Ensuring Gainful Employment

Protecting Students and Taxpayers Is Not an Either-Or Situation

SOURCE: AP/Jim R. Bounds

Aja Holmes studies for her online college classes at The University of Phoenix.

By Julie Margetta Morgan | February 24, 2011

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Politicians love false dichotomies. Remember “You’re either part of the solution or part of the problem” and “Either you are with us, or you are with the terrorists”? Positioning two nonexclusive alternatives as an either-or situation is a cheap rhetorical trick, but when House members used it to prevent the Department of Education from implementing a regulation on career education programs, it became very expensive—for taxpayers and for students.

The House of Representatives last week passed an amendment that would prevent the Department of Education from implementing a regulation called “gainful employment.” The proposed rule would require career education programs—primarily at for-profit colleges—to prove that their students are able to pay off the debt they incur after they graduate. Members like Rep. John Kline (R-MN) argued that the amendment was necessary because for-profit colleges are an important part of our higher education system, particularly when it comes to low-income and minority students. Others argued that the gainful employment regulation was a bad policy because all colleges must be regulated more tightly, or because its effects must be studied, or because students need information to make better decisions about choosing a college.

These arguments imply that allowing the Department of Education to implement its regulation on career education programs would be at odds with the continuing operation of for-profit colleges, or studying the regulation’s effects, or regulating the rest of higher education. According to these members, we either implement a gainful employment rule or we give students more information about the quality and cost of educational programs. We either implement the regulation or we regulate community colleges. But there’s no need to make a choice.

The gainful employment regulation is not a solution to every problem in higher education, and it’s not even an answer to all of the problems in the for-profit college sector. It is just one step in bringing higher education institutions in line with the needs of taxpayers and students. And it’s not a proposal that excludes or preempts other equally important reforms. We can have a regulation that ensures gainful employment and tighter regulation of public and private colleges. We need gainful employment’s consumer protection and better information to promote consumer choice.

Every roadblock to the implementation of a gainful employment rule means more students taking on insurmountable debt in pursuit of educational programs that will leave them worse off than if they had never attended college. The only either-or choice here is either take action to regulate career education programs, or continue using taxpayer dollars to pay for educational programs that are of little value and continue the cycle of student debt and loan default. When the Senate considers this amendment, hopefully it will make the right choice.

Julie Margetta Morgan is a Policy Analyst with the Postsecondary Education Program at the Center for American Progress.