For-Profit Colleges: Targeting People Who Can't Pay

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For-Profit Colleges: Targeting People Who Can't Pay

TERRY GROSS, host:

This is FRESH AIR. I'm Terry Gross.

It's great to think of disabled veterans, poor people, immigrants, even
the homeless having the opportunity to earn a college degree, and a new
breed of for-profit colleges has been offering that opportunity. But
that opportunity can come with a life-changing downside.

My guest Daniel Golden won a George Polk and was a finalist for a
Pulitzer Prize for a series of articles he co-wrote for Bloomberg News,
investigating the $30 billion industry of for-profit colleges.

The investigation found that many of these colleges make their money
through federal grants and loans given to the students to pay tuition.
But while aggressively recruiting students who will bring those federal
dollars, little consideration is given to whether those students are
likely to graduate, get a good job and ever be able to pay back their
student loans.

Many of the students can do none of the above and are unprepared for the
debt they're stuck with. The House and Senate have been hearings on for-
profit colleges, and the Government Accountability Office found that
these colleges encouraged fraud and engaged in deceptive and
questionable marketing practices.

My guest Daniel Golden now writes for Business Week. He won a Pulitzer
Prize when he wrote for the Wall Street Journal.

Daniel Golden, welcome to FRESH AIR. How do most of the for-profit
colleges that you're writing about compare to, say, vocational schools?

Mr. DANIEL GOLDEN (Writer, Business Week): Well, the for-profit sector
originally was made up predominately of sort of trade and vocational
schools that had subjects like truck driving or hairdressing.

But it's expanded a great deal in the past 10 years. So now, for-profit
colleges offer programs in business and education and health
administration and criminal justice, and they command a far greater
proportion of the country's college students than they used to, when
they were just vocational or trade schools.

GROSS: Most colleges and universities are either public, like state
universities, or they're nonprofit. So these are for-profits that you're
talking about. Explain where the profit is made.

Mr. GOLDEN: Well, the for-profit colleges make a profit because they
charge quite a high tuition compared to, say, state universities. It's
generally $15,000 a year and up, all the way to 35 or $40,000. And they
derive that profit mostly not from students paying out of their own
pocket, but from federal grants and loans to the students, federal
financial aid.

Most of their students are eligible for this aid because they
predominately serve low-income students. So close to 90 percent of the
revenue of the for-profit sector actually comes from the federal
government.

GROSS: So that sounds great. That sounds like a real public service,
that the federal government is helping low-income students get this
training. So the problem comes in, though, that a lot of the students
will never be able to repay the loans.

Mr. GOLDEN: That's right. At for-profit colleges, you know, estimates of
the graduation rates vary, but it seems probable that about just one-
third of the students at the for-profit colleges graduate.

So most of them drop out, and because the tuitions are high and they've
had to borrow to pay the tuition, they drop out. They're laden with
debt, and often they can't find a good enough job to be able to pay that
debt off.

And because these student loans can't be discharged even in bankruptcy,
they follow these former students throughout life. The government will
garnish their wages or their tax refunds, and it becomes harder for them
to get housing and other benefits. So it's a - it can be a life-long
drag on people who already are struggling.

GROSS: So this can be a real problem for the students who can't pay back
their loans. But it's not a problem for the for-profit college. Why not?

Mr. GOLDEN: It's not a problem for the for-profit college because they
get the money essentially paid up front from the government. They don't
bear the risk if the student defaults on the loan.

In that sense, it's very akin to the subprime mortgage scandal, in which
the lenders, you know, were selling the American dream - housing
ownership in that case, education in this one - and saddling people with
debts they couldn't repay. And yet the lenders also, in the subprime
crisis, they didn't bear the brunt if the person couldn't pay their
mortgage.

GROSS: Now, the for-profit college system has been offered as an example
- a positive example, of how private enterprise can be very successful.
On the other hand, it's been criticized for making its profit primarily
on taxpayer money. Can you expand on both sides of that for us?

Mr. GOLDEN: Yeah. Well, I think one way to begin to think about that is
to realize that the business model of for-profit colleges has not always
been the one we're talking about now. You know, the leader in the
industry is the Apollo Group's University of Phoenix.

