment with wages high enough to pay off student loans.

But the New York Times Eric Lichtblau reports that "...after a ferocious response that administration officials called one of the most intense they had seen, the Education Department produced a much-weakened final plan that almost certainly will have far less impact as it goes into effect next year."

"The story of how the for-profit colleges survived the threat of a major federal crackdown offers a case study in Washington power brokering. Rattled by the administration’s tough talk, the colleges spent more than $16 million on an all-star list of prominent figures, particularly Democrats with close ties to the White House, to plot strategy, mend their battered image and plead their case.... "
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"In all, industry advocates met more than two dozen times with White House and Education Department officials, including senior officials like Education Secretary Arne Duncan, records show, even as Mr. Obama has vowed to reduce the “outsize” influence of lobbyists and special interests in Washington.
The result was a plan, completed in June, that imposes new regulations on for-profit schools to ensure they adequately train their students for work, but does so on a much less ambitious scale than the administration first intended, relaxing the initial standards for determining which schools would be stripped of federal financing."

The losers, the thousands of students who are lured into attending for-profit colleges with promises of accredited degrees, jobs and increased income, but who end up with a lifetime of debt, with worthless credits, and without the jobs and income they were promised.

The joke in Washington, according to Lichtblau, is that the industry effort to defeat the regulations mainly ensured “gainful employment” for the capital’s Democratic lobbyists and political consultants.

The Times article is a disturbing case study in how corporate America and its lobbyists manipulate public policy to serve their interests.It is linked here.