Higher Education’s Debt Kiss

The U. S. Department of Education wants for-profit colleges to prove that their graduates are gainfully employed. For their part, the for-profits claim that their non-profit counterparts would fail such a test.

Specifically, the Association of Private Sector Colleges & Universities (APSCU) names four which it predicts would fail:

• George Washington University;
• Lutheran Theological Seminary at Gettysburg;
• The University of Michigan; and
• Virginia Commonwealth University.

“The Department is proposing minimum standards to help ensure that these programs prepare students for employment and have earnings sufficient to repay their student loan debt,” the Department of Education explains. “These proposed regulations are designed to protect students from attending programs that leave them with high debt but without the means to pay it back. “

“The regulations will limit subsidies that taxpayers provide to students to attend programs that are not performing. Finally, these standards and reporting requirements will motivate institutions to improve the performance and value of these occupational programs.”

Yet and still, according to APSCU, “An October National Center for Education Statistics (NCES) report found:

• “26% of bachelor’s degree recipients from public four-year institutions who were repaying their loans would fail a 12% debt-to-earnings test;
• “39 % at private nonprofits would fail a 12% debt-to-earnings test;
• “35% at private-sector institutions would fail a 12% debt-to-earnings test;
• “Yet the Department has proposed an 8 percent debt-to-earnings metrics threshold as the government standard for affordable debt.”

The NCES “is the primary federal entity for collecting and analyzing data related to education.”