Team Obama Caves Once More to For-Profit College Predators

Some things just don't change, and Team Obama is one of them.  From HuffPo:

The Obama administration on Thursday retreated from an ambitious proposal to protect low-income students and taxpayers from wasteful career-training programs and for-profit colleges that saddle students with taxpayer-backed debts they can not repay.

Investors cheered the news, sending shares in major for-profit college chains soaring Thursday and significantly outpacing gains in the broader U.S. stock market. Student advocates and consumer groups accused the administration of selling out students. . . .

John Oliver's Takedown of Online Diploma Mills

Must see!!



from the Consumerist:

What would it look like if you condensed all our hundreds of stories about student loans and for-profit colleges into a profanity-filled, hilarious rant that takes a brief detour to discuss Lyndon Johnson’s scrotum? John Oliver answered that question on Sunday night.

Just like it’s recently done with the payday loan industry, Dr. Oz, and net neutrality, Last Week Tonight with John Oliver took one of our favorite topics and made it much funnier than it has any right to be.

You can watch the whole video above, or just read the highlights below:

On the near-inevitability of leaving college shouldered with debt:
“Essentially, student debt is like is like HPV — if you go to college, you’re certainly going to get it, and if you do, it will follow you for the rest of your life.”

On the growing pervasiveness on student loan debt:
“It has surpassed Bob Marley’s greatest hits album as the thing seemingly every college student has.”

On slashed education budgets and skyrocketing tuition:
“In recent years, states have slashed funding for higher education by 23%. Public institutions have responded by raising tuition rates, forcing students to take out ever-larger loans. Why else do you think that colleges have many f*ing a cappella groups? They know they sound stupid, they just can’t afford instruments anymore.”

On a former University of Phoenix executive’s explanation that marketing expenses are often double the amount spent on professors: 
“He’s basically saying, ‘Hey teachers — we’re not saying you don’t matter; we’re just saying that ads about you matter twice as much.'”

On for-profit college recruiters being taught to emotionally manipulate potential students through “pain points“:
“The only people that should be doing that are dominatrixes… or emo bands.”

On the fact that only 27 out of 115 people enrolled in one ITT engineering program graduated and only 13 (11.3%) of them ended up working in the field they studied:
“Everyone else would have genuinely been better off studying engineering at Hogwarts, because at least that way they’d have a f*ing owl to show for it.”

On allegations that recruiters at for-profit educator Ashford signed up veterans suffering from brain injuries, some of whom could not remember which courses they enrolled in:
“I will say this for for-profit colleges: They’ve just given us all an education in the depths of human depravity. We all have a diploma in that now.”

On obvious but effective lobbying by the for-profit college industry:
The Dept. of Education has been ordered to come up with a so-called “gainful employment” rule that requires colleges to prove that a minimum number of a school’s graduates are able to find gainful employment after they graduate.

In response to the initial attempt at creating the rule, lobbyists at the Association of Private Sector Colleges and Universities bombarded regulators with the following form letter, which many people submitted without even filling in the blanks:

“I am a career college student at [INSTITUTION] studying [PROGRAM]. [INSTITUTION] is providing me with the education and training necessary to obtain the job I’ve always wanted as a [CAREER].”

As ridiculous as it is, the efforts of APSCU were successful in scuttling the first go at a gainful employment rule. The Dept. of Education is taking another go at it, and APSCU is still trying to fight against the regulation.

So Oliver has drafted the following form letter, which he’s suggesting that people send to apscu@apscu.orgwithout filling in any of the relevant information:

To Whom It May Concern:
I am [NAME HERE], a human being with [DESCRIBE AT LEAST SOME LEVEL OF SENSE] who is sick of your [SYNONYM FOR BULLSHIT].
Whatever the benefits of for-profit schools, your trade group is protecting the worst actors, and [ADDITIONAL INSULTS]. [IDEAS FOR PLACES TO CRAM THIS LETTER ONCE ROLLED UP]. [PROPOSALS FOR HUMAN WASTE PRODUCTS TO BE EATEN].
Thank you for your time,
[NAME HERE AGAIN]

Oliver’s advice to current college freshmen with student loans:
“You need to stop watching this show right now — you don’t have time for this! Get out there and enjoy the f*ck out of your college experience because you may be paying for it for the rest of your life.

