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Sunday, October 24, 2004
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FUNNY MONEY
Thoughtful post from Fenster Moop over at 2Blowhards, in which he defends for-profit schools like the University of Phoenix against UD’s cruel satires of them [see UD post a bit below this one, where she does stuff with the song "Rawhide"]. “My understanding is that what Phoenix does it does rather well,” says Moop. But does it? Its company stock (Apollo Group Inc.) has sunk like a stone (28 percent since June 8, according to Bloomberg); it’s being investigated to death for all sorts of illegalities, most involving tricks played on the government, and on students, in order to maintain high enrollment and the massive federal aid that comes with it. It’s already been the recipient of what Susan Aspey, a spokesperson for the Department of Education, calls “the largest fine the department has ever imposed on a school.” None of this differentiates Phoenix much from a number of other for-profit universities. In fact Phoenix seems slightly cleaner than the industry norm. There’s now “intense regulatory scrutiny [of] the [entire] for-profit education industry,” notes Bloomberg. The regulatory laws are in place to “protect prospective students from being pressured, and taxpayers from potential defaults on student loans.” Among the “well-publicized legal problems with some of these companies,” as one specialist in educational stocks puts it, there‘s the SEC inquiry into “allegations that [Career Education] inflated student enrollment at colleges in Montclair, New Jersey, and Santa Barbara, California.” As the same stock specialist remarks, “That usually means there’s fire, when you see that kind of smoke.” Fenster wonders, quite reasonably, why “lower-end customers” for education shouldn’t be allowed “a convenient, low-cost educational alternative,” for themselves. After all, rich people can go to Jacuzzi U. and get pampered and grade-inflated through. But UD would like to suggest that it’s doing lower-middle class people no favors to drag them into corruptly run schools where they take courses they can’t pass and then default on their loans. UD doesn’t think it’s very respectful of such people for them to have to be part of universities that (like one of the for-profits) use “Monopoly money…in a contest to drum up applications.” -------------------------------------------------------------- For-Profit Update, January 31, 2005: 60 Minutes investigates. Go here. |