And years ago, that had a very successful model that didn't depend so
much on federal student aid. Essentially, what it would do is it would
enroll middle managers who had some prior college experience and were
stuck in their jobs because they didn't have a college degree. And they
would complete their degree at Phoenix.

And it was - and in general, their tuition was paid by their employer,
and it was quite successful. The courses were convenient. They took
place at night. The people knew what college was like. There was a lot
of group work that took advantage of their knowledge and understanding
that they'd already gleaned about the subject, and it worked very well.

Now, the problem, though, for Phoenix was after it became publicly
traded in the mid-'90s, it was in a market that couldn't grow that much.
There's a limit to how many middle managers seeking degree completion
there are.

And so to me, one of the seminal moments was in 2001 at the 80th
birthday party of the University of Phoenix' founder, John Sperling, and
kind of the patriarch of the industry, where there was a big
celebration. There was mock money with his face on it given out to
guests, and so on.

And there he proclaimed that Phoenix, which had just reached 100,000 in
enrollment, that, you know, next stop, 500,000 students. And in the
ensuing years, I think the Phoenix people realized that they couldn't
get there with the model they had.

And so they started this two-year online program called Axia College,
which just skyrocketed to more than 200,000 students. And virtually all
of them were funded by federal aid. They were low-income students with
no prior college experience. And the Phoenix model that had worked so
well for a different population didn't work as well for these people.

And the result was, you know, Phoenix's graduation rate went down. Its
default rate went up, and it was imitated throughout the industry
because other for-profit colleges - many of whom were run by former
Phoenix executives - recognized that they could tap this big bucket of
federal funding.

And so you've got this situation where the for-profit industry says, you
know, we serve low-income people. We're filling a niche. They're
underserved by traditional colleges. But, of course, the criticism is
that they serve them at a high tuition, and these students frequently
don't graduate and aren't able to repay the loans they take out.

GROSS: Are a lot of these colleges the equivalent of chains?

Mr. GOLDEN: Yeah. They are, in a way, the equivalent of chains. I mean,
if you think of the University of Phoenix, for example, it has its
online component, which, you know, most of its students now go to. It
has close to 500,000 students.

And then it has buildings around the country, but no matter where you go
to the University of Phoenix, essentially, you take the same course. You
know, Economics I is the same all around the University of Phoenix.

It's not like, you know, going to Harvard or Yale, where the professor -
you have a tenured professor who's designed a unique course with
distinctive requirements and textbooks. At one of these - at any
University of Phoenix campus, the curriculum's been designed centrally.
So it's the same curriculum, the same text, and so on.

And the teacher is usually a part-timer who's more of a facilitator.
They, you know, they grade the papers and so on, but they don't
generally make up the assignments or pick the textbooks. So it is kind
of a mass-produced education, and that's one way of saving costs. I
think the colleges would also say it also assures a certain degree of
quality.

GROSS: If the for-profit colleges are making money through federal loans
to students, they're looking for students who can qualify for federal
loans. So who is the target population?

Mr. GOLDEN: Well, the target population tends to be predominately low-
income, and often minorities. In my reporting, I visited homeless
shelters where for-profit colleges were seeking students.

They've also looked for students very aggressively among active-duty
military, whose tuition is paid by the Defense Department, and war
veterans, whose tuition is paid by the GI Bill. And that's been
particularly true since the new, more generous GI bill took effect a
couple years ago.

GROSS: Okay. So recruiters for for-profit colleges go to homeless
shelters to recruit. Can homeless people easily get loans from the
federal government to go to school? I mean, in a lot of ways, you'd hope
that they would. I mean, if anybody needs help, it's homeless people.

You know, if you can get an education, think of how great that would be.
So on the one hand, it sounds great that they're going to homeless
shelters trying to help people get an education. What's the downside?

Mr. GOLDEN: Well, the downside again is that the tuition is quite high,
so that the government can perhaps give them a Pell Grant, which is five
or $6,000 straight grant, but then there's loans on top of that from the
government.

And many of these homeless people have other problems, such as
alcoholism, mental illness. And so they may not very well-equipped to
actually graduate from a college and get a job so that they end up just
in a worse financial plight because they can't afford to repay the
loans.

I should also, perhaps, mention that a lot of the for-profit college
programs tend to be online rather than in person. And for people who are
not that well-prepared academically and who are low-income, it may be
harder to go to school online, in a way, because the - they may need
tutoring and help. And that can often be better done in an in-person
setting, rather than just having a sort of tutor over the computer.

