Obama On For-Profits

Career College Central summary:

  • On Friday, in a question-and-answer session at the State University of New York at Binghamton, a doctoral student at (nonprofit) Syracuse University asked President Obama about the sector and for-profit colleges that the student called "predatory." The president agreed that some for-profit colleges are taking advantage of students (and in particular veterans), and said that he believed that these abuses were more prevalent in the for-profit than the nonprofit sector.
  • In his answer, Obama stressed that there was no reason to believe that for-profit status is inherently wrong. "For-profit institutions in a lot of sectors of our lives obviously [are] the cornerstone of our economy. And we want to encourage entrepreneurship and new ideas and new approaches and new ways of doing things. So I’m not against for-profit institutions, generally."
  • But he said that the questioner was correct in noting problems in higher education. "[T]here have been some schools that are notorious for getting students in, getting a bunch of grant money, having those students take out a lot of loans, making big profits, but having really low graduation rates. Students aren’t getting what they need to be prepared for a particular field. They get out of these for-profit schools loaded down with enormous debt. They can’t find a job. They default. The taxpayer ends up holding the bag. Their credit is ruined, and the for-profit institution is making out like a bandit. That’s a problem."

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