Union workers save lives and power Hurricane Sandy recovery

The recovery from Hurricane Sandy is going to require time, money and effort. And, like so many of the heroic rescues that happened during the storm, much of the effort is going to come from union members, and especially from the unionized public workers that the Republican Party has worked so hard to hurt over the past couple of years.

Already we've seen fire fighters, police, EMTs, nurses and other health care workers saving lives.

They've gone into flooded streets to rescue people, fought fires, carried patients down flight after flight of stairs to evacuate them. New York City fire fighters belong to the Uniformed Firefighters Association. Many of the health care workers carrying patients out of NYU Langone Medical Center as it was evacuated belong to SEIU1199.

Now the hard work of getting back to normal has begun. Garbage collectors are out clearing debris from city streets. Bridges and tunnels are being inspected for safety. Railroad tracks and roads are being assessed and repaired. New York City buses will begin running again Tuesday afternoon, driven by unionized transit workers. Members of more than a dozen unions were involved in rescue or are involved in recovery.

These union members are people whose jobs Mitt Romney, Paul Ryan and congressional Republicans would cut, whose pensions and benefits have been slashed by New Jersey Gov. Chris Christie, whose right to bargain has been under attack across the country.

Make no mistake about it: The fact that these are union workers is important. Unions bargain for the tools their workers need to do the best job possible, from having enough workers on the job to having adequate equipment and training. The wage and benefits improvements union members get help keep workers on the job for longer, so that they develop the skills and experience to handle worst-case scenarios like the one we're seeing now. Having health care keeps them healthy enough to do physically taxing jobs like carrying patients down 17 flights of stairs.

If someone you love was rescued from a flooded area, chances are it was a union member who rescued them. When your power goes back on, chances are a union member will have done the work. Mitt Romney will probably once again encourage you to embrace the line that we like workers, but just hate their unions. But the workers are the unions, and the collective power of unions helped individual workers rescue people or restore power or mobility by making sure they had the tools to get the job done and the pay and benefits such important work deserves.

For more see the Daily Kos.

A Big Storm Requires Big Government

New York Times Editorial 10/29/12

Most Americans have never heard of the National Response Coordination Center, but they’re lucky it exists on days of lethal winds and flood tides. The center is the war room of the Federal Emergency Management Agency, where officials gather to decide where rescuers should go, where drinking water should be shipped, and how to assist hospitals that have to evacuate.

 

Disaster coordination is one of the most vital functions of “big government,” which is why Mitt Romney wants to eliminate it. At a Republican primary debate last year, Mr. Romney was asked whether emergency management was a function that should be returned to the states. He not only agreed, he went further.

 

“Absolutely,” he said. “Every time you have an occasion to take something from the federal government and send it back to the states, that’s the right direction. And if you can go even further and send it back to the private sector, that’s even better.” Mr. Romney not only believes that states acting independently can handle the response to a vast East Coast storm better than Washington, but that profit-making companies can do an even better job. He said it was “immoral” for the federal government to do all these things if it means increasing the debt.

 

It’s an absurd notion, but it’s fully in line with decades of Republican resistance to federal emergency planning. FEMA, created by President Jimmy Carter, was elevated to cabinet rank in the Bill Clinton administration, but was then demoted by President George W. Bush, who neglected it, subsumed it into the Department of Homeland Security, and placed it in the control of political hacks. The disaster of Hurricane Katrina was just waiting to happen.

 

The agency was put back in working order by President Obama, but ideology still blinds Republicans to its value. Many don’t like the idea of free aid for poor people, or they think people should pay for their bad decisions, which this week includes living on the East Coast.

 

Over the last two years, Congressional Republicans have forced a 43 percent reduction in the primary FEMA grants that pay for disaster preparedness. Representatives Paul Ryan, Eric Cantor and other House Republicans have repeatedly tried to refuse FEMA’s budget requests when disasters are more expensive than predicted, or have demanded that other valuable programs be cut to pay for them. The Ryan budget, which Mr. Romney praised as “an excellent piece of work,” would result in severe cutbacks to the agency, as would the Republican-instigated sequester, which would cut disaster relief by 8.2 percent on top of earlier reductions.