GROSS: My guest is Daniel Golden. He won a George Polk Award for the
series of articles he co-wrote for Bloomberg News, investigating for-
profit colleges.

We'll talk more after a break. This is FRESH AIR.

(Soundbite of laughter)

GROSS: My guest is Daniel Golden, who now writes for Business Week.
We're talking about the series of articles he co-wrote for Bloomberg
News investigating how for-profit colleges often make misleading claims
and promises to recruit financially vulnerable students who qualify for
federal grants or loans. The colleges make big profits on those federal
dollars.

So veterans, through the GI Bill, can get grants from the federal
government to go to college, including private colleges. So have for-
profit colleges been very active in recruiting vets?

Mr. GOLDEN: Yes. For-profit colleges are very active in recruiting
veterans. There's a lot of federal money available under the GI Bill for
veterans. It's increased greatly since the passage of the post-9/11 GI
Bill for veterans returning from Iraq and Afghanistan.

And so you'll find for-profit colleges, they show up at conventions of
veterans groups. They have separate recruiting divisions devoted to
active-duty military and veterans. They advertise in military and
veteran-related publications. And they've been very successful in
signing up veterans.

I think the University of Phoenix has more veterans than any other
college in the country, and there's many other for-profit colleges in
the top 10 among recruiting of students funded by the GI Bill.

And it serves two purposes for the colleges. Not only does it provide
them with the GI Bill funding, but it also helps them get around an
obscure federal law known as the 90/10 rule, which says that colleges
can only get 90 percent of their revenue or less from federal financial
aid.

And many of the for-profit colleges, because they have so many low-
income students who qualify for aid, are bumping right up against this
90 percent. And they're concerned about exceeding it, which could
jeopardize their access to aid.

And it turns out that the GI Bill funds, as well as the tuition
assistance for active-duty service members, under the law it counts as
private money. It counts toward that 10 percent. So for every veteran or
active-duty service member that they enroll who's paid for by Defense
Department tuition assistance or Veterans Administration money under the
GI Bill, for each one of those people that they enroll as students, it
helps cushion them against the 90/10 rule. And so they're - that gives
them even increased motivation to pursue service members and veterans.

GROSS: Tell us one of the stories you uncovered during your reporting of
how for-profit colleges recruit veterans.

Mr. GOLDEN: Well, I did a story profiling an Iraq veteran named Chris
Pansky(ph), and it was a sad story. He had post-traumatic stress
disorder pretty severely, and he had enrolled at an institute owned by
Education Management, which is - its major investor is - it's biggest
investor is Goldman Sachs, and it runs a lot of for-profit colleges and
these art institutes.

And at least by his account, you know, the college kind of rushed him
into its student body, even though he kind of warned he would need, you
know, special help and special attention because of his disability.

And when I went to see him at his house in southern Virginia, he had -
right behind his computer where he would take his online classes, there
were holes in the wall that he had punched out of frustration with his
courses.

And he had - I forget the exact numbers, but he had failed quite a few
of his classes, and he had, you know, begged for in-person tutoring -
which the college didn't provide because it was an online program - and
for simplified homework assignments. They said they wouldn't do that
kind of accommodation. And so he was really feeling stressed, isolated
and overwhelmed.

And the broader point was that a lot of veterans do come back with PTSD,
and for them, it may look simpler in the short term to just stay home in
their living room or their basement and take classes on the computer
from a for-profit college.

But, you know, sooner or later, they're going to need to reintegrate
into society, and for that, going to a traditional classroom with
classmates and a professor right there is probably more helpful.

And so I think that, you know, the GI Bill - which was, of course,
funding Chris' education. I mean, it was designed to help returning
veterans reintegrate into society and rise in society. And so when I
visited Chris, it made me wonder if, you know, the best use of the money
was really to pay for somebody like him to sit alone in his house and
take these online classes.

GROSS: So correct me if I'm wrong, but the way you're describing this,
it sounds like recruiters for some for-profit colleges intentionally
recruit many people who are very unlikely to succeed. They're almost
more likely to fail, both at school and financially. And they're almost
being set up to owe money.

