Betsy DeVos's misguided repeal of the gainful employment rule

Imagine you’re an ambitious young college student and, after a couple of years in the classroom, you decide to make teaching your career. The next step is a master’s degree, which is supposed to be a giant step toward obtaining your teaching credentials. You sign up for a program that looks great, pay for the classes, and work hard—only to find out the degree doesn’t meet your state’s requirements.

Or you’re an aspiring nurse halfway through your RN program, but when your school goes bankrupt you’re left back at square one—except for tens of thousands of dollars in student loans you still have to repay.

These nightmare scenarios are not movie scripts; they were the everyday reality for thousands of Americans ensnared by the for-profit and career college industry before the Obama administration began to regulate it.

While those rules worked well to protect students, the Trump administration wants to erase them. Last summer, Education Secretary Betsy DeVos repealed a crucial Obama-era protection, the so-called gainful employment rule, potentially sending us back to the not-so-halcyon days of debt and despair.

Late last month, our organizations—the American Federation of Teachers and Student Defense—filed suit to vacate the repeal and put the rule back on the books. Gainful employment has big implications for students and taxpayers. It says, in short, that nearly all for-profit college programs and nondegree career programs at public and private nonprofit colleges are only eligible for federal student aid if they lead to good jobs that pay enough for students to repay their loans.

The rule, finalized in 2015, was effective. It was enacted after an explosion in for-profit colleges that promised students a better life, but left them instead with disappointment and a pile of debt. High-profile collapses—think Corinthian Colleges and ITT Technical Institute—exposed some of the worst excesses and abuses of the industry.

A Seton Hall University study released last November found that failing the rule’s standards was associated with a higher likelihood of a program or college closing. The authors write, “It was reasonable for colleges to expect that these sanctions would not be enforced when the data were first released given the incoming Trump administration’s proposals to remove the rule. This means that any observed effects are likely due to pressures from internal stakeholders, college owners, or the general public instead of from the federal government.”

Jonathan Kaplan, former president of Walden University, wrote in Inside Higher Ed the following month that the study showed gainful employment had “achieved one of its stated policy goals: encouraging for-profits to examine with more intention the financial return of their programs for students.”

Most of us understand that consumers need protection from big business. Unfortunately, this administration seems to view it the other way around, perhaps because many of DeVos’s senior higher education advisers hail from companies like Bridgepoint Education, DeVry, and Career Education Corporation. All three ran numerous programs that did not pass the gainful employment rule’s standards and have been subject to federal and state investigations.

The Trump administration seems to believe that its primary job is to protect the industry, rather than to ensure borrowers get a good, affordable education—a position that would seem to chafe with the Education Department’s mission to “promote student achievement and preparation for global competitiveness by fostering educational excellence and ensuring equal access.”

Over her three-year tenure, DeVos has attempted to dismantle other borrower protections established in previous administrations. At the same time she announced her intention to roll back gainful employment, DeVos ordered her department to delay the effective date of the borrower defense rule, which provides defrauded students the opportunity to have their loans forgiven. And she effectively dismantled an enforcement unit that was focused on investigating abuses by for-profit schools.

But the secretary’s eagerness to carry out this ruinous agenda has a silver lining: Many of her highest-profile initiatives have been reversed in court. The delay of the borrower defense rule was struck down in October 2018, and after further litigation the Education Department discharged $150 million in debt owed by students whose schools had closed. In October the following year, a federal judge held DeVos in contempt of court for violating an order to stop collecting on the student loans of defrauded Corinthian students. That followed a ruling last year finding that DeVos had illegally delayed a rule providing additional protections for students enrolled in online education.

We are confident DeVos’s dismantling of the gainful employment rule will share the same fate. But why are unions and advocates forced to fight to defend what few protections borrowers have already won? Isn’t that DeVos’s job?

Instead of stymying students, the administration should be working with us to create new and affordable educational opportunities for tomorrow’s teachers, nurses, veterans, government employees, first responders, and trade workers. In other words, Betsy DeVos should protect the people she’s sworn to serve, not the for-profit industry that all too often exploits them.

Aaron Ament is president of Student Defense.

Randi Weingarten is president of the American Federation of Teachers.