“I’m serious: Drink beer from a funnel, kidnap a mascot, find out if you’re gay or not, and even if you are not, have some gay experiences. Do it now; it doesn’t count.

“Become that weird guy on campus who rides a unicycle from class to class, find out whoever the Winklevoss twins of your school are and steal their idea for a website, and shoot fireworks out of every bodily orifice you can f*ing find. Do it now, please!

“Make sure your college years are the best ones of your life because thanks to the debt that we are saddling you with, they almost certainly will be. Get out there and do it! Go nuts! Go crazy!”

Workforce Investment Act Becomes $3 Billion Handout to Predatory "Colleges"

No bills get through Congress these days without an overwhelming amount of money to be made by both sides of the corporate aisle.  Such a bill sailed through last month without so much as racial slur at the President, something quite unheard of in the age of an ostensibly-black Commander in Chief.

The legislation is called the Workforce Investment Act, and it's worth $3.1 billion to corporate higher ed profiteers who convert government retraining assistance to building corporate empires that offer nothing in return except tens of thousands in additional debt to the unemployed people who can least afford it.

Congress has been on this fool's errand of retraining for jobs that don't exist since the 1960s, when policy elites decided that job creation programs were too expensive and too divisive, in that most white folks preferred to keep minorities dependent on handouts, rather than to allow them into the middle class with real job opportunities.  Such a policy allows for black folks to be contained and castigated at the same time for being lazy louts.  A win-win for both race and class supremacy.

A clip from the NYTimes article:

". . . .Millions of unemployed Americans like Mr. DeGrella have trained for new careers as part of the Workforce Investment Act, a $3.1 billion federal program that, in an unusual act of bipartisanship, was reauthorized by Congress last month with little public discussion about its effectiveness. Like Mr. DeGrella, many have not found the promised new career.

Instead, an extensive analysis of the program by The New York Times shows, many graduates wind up significantly worse off than when they started — mired in unemployment and debt from training for positions that do not exist, and they end up working elsewhere for minimum wage.

Split between federal and state governments — federal officials dispense the money and states license the training — the initiative lacks rigorous oversight by either. It includes institutions that require thousands of hours of instruction and charge more than the most elite private colleges. Some courses are offered at for-profit colleges that have committed fraud in their search for federal funding. This includes Corinthian Colleges Inc., which reached an agreement last month with the federal Education Department to shut down or sell many of its campuses. . . ."

Duncan Caves to the Billionaires of the For-Profit Exploitation Colleges

From TICAS:

Statement on Final Gainful Employment Rule 

Pauline Abernathy, Vice President, The Institute for College Access & Success

Background:  Today the U.S. Department of Education issued a final “gainful employment” rule to enable enforcement of the federal law requiring any post-secondary career education program receiving federal financial aid to “prepare students for gainful employment in a recognized occupation.”  The final regulation applies to all career education programs, whether offered by a public, non-profit or for-profit college.

“The final gainful employment rule is a first step towards preventing federal taxpayer dollars from being wasted on career education programs that leave students with nothing but insurmountable debt. Unfortunately the final rule will allow many programs that over-charge and under-deliver to continue to receive federal student aid. It also fails to address the recommendations of a broad coalition of student, civil rights, consumer, higher education and college access organizations to strengthen the modest draft rule published last July. While the final rule is a step in the right direction, it is substantially weaker than the draft rule and it will take longer to protect students and taxpayers from the worst of the worst programs. 