 

Does Mr. Romney really believe that financially strapped states would do a better job than a properly functioning federal agency? Who would make decisions about where to send federal aid? Or perhaps there would be no federal aid, and every state would bear the burden of billions of dollars in damages. After Mr. Romney’s 2011 remarks recirculated on Monday, his nervous campaign announced that he does not want to abolish FEMA, though he still believes states should be in charge of emergency management. Those in Hurricane Sandy’s path are fortunate that, for now, that ideology has not replaced sound policy.

3 University of Phoenix campuses in Wisconsin will close

Yesterday the University of Phoenix announced that it was closing 115 locations across the country, a move that will affect 13,000 students. Three of these campuses are located in Wisconsin. The Madison, Brookfield and Grand Chute campuses have stopped enrolling students and eventually will close. At this point the Milwaukee campus will remain open.
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The closures come as parent company Apollo Group Inc. said earlier this week that its fourth-quarter net income tumbled 60%, hurt by higher costs and declining enrollment at the University of Phoenix. .
The University of Phoenix currently has about 328,000 students, down from a peak of more than 400,000. Following the closures, it will be left with 112 locations in 36 states, the District of Columbia and Puerto Rico.

Shares in the Phoenix-based company tumbled nearly 8% in after-hours trading.

University of Phoenix to close 115 locations

The University of Phoenix, the nation’s largest for-profit university, is closing 115 of its brick-and-mortar locations, including 25 main campuses and 90 smaller satellite learning centers. The closings will affect some 13,000 students, about 4 percent of its student body of 328,000.
      

It is also laying off about 800 employees out of a staff of 17,000, according to Mark Brenner, senior vice president for communications at the Apollo Group, which owns the university.

 

After the closings, which are to be completed next year, the University of Phoenix will be left with a nationwide network of 112 locations and a physical presence in 36 states, the District of Columbia and Puerto Rico.

 

Apollo stock closed Wednesday at $21.40, down $6.09, a 22 percent decline.

 

Enrollments at the University of Phoenix and in the for-profit sector over all have been declining in the last two years, partly because of growing competition from other online providers, including nonprofit and public universities, and a steady drumroll of negative publicity about the sector’s recruiting abuses, low graduation rates and high default rates.

 

 In Milwaukee, Everest College, owned by Corinthian College Inc.announced it was closing less than two years after its controversial opening after regulators disclosed that the college had an abysmal 5% job placement rate and a drop out rate of more than 50%. Sanford Brown, another for-profit with a nefarious reputation, has also announced that it is closing its Milwaukee campus        

 

Late last month, Kaplan Higher Education, a division of the Washington Post Company, announced that it was closing nine of its campuses and consolidating four others into nearby locations. The company did not give a reason, but in an August filing with the Securities and Exchange Commission it disclosed that an accrediting commission had warned that its campuses in Baltimore, Indianapolis and Dayton could lose their accreditation — and with it, eligibility for the federal student aid that makes up more than 80 percent of Kaplan’s revenues — for failure to meet student achievement requirements.

 

As the negative publicity about for-profits mounted — including many charges that the schools enrolled students who had almost no chance of succeeding, to get their federal student aid — both Kaplan and the University of Phoenix announced new programs, offering some form of free trial, to ensure that they enrolled only students who had a reasonable likelihood of success. Those programs cut substantially into their enrollment numbers.

 

“We’ve said publicly that about 20 percent of the students in our free three-week online orientation program either don’t complete the program or don’t enroll,” said Mr. Brenner.

To help boost enrollment, the University of Phoenix last week announced a tuition freeze for students who remain consistently enrolled.

 

Students affected by the University of Phoenix closings will have the option of transferring to the university’s online classes — about three-quarters of its students are online — or moving to a nearby site. Students are now being notified of the changes, and a hot line has been set up at (866) 992-3302 for those with questions.

 

Based on an article by Tamar Lewin in the New York Times, October, 15, 2012

 

      

 

 

What caused the deficit?

It has become an article of faith among Republicans that President Obama's polices caused the deficit to soar. As a result, they claim we need to cut federal programs that assist low and middle income families because it is immoral to leave these bills to our children. The problem is that it is just not true that the Recovery Act is responsible for the nation's projected deficits. According to the non-partisan Congressional Budget Office, the Recovery Act and even TARP (the bank bail-out) are not responsible for projected deficits. That is because these policies are short term. It's long term policies, like the high income Bush tax cuts, that stay in the system and remain unpaid for, that drive deficits. The Great Recession played a major role by reducing tax revenues and triggering automatic stabilizers, existing counter cyclical laws, like unemployment compensation and food stamps, that automatically increase federal spending during a downturn and then decrease spending during a recovery. Check out the chart by the Center on Budget and Policy Priorities (CBPP) that illustrates that absent the Bush era tax cuts, the wars of choice in Iraq and Afghanistan and the downturn, there would be virtually no deficit.     The entire CBPP report is linked here.