Mr. GOLDEN: Well, that's true. And there's another component to this,
which is until recently, most of these schools were paying their
recruiters based on how many people they would sign up. It's known as
incentive compensation. So the recruiters had, you know, a motivation to
sign up anybody they could, and that's what they were doing.

Incentive compensation in college recruiting was actually banned in
1992, but in 2002, the Bush administration put through a series of
loopholes, and the companies used those loopholes to get around the ban
and pay their recruiters just per head of students enrolled.

Now since this has become an issue, in recent months, the Obama
administration has sought to rein this in and has essentially gotten rid
of those loopholes. And now incentive compensation is not a practice
that for-profit colleges will be able to use.

GROSS: The GAO, the General Accountability Office, found that some
recruiters from for-profit colleges exaggerated applicants' potential
salaries after graduation, and they failed to provide clear information
about the colleges' program duration, the colleges' costs, the actual
graduation rate.

So did you find the same thing in your investigation?

Mr. GOLDEN: Yes. You know, we found a lot of the same problems with the
recruiters for for-profit colleges.

GROSS: So how would you compare the tuition at for-profits with, say,
community colleges?

Mr. GOLDEN: Well, the tuition at for-profit colleges is far higher than
at community colleges. You know, tuition at for-profit colleges can
range from, you know, $15,000 a year, up to $35,000 or $40,000. And
community colleges are generally, you know, up to $5,000 and probably no
higher than that.

And the result is that a student who goes to a community college can
cover that cost with a Pell Grant, primarily, and they don't need to
take out loans - whereas to go to for-profit colleges, even if they get
the Pell Grant, they also need government loans on top of that, and in
some cases private loans, which are at higher interest rates.

GROSS: So are nonprofits having to compete with for-profits, or are they
dealing with different populations of students?

Mr. GOLDEN: I think in general, the for-profit colleges are competing
most directly with community colleges - which, of course, are two-year
public colleges - because the community colleges are kind of the
traditional system's way of serving low-income students who have a high
school degree but don't necessarily have strong test scores or strong
academic preparation.

And the community colleges and the for-profit colleges are, in a way,
going head-to-head for students.

GROSS: But I thought the community colleges were pretty overcrowded,
that they're already - a lot of them are so full, there's such
competition to get in, that the overflow is going to the for-profits.

Mr. GOLDEN: That's right. A lot of the community colleges are very
crowded. And, you know, the classes they have available may be at an
inconvenient time and so on. And, you know, the for-profit colleges, one
of the big, you know, arguments they make on their behalf is that
they're customer friendly, they're flexible.

If you sign up online, you can start a class right away. You don't have
to, you know, wait months for the semester to begin. If you want to - if
you go to an actual building for your class, you know, the time will be
convenient for you.

And so the for-profit colleges say that they're more convenient, more
flexible, more customer-friendly than community colleges, which do - are
often overcrowded, and that's one reason the for-profit colleges are
growing so quickly in their student body.

GROSS: Daniel Golden will be back in the second half of the show. He won
a George Polk Award for co-writing a series of articles on for-profit
colleges published in Bloomberg News. He now writes for Business Week.

I'm Terry Gross, and this is FRESH AIR.

(Soundbite of music)

GROSS: This is FRESH AIR. I'm Terry Gross, back with Daniel Golden.
We're talking about the series of articles he co-wrote for Bloomberg
News investigating how for-profit colleges often make misleading claims
and promises to recruit financially vulnerable students who qualify for
federal grants or loans. The colleges make big profits on those federal
dollars. Some stockholders and executives have done quite well, but a
majority of the students don't graduate, don't get the jobs they were
expecting and are left with an unmanageable debt.

One of the really interesting twists in the story of for-profit colleges
is that The Washington Post, which like all newspapers is - in a new
world where it's harder to turn a profit than it used to be for
newspapers - The Washington Post bought Kaplan, which is one of the
largest for-profit college companies. Would you describe the company
Kaplan?

Mr. GOLDEN: Yeah. When the Post bought Kaplan, it was a test-preparation
company, giving, you know, helping students do well on the SATs and in
other standardized tests. But it branched into the college business,
which has become the dominant part of Kaplan, and almost, I think,
around a third of The Washington Post company's entire revenues.

