Monday, September 8, 2014

John Oliver, Student Debt, and the Edubiz Marketplace

I really have nothing to add to this, but boy do you need to see it.

Okay, I have one thing to add to it. He actually missed the part where the fed bailed out Corinthian.

This is what twisted market forces look like when they hit education. When the government sets up a system with the main function of using students to funnel loan dollars to education based businesses, this is what you get. You are using students as a conduit where they allow the feds and banks to channel big money to schools, generating a profit by charging the conduits interest! The providing of an education is completely secondary to the providing of a big payday for the corporations involved.

Is it going to look any different in the K-12 world? Of course not-- choice systems are a way to funnel tax dollars to edubiz corporations. The only difference is that we're not making the people who use vouchers pay for the privilege. Yet.

But the big fat student loan packages that are being shoved through various students in need are simply another form of voucher. If I were a voucher fan, drooling over the prospect of the day when I could shop around an all-charter, all-private world of schools, I would take a good long hard look at what's going on in the world of college finance today. And I would have a good hard think about what these kinds of market forces, twisted by crony capitalism and government money-funneling, would do in that world.

As we like to say in cyberia, if you aren't paying, then you're the product. And that means your interests are not paramount. But here we see revealed the great humungus fallacy in the idea of a free market school system. Fans of that systems imagine "I will be the customer, so I will be in charge." Brzzzzt! Wrong. The customers are the schools, profiting through you. You will have no more market power than a wallet.


  1. That was so d@m^ funny. He's brilliant in working in that hilarious tape of LBJ. Does Arne's Asst Sec of Ed have a personal investment in Corinthian College?

  2. Other than the fact that many of these for-profit schools are run by scumbags, there is very little here that is correct.

    First of all, do you know what other group of schools provides poor educations, has low graduation rates, and incurs high student debt loads? HBCUs. But don't expect anyone to sound the alarm on them anytime soon.

    Second, the notion that student debt is exploding because of reduced state funding is a myth perpetuated by colleges. Tuition has been rising at twice the rate of inflation for 30 years. Why? Because of the very student loan programs Oliver so loves. We have a higher education bubble because students have been willing to borrow whatever it took to go to the nicest schools they could get into. Schools have poured this money into Taj Mahal facilities and armies of administrators.

    Now that times are hard, colleges are facing tough choices, like: Should we lower tuition, or maybe not hire that second vice provost for multiculturalism? Guess who loses in that debate? Hint: That vice provost just bought a new Mercedes.

  3. The interest earned on student loans goes to Arne and the DOE. They use some of it to render the IDEA act and FERPA protections useless, and to support TFA, RttT, charters, etc.

    Had the DOE shut down Corinthian, the students would have had their loans, and interest, nullified. Because Corithian is allowed to "wind down", the students remain on the hook for the loans for their worthless education, and the intere$t goes to Arne.

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