What Is it With Republican Support of For-Profit College Scams?

MADISON, Wis. — With the for-profit “college” ITT Tech under increasing scrutiny and with state and federal regulators handing down penalties for shady business practices, the question remains: Why did Gov. Scott Walker conduct a photo-op at the Greenfield ITT Tech site? ITT has been barred by federal regulators from accepting new students using federal financial aid and by Wisconsin regulators from accepting new state students. Adding to the cloud of scandal, ITT is also under investigation by multiple attorneys general, as well as the federal Consumer Financial Protection Bureau (CFPB) for deceptive and abusive practices against students.

Walker is not the only Wisconsin elected official to embrace the predatory for-profit cartel, which includes 26,000 current students in Wisconsin paying annual tuition of $150 million. U.S. Sen. Ron Johnson delivered what he termed a “state of the nation” speech at the private, for profit Globe University in Green Bay, after having infamously said the solution to the nation’s $1 trillion-plus student loan debt crisis was more for-profit colleges. And just last week, One Wisconsin Now first reported on Johnson’s extraordinary comments that professors could be replace by having students watch Ken Burns’ Civil War “tape.”

“Scott Walker and Ron Johnson oppose allowing more than 500,000 Wisconsin student loan borrowers to refinance their loans, just like you can a mortgage,” said Scot Ross, One Wisconsin Now Executive Director, “But Walker and Johnson support the morally bankrupt for-profit college industry that preys on veterans, older Americans, people of color and those living in poverty.”

ITT Tech which operates 145 campuses in 35 states and is one of four for-profit colleges under investigation by multiple attorneys general across the country. Today the Milwaukee Journal Sentinel reported that questions about the financial viability of ITT have resulted in the state Educational Approval Board suspending the school from enrolling Wisconsin students. The chain is also under investigation in a separate inquiry by CFPB for “predatory student lending,” alleging ITT pushed students into high-cost private student loans and used high-pressure tactics.

Further, ITT Tech focused intently on luring returning soldiers from the Iraq and Afghanistan wars into signing up. A comprehensive 2012 report authored by the U.S. Senate Committee on Health, Education, Labor & Pensions Committee, Sen. Tom Harkin (D-Iowa) concluded ITT : “Documents also demonstrate a focus on recruiting students eligible for military benefits. ITT is the second highest recipient of post-9/11 GI bill funds, taking in $178 million between 2009 and 2011. In 2009, ITT initiated a military marketing plan with the goal of increasing military enrollments by 20 percent at 42 selected campuses.” [Page 530]

Meanwhile It has been reported that 96 percent of Globe students take out student loans and graduate with an average of nearly $45,000 in debt. Globe also partners with another company to provide loans to students with interest rates massively higher than market rates, usually in the 18 percent range. Current and former students at Globe University sued in a class action lawsuit over allegations of misleading and deceptive practices by the institution.

“Republicans like Walker and Johnson want less oversight and less regulation of these domestic war profiteers and loan sharks,” said Ross. “And we haven’t even started on Trump ‘University.’”

The for-profit “college” bearing the moniker of Republican Presidential nominee Donald Trump has been under scrutiny by the courts and the press for business practices that left students deep in debt with little to show for their time and money.

The student loan refinance legislation Johnson opposed was authored by Sens. Elizabeth Warren and Tammy Baldwin. Walker opposes the Wisconsin “Higher Ed, Lower Debt” bill for refinancing of loans for Wisconsin student loan borrowers. Neither bill creates any new net cost to taxpayers. Both Hillary Clinton and Russ Feingold have fully endorsed the refinancing of student loans, which would immediately help 25 million Americans.