“Since the draft gainful employment rule was issued, evidence of rampant fraud and abuse in the for-profit career college industry has continued to mount: 11 state attorneys general have launched a joint investigation of the industry; the Justice Department and state attorneys general joined a whistleblower lawsuit against one of the largest publicly traded career college corporations; a Government Accountability Office undercover investigation found 15 out of 15 career colleges engaged in deceptive and misleading practices; and a Senate committee investigation has uncovered company documents encouraging unseemly, high-pressure recruiting tactics.  

“This year alone, taxpayers are expected to underwrite more than $30 billion in federal loans and more than $9 billion in Pell Grants to students attending for-profit career colleges.  However, the evidence is clear that many of these programs are fleecing both taxpayers and students.  The industry enrolls about one in ten college students, but it accounts for one in four federal loan and grant dollars and for nearly half of all defaults on federal student loans. 

“More needs to be done to prevent the waste of taxpayer dollars and protect students, including veterans, from programs that swindle them rather than prepare them to succeed in the workforce.”

An independent, nonprofit organization, the Institute for College Access & Success works to make higher education more available and affordable for people of all backgrounds. For more about our programs and initiatives, including the Project on Student Debt, see http://ticas.org. For more information about support for a strong gainful employment rule, see www.ProtectStudentsandTaxpayers.org. 

For-Profits Draining Federal Education Funds and Leaving Students Broke and Empty-Handed

Tamar Lewin at the NYTimes calls these predatory corporate diploma mills "commercial colleges." How quaint. 

Think Progess has the real story:

The Education Department today released new data on the rate at which higher education students default on their student loans, which showed that students at for-profit colleges — schools like the University of Phoenix or Strayer University — are defaulting at rates far above those at other institutions. In fact, 25 percent of students who attend for profit colleges default within three years. Here’s a chart comparing default rates at different types of schools (the green bar represents defaults at private, for-profit schools).

Here are some more key facts about for-profit colleges:

– Just 11 percent of higher education students in the country attend for-profit schools, yet they account for 26 percent of federal student loans and 44 percent of student loan defaults.

– Many of the schools make up to ninety percent of their revenue from U.S. taxpayers, through the Pell Grants, Stafford Loans, and other federal assistance used by their students. 91.5 percent of Kaplan’s revenue comes from the government, along with 88 percent revenue at the University of Phoenix.

– CEO’s of for-profit colleges receive up to 26 times the amount of pay that the heads of traditional universities do.

Strayer CEO Robert Silberman was paid $41.9 million in 2009. As Bloomberg News noted, “Silberman’s annual compensation would have ranked him eighth on Equilar’s list of the highest-paid executives at the largest 1,000 companies.”

The schools also engage in aggressive recruiting and marketing tactics, promising students quick degrees and good jobs, when the result is more often a rip-off, resulting in “crushing debt and bleak job prospects.” A new report from the National Consumer Law Center said that the for-profits’ in-house loan programs are, for all intents and purposes, predatory.

To address these problems, the Obama administration is attempting to implement tougher regulations — dealing with what’s known as “gainful employment” — which would cause for-profit programs, as well as some programs at non-profit and state schools, to lose their access to public money if their graduates fail to meet a certain debt-to-income ratio or have high rates of student loan default. The regulatory drive has caused the for-profits to buy up a slew of lobbyists and make millions in donations to congressional campaigns and political action committees.

Currently, for-profit schools are only allowed to make 90 percent of their revenue from the federal government. But the schools evidently feel this is not enough, as they’re pushing the government (aided by House Republicans) to eliminate a rule capping how much of their revenue can come from federal largesse, providing them with what is essentially a bailout, as they’re likely to violate the rule this year unless an exemption is made.

For more information, read today’s Progress Report, “For-Profits, Not Students.” Cross-posted on The Wonk Room.

