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.
Facts matter, and many “facts” presented by the HELP Committee are in serious dispute. In the Senator’s first hearing, the star witness was a Wall Street short seller with no background in education who stood to profit personally by attacking companies like ours. Citizens for Responsibility and Ethics in Washington, a nonpartisan watchdog group, has called this a serious conflict of interest.
The Senator also commissioned a Government Accountability Office report on private-sector education that was so filled with inaccuracies that the GAO took the extraordinary step of reissuing the testimony with dozens of corrections and demoted the manager in charge of the report. Yet the Senator continues to defend the report’s credibility.
We at Corinthian work hard to offer our students a quality education and to protect the interests of taxpayers. We and others in our sector, such as the Coalition for Educational Success, are ready to work constructively with Members of Congress to develop effective rules that support these ends.
Sound policy must be based on solid facts and real solutions, not unsupported sound bites. Therefore we favor:
• Extensive research into program outcomes and student debt at all colleges and universities, traditional as well as private sector.
• Policies that would provide additional information and consumer protections to students at all colleges and universities, traditional as well as private sector.
• A single high standard of achievement for all colleges and universities, traditional as well as public sector.
With these facts and solutions, we can ensure that more Americans attend college, that we invest our tax dollars wisely and that we meet President Barack Obama’s goal of having the world’s highest percentage of college graduates by 2020.
We need facts and solutions in higher education, not scapegoats.
Jack Massimino is chairman and CEO of Corinthian Colleges Inc.
Each year since 1990, CQ Roll Call has reviewed the financial disclosures of all 541 senators, representatives and delegates to determine the 50 richest members of Congress. This year's report, derived from forms covering the calendar year 2012, shows it took a net worth of $6.67 million to crack the exclusive club.