Home > Uncategorized > The Fruits of Deregulation? Caveat Emptor… and If Too Many Consumers Fail? Blame the Schools

The Fruits of Deregulation? Caveat Emptor… and If Too Many Consumers Fail? Blame the Schools

August 19, 2018

The headline of this post was the thought that came to me as I read Valerie Strauss’ recent Washington Post article about Betsy DeVos’ decision to hold students accountable for debts they incurred as a result of enrolling in for-profit schools who made false promises and used false information to lure them into enrolling. Here’s Ms. Strauss’ summary of Ms. DeVos’ proposal:

…on Wednesday, the U.S. Education Department followed up on its action in 2017, when it suspended two key rules from the Obama administration that were intended to protect students from predatory for-profit colleges. And the agency had promised to write its own regulations, which emerged this week.

The proposed rules require students to prove that schools knowingly deceived them if they want to qualify to have federal loans canceled. And the agency dropped a provision that allowed similar claims to be processed as a group. Instead, students will have to prove their claims individually.

The net effect of this rule change is cataclysmic for students who owe money to post-secondary institutions that defrauded them but VERY helpful to those who operated the schools and those who loaned money to the students.

And this is the fruit of deregulation: the buyers always pay the price and the bilkers and bankers walk away with money in their pockets. And the politicians’ solution? Blame the schools! If schools did a better job of educating students their graduates wouldn’t be falling for these scams. We need to require graduates to pass courses on consumerism!

 

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