The Kanamits of Kaplan "Serving the Poor"

I don't want to pick on Kaplan too much, for it is surely not the only corporate culture devoted to "serving the poor."  Fortunately, though, for many millions who were lined up to fly away on what they expected be a great educational adventure, a few hardworking Congressmen have been able to translate Kaplan's slick catalog, "To Serve the Poor:"  
DON'T GET ON THAT EDU-SHIP, FOLKS --"TO SERVE THE POOR"--IT'S A COOKBOOK!

From NYTimes:

. . . .“We purchased colleges that served mostly poor students, and we have embraced that role,” Mr. Graham said. “For students with risk factors, older working students with children, Kaplan has dramatically better graduation rates than community colleges.”

The company has acknowledged, however, that the new rules could hurt Kaplan. According to 2009 data released this summer by the Department of Education, only 28 percent of Kaplan’s students were repaying their student loans. That figure is well below the 45 percent threshold that most programs will need to remain fully eligible for the federal aid on which they rely. By comparison, 44 percent of students at the largest for-profit, the University of Phoenix, were repaying their loans.

Kaplan is facing several legal challenges. The Florida attorney general is investigating eight for-profit colleges, including Kaplan, for alleged misrepresentation of financial aid and deceptive practices regarding recruitment, enrollment, accreditation, placement and graduation rates.

Kaplan is also facing several federal whistle-blower lawsuits whose accusations dovetail with the findings of an undercover federal investigation of the for-profit industry this summer, including video of high-pressure recruiting and unrealistic salary promises.. . .

For-Profit Diploma Mills: 15 of 15 Crooked in GAO Undercover Investigation

When the oligarchs decided for Obama that the U. S. would be #1 in college graduates by 2020, they knew that such a goal would be as meaningless as the paper handed out by the Wall Street U's to the most exploited students whose K-12 non-preparation leaves them with no option for a college education except for a fraudulent one paid for by the taxpayer with Pell Grants. 

But students and taxpayers just keep getting the business by big business as Arne does the rope-a-dope on cracking down in any significant way on these whale donors who can afford the big corporate donations.  Why shouldn't they--they have an endless revenue stream from the federal treasury.  From the NYTimes:

Undercover investigators posing as students interested in enrolling at 15 for-profit colleges found that recruiters at four of the colleges encouraged prospective students to lie on their financial aid applications — and all 15 misled potential students about their programs’ cost, quality and duration, or the average salary of graduates, according to a federal report.

The report and its accompanying video are to be released publicly Wednesday by the Government Accountability Office, the auditing arm of Congress, at an oversight hearing on for-profit colleges by the Senate Committee on Health, Education Labor and Pensions.

The report does not identify the colleges involved, but it includes both privately held and publicly traded institutions in Arizona, California, Florida, Illinois, Pennsylvania, Texas and Washington, D.C. According to the report, the colleges in question were chosen because they got nearly 90 percent of their revenues from federal aid, or they were in states that are among the top 10 recipients of Title IV money. . . .

Do read on.

For Profit Diploma Mills Draining Federal Student Loan Kitty

Some of the for-profit bottom feeders who prey on the poor and even the homeless to recruit bodies for their worthless degrees have been outed.  We must wonder what it will take to cut these money sinks off from the federal student loans that are making for profit college CEOs deliriously wealthy.

From the Chronicle of Higher Ed:

These 20 institutions could be found in violation of a new federal rule on student-loan defaults if it took full effect today instead of in 2014, as planned. The colleges could escape risk by lowering their default rates before then. Colleges in violation can lose eligibility for federal student aid. For-profit institutions appear disproportionately affected by the new rule. Only three colleges named below are not for-profit: Benedict, Jarvis Christian, and Texas Colleges. An institution would violate the rule if for three consecutive years, 30 percent or more of its borrowers defaulted within three years of their scheduled start of repayment, or if the institution's default rate exceeded 40 percent in the most recent three-year period.