Corinthian College Inc. manipulates student loan default rates

By Stephen Burd

In examining the student loan default rate data that the U.S. Department of Education recently released, it’s hard not to marvel at the success that Corinthian Colleges has had in driving down its schools’ two-year cohort default rates.

The for-profit higher education corporation’s two-year rates have plunged across the board, with most of them dropping by double digits. For example, the company’s Everest College campus in Thornton, Colorado saw its rates plummet, from 27.3 percent in 2009 to 3.7 percent in 2010.

Similarly, at Everest Institute in Pittsburgh, the rate dropped from 25.2 percent to a remarkably low 1.1 percent. [The company has been much less successful in lowering its schools’ 3-year default rates. Those were 34.9 percent at the Thornton campus and 28.6 percent in Pittsburgh. But the government won’t start holding schools accountable for these rates until 2014.]

How did Corinthian’s leaders achieve this remarkable feat?

Did they do it by:

A. Radically improving the quality of the programs their schools offer to ensure that their graduates have the skills they need to obtain gainful employment in their fields of study?

B. Slashing prices so that students don’t have to take on so much debt?

C. Overhauling their schools’ recruiting practices to ensure that they enroll only students who they know can succeed in their programs?

The correct answer is “none of the above.” Instead, as the Senate Committee on Health, Education, Labor and Pensions has documented, Corinthian officials have engaged in a no-holds-barred campaign to drive down their schools’ rates by pushing former students to obtain temporary forbearances and deferments on their loans. The company’s sole purpose has been to prevent these borrowers from going into default during the current two-year window when the Education Department holds schools responsible for their rates.

As long as borrowers are in deferment or forbearance, they are not required to make payments on their loans and are not in danger of defaulting. Yet federal law mandates that the Education Department include such borrowers among those who are successfully repaying their loans in the default rate calculation. As a result, colleges can artificially lower their rates by persuading their former students to take advantage of these options.

And while this may look like a win-win for both the company’s schools and their former students, that’s not the case for many of these borrowers. While putting federal student loans into forbearance allows borrowers to stop making payments temporarily, interest continues to accrue on the loans, ballooning the size of the overall debt load. The same goes for deferments on unsubsidized federal loans. Many of these borrowers could be better off making graduated or extended repayments, consolidating their loans, or entering into the Income Based Repayment Program, which would allow them to pay back their debt as a percentage of their income.

Corinthian hasn’t exactly kept its efforts secret. In fact, company officials have been quite open about their intentions with investors. But they haven’t revealed much about how they put their plan into action. So how did they do it? The answer can be found in the report (see pages 181-184) that the Senate HELP committee released in July on its investigation into the for-profit higher education industry. Citing internal company records that the committee obtained from Corinthian, the report shows the extraordinary lengths that Corinthian has gone to achieve its aim:

 

To accomplish a lower reported default rate, Corinthian hired three contractors. One was General Revenue Corporation, which devoted 60 full-time employees to call former Corinthian students who were late making payments but not yet in default. The company also hired two firms, ROI and TEAM Enterprises, to send out 30 or more people to knock on former students’ doors to secure ‘cures.’ This same document reveals that students in late stages of delinquency but not yet in default -- a period during which they are the biggest threat to Corinthian’s default rate – could be contacted up to 110 times per month. Another internal document shows that, in order to achieve the company’s desired default rate, the call center run by General Revenue Corporation would make between 2 and 2.5 million calls a year, or 429 calls per employee per day to former Corinthian students. [Emphasis added]

Corinthian also built its own internal default-management operation, complete with a call center and dozens of employees. Documents show that the default-management operations at Corinthian are run with the same high-pressure sales environment as the recruiting department. Compensation is directly tied to the number of students an employee successfully eliminates from the company’s default rate.

