Fannie Mae Goes to College

Is it a scam, a great business model, or the way we should provide higher education to the masses?  For-profit colleges market heavily to low-income high school graduates.  The federal government provides Pell and other grants and loans with the money going directly to commercial colleges.  The students accumulate huge loan debt with the promise their future incomes will be higher so they can pay them off.  The students may or may not ever graduate to realize that potential, but the debt persists.  The statistics simply don’t exist for the money Congress and the current administration are pushing into their goals for 80% of high school students to go to college and for the federal government to loan them the money they need.   

With Fanny Mae, we added to the national debt, and we all will pay in the long run.  With student loans, if we add to an individual’s personal debt, who’s going to bail that person out later?   

The Eduguru speaks: How about some accountability for the for-profit colleges?  Maybe students should get refunds if they don’t graduate.  Maybe they should get a warranty on their future earnings based on the ad they responded to when they were recruited.

Comments

[Glynn Ligon]

Read your comment, Joe. Ugly stats. Gates, Dell, Obama, everyone has a goal of 80% of high school grads going to college--they did. Of course, the 80% is accompanied by a goal of those grads being qualified for college-level work. OK, Eduguru, run with that. Gates, Dell, Obama graduated from HS qualified for college, but had a 33% graduation rate from college. Combine Joe's stats with Gates/Dell's stories & you wonder why we are pushing everyone into colleges--and what colleges are doing with them.

[Joe O'Reilly]

If you read some of the news stories of who they are recruiting it is deplorable. University of Phoenix has become one of the more frequent choices our students make, even more than the state's flagship univeristy, the U. of Arizona.

But the institutions that are failing the largest number of students are our community colleges. They are attracting about half our graduates and few ever complete. The local CC has an 11% graduation rate for first time college attenders who go full-time and who intend to get a degree (the 22% of their student body who is most likely to finish). Only 12% transfer, so that does not explain it.

Students don't leave with huge debt loads, but crushed dream and stunted earnings are still a high price to pay.