Institution*	Location	Number of borrowers starting repayment in 2007	Number of borrowers who defaulted within three years	Default rate, 2007	Default rate, 2006	Default rate, 2005
Three years with default rate of 30 percent or more:
Arizona Automotive Institute	Phoenix, Ariz.	552	214	39%	36%	33%
Aviation Institute of Maintenance	Kansas City, Mo.	124	46	37%	47%	31%
Benedict College	Columbia, S.C.	1,103	374	34%	33%	34%
Camelot College	Baton Rouge, La.	249	84	34%	51%	35%
Centura College-Richmond	Richmond, Va.	345	112	32%	33%	33%
College of Office Technology	Chicago, Ill.	644	305	47%	39%	38%
Everest College at San Bernardino	San Bernardino, Calif.	765	284	37%	33%	32%
Everest Institute at Rochester	Rochester, N.Y.	1,638	610	37%	35%	34%
Huntington Junior College	Huntington, W.V.	483	199	41%	38%	33%
Jarvis Christian College	Hawkins, Tex.	224	89	40%	40%	37%
Tesst College of Technology	Baltimore, Md.	1,098	462	42%	42%	34%
Texas College	Tyler, Tex.	365	149	41%	41%	36%
Westwood College-DuPage	Woodridge, Ill.	885	269	30%	31%	34%
WyoTech at Long Beach	Long Beach, Calif.	2,224	719	32%	35%	31%
Default rate of more than 40 percent in most recent year:
Advanced College	South Gate, Calif.	92	37	40%
Angley College	Deland, Fla.	115	51	44%
Centura Institute	Orlando, Fla.	57	23	40%
College America at Flagstaff	Flagstaff, Ariz.	240	111	46%
Lamson College	Tempe, Ariz.	330	145	44%
Lincoln Technical Institute	Philadelphia, Pa.	544	230	42%
Additional colleges have recorded high rates for two consecutive years and so may be at risk of violating the rule if they cannot lower their default rates.
		Degree-granting institutions		All postsecondary institutions
Number of institutions with a default rate of 30% or more in 2007 and 2006		41		100
Number that are for-profit		34		93
* Degree-granting institutions only
Note: The federal rule allows for appeals on various grounds, allowing some colleges with high rates to avoid losing eligibility for federal dollars. Colleges with fewer than 30 borrowers in one year are subject to separate provisions under the rule and so are not included in this analysis.
Source: U.S. Education Department data
Chronicle analysis by Jeffrey Brainard

For-Profit Diploma Mills Drain Away Cash and Hope

Sunday's New York Times had a revealing piece on the leeches and bottom feeders in the for-profit college business who prey on the poorest and most vulnerable. By making big promises and delivering nothing of value in return, these diploma mills drain students' Pell Grant funds, and students are left in debt with no job prospects. A clip:

. . . .The stakes are enormous: For-profit schools have long derived the bulk of their revenue from federal loans and grants, and the percentages have been climbing sharply.

The Career Education Corporation, a publicly traded global giant, last year reported revenue of $1.84 billion. Roughly 80 percent came from federal loans and grants, according to BMO Capital Markets, a research and trading firm. That was up from 63 percent in 2007.

The Apollo Group — which owns the for-profit University of Phoenix — derived 86 percent of its revenue from federal student aid last fiscal year, according to BMO. Two years earlier, it was 69 percent.

For-profit schools have proved adept at capturing Pell grants, which are a centerpiece of the Obama administration’s efforts to make higher education more affordable. The administration increased financing for Pell grants by $17 billion for 2009 and 2010 as part of its $787 billion stimulus package.

Two years ago, students at for-profit trade schools received $3.2 billion in Pell grants, according to the Department of Education, less than went to students at two-year public institutions. By the 2011-12 school year, the administration now estimates, students at for-profit schools should receive more than $10 billion in Pell grants, more than their public counterparts. (Those anticipated increases may shrink, depending on the outcome of wrangling in Congress over health care and student lending.)

