Follow the money: For-profit colleges pumping campaign money to foes of regulation

For-profit colleges and universities and their industry association gave at least $694,829 to political candidates through May 31, much of it to members of Congress who oppose greater regulation of the industry, including proposed curbs on aggressive recruiting of veterans with G.I. Bill benefits.

Among the industry’s principal givers are the Apollo Group (parent company of the University of Phoenix), which has contributed $259,901 to candidates; APSCU, which has given $184,500; and DeVry, Westwood College, Argosy and Art Institutes parent Education Management Corporation, and Everest parent Corinthian Colleges. The Art Institute and Everest have recently established operations in Milwaukee.

The for-profits have contributed to Republican presidential hopeful Mitt Romney and nothing to Barack Obama, whose administration has been largely seen as cracking down on them.

The Association of Private Sector Colleges and University, or APSCU, and its members gave to Senate and House members who have spoken out against the so-called gainful-employment regulation, under which educational programs would lose access to federal aid if their graduates fail to earn enough to repay their student loans. Last month, the federal government reported that five percent of career-training programs at both nonprofit and for-profit schools do not meet that test.
The rule is in limbo after a federal judge this month struck down the way the Department of Education calculated the ratio of debt to income, though he affirmed that it could proceed with the rest.

For-profit colleges gave financial support to lawmakers who wrote letters critical of the regulation or who attended a rally on the west lawn of the Capitol called to protest it, and to members of the Congressional Black Caucus, who said it would discriminate against nonwhite and low-income students.

Also receiving contributions were members of Congress who oppose restrictions on aggressive recruiting by for-profit colleges of veterans who use G.I. Bill benefits, criticized a General Accounting Office report about student-recruiting fraud, or voted against putting for-profits under the new Consumer Financial Protection Agency, and both Republican and Democratic members of the House and Senate education committees. In all, the for-profit schools backed at least 93 representatives and senators or candidates for Congress, 53 of them Republicans, according to federal disclosure forms.

Among those are Republicans George Allen and Josh Mandel, who are challenging Senator Jim Webb (D-Va.) and Senator Sherrod Brown (D-Ohio), respectively, both of whom have favored reforms to regulate the way veterans can be recruited by for-profit schools.

Members of the House who spoke at a 2010 rally against the gainful-employment regulation received campaign-finance contributions, however, including Robert Andrews (D-N.J.), Ted Deutsch (D-Fla.), Brett Guthrie (R-Ky.) and Glenn Thompson (R-Pa.). Guthrie and Thompson also criticized the GAO for an undercover investigation that found recruiting abuses at for-profit colleges, which the industry attacked for transcription errors and other problems, but whose conclusion was not changed.
House Oversight & Government Reform Chairman Darrell Issa (R-Calif.) also criticized the GAO report, as did House Education and the Workforce Committee Chairman John Kline (R-Minn.), and committee member Carolyn McCarthy (D-N.Y.). Issa, Kline and McCarthy also received campaign contributions from for-profit colleges or their industry association.

Other members of Congress who raised questions about the gainful-employment rule got money, too, including Jason Altmire (D-Pa.), Judy Biggert (R-Ill.), André Carson (D-Ind.), Gerry Connolly (D-Va.), Ron Kind (D-Wisc.), Tim Murphy (R-Pa.), former House Speaker Nancy Pelosi (D-Calif.) and Loretta Sanchez (D-Calif.) in the House, and, in the Senate, Minority Leader Mitch McConnell (R-Ky.), and Bill Nelson (D-Fla.).

Some members of the Congressional Black Caucus have attacked the gainful-employment proposal and other regulations as discriminatory, as for-profit colleges enroll disproportionate numbers of low-income students and nonwhites. Among Black Caucus members who got financial support from the for-profit colleges were Alcee Hastings (D-Fla.), Ed Pastor (D-Ariz.) and Edolphus Towns (D-N.Y.).
Members of the House Education and the Workforce Committee received donations, too, including Kline, Andrews, Biggert, McCarthy, Lou Barletta (R-Pa.), Virginia Foxx (R-N.C.), Trey Gowdy (R-S.C.), Joe Heck (R-Nev.), Duncan Hunter (R-Calif.), Mike Kelly (R-Pa.), Howard “Buck” McKeon (R-Calif.), Todd Rokita (R-Ind.), and Dennis Ross (R-Fla.).

So did members of the Senate Committee on Health, Education, Labor & Pensions, including Michael Bennet (D-Colo.), Orrin Hatch (R-Utah), Johnny Isakson (R-Ga.), Mark Kirk (R-Ill.) and Rand Paul (R-Ky.).

For-profits also gave to U.S. Rep. Jim Moran Jr. (D-Va.), whose brother Brian is chairman of the Virginia Democratic Party as well as APSCU’s vice president for government relations; Republican congressional candidate from Arizona Kirk Adams, an alumnus of the University of Phoenix; and Kristi Noem (R-S.D.), cofounder of the Congressional E-Learning Caucus.

At least one senator who’s been critical of for-profits received financial support anyway: Marco Rubio (D-Fla.) a potential vice-presidential running mate to Romney.

This post is based on an article by Jon Marcus in the Hechinger Report, July 12, 2012

For-Profit Colleges Spend Much Less On Educating Students Than Public Universities

Chris Kirkham reports:

For-profit colleges devote less than a third of what public universities spend on educating students, even though the for-profit institutions charge nearly twice as much as their public counterparts for tuition, according to new federal government data released Thursday...

On average, for-profit schools spent $2,659 per student on instructional costs during the 2008-09 school year, compared with $9,418 per student at public universities and $15,289 per student at private non-profit colleges.

 
Meanwhile, the average cost for an undergraduate student at a for-profit college was nearly $31,000, after factoring in grants received. The average cost for private non-profit colleges was $26,600, while students at public universities paid on average $15,600.

The entire article which first appeared in the Huffington Post is linked here.

Diploma mills recruit at halfway houses and homeless shelters

Bloomberg Businessweek reports that for-profit schools are recruiting students at homeless shelters and halfway houses, enticing them into huge debts to pay for overpriced programs and sticking taxpayers with the bill.

The article also notes that Goldman Sachs, the high profile investment firm and bailout recipient whose CEO recently testified before Congress about alleged improprieties, owns (38%) the Education Management Corporation, the owner of the Art Institute of Milwaukee which is seeking a public subsidy (new market tax credits) to anchor a redevelopment project in Milwaukee's 3rd ward.

Have these billionaires no shame?


The expose is linked.