Diploma mills whining that coming regulation will eat into their profits

[marmar]

:nopity:


By Christopher Hinton, MarketWatch


NEW YORK (MarketWatch) -- Shares for companies that provide university and college degrees declined Friday after The Washington Post Co. said proposed U.S. regulation of for-profit educators could harm its Kaplan division.

The new regulations, if passed, would help to halt predatory lending to low-income students and tighten standards among financial aid advisors.

Such changes could "adversely affect" the Kaplan's ability to retain admission workers, financial aid advisors and students, the Washington Post said in a statement.

Kaplan is the company's largest division in terms of operating income. ...........(more)

The complete piece is at: http://www.marketwatch.com/story/for-profit-educators-slump-on-regulation-fears-2010-08-06

[Tansy_Gold]

1. I love how they frame their objection

It will "adversely affect" their ability to retain admission workers, financial aid advisors and lastly, students.

All this does is make the proposed regulation look like just another way of putting people out of work. Right away, there will be defenders echoing this. "It provides jobs! If you take away their ability to make a profit, you're gonna put people out of work! And think of all the professors who are going to be laid off, too!"

It's not that these statements aren't true -- it's that they represent only the "small benefit" portion of the equation, the other half of which is "BIG COST."

This was illustrated to me just the other day by an acquaintance who runs a small retail business. I was in need of a sympathy card to send to a friend whose mother had passed away. "Oh, I have cards," the business owner told me. She knew I try to patronize small, local businesses over impersonal national chains whenever I can, so I went to look at her selection, which consisted of two revolving racks of cards placed in her store on consignment.

They were nice cards, but also quite expensive. I know her well enough to ask her, "How much do you make off each one you sell?" Her gross profit was 25%, but she was also responsible for inventory damaged or soiled. I could actually pay her the 25% profit on a sale, then go to another store that also had cards and buy one cheaper than the 75% that went to the consignor.

The benefits of having people employed by these parasitical "colleges" are many times outweighed by the costs (which pretty much equal the profits that go to the stockholders).



Tansy Gold, nty

[Submariner]

2. But...but..our bonuses!....the Golden Parachute!..will be in jeopardy

And I was so looking forward to getting my PhD. at Beck University.

Damn...foiled again.x(

[Starry Messenger]

3. Good!

How shameful of them to use the employees as their shield. How many people have they thrown into the job market with dodgy degrees and loads of debt?

[1957john1957]

4. There are not-for-profit colleges/universities which aren't much better. All employees' salaries

depend on how many students are paying tuition, so there's an equal pressure to recruit students. Even grades (whether or not a student at least passes) are influenced by this pressure - faculty who fail too many students find themselves under great negative pressure, especially if they are non-tenured (even if the students truly deserve to fail and even if faculty have made great effort to help those students).

[ProgressiveProfessor]

5. I agree, the rules and reporting should be tightened for ALL colleges and universities

Not all the bad eggs are for profit.

[Odin2005]

6. Somebody call the Waaaaaahmbulance!!!

[Hannah Bell]

7. Kaplan: owned by the Washington Post. Which runs PR touting "education reform" --

like:

- loosening the rules to help increase profits at diploma mills (kaplan = diploma mills)
- mandating more testing in k-12 (kaplan = test materials & prep)
- allowing chain charter schools (kaplan = canned curriculum)


it's good to have friends in high places. The WAPO talks up "reform" & its for-profit ed company reaps the bucks.