As part of these efforts, Corinthian started offering former students gift cards to McDonald’s to get them to contact the call center. According to the report, the company made this offer “by e-mail and mobile phone text messages, and the messages explicitly referred to postponing student loan payments.” Meanwhile, employees who met their targets were showered with praise, while those who failed were taken to task:

 

E-mails show that managers pushed employees to secure as many ‘cures’ as possible. “Team Central…you did it!” reads one e-mail sent to dozens of line-level default management employees, “We cured 243 students on Wednesday…our Division is leading [Corinthian Colleges] and that is a direct reflection of your daily efforts to drive down our CDR [cohort default rate].”

 

In addition to this message of encouragement, other e-mails demonstrate a willingness to reprimand employees if targets are not hit:“Tuesday saw the lowest number of staff calling in the past several days. This led to less calls and less students we talked to. We all know two truths: This must be a campus-wide effort and this is definitely a numbers game.”

A numbers game, indeed. By pushing former students to get forbearances and deferments on their loans, Corinthian has been able to artificially lower its schools’ rates and make sure that these institutions continue to receive hundreds of millions of dollars in federal student aid funds each year.

Suggested Reading

The Myth of Record Low Default Rates

Corinthian Colleges Shows Why Gainful Employment Rules Are Too Weak

Shape Up or Lose Out: The 218 Institutions that Must Develop Default Prevention Plans

 

Reprinted from Higher Education Watch.

Kaplan to close 9 campuses

Kaplan higher-education division will close nine campuses and consolidate four others into existing nearby locations, the company said in a Securities and Exchange Commission filing.

The company, owned by the Washington Post, said it would stop new enrollments at the nine campuses it is closing, but that it would continue teaching the students currently enrolled there.

Kaplan's decision comes only a month after Everest College announced that it would close its Milwaukee campus less than two years after it opened. Everest's job placement rate in Milwaukee was a dismal 5% and its drop out rate over 50%. Everest has agreed to pay off the federal loans of all of its Milwaukee students who dropped out without completing their program of study.

Kaplan's parent company did not give a reason for its decision to close the campuses or identify them, but in an Aug. 7 SEC filing it disclosed that an accrediting commission had warned three campuses (in Baltimore, Indianapolis and Dayton, Ohio) that they could lose accreditation “for failure to meet certain student achievement threshold requirements” and had asked for the school to respond by September.

The loss of accreditation would mean the Kaplan campuses would no longer be eligible for Title IV loans from the Education Department, the source of nearly 90 percent of Kaplan higher-education revenue.

Kaplan was still a test-prep company when the Washington Post Company bought it in 1984, after Richard D. Simmons, the president, convinced Katharine Graham of its potential for expansion and profits.

Over the last decade, Kaplan has moved aggressively into for-profit higher education, acquiring 75 small colleges and starting the huge online Kaplan University. Now, Kaplan higher education revenues eclipse not only the test-prep operations, but all the rest of the Washington Post Company’s operations.

The Washington Post's Company chairman, Donald Graham, has emerged as the highest-profile defender of for-profit education. Together, Kaplan and the Post Company spent $350,000 on lobbying in the third quarter of 2010, more than any other higher-education company. And Mr. Graham has frequently gone to Capitol Hill to argue against the regulations in private visits with lawmakers, the first time he has lobbied directly on a federal issue in a dozen years. His newspaper, too, has editorialized against the regulations.

Four whistle-blower suits against Kaplan under the federal False Claims Act have been made public in the last few years, all making accusations that the company used deceptive practices in its quest for profits, including enrolling unqualified students and paying recruiters for each student enrolled, a practice forbidden by federal law.

In addition, the suits allege, Kaplan kept students on the books after they dropped out, inflated students’ grades and manipulated placement data to continue receiving financial aid. Three of the suits, from Pittsburgh, Milwaukee and Miami, have been consolidated for trial in Miami. A fourth, from Las Vegas, is pending there.

The company said revenue at the campuses to be closed represent approximately 4 percent of total revenue for Kaplan higher education and 2 percent of the total Kaplan division, which includes other educational operations. The Post Co. said Kaplan expects to incur an estimated $18 million in restructuring costs, a portion of which would be recorded in third-quarter earnings, with the remainder recorded through the end of 2013.

Kaplan has about 70 campuses, and about a third of the division’s 67,605 students as of June 30 were on Kaplan ­higher-education campuses, with most of the rest of them studying through online programs.