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Margaret Spellings and the for-profit college industry

spellings-400cYesterday in The Nation, Zoe Carpenter laid bare the many reasons people who care about higher education should be concerned about the recent naming of Margaret Spellings as president of the University of North Carolina system.

Those reasons — close ties to the deceptive and imploding for-profit college sector, former leadership of a student loan debt collection company, homophobic comments — may already be old news to state residents, but here’s some elaboration from Carpenter:

At the Department of Education, Spellings tried to bring the focus on performance metrics and accountability that drove No Child Left Behind in higher-education policy.She convened a Commission on the Future of Higher Education, whose final report referred to students as “consumers,” and lauded elements of the for-profit education industry for embracing “an aggressive, outcomes-based approach.” Ironically, it’s the for-profit industry that has failed most egregiously since then to produce positive results for students. Kaplan Higher Education, one of the companies praised in the Spellings report, was forced to refund over a million dollars to hundreds of students in January after a federal investigation into the hiring of unqualified instructors, and another$1.3 million in July.

Spellings went on to work in the troubled for-profit industry after leaving the White House—an experience, she told UNC’s board of governors, that taught her “a lot about how we can serve our students and think of them as customers in providing a product in convenient ways for them.” Beginning in 2012 she served on the board of the Apollo Group, the parent company of for-profit chain University of Phoenix. That “diploma factory” is now under investigation by the Federal Trade Commission, in part for its aggressive recruiting of military veterans. Its online program has a graduation rate of just 7.3 percent, and the student loan default rate is up 5 percent from the national average.

Spellings also chaired the board of the Ceannate Corporation, a student loan–collection agency. It’s not surprising that she had connections there: During Spellings’s tenure the education department was accused of acting “as a wholly owned subsidiary” of the student-loan industry. Preying on student borrowers is lucrative business: profit margins for loan collectors average 30 percent. “Despite widespread calls to reform the student loan industry, Spellings and the Ceannate Corporation have simply profited off of it,” two UNC professors wrote in a recent op-ed. “Spellings’ defense of for-profit colleges [following her appointment] is perhaps just as disturbing as the predatory practices these institutions use to fleece students.”

Spellings has also come under fire for homophobia. She used her second day as education secretary to send a letter to the chief executive of PBS, admonishing her for a brief, unaired scene on a show called Postcards From Buster that depicted a same-sex couple. “Many parents would not want their young children exposed to the lifestyles portrayed in the episode,” she wrote. Spellings asked for the network to return the public funds that had been used to film it. Asked about the comments after her election to the top post at UNC, she said, “I’m not going to comment on those lifestyles.” She defended her actions, arguing that it was “a matter of how we use taxpayer dollars,” not about “any particular view” on “particular groups of people.”

Add to those yesterday’s announcement of a $102 million student loan forgiveness settlement involving Education Management Corporation — yet another connection Spellings had with the for-profit college industry.

Turns out that after leaving the White House Spellings also worked as a consultant to EDMC, and in comments at a forum for higher education leaders, defended the for-profit college world.

“We need to again use better data to make our case … to tell our story in credible ways,” Spellings was quoted by Inside Higher Ed as having told the folks gathered at that forum.

“We’re seen as wild-eyed, often profit-making, the wild west of higher education, and often don’t get credit for what we do.”

One Comment


  1. harold minor

    November 20, 2015 at 2:01 pm

    How could you make a worse choice. They have had 15 years to tell their story, rather steal money. What a joke.

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