Sunday, December 28, 2014

For-Profit College Degrees Are Worthless

By Professor Doom

     I’ve often said for-profit colleges generally offer worthless degrees at an extreme price, but I hate simply expecting the reader to trust my word on such things. A recent article, mainstream news even, gave some nice examples of the over-the-top uselessness of these degrees.

     Students across the country are shelling out tens of thousands of dollars for degrees that end up being completely worthless.

     I do want to point out, however, that non-profit schools, while cheaper, also offer a great number of degrees that are, in terms of the marketplace, completely worthless. Back when higher education was cheap, this was not a problem…tuition was low enough that “work your way through college” at a fast food place was quite possible. But now that campuses are overrun with 6- and 7-figure salaried administrators (and 4-figure paid adjuncts teaching the actual courses), there are huge disconnects between the cost of education that students pay, the cost that is actually paid to the educators, and, most importantly, the quality of the education that the students receive. For-profits may be the worst, but a great many state institutions are only a few shades better.

…So at age 23, she enrolled in a two-year criminal justice program at for-profit Everest College in Chesapeake, Va.
But the wealth of job opportunities the school had touted never transpired, and all she ended up with was more than $22,000 in student loan debt. She said classes were terrible, she didn't receive any of the training she needed, …

     Criminal Justice is a popular field, because it can provide entry into the incredibly lucrative “law enforcement” industry (law enforcement, health care, and education are really the big job producers in last few decades of extreme government growth…do note government is now in the process of wrapping more of its tentacles around health care even as you read this). I had the pleasure of teaching an entire class full of police officers when one of my institutions set up a Criminal Justice outreach program. I know the police are often (and often justifiably) vilified, but, for what it’s worth, they are better than average as students (they are also slightly older, which may well be the important factor).

     Back to the point, the above poor student shelled out over $20,000 for coursework, supposedly job-related coursework, which provided none of the training or education she needed to get an actual job. Of course, the student didn’t actually pay that money. Instead, it was provided via a student loan.

     This is quite common, and so, for the sake of new readers, allow me to explain the game being played. The first thing a school does when it opens its doors is work to get accredited. Only accredited schools can qualify their students for the various Federal student aid programs, including those all-important student loans.

     Before the school becomes accredited, the school keeps tuition low, because it needs to attract students, and being affordable helps with that. The school also tries to be reasonably legitimate, as far as the education it provides. It needs this because accreditors need to have some reason to believe the school is legitimate before they will award full accreditation.

     Once the school becomes accredited, it all changes. First, the school jacks up the tuition to as much as they can get away with, which usually means whatever the student loan money available is. Then, the school sacrifices all integrity, annihilating all educational standards, the better to draw in, and keep, students that think that merely because they’re getting good grades, they’re actually learning something relevant.

      While the article focuses on for-profit schools, it’s the same pattern at many state and non-profit schools. I totally grant that there are many exceptions, but they are exceptions. Having worked to bring a school through the accreditation process and seen what happens once accreditation is awarded, my own eyes tell me that this pattern is the reality of higher education today…state schools often have a harder time increasing tuition, and that’s the ONLY reason they’re cheaper than the for-profit schools. But, otherwise, the pattern is the same.

      You might be wondering how the bogus schools can keep accreditation, but the reason behind this is simple: accredited schools generally self-report their legitimacy, and only need do so every 5 to 10 years. So, the bogus school self-reports that their students are getting good grades, self-reports that their students are getting good jobs, self-reports that their coursework is of the highest standards, and so on…and accreditors are perfectly happy with this.

      Of course, the rubber meets the road when it comes time to actually pay off those student loans, and that’s where problems become visible in a way that self-reporting won’t work. There’s a big difference between words on paper and checks for actual money, after all.

“…student loan default rate (of up to 27% for its Everest College campuses) is lower than other community colleges and its graduation and job placement rates are higher…”

     So, at this school, the self-reported graduation and job placement rates are (supposedly) as good as any community college (that’s a low, low, bar, since many community colleges “boast” a lower than 10% graduation rate). The student loan default rate, however, is not so easily buried, since someone has to write an actual check.

     Despite what’s said here, for-profit schools generally have a worse default rate than state schools. While it is claimed that this is due to the bogus nature of the for-profit coursework, I find this assertion dubious, as I’ve shown and seen many times that the coursework in state schools to be comparably bogus. No, the reason for the higher default rate is very simple: students at for-profit schools are charged more for tuition, and thus get deeper into debt. It is simply the larger debts that explain the higher default rates.

     But, back to the article:

“…the school spent six months convincing him to enroll -- promising to provide all the training and help he needed to find a high-paying computer science job…
But upon enrolling in the computer science program, he said the quality of education "was a complete joke" and job assistance was nonexistent…”

     The main expense of for-profit schools isn’t on education (like state schools, they pay the highly educated teachers very little), it’s on recruiting suckers/students to enroll. Google’s biggest customer, for example, is the for-profit University of Phoenix, which spends $200,000 a day on Google advertising. My own research on for-profits rather backfired on me—much like the luckless student involved, I too endured (and still endure) many phone calls from for-profits hoping to make a sale with me.

     This is how the for-profits overcome their well-deserved reputation for worthlessness—extensive advertising for suckers that don’t know what they’re getting into. 

     And, again, accreditation totally doesn’t care how fraudulent these schools are. Even if it did care, accreditation can do nothing about it. For example, accreditation’s response to UNC’s 18 year scam of fake courses was to “make” UNC offer courses to all the students that felt they might be cheated by the fake courses

     “…after accumulating more than $20,000 in debt to attend the one-year program, he wasn't able to find a single job in computer science. He's still unemployed, is now homeless -- and he is convinced he'd be better off without the degree even listed on his resume. 

He says multiple employers have told him that they don't view his degree as credible because of the for-profit industry's reputation and because other people they've hired from the school haven't had the necessary skills for the job…”

      The Federal government knows these schools are scams (for the most part) but has no choice in the matter, as the law is written so that all accredited schools, no matter how corrupt, must play by the same rules when it comes time to doling out the student loan loot. It’s possible that the law might be changed at some point, of course.

      I agree, accreditation as it stands today is utterly useless and should have nothing to do with student loan money. But a better solution by far would be to take student loan money out of education. If University of the People can offer fully accredited 4 year degrees for $4,000 or so without taking student loan money, there’s simply no excuse for for-profits offering the same degrees for $100,000, after all.



  1. Great article, Professor. I've just been in a debate for the last two days regarding this topic. However, when trying to have an intelligent discussion with someone that has vested interests in "higher education," it's quite hard to get through to them the waste of time, talent and money these worthless degrees really are. I know MANY college educated people who are currently working in local fast-food joints and call centers - a perfect example of the waste of time, talent and money.

    Peace, and keep up the good work!

    Mr. Freethinker

    1. Well, people have been trained since very young to believe "college is the answer", that if you just get that degree, any degree, then someone will hire you and take care of you forever.

      When someone is that vested, there's little you can do about it. I remember trying to convince staunch advocates of the fiat money system that inflation really is more than the 1.5% the government claims it is. Charts, figures, nothing would convince them....even asking them to pick up a pocket calculator and see it with their own eyes accomplished nothing.