First, Kaplan bought a string of little for-profit colleges, and then
it's opened its own online university called Kaplan University. And
together, they have something like 100,000 students. And that's, as I
said, the backbone of, you know, The Washington Post's finances at this
point.

GROSS: Has that put the Post in an awkward position? The Post reported
on it in an article not long ago.

Mr. GOLDEN: I think it has. I mean, that was a very good piece that they
did, kind of reconstructing the Post's, you know, movement into Kaplan
and how they viewed it now. Before that, they waited a long time before
doing that kind of in-depth piece, and I think it's, you know, it's
naturally awkward when there's corporate interests involved and yet the,
you know, the newsroom wants to do the best possible job.

GROSS: So, how has The Washington Post dealt with the fact the Obama
administration is trying to regulate for-profit colleges? And since the
Washington Post owns a for-profit college chain, has the Post been
trying to get involved on one side or another in that argument? And is
it affecting the paper's coverage of that issue?

Mr. GOLDEN: Well, I don't work there, so I can't say if it's affecting
the coverage. But certainly, The Washington Post has been very upfront
in opposing - as a company - very upfront in opposing the Obama
administration's regulations. There's one particularly controversial
regulation known as gainful employment, where the proposal would
essentially tie the college's access to government financial aid to the
student ability at the other end to pay back their loans and earn a
decent income. And Kaplan's very concerned about this. Its loan
repayment rate is not very strong, and the Post has, you know, lobbied
strenuously against this regulation. And Donald Graham has been, you
know, personally out front leading the charge.

GROSS: So let me just see if I understand the issue correctly. The Obama
administration wants a regulation that would say, basically, if you're a
for-profit college and, you know, a high percentage of your students are
unable to pay back their loans, the federal government is not going to
allow as many students with federal loans to be in your school.

Mr. GOLDEN: Well, potentially, the ultimate penalty would be that the
Obama administration would cut off a college's eligibility for financial
aid entirely so they wouldn't receive those funds. I believe when the
regulation was first announced, the government estimated that something
like five percent of for-profit college programs would be cut off from
aid, you know, when this regulation would take effect.

GROSS: One of the things that sets apart for-profit colleges is that
they have stockholders. They're public, and the stockholders want
profits like in all corporations that are public. So do you think that
the demand of stockholders for increasing profits puts pressure on for-
profit colleges to not only recruit a lot of students, but to keep the
tuition high?

Mr. GOLDEN: I don't think there's any question that when a for-profit
college becomes publicly traded, there's extra pressure to satisfy their
investors. And that usually translates into efforts to boost enrollment.
So I'd say a lot of these sort of practice incentive compensation in the
last few years, paying recruiters based on how many students they
enroll, and some of the abuses where maybe they were signing up students
who needed more academic training or weren't likely to succeed in
college, I think a lot of that can probably be attributed to the
pressure to satisfy Wall Street.

GROSS: You know, the students who default on their loans and don't
graduate, nobody forced them to go to college. Nobody forced them to
take out a loan. How much responsibility do they bear for the
predicament that they're in? Your article's very, you know, critical of
the for-profit colleges, but what about the students?

Mr. GOLDEN: I mean, that's a difficult question, and I guess it depends
partly to whether they were given full and accurate information by the
recruiters and, you know, how much they knew they were getting into.
And, you know, the evidence seems to suggest that recruiters who were
paid on the basis of how many students they would sign-up, you know, did
not necessarily provide a balanced picture of the pluses and minuses,
and didn't also necessarily give people enough time to make a thorough
assessment for themselves.

And, you know, often, you're dealing with people whose family do not
include, you know, college graduates and do not have a lot of
sophistication about the system and may just have seen, you know, an ad
on a website or a late-night television program, called up on a whim
and, you know, got themselves signed up in a college and on the hook for
federal student loans almost before they knew what happened. And that
doesn't absolve them totally of responsibility, but it does - you know,
it suggests that the colleges have a responsibility, too.

GROSS: So would you give any suggestions to people who are or who know
somebody who will be trying to enroll in a for-profit college, things to
watch out for?

Mr. GOLDEN: Well, I would look closely at the for-profit colleges, you
know, whatever statistics are available about it: the graduation rate,
the loan repayment rate, the tuition rate. If you're looking for a
program that has a sort of clinical component, such as nursing, make
sure that the college offers that program and not just an online course,
that you get the – they arrange for the actual clinical experience that
you may need. And check the accreditation of the for-profit college.