Enrollment at for-profit trade schools expanded about 20 percent a year the last two years, more than double the pace from 2001-7, according to the Career College Association.. . . .

For Profit Diploma Mills Collect Billions: Students and Taxpayers Left with Piece of Coal

From Pro Publica:

. . . .A recent investigation by the Government Accountability Office found instances of for-profit schools’ engaging in outright fraud to sign up unqualified students [3] (PDF) and warned that "the government cannot be assured that its student aid funds are only provided to students who have an ability to benefit from higher education.’’

Earlier this week, the department made public the default rates for students who graduated three years ago [4], reporting that students at the larger for-profits were defaulting at a rate of around 20 percent. Those are similar to levels, last seen during the early 1990s, that prompted the last major changes in how government regulates the industry.

Previously, the department published data only for defaults in the two-year window after students graduated. In general, those were relatively low. The numbers released this week show that by year three, the rates rise dramatically, as this chart shows. [2]

The three-year rates for some schools are high enough that, if those rates continued for another couple of years, those schools would no longer be permitted to write federal student loans [5] and grants, which cost the federal government $117 billion [6] (PDF), according to the Department of Education. The stimulus package pumped another $15 billion into education grants. The largest recipients [7] of both programs are for-profit schools. . . .

For Profit Diploma Mills Draining Fed Ed Dollars and Leaving Students Broke

The corporate felons at the Apollo Group were convicted in early 2008 of fraudulently misleading investors. From the NYTimes, 01/17/08:

PHOENIX (AP) — The Apollo Group Inc., the company that owns the University of Phoenix, fraudulently misled investors in 2004 about student recruitment policies, a federal jury decided Wednesday. The panel ordered the company to pay shareholders about $280 million.

Jurors said Apollo officials “knowingly and recklessly” made false statements in a news release, a filing with the Securities and Exchange Commission and four conference calls with market analysts. By doing so, jurors said, Apollo violated federal securities laws. . . .

Since that time, the Apollonoid lawyers have been trying to cut a deal to lower the settlement to somewhere between 45 and 200 million. UPhoenix has nothing really to worry about, however, even if the entire amount has to be paid, for $280 million would be just over a third of what UP hustles in one year from Pell Grant dollars alone. From a story today by AP's Justin Pope on the corporate college corruption that Arne Duncan has enabled by allowing federal grants and loans to be wasted in the virtual learning corporations that are devoid of any discernible virtue:

Phoenix alone had more than 230,000 Pell recipients last year (and received $657 million Pell dollars, roughly its parent company's yearly profit). Its campuses educate nearly four times more low-income students than the entire Big 10, and more than 30 times the Ivy League, the AP found. Unlike proprietary schools, those traditional colleges enjoy tax-free status for supposedly providing a public service, notes Harris Miller, president and CEO of the Career College Association.

And $657 million is just the Pell Grant dough. There are hundreds of millions, too, in low interest federal student loans that go pay millions to UP's CEOs and to pay dozens of dollars at least to adjunct professors, many of whom bought their own degrees at these same pedagogical establishments.

Yes, business is good at Apollo, with a "buy" rating (that was likely bought) on its stock. Bought or not, Apollo is spending almost a billion dollars every year on sales and promotion. That's $1,000,000,000. The corporates control 10 percent of the higher education market. Hey, you can't keep a good casino capitalist down, especially when your lobbyists have made sure there is nothing virtual about the cold hard cash that comes pouring forth from the Federal Treasury, money that was intended to help those who need help to get a college education.

But you can keep keep down Apollo's clientele, those adults and teens left behind, those who comprise the poorest and most desperate college student population, the ones who can't go to the leafy three-dimensional campuses, the real campuses with libraries and labs, football teams and food courts. Meanwhile, the corporate ed reformers in charge of California's public university system are putting real colleges further out of reach with a 30-40 percent tuition increase planned for next year--assuming the students and workers don't burn the whole thing down first. A very effective corporate college feeder strategy that will, no doubt, attract more uninformed and gullible students to the Kaplans and the UPs, students who will never challenge the crap ed they receive. After all, that's what they got in the 12 years prior, right.

