Outsourcing College

The Education Management Corporation is based right up the road from me in Pittsburgh, PA. They're a for-profit education provider whose best-known outlet is the Art Institute chain. (They should not be confused with the Education Credit Management Corporation, an outfit that is also in the for-profit college biz, having bought up the pieces of the Corinthian empire.)

They've had their problems. You know a company has been struggling when its website proudly announces front and center that it has struck a deal with thirty-nine states, the District of Columbia, and the Department of Justice to end the many, many, many state and federal suits, investigations,  and charges against it for fraud and bad recruiting practices.

Mock my hair all you want. It cost more than your house.

Now this morning's Politico includes other shenanigans-flavored news:

The latest downsizing move by one of the nation's largest for-profit college chains — the cash-strapped Education Management Corporation — may be selling off campuses to a company in India.

The company in question appears to be Ritman Balved Education Foundation, a non-profit that runs the relatively huge Amity International School chain. Massachusetts Attorney General Maura Healey (one of the thirty-nine attorney generals involved with EDMC's other shenanigans) describes the sale as a "plan to outsource the remainder of its teach-out obligations to an unlicensed foreign entity."

Amity is part of a rising trend in India of private universities, a trend that attracted attention from the Wall Street Journal in 2007. That story notes that India was having trouble adjusting to the rise of private businesses in education, and that while Indian law required schools of higher learning to be non-profit, they were still plenty expensive and making some folks mighty rich. There are concerns they are "blurring the lines between philanthropy and business." Go figure. It all sounds familiar:

While the private universities are adding much-needed capacity, they are also raising questions about the quality of their degrees and the motives of some wealthy backers.

RBEF is one philanthropy-flavored foundation behind this movement, though it does have some features that don't immediately resemble our US brand of edu-philanthropic-profiteering. For instance, their website touts their educational commitment, but notes that RBEF

also supports nation building through initiatives like military training, environment & energy research, corporate social responsibility, youth empowerment activities like hosting world youth forums, sporting academies and extensive support for the underprivileged sections of the society.

Nation building through military training. Well, then. That's one thing that Gates and Walton don't do, as far as I know.

RBEF was founded by Dr Ashok K Chauhan, an international corporate billionaire who decided in 1986 to get into the edubusiness. His main business is the AKC Group of Companies, which includes a bit of everything, now including the RBEF. He has done very very well for himself, with a chain that includes five universities and hundreds of schools at other levels. Chauhan is pushing 75, but his son is already in place to take over the family business.

So I'm torn here. On the one hand, EDMC's Bob Greenlee offers what are clearly weasel words (EDMC "remains committed to providing current students with the resources on-site to meet their educational and career needs" which of course means that once the current crop is outta here, all bets are off). Meanwhile, Politico reports that current students are being vigorously pushed toward the door. EDMC is already has its boarding pass and its luggage tagged for a trip on Outsource Airlines.

On the other hand, RBEF appears to have a hell of a lot more positive experience than EDMC, a group that is admittedly older (1962) but has spent the last decade hemorrhaging money and picking up lawsuits. They may be one more money-grubbing corporation in education to make a buck, but at least they're a stable one.

We've seen the pattern with private business universities before-- ultimately the revenue matters more than taking care of the students, corners are cut, false promises are made, more corners are cut, and soon the school has polluted its own business so badly that it can't be sustained. Outsourcing is one more logical evolution of a model that is bad business and worse education.