Often, for-profit colleges may have been accreditation that is kind of
of a second-tier compared to the accreditation of a traditional college,
so that if you go to the for-profit college for a while and you want to
transfer to a traditional college, that college may not accept your
credits. And so you'd have to start all over.

So make sure your course credits can transfer. Make sure there's the
needed clinical experience, and make sure that there's a decent chance
of being able to repay whatever loans you get.

GROSS: How can you tell if a college has second-tier accreditation?

Mr. GOLDEN: Well, the highest level of accreditation is known as
regional accreditation, and there's six regional accreditors, and each
of them has a website and lists the colleges that they do accredit. Now
one thing that's interesting, there was a pattern over the last decade
was that for-profit colleges that had a kind of accreditation known as
national accreditation, which isn't sort of considered quite as
desirable in traditional circles.

They were buying small, struggling religious colleges or nonprofit
colleges that had very few students and were losing money, but had the
coveted regional accreditation. And because the accreditation
essentially went with the institution rather than changing with the
owner, the colleges were essentially buying accreditation, and so a
number of for-profit colleges now to have regional accreditation by
virtue of those acquisitions.

GROSS: But that doesn't make the quality of the education you're going
to get there any better. Is that what you're saying?

Mr. GOLDEN: Yeah. And what they did was that they acquired the college,
but then they would totally transform it. So they would acquire the
accreditation, but the college, then, they would turn into an online,
standard for-profit college, offering the same programs as many of the
others: business, education, criminal justice. So the traditional
college often only existed in name, and often the name was changed, too.
And essentially, the accreditation was passed on, and the, you know,
only the shell of the old college that had gained that accreditation
remained. So the accreditation, in a sense, said very little about the
actual quality of the new for-profit college. There has been some
tightening of the, you know, a crackdown by the accreditation agencies
after this encountered a lot of criticism.

GROSS: My guest is Daniel Golden. He won a George Polk Award for the
series of articles he co-wrote for Bloomberg News, investigating for-
profit colleges.

We'll talk more after a break.

This is FRESH AIR.

(Soundbite of music)

GROSS: My guest is Daniel Golden. We're talking about the series of
articles he co-wrote for Bloomberg News, investigating how for-profit
colleges often use misleading claims and promises to recruit financially
vulnerable students who qualify for federal grants or loans. The
colleges make big profits on those federal dollars, but many students
don't graduate and are left with a debt they cannot manage.

So what's going on in Congress now in terms of investigating for-profit
colleges and taking sides for and against them?

Mr. GOLDEN: Well, the Senate Education Committee has been holding, for
close to a year, series of hearings on various aspects of for-profit
colleges and some of the alleged abuses. And then there was a lot of -
has been a lot of battling over this particular regulation I mentioned
before. There was an effort in Congress by supporters of for-profit
colleges to essentially defund that rule that could have cut off some of
the access to financial aid for the schools. That didn't pass - the
effort to defund it – and so I think the regulation, it looks as if it
will be taking effect at some point.

And - but the for-profit colleges have a lot of allies in Congress. I
mean, it's another parallel, in a way, to the subprime in a sense that
they're a little bit like Fannie Mae and Freddie Mac, where the for-
profit colleges, because they're Wall Street companies, they have a lot
of sympathizers among Republican supporters of free enterprise and big
business. And because they serve low-income families, they have quite a
few allies among, you know, Democrats who know that a lot of their
constituents go there.

So they have powerful political presence. And in addition, they have
spent a lot of money and hired a lot of Washington insiders to lobby
and, you know, they're not to be under estimated as a political force.

GROSS: So you shared a George Polk Award for reporting for your
Bloomberg News story on for-profit colleges. Now in 2004, you won a
Pulitzer Prize for your investigative stories on another end of
education: elite universities, like Yale and Harvard. You ended up
writing a book called "Price of Admission: How America's Ruling Class
Buys its Way into Elite Colleges - and Who Gets Left Outside the Gates."

So it's interesting that you've written about, you know, the very poor
and the very rich going to college. What were some of the issues that
you raised in your examination of elite universities?

