Alex Schlack
Chris Werry
RWS100
October 17 2014
“Why
Do You Think They’re Called For-Profit Colleges”
Out
of all the immense educational opportunities after High School, why have
for-profit colleges been stirring up so much debate? For-profit colleges are
public institutions managed and operated by private, money seeking businesses
and corporations. For-profit colleges
have always existed in the past, but they were always referred to as career or
trade schools that only offered certificates and associate degrees to people
who lacked the money or couldn’t get accepted into the traditional
universities. And since these huge universities have been getting more
challenging to get into due to lower acceptance rates, and the community
colleges reach or exceed their enrollment capacities, these for-profits have
been receiving loads of attention from students whom this is their only option.
But for-profits have been ultimately taking advantage of this growing
population of students, as you can see through their enrollment numbers, which
have increased by 225 percent. Now a lot of people didn’t see this upcoming
exponential growth, except for one entrepreneur named Michael Clifford.
Clifford is the guy who took these once dying non-profit organizations and
revolutionized them into moneymaking machines.
A lot of the money that these for-profits make is actually from loans
and grants form the government. However, people are skeptic about the fact that
these for-profit colleges are receiving such large amounts of money for student
aid when in reality they only accept 10 percent of their applying
students. The truth is, all this money
isn’t going to a good cause. That’s why
people are questioning for-profit’s suspiciously large student debt,
recruitment tactics, and misleading information. All these viable concerns about for-profit
colleges are discussed, clarified and complicated in Kevin Carey’s article,
“Why Do You Think They’re Called For-Profit Colleges.” Carey’s overall argument states that even
though there are some problems and shady activity with for-profit colleges,
they still play an important ole within our society. I will personally observe and analyze Carey’s
work and how he presents the pros and cons of For-Profit Colleges. In his
writing, Carey introduces various claims about main questions associated with
these famous for-profit colleges but there are only three main ones that he
talks about the most.
Carey first claims that
for-profits have a higher rate of default in loans than needed, since a majority
of the students are from low-income backgrounds. Carey states in his article,
“Many students come form low-income backgrounds. You don’t need a college
degree to know that large debt plus small income equals high risk of default.” Carey
doesn’t consider for-profit colleges as “bad”, but he clearly implies that is
wrong for them to set up these students so that when they graduate or if they
even graduate, they will have mass amounts of student debt. Carey backs up his
argument by saying, “Even the for-profit Corinthian Colleges estimated in
official documents filed with Securities and Exchange Commission that more than
half the loans it makes to its own students will go bad. Corinthian still makes
a profit, because it gets most of its money form loans guaranteed by Uncle
Sam.” In this he gives a valid example
of a for-profit college that obtains a profit from loans of students who cant
pay them off because they don’t have the money to do so. Carey thinks that for-profit colleges
shouldn’t promise to help these students after they graduate when they are
clearly inept to paying off their default loans for their education. In addition to illustrating Carey’s argument,
the Government Accountability Office (GAO) actually did a study and created a
report on for-profit colleges that ultimately extends Carey’s claim. They
wrote, “When students do not make payments on their federal loans and the loans
are in default, the federal government and taxpayers assume nearly all the risk
and are left with the costs. For example, in the Direct Loan program, the
federal government and taxpayers pick up 100 percent of the unpaid principal on
defaulted loans. In addition, students who default are also at risk of facing a
number of personal and financial burdens.”
While Carey’s claim is general and mainly opinionated, the GAO provides
concrete detail and evidence that builds off Carey’s viewpoint. They do this by
stating that for-profits make more money than they are supposed to, by claiming
one hundred percent of the money form default loans that students fail to pay. And
since their debt cannot be repaid, they become ineligible for assistance under
federal loan programs and cant receive any financial aid until the loan is
repaid fully. This shows how
for-profit’s high default rates affect the students after they graduate, and
this is why lots of people doubt the purpose of these schools and question why
the government hasn’t reformed them.
This leads us to Carey’s second claim, in which he talks about the
benefits of for-profit colleges.
In Carey’s second claim he talks
about the pros of for-profit colleges and how they have contributed and
fulfilled needs that other traditional universities have ignored. Carey gives
various examples of for-profit colleges that have come up with new ideas or
innovations to make their reputation better. He does this by saying, “While
old-line research universities were gliding their walled-off academic city states,
the University of Phoenix was building no-frills campuses near freeway exits so
working students could take classes in the evening.” Carey argues that that
for-profits are showing efforts to make differences that focus on public
interest. Carey presents another example, “The for-profit Kaplan University
recently struck a deal with the California community-college system to provide
course that the bankrupt public colleges cannot.” This is a prime demonstration exemplifying
the little steps these for-profit colleges are taking to put their name
out. They are giving students alternative
opportunities that traditional universities cannot, and community colleges lack
the money to. Another element that Carey
mentions is that the for-profit sector possesses regional accreditation,
meaning that their practices are ethical and acceptable, employing suitable
quality assurance. This I something that goes unnoticed according to Carey,
when he predicates, “Accreditation has become like a taxicab medallion,
available for bidding on the open market. That’s why people like Clifford
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