What's the graduation rate from these online corporate diploma mills? Try 38%. How much do students owe after their miseducative experiences? Almost 9 percent more than they would if they were enrolled in PRIVATE nonprofit four-year colleges:

Students who don't graduate will be hard pressed to repay their debts. On average, for-profit schools cost five and a half times the price of community colleges. Virtually all students must borrow some money, and even among graduates of for-profit four-year programs, the average borrower ends up owing $33,000, according to the latest government data analyzed by Mark Kantrowitz of the Web site finaid.org. That's about $5,000 higher than even private nonprofit four-year colleges.

Yes, the Federal gravy train just keeps on rolling for the capitalist frauds, crooks, and profiteers who act as if they own the Republic. Here is another clip big clip from Pope's piece:

RALEIGH, N.C. – Students aren't the only ones benefiting from the billions of new dollars Washington is spending on college aid for the poor.

An Associated Press analysis shows surging proportions of both low-income students and the recently boosted government money that follows them are ending up at for-profit schools, from local career colleges to giant publicly traded chains such as the University of Phoenix, Kaplan and Devry.

Last year, the five institutions that received the most federal Pell Grant dollars were all for-profit colleges, collecting over $1 billion among them. That was two and a half times what those schools hauled in just two years prior, the AP found, analyzing Department of Education data on disbursements from the Pell program, Washington's main form of college aid to the poor.

This year, the trend is accelerating: In the first quarter after the maximum Pell Grant was increased last July 1, Washington paid out 45 percent more through the program than during the same period a year ago, the AP found. But the amount of dollars heading to for-profit, or "proprietary," schools is up even more — about 67 percent.

For-profit colleges say the country has little choice but to accept their help to achieve President Obama's goal of getting every American to enroll in some form of education beyond high school. The for-profit schools have space while community colleges are bursting at the seams. Besides, their convenience and career-focused curriculum are clearly winning customers, who are free to use their aid where they choose.

But critics say the increased federal aid has unleashed a new gold rush. They complain the industry has too many incentives simply to enroll students and tap the spigot from Washington — and not enough to make sure students succeed.

The industry is "an aggressive sales operation that has a voracious appetite for recruiting the poorest students," said Barmak Nassirian, associate executive director of AACRAO, a group representing admissions officers and registrars at traditional colleges. "The victims here are the students themselves and the taxpayers, who have to pick up the tab."

Regardless of how AP's findings are interpreted, they underscore the extent to which the United States has ramped up its support for low-income college students in recent years, but increasingly outsourced the job to the private sector.

• Last year, Washington paid out a record $18.3 billion in Pell Grants, which typically go to families earning under $40,000. Proprietary colleges collected about $4.3 billion of that, or about 24 percent — roughly double the proportion a decade ago.

• In the first quarter of the current academic year, for-profit colleges collected $1.65 billion, or 67 percent more than in the same period a year ago. On July 1, the government made more students eligible for Pell grants and increased the maximum award by $600 to $5,350.

• For-profits are also grabbing a growing share of loans subsidized by the government to help low-income students. They collected about $7 billion in subsidized Stafford loans in 2008-2009, up from $4.7 billion two years before. Taxpayers subsidize the interest rate and take the hit when students default. Nearly one-quarter of students at for-profit schools default within four years, more that double the rate of other schools.

Overall, the sector enrolled about 2.7 million students in 2007-2008, the latest year with complete federal data available. That was only about 10 percent of total enrollment in higher education, but it's about 2 million more than a decade before.

The numbers are even more striking for low-income students: The number of Pell recipients enrolled in for-profit schools is 50 percent higher than two years ago. . . .