Mr. GOLDEN: Well, what I documented in my series of stories for The Wall
Street Journal and then in my book was that elite universities and the
Ivy Leagues and also some elite state universities and others were
essentially lowering their admission standards to admit children of
alumni, of donors and others sort of wealthier or well-connected people.
Some people refer to that as white affirmative action.

I have documented in the context of efforts at the time to, you know,
eliminate traditional affirmative action for minority students. And I
point out that more students benefited from affirmative action for the
rich and well-connected.

And it's funny, you know, since I began writing about for-profit
colleges, some people have said to me, well, you know, before you were
critical of the, you know, traditional public and nonprofit schools. Now
you're attacking the for-profit colleges. You know, don't you like
anybody?

And, you know, I gave that some thought, and I realized that there was
kind of a common theme in these stories in that while the elite colleges
were, you know, going after - you know, lowering their standards to go
after wealthy students and the for-profit colleges were pursuing the
neediest students, I mean, the motive was essentially the same, which
was, you know, financial gain - for the endowments in the first case,
and from the financial aid from the government in the second case.

And it just kind of - I think the lesson to be drawn from my coverage
over these many years now is that, you know, education is obviously a
business, and there's a place for money in it. But when, you know,
financial considerations drive the recruiting and the admission of
students, kind of to the detriment of other factors, there's going to be
problems in the long run.

GROSS: You know, my takeout from some of your reporting is that
something that sounds so good, you know, government giving loans to poor
students to go to college, to improve themselves, and then the colleges
being there, willing to take students who don't have sterling academic
records, who don't have money, willing to take them in and help them get
a college degree, that sounds so good. But the results are often – not
always - but often actually damaging to the students while the colleges
themselves make profits.

Mr. GOLDEN: Yeah, that's part of the heartache because if the - ideally
this could be a route to upward mobility and the American dream and in
that sense it has the same pathos as it did for many people who took out
subprime mortgages in the, you know, with the goal of home ownership and
were unable to attain that and ended up burdened with debt instead. So,
yes, there’s great promise to it.

And to be fair to the for-profit colleges, I don't think any type of
system has really figured out how to solve the problem of taking
academically poorly prepared low-income students and making sure that
they attain great college success.

I mean graduation rates are not very strong at community colleges
either. So I mean it's a challenge that, you know, perhaps the for-
profit colleges haven't figured out yet and with, you know, great damage
to some individual lives, but it's also a challenge that our entire
society still has to solve.

GROSS: So your stories have focused on students at for-profit colleges
who have gotten federal loans that they couldn't repay because they
never got the jobs that they were led to believe they’d be able to get,
they maybe never even graduated out of a college program. Did you also
look at students who got the federal loans, went to the for-profit
college, graduated, got a job, and their lives actually did improve and
they were able to pay off their debts?

Mr. GOLDEN: Yeah. Certainly. I mean, there are any number of satisfied
customers and there are people for whom these colleges have been a leg
up to a better life. I mean, you know, there's no question of that. I
mean the question is sort of how widespread is the harm versus how
widespread is the benefit.

And, you know, these colleges will say well, look, we have huge numbers
of students. I mean the University of Phoenix has, you know, close to
500,000 students and there's, you know, more than a 100,000 at several
other companies. So there's no doubt that, you know, many of them are,
you know, benefit from this and it works out for them.

I mean but you just had to overall also look at the percentages that
show that startlingly low rates of being able to repay loans, high rates
of defaulting on loans, low graduation rates, and also just the
anecdotal evidence pouring in from so many people, you know, complaining
about having been misled. And there's a large number of court cases and
so on with some of these similar allegations and the GAO Report. And you
put it all together and then the conclusion has to be that, you know,
these colleges provide a definite service for some of their students,
but many others, you know, come out, you know, either the same or worse.

GROSS: Well, Daniel Golden, thank you so much for talking with us.

Mr. GOLDEN: Thank you. It's been my pleasure.

GROSS: Daniel Golden won a George Polk Award and was a Pulitzer Prize
finalist for the series of articles he co-wrote about for-profit
colleges which was published in Bloomberg News. He now writes for
BusinessWeek.

You'll find links to his series on for-profit colleges and his series on
elite colleges on our website, freshair.npr.org.

