Pyrrhic Defeat and the Student Loan Portfolio: How a Managed Meltdown Enables Unauthorized Asset Sales

In classical history, a Pyrrhic victory refers to a win so costly that it undermines the very cause it was meant to advance. Less discussed, but increasingly relevant to modern governance, is the inverse strategy: the Pyrrhic defeat. In this model, short-term failure is tolerated—or even cultivated—because it enables outcomes that would otherwise be politically, legally, or institutionally impossible. When applied to public finance, pyrrhic defeat theory helps explain how the apparent collapse of a system can be leveraged to justify radical restructuring, privatization, or liquidation of public assets.

Nowhere is this framework more relevant than in the management of the federal student loan portfolio.

The federal student loan portfolio, totaling roughly $1.6 to $1.7 trillion, is not merely an accounting entry. It is one of the largest consumer credit systems in the world and functions simultaneously as a public policy tool, a long-term revenue stream, a data infrastructure, and a political liability. It shapes who can access higher education, how risk is distributed across generations, and how the federal government exerts leverage over the postsecondary sector. Precisely because of its scale and visibility, the portfolio is uniquely vulnerable to narrative reframing.

That vulnerability was not accidental. It was constructed over decades through a series of policy decisions that stripped borrowers of normal consumer protections while preserving the financial attractiveness of student debt as an asset. Chief among these decisions was the gradual removal of bankruptcy protections for student loans. By rendering student debt effectively nondischargeable except under the narrow and punitive “undue hardship” standard, lawmakers transformed education loans into a uniquely durable financial instrument. Unlike mortgages, credit cards, or medical debt, student loans could follow borrowers for life, enforced through wage garnishment, tax refund seizure, and Social Security offsets.

This transformation made student loans exceptionally attractive for securitization. Student Loan Asset-Backed Securities, or SLABS, flourished precisely because the underlying loans were shielded from traditional credit risk. Investors could rely not on educational outcomes or borrower prosperity, but on the legal certainty that the debt would remain collectible. Even during economic downturns, SLABS were marketed as relatively stable instruments, insulated from the discharge risks that plagued other forms of consumer credit.

Private banks once dominated this market. Sallie Mae, originally a government-sponsored enterprise, became a central player in both originating and securitizing student loans, while Navient emerged as a major servicer and asset manager. Yet as Higher Education Inquirer documented in early 2025, banks ultimately lost control of student lending. Rising defaults, public outrage, state enforcement actions, and mounting evidence of predatory practices made the sector politically radioactive. The federal government stepped in not as a reformer, but as a backstop, absorbing the portfolio and stabilizing a system private finance could no longer manage without reputational and regulatory risk.

That history reveals a recurring pattern. When student lending fails in private hands, it becomes public. When the public system is allowed to fail, it becomes ripe for re-privatization.

A portfolio does not need to collapse to be declared unmanageable. It only needs to appear dysfunctional enough to justify extraordinary intervention.

The post-pandemic repayment restart, persistent servicing failures, legal challenges to income-driven repayment plans, and widespread borrower confusion have all contributed to a growing narrative of systemic breakdown. Servicers such as Maximus, operating under the Aidvantage brand