In 2010, during the depths of the worst recession in decades, one national educational organization helped 60,000 Americans complete college. Most were low-income, minority adults. Many worked and raised families while they went to school. At a time of widespread unemployment, about 70 percent of this organization’s graduates are expected to successfully enter the workforce.
If you don’t recognize this organization — Corinthian Colleges Inc. — you’re not alone. In a recent Guest Observer column (“Reform Oversight of For-Profit Colleges,” May 2), Sen. Tom Harkin ignored all these facts and offered such a distorted description of Corinthian that we didn’t recognize ourselves.
The Iowa Democrat, who chairs the Senate Health, Education, Labor and Pensions Committee, has held a series of highly contentious hearings on private-sector colleges such as ours that began last June. Ten members of the HELP Committee, all of its Republicans, recently became so alarmed by the way the hearings have been conducted that they threatened to boycott any future proceedings. Sen. Mike Enzi (R-Wyo.) called the hearings “disorganized and prejudicial” and “biased and unprofessional.”
Rather than address these concerns, however, Harkin opted instead to continue his unfair attacks, targeting our company in Roll Call. A number of assertions in the Guest Observer column, like a number of charges made in HELP Committee hearings, are wrong or have been discredited. For example:
• Using unreliable, unofficial statistics, the column exaggerates the number of Corinthian students who default on loans. We have invested millions of dollars in programs to prevent defaults, and we estimate that we have cut our two-year default rate almost in half, to about 9 percent to 12 percent for our 2010 student cohort. The column ignores our hard work and instead cites statistics that the Department of Education has admitted were “incorrectly inflated,” claiming that “as many as 40 percent of students at certain schools” default.
• The column cites Corinthian as an example for the Senator’s claim that most students who enroll at our sector’s schools do not graduate. This misunderstands or misstates data that we supplied him. In the time frame the column cites, 73 percent of our students graduated or continued their studies.
• The column overstates the amount of indebtedness incurred by Corinthian students. The majority of our students take career education courses that last two years or less, and our median student loan is $11,525. Yet the article singles out a four-year business course that very few students take and asserts, incorrectly, that “the average student will graduate with tens of thousands of dollars in debt.”
• The column also overstates our most recent annual earnings by more than 60 percent, failing to note that we paid more than $95 million in taxes. Our after-tax margin of about 8.3 percent was fair and reasonable by any standard.
• The column notes that we raised tuition earlier this year but does not indicate that we did so solely to comply with a perverse and self-defeating federal mandate called the “90/10 rule” that the Senator supports. We have repeatedly said that if a better measure than the 90/10 rule is enacted, we will lower tuition.