The first, last, and most evocative scenes of a Frontline television documentary on for-profit higher education that airs Tuesday night on PBS show an educational entrepreneur named Michael K. Clifford wheeling and dealing over his next college takeover target, while lounging on the lush lawn of his oceanfront headquarters in California or driving his Mercedes sedan to a meeting.
Mr. Clifford isn’t exactly the typical for-profit college leader, and many people in that sector dislike his bravado and his readiness to boast publicly about the profits to be made from owning colleges. (He’s had a hand in converting ailing nonprofit institutions like Grand Canyon University and the renamed Ashford University into publicly traded companies, and he persuaded the business icon Jack Welch to invest and lend his name and time to another institution, Chancellor University, that might someday try the same.)
During the 15 years I’ve covered the sector, I’ve seen both its forward-thinking traits and some of the unseemly practices that can be endemic to a growth-driven industry. So I think it’s altogether appropriate—and perhaps instructive for the general public—that the producers of this program chose to highlight a figure who is responsible for not only some of the most creative but also some of the most controversial practices in the for-profit college field today.
The $18-billion industry is both. But you would hardly know that from the drumbeat of recent news stories that frequently highlight the sector’s recruiting misdeeds but rarely give it credit for its educational innovations in teaching, curricula, and retention.
Concentrating on High Costs
Aside from the prominence it gives the flamboyant Mr. Clifford, the 52-minute Frontline report, “College Inc.,” largely eschews sensationalism and rightly focuses on the costs of attending those colleges, compared with public alternatives, the disproportionately heavy debt load many of their students end up with, and the aggressive recruiting tactics some of the companies employ. Those are some of the unsavory elements of for-profit higher education that have helped make the colleges the institutions of choice for one out of 10 students.
(A disclosure: I was contacted by one of the show’s producers in December and spoke with him off-camera for about an hour, but I had no other connection with the production.)
The documentary reveals an internal e-mail message obtained from the Department of Education that shows an Argosy University director of admissions advising enrollment counselors in a call center that the way to engage prospects is to “Push their hot button. Don’t let the student off the phone. Dial. Dial. Dial.”
It also features a sober interview with a former Ashford University enrollment adviser who reports she was required to make 150 calls a day and “close on at least 12 students a month.” In the show, the adviser, Tami Barker says: “The amount of pressure they put on you to meet these quotas, I think, challenges anybody’s integrity.” Colleges are forbidden from paying recruiters based solely on the number of students they enroll and Bridgepoint Education, the parent company, denied on the show that it has quotas.
An advance copy of the show, subject to revision before air time, was provided to reporters. In addition to focusing on Argosy, owned by Education Management Corporation, “College, Inc.” examines recruiting practices of the Apollo Group’s University of Phoenix and a branch of Corinthian Colleges Inc.'s Everest Colleges. Although only a few company officials appear, the show includes interviews with Secretary of Education Arne Duncan (“We have some work to do” he says when asked if current regulations were adequate), and Harris N. Miller, president of the Career College Association. (Click here to see the show.)
The Price of Accreditation
The show is right on the mark with its focus on the lax regulatory environment that for years has allowed investors who buy ailing nonprofit colleges to acquire their regional accreditation as part of the deal—and, with it, the immediate right to participate in federal student-aid programs.
Mr. Clifford says independent appraisers have told him such accreditation was worth $10-million to investors on some of his deals.
The show also speaks with Sylvia Manning, president of the North Central Association of Colleges and Schools’ Higher Learning Commission, one of the regional accrediting bodies that has recently begun taking a tougher stance on such conversions in which accreditation was sold, as she put it, like “a taxi license.”.
Although “College, Inc.” does mention Grand Canyon’s state-of-the-art nursing facility and its plans to invest $60-million more in campus improvements, the show touches too lightly on the education that actually goes on in the classrooms, save for some scenes at one of Mr. Clifford’s newest acquisitions, a nursing school aimed at working Latino students, and a quick interview with “satisfied students” at Grand Canyon.
And the somewhat dismissive tone it takes toward the colleges’ online-education offerings seems out of sync with the broader national movement that continues to embrace distance education as a vital tool for extending higher education to more and more students, particularly working adults.
“College, Inc.” also plays a bit loose with its rhetoric on student debt. The show notes that students at for-profit institutions make up just 11 percent of the college-student population but account for about 44 percent of all student-loan defaults. Unlike many other news reports, it goes further to explain that one reason for that high rate of default may be that the students are disproportionately poorer than the student population as a whole. But by mentioning the figure of $750-billion—the value of all outstanding student loans across all sectors of higher education—while discussing the propensity of for-profit college students to default on their loans, the show may leave the misimpression that 44 percent of that total sum is at risk as a result.
On balance, however, the program’s weaknesses are mitigated by the context the producers provide. They remind viewers, for example, that the sector is diverse and that it is difficult to assess the quality of the colleges’ degrees because across all of higher education, “there’s no standard measure.” They also show that the for-profit industry owes some of its recent success to the current political and economic climate. That’s most evident in the comment that follows an interview with the president of City University of New York’s LaGuardia Community College, Gail O. Mellow, who laments that her public institution and many like it have had to turn students away because they don’t have the money to take in more “The failure of community colleges to accommodate the demand,” the show notes, “has given Clifford and others a huge opportunity.”
Financial Affairs is a column on the business of the academic enterprise. Follow Goldie on Twitter @.