Coming up, Milo Miles reviews a new legit Iggy Pop box-set with bootleg
live recordings. This is FRESH AIR.
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Iggy Pop: A Punk Rocker Devoted To Imperfection

TERRY GROSS, host:

Over the course of more than 40 years, Iggy Pop has gone from a noisy
brat who seemed to have no chance at stardom, to a widely respected
founder of punk.

Music critic Milo Miles has a review of a new set of officially-released
live bootlegs called "Roadkill Rising."

(Soundbite of cheering)

(Soundbite of song, "Real Wild Child")

IGGY POP (Musician): (Singing) Woo, woo, woo, woo. Well I'm just out of
school, like I'm real, real cool. Gotta dance like a fool. Got the
message that I gotta be a wild one. Ooh yeah, I'm a wild one. I'm gonna
break it loose. Gonna keep'em movin' wild. Gonna keep a swingin' baby.
I'm a real wild child.

MILO MILES: I'm not presenting much of a consumer guide here. If you
even think you would enjoy four CDs of unreleased Iggy Pop concert
bootlegs - with dropouts, feedback and lots of flubbed notes - you don't
need me to tell you about it.

This is more of a reflection on surprising endurance. Back in the late
'70s, Iggy, like Keith Richards, was supposed to already have a coffin
with his name on it. Yet 10 years into the 21st century, he has enough
of an established audience to support a boxed set of rough-edged
performances that span more than four decades. So you have to ask: Has
success spoiled Iggy Pop?

(Soundbite of song, "Funtime")

IGGY POP: (Singing) Fun, Hey baby, we like your lips. Fun, hey baby we
like your pants. All aboard for funtime. Fun, hey...

MILES: Perhaps a better question is: How can you spoil someone so
devoted to imperfection? Flaws and foul-ups have been part of Iggy's
plan from the start, part of what makes him an arch-punk.

In the early days of rock 'n' roll songs, a constant character was the
social outcast - a misfit who was, deep down, a knight in black leather.
Of course, these were stand-ins for the performers themselves, good guys
pushing what the squares considered pernicious garbage. And hippies were
a milder, fuzzier version of the same misunderstood soul.

Iggy Pop would have none of it. From day one in the late '60s, he was
bad and mad all the way down. He called himself the world's forgotten
boy, and in one deathless turn, a submissive canine.

(Soundbite of song, "I Wanna Be Your Dog")

IGGY POP: (Singing) I'm so messed up, I want you here. In my room I want
you here. Now we're gonna be face-to-face. And I'll lay right down in my
favorite place.

Now I wanna be your dog. Now I wanna be your dog. Now I wanna be your
dog.

MILES: The "Roadkill Rising" set confirms that Iggy's biggest flaw is
that he has trouble with slow tunes. He cannot develop momentum or build
to a big finish; when his tempo falls, the show usually slides to a
halt.

In his weird way, however, Iggy can turn that to an advantage. During a
heated show in 1980, he can't get the audience to calm down enough for
him to cover "One for My Baby (And One More for the Road)." He curses
and rages at the fans and they do the same at him. He starts the tune
over and over again until you want to holler that trying to sing a boozy
dirge to a crowded mass of zonked maniacs may not be a smart plan. But
it is perverse. And that's what Iggy wants.

The slowish number that works best on "Roadkill Rising" is Iggy's hearty
but tender reading of the McCoys' "Hang on Sloopy." For all his screams
of personal nihilism and fury, it may be the most autobiographical
statement on the set.

(Soundbite of song, "Hang on Sloopy")

IGGY POP: (Singing) Sloopy lives in area, bad part of town. And
everybody here tries to put my Sloopy down. So hang on Sloopy. Come on,
come on. Hang on Sloopy. Come on, come on. Just a little bit louder.
Well, just a little bit harder.

Hang on Sloopy, Sloopy hang on. Hang on Sloopy, Sloopy hang on.

Sloopy let your hair down a little...

MILES: So is Iggy less captivating now that he's no longer beneath the
underdog? Not necessarily. He founded a style as much as Little Richard
or Buddy Holly and he has a core cluster of wild man anthems that will
make people gasp and laugh for a long while. He's a shirtless, good-guy
knight after all.

GROSS: Milo Miles reviewed the new Iggy Pop set called "Roadkill Rising:
The Bootleg Collection 1977-2009." You can download podcasts of our show
on our website, freshair.npr.org.

I'm Terry Gross.
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