Week 7 Education

The reading entitled “Subprime Opportunity: The Unfulfilled Promise of For-Profit Colleges and Education” described the subprime lending situation as a “lack of federal oversight, paired with the skewed, growth-driven priorities of Wall Street, [that] led to an inevitable collapse—one in which bankers got rich and new home- owners were driven deeply into debt, foreclosure, and poverty”(1). This trend of the rich becoming richer at the expense of the poor and/or uninformed being exploited seems all too common in many of our course discussions. Healthcare, the environment, and now education are all being utilized as mediums through which people can make a profit, and it seems that this trend is not being followed without consequences. 

The “Subprime Opportunity” reading was constantly making comparisons between nonprofit and for-profit colleges in regards to expenses, graduation rates, and loans, but I felt that the article ignored the fact that even at nonprofit and public colleges, the cost of attending is still extremely high. The discussion of for-profits being disproportionately expensive is an import one, however, the question of high education costs in general is equally critical. Perhaps the “failure of public and private nonprofit institutions to serve the underdeserved” is directly related to the un-affordability of higher education, even when government grants and student loans are taken into account (1). The mission of nonprofits is generally to serve the “underserved,” so why is education more often than not an exception? The exploitation of prospective students by for-profit universities like the University of Phoenix is unacceptable, but the lack of accessibility to higher education is as well. This problem is even further complicated by student loans. 
Although taking out student loans is often the only way that many can access higher education, this video shows that loans are creating problems that, financially speaking, may outweigh the benefits of obtaining a college education:

The problems that student loans are creating call for the government to, as Stephen Burd points out in his article “Fed Up at the University of Phoenix,” “reconsider whether it's really in the public's best interest to continue to provide huge subsidies, in the form of federal grants and loans, to help low- and moderate-income students go to colleges that are much more interested in rewarding investors on Wall Street than educating students”. Apparently, the US Department of Education is addressing this concern. According to a New York Times article, the Department of Education, in response to the widespread knowledge of problems associated with for-profit colleges, is preparing to release a list of guidelines in relation to providing aid to students attending for-profit schools. One response is to "cut off federal financial aid to programs whose graduates have big student loans, low income and low loan-repayment rates". Additionally, colleges with default rates that exceed 30% for three consecutive years will not be eligible for federal aid. Taking steps to protect students from accumulating un-payable amounts of debt is critical to ending the problems associated with for-profit schools. However, I do not feel that that it solves the larger problem at hand, thus higher education will still remain too expensive for many to afford, even with federal aid and student loans.  

As O'Neill describes it: "tuition for private schools and colleges, even with financial aid, is often prohibitive" (133). I have heard countless stories of students who were accepted to prestigious, nonprofit universities, yet they ended up at their state's public university because they simply could not afford to go anywhere else. I see nothing wrong with attending a public university in one's state of residency, but in a time when people are judged based on GPA and the prestige of the university they attend, affordability creates a problematic divide between the haves and the have-nots. Private nonprofit colleges and universities appear to be an exception to the rule of nonprofits as organizations who help those that are most in need.

I suggest reading the NY Times article that I included-it is very relevant to this week's readings and discussion! Also, as I was on YouTube looking for a video to include in my post, the related videos section had advertisements for both Kaplan and the University of Phoenix and the marketing strategies they use to attract students are pretty interesting to watch: U of Phoenix and Kaplan