In May of 2014, President Obama proposed that the Administration take steps to address the large number of students who enroll in for-profit college career programs that graduate with little experience, skills that were less than spectacular and high amounts of debt. These programs are leaving students with little option but to default on their loans and search for a job that has little correlation to the program they went through or the certification they received. The Department of Education found that the prospects for these career training programs were even worse than high school dropouts- 72% of them earned less than a high school dropout.
On Thursday, President Obama finally released the official regulations for such for-profit college programs, but the final product was far weaker than many supporters were hoping for. The new regulations are not as strict on the colleges as the originally proposed rule stated, but still has formidable results for programs that do not improve in the near future.
In order to qualify for federal student aid, programs must prepare students for “gainful employment in a recognized occupation.”
The rule released on Thursday threatens 1,400 institutes that teach programs in culinary arts, mechanics, medical assisting and other careers. This rule threatens approximately 500 fewer programs than the spring rule proposed but still poses a hazard to programs that could lose funding if they do not significantly improve their students’ prospects after graduation.
If these schools fail to reduce the percentage of students who default on their loans, the income generated from federal loans and Pell Grants will be cut off, endangering a huge percentage of funding for the schools.
Met with bipartisan opposition, similar regulations have been opposed through legal action in the past and for-profit colleges are threatening to take action against these new regulations as well. In addition to opposition, those who supported the regulations were disappointed that the rule was far weaker than expected. Many believe that the bill is not strong enough, pointing to shaky aspects such as the rule that programs will be evaluated only by the loan actions of students who graduate, despite the fact that many students do not graduate from career-training programs at all. These students often accumulate financial burdens as well, but the new regulation fails to take into account their debt.
While the regulations are obviously not as strong as they could and should be, they are making steps in the right direction. Today’s students are entering a workforce and economy that are not exactly thriving. Programs that put young adults at a disadvantage from the start must be met with some form of regulation. These regulations will deter harmful lending practices and education programs that do not improve student prospects. Predatory actions stemming from the greed of for-profit colleges must be met with opposition in order to protect the wellbeing of young adults in career programs, reduce the amount of debt such students are obtaining and protect the health of our economy and workforce.