Wednesday, June 14, 2017

I predicted it in my recently published article...

... in the SAGE Journal of Industry and Higher Education:

The fortunes of the for-profit higher education industry rise and fall with the political tides in the United States. During the 8 years of the George W Bush Administration (Republican), the for-profit sector of US higher education prospered. The following two terms of the Obama Administration (Democrat) resulted in the loss of all the ground gained during Mr Bush’s two terms in office. Indeed, the US Department of Education, led by Secretary Arne Duncan, aggressively attacked the for-profit higher education providers. This attack took two very effective forms: the wielding of ‘gainful employment’ regulations to sever the eligibility of for-profit corporations to receive federal financial aid funding for admitted students, and the withdrawal of authority from the for-profit sector’s accrediting agency. This article argues that, if the past is predictive, the prospects for the for-profit higher education providers are bright under Mr Trump.

The Chronicle of Higher Education is reporting this afternoon  that DOE Secretary DeVos just announced that the "gainful employment" regulations, that the Obama Administration fought so hard to put into place and defend against court challenges,  will now be rolled back.  The subsequent news release speaks for itself:

Secretary DeVos Announces Regulatory Reset to Protect Students, Taxpayers, Higher Ed Institutions

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US Department of Education
June 14, 2017
Contact: Press Office
(202) 401-1576 or

Secretary DeVos Announces Regulatory Reset to Protect Students, Taxpayers, Higher Ed Institutions

Negotiated rulemaking committees to convene on Borrower Defense to Repayment and Gainful Employment to improve regulations

Currently approved BDR claims to be discharged this month, claims to continue to be processed
Today, U.S. Secretary of Education Betsy DeVos announced the Department’s intention to establish rulemaking committees on Borrower Defense to Repayment (BDR) and Gainful Employment (GE) regulations. The Department intends to develop fair, effective and improved regulations to protect individual borrowers from fraud, ensure accountability across institutions of higher education and protect taxpayers.
“My first priority is to protect students,” said Secretary DeVos. “Fraud, especially fraud committed by a school, is simply unacceptable. Unfortunately, last year’s rulemaking effort missed an opportunity to get it right. The result is a muddled process that's unfair to students and schools, and puts taxpayers on the hook for significant costs. It's time to take a step back and make sure these rules achieve their purpose: helping harmed students. It’s time for a regulatory reset. It is the Department’s aim, and this Administration’s commitment, to protect students from predatory practices while also providing clear, fair and balanced rules for colleges and universities to follow.”
Due to pending litigation challenging the BDR regulations, the Department is postponing the effective date pursuant to section 705 of the Administration Procedures Act. While negotiated rulemaking occurs, the Department will continue to process applications under the current borrower defense rules.
“Nearly 16,000 borrower defense claims are currently being processed by the Department, and, as I have said all along, promises made to students under the current rule will be promises kept,” said Secretary DeVos. “We are working with servicers to get these loans discharged as expeditiously as possible. Some borrowers should expect to obtain discharges within the next several weeks.”
Postsecondary institutions of all types have raised concerns about the BDR regulations since they were published on Nov. 1, 2016. Colleges and universities are especially concerned about the excessively broad definitions of substantial misrepresentation and breach of contract, the lack of meaningful due process protections for institutions and “financial triggers” under the new rules.
As part of the Department’s regulatory review of its regulations, the agency will also convene a second negotiated rulemaking committee on Gainful Employment. As the Department worked on implementing this regulation, it became clear that, as written, it is overly burdensome and confusing for institutions of higher education. 
The Department plans to publish its Notice of Intent to Conduct Negotiated Rulemaking on BDR and GE in the Federal Register on June 16, 2017. The Department will conduct public hearings on BDR and GE on July 10, 2017, in Washington, D.C. and July 12, 2017, in Dallas, Texas. 

The claim that the revised rules --- if they ever emerge --- will be more fair than the ones promulgated by the Obama Administration is in line with the the Administration's claim that more people will be able to obtain affordable health care under the GOP's new health care act than under Obamacare.  The Congressional Budget Office, a non-partisan agency, by contrast predicts that millions more Americans will have no health insurance next year under the Republican plan.  We have entered a new era of Orwellian Doublespeak.

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