For-Profit Colleges Racking Up Federal Debt

The first bubble to burst was the dot com boom, and then in 2008 the housing market collapsed. But with many students graduating with massive amounts of debt in the form of student loans, many people are speculating that this would be the next major loan default crisis that the United States would witness. Even though the principles that when one invests in their future through forms of education, for-profit institutions are capitalizing on this by taking advantage of federal aid so that they return profits to their investors.

Over the past few years, the amount of money that these for-profit institutions delegated towards advertising their degree programs saying that they would help students open up many more doors to their lives has mislead many students. These schools, such as The University of Phoenix and ITT Tech have received more than $4 billion in federal grants and $20 billion in loans in 2009 has become a cause of concern. Many lawmakers are suggesting that too much taxpayer money is being used to generate profits for the colleges instead of providing students with a useful high quality education.

If one takes a look at the facts for Le Cordon Bleu compared to Orange Coast College’s culinary program, not only the difference in price varies dramatically, but also the students who come out of Orange Coast College’s program would have a significant amount of debt that is less than the other program. Another reason why critics and lawmakers are calling for these for-profit institutions to have a cap on how much federal aid they can receive is that students who enroll in these institutions drop out, thus having to repay their student loans of on average over $40,000 for a an associate’s degree that one could earn at Orange Coast College for roughly $5,000.

Many of these schools are exaggerating the value of their degree programs, often selling young people on dreams of middle-class wages between $40,000 to $75,000 while setting them up for default on their debts combined with low-wage jobs and a constant struggle to avoid poverty. There are regulations set forth to ensure that vocational schools that receive aid dollars to prepare students for “gainful employment.” A proposal by the United States Department of Education is suggesting that programs would be barred from loading students with more debt than justified by the likely salaries of the jobs they would pursue. Currently, the law states that admissions staff are barred from making promises about jobs or salaries, and schools requires students to sign disclosures stating that they understand that their programs have no guarantees. However, in results that these schools filed with accreditation agencies from July 2007 to July 2007, students who graduated from Le Cordon Bleu’s culinary arts program received work that paid an average of $21,000 a year, or roughly ten dollars an hour.

Financial aid experts say that such high rates of expected loan default proves that graduates will not earn enough to make their payments. However, the loans make sense for these schools because it enables the flow of taxpayer money to their investors. For-profit schools receive the bulk of their revenue from federal loans and grants. Investigative reporters found that recruiters not only mislead potential students about their post-graduation job opportunities. According to a New York Times article, there were some instances that some students claimed dependents that did not even exist, and encouraged them to lie about their assets to obtain maximum federal financial aid. Also, many of the large corporations such as The University of Phoenix and ITT Tech are issuing their own in-house private loans, even though some schools expect more than fifty percent of such loans to go into default. They have tried to satisfy a federal law that requires at least ten percent of the school’s revenue to come from sources other than financial aid.

Education is an important part of the American dream, because with education, one has the ability to do anything they aspire to do. But as corporations penetrate this highly regarded institution in our society, they place a burden on those of who worked hard to get to where they are today. The practices that for-profit schools utilize to maximize and return profits to their investors by encouraging students to enroll and take out copious amounts of student debt is astounding. There have been talks of reformation in the education system, and that for-profit institutions should be included in these discussions to prevent a potential third economic meltdown.

References

Blumenstyk, G. (n.d.). Loan-Default Rate at For-Profit Colleges Would Double Under New Formula – Administration – The Chronicle of Higher Education. Home – The Chronicle of Higher Education. Retrieved November 13, 2011, from http://chronicle.com/article/Loan-Default-Rate-at/126250/

For-Profit College Recruiters Use Deceptive Practices To Lure Potential Students. (n.d.). Breaking News and Opinion on The Huffington Post. Retrieved November 13, 2011, from http://www.huffingtonpost.com/2010/08/03/for-profit-college-recrui_n_668492.html

Goodman, P. S. (n.d.). For-Profit Schools Cashing In on Recession and Federal Aid – NYTimes.com. The New York Times – Breaking News, World News & Multimedia. Retrieved November 13, 2011, from http://www.nytimes.com/2010/03/14/business/14schools.html?pagewanted=all

Kirkham, C. (n.d.). For-Profit Colleges Offer High-Risk Loans To Keep Fed Dollars Flowing, Consumer Group Says. Huffington Post. Retrieved November 13, 2011, from http://www.huffingtonpost.com/2011/02/01/for-profit-colleges-high-risk-loans-fed-money_n_816888.html

Lauerman, J. (n.d.). For-Profit Colleges Charging More While Doing Less for Low-Income Families – Bloomberg. Bloomberg – Business & Financial News, Breaking News Headlines. Retrieved November 13, 2011, from http://www.bloomberg.com/news/2010-12-31/for-profit-colleges-charging-more-while-doing-less-for-low-income-families.html

Lewin, T. (n.d.). For-Profit Colleges Mislead Students, Report Finds – NYTimes.com. The New York Times – Breaking News, World News & Multimedia. Retrieved November 13, 2011, from http://www.nytimes.com/2010/08/04/education/04education.html

Pope, J. (n.d.). Student Loans: The Next Bubble?. Huffington Post. Retrieved November 13, 2011, from http://www.huffingtonpost.com/2011/11/06/student-loans-the-next-bu_n_1078730.html

Freedom Of Ze Speech

In America, we are privileged with the right to freedom of speech, ideology, and the right to assemble. But these freedoms are questioned when they cross into the grey area between the first amendment rights granted by the constitution, and speech that is clearly inciting hate and violence.

For instance there was a rally in Pomona on Saturday organized by the National Socialist Movement, an American Neo-Nazi movement protesting California’s passage of the DREAM Act. Many people would argue that this rally was to incite hate, but aren’t these people allowed the same right to assemble and voice their opinion as me and you?

This was the same issue in Skokie, Ill. in the late 1970s when the same political movement held a political rally in a town where many Holocaust survivors lived. The Supreme Court found that the National Socialist Movement’s symbol known as the swastika is a symbolic form of free speech and they had the right to hold their rally at Marquette Park.

Whether you like it or not, the freedom of speech, ideology and the right to assemble is a right that people in other countries would give anything for. The fact that we have immigrants coming from nations with oppressive governments shows that this right is something we all should fight to protect.

The government of Syria is trying to prevent their citizens from assembling to protest their anger with the government by blocking social media websites and enforcing curfews on their people.

The fact that the National Socialist Movement or any other movements like the Occupy Wall Street Movement and the Tea Partiers are granted the right to freedom of speech and assembly from the first amendment of the Bill of Rights is something that we should not take for granted.

Some 250 years ago, our founding fathers saw that the freedom of speech and assembly was so integral to the foundation of this nation that they fought to include it when they amended the constitution to include the Bill of Rights.

The right to free speech and the freedom to assemble is granted to the people of the United States. Although your neighbor may not have the same beliefs as you, we are all entitled to our own opinion.

Students and organizations with beliefs that all of the disabled gay illegal Gypsy Jews should be annihilated from the face of the Earth are allowed to assemble in the Orange Coast College’s Free Speech Zone, as with organizations preaching ideals of peace, love and puppies.

Even though many people and organizations have ideals and beliefs that you may or may not agree with, we are all entitled to our own opinion.

The Ever Powerful Airport Ninja

Now that Halloween is over, the busiest travel period always coincides with the holidays being right around the corner.

Although Generation 9-11 is aware that there are now more travel delays for those who fly, people generally do not take these precautions set forth by the Transportation Security Administration [TSA] for our general safety.

Flying can be quite stressful, and because of the incompetence of many inexperienced flyers, I usually find myself at wits end before I get to the TSA checkpoint. People go through the metal detectors with their keys in their pockets and attempt to bring water bottles and large toiletries with them in their carry-on only to have it taken away.

There is a way for you to prevent yourself from being recognized as one of the travelers the rest of flyers loathe — the solution is to be a stealthy Airport Ninja.

You see them every time you fly. They are the ones who fly through airport security with such stealth. They know all the travel secrets, and now this self-proclaimed Airport Ninja is going to spill the beans.

Airport Ninjas know how to dress for the airport. You can save time and stress by dressing appropriately. Since you know you are going to have to take your belt, shoes and jacket off before you go through the metal detectors, my advice is to keep those items in your carry-on bags (apart from shoes, which should be able to come off and on with ease).

Another rule of thumb is to have all metal items in your bag, and to have your laptop and cell phone already out, and in the tray so they can go through X-ray screening.

Airport Ninjas know to bring only what they need. This ninja knows that unless he is going to be gone for an extended period of time, he is going to travel with only carry-on luggage.

Also, it is highly recommended that you do not bring toiletries or liquids unless you absolutely have to. When that occurs, already have them in a quart-sized zip-lock bag that is easily accessible. With this already done before you get to the airport, all you have to do is check in, and you are on your way.

As a traveler, I usually find that unless if I am flying with an airline with which I have no miles, I go to the check-in counter because I have enough miles to qualify to the 1K status.

The glory of being a 1K member entitles me to first-class upgrades, complimentary Wi-Fi on flights, and a separate line to go through security. If you are just the average traveler, the recommended thing for you to do is check in online, and if you have bags, check them in online as well so you can expedite the process and reduce stress from your end.

One last bit of advice from this skilled Airport Ninja is always arrive to the airport earlier than recommended. You never know what may happen, and as Murphy’s Law predicts, anything that can go wrong will go wrong.

Now that you know some of the best kept secrets of the Airport Ninja, you now find that travelling will be a breeze.