(David Mansdoerfer) – Can you tell the difference between a for-profit, nonprofit, and state school? Throughout the United States, the difference between these three forms of higher education isn’t as drastic as you might think.
Lately, the Obama Administration has begun to wage a war against for-profit education. In this, the Obama Administration has come up with new regulatory system entitled Gainful Employment. Gainful Employment, which stipulates that the median debt to income ratio for students graduating from a for-profit school must be 8% or less, could seriously cripple the for-profit higher education industry.
If a school fails to hold their students debt to income ratio below 8%, they could lose out on Title IV funding such as the Pell Grant and Stafford Loan. If a school loses this funding, students will have to go out and get private loans, which usually come with a much higher interest rate, or not attend school at all.
In examining cost, for-profit schools tend to cost more on average than both state and nonprofit schools. The cost difference, however, is decreasing. For example, the average cost of a bachelor degree from the Art Institute, a for-profit school, is roughly $90,000, including room and board. At UNLV, the average cost of attaining a four year bachelor degree, is roughly $88,000, two thousand less than attaining a degree from the Art Institute.
If the cost isn’t significantly different, then why are proprietary schools being held to a different standard then state schools and nonprofit universities?
Proponents of this crackdown fail to understand the need for these schools in today’s economy. Today, more than 3 million people attend for-profit schools throughout the United States. Students attend these schools because it fits with their schedule, they couldn’t get into another school, or they offer programs that nonprofit and state schools do not.
If the Obama administration really wants to increase higher educational achievement, they should stop singling out the sector that is expanding educational opportunity to students who don’t fit the mold of a traditional state school or nonprofit university.
If gainful employment is enacted, students from for-profit schools will be the ones most affected. Remember, a student has a choice about where they attend school. By enacting regulations that holds their schools to a higher standard because of a bias against for-profit education, are we telling them that their education is less valuable?
I doubt students who attend for-profit schools would be inclined to be very thankful for the government telling them that their education isn’t worth as much as if it would have been had attended a state school or nonprofit university.
Don’t take me for my word. Talk to your local graphic designer who got his degree at the Art Institute. Talk to your favorite chef who got his degree at Le Cordon Blue. Talk to the executive whose MBA from the University of Phoenix that got him that promotion. They will be able to tell you about how their education at a for-profit school helped them.
(Mr. Mansdoerfer is the Director of Federal Affairs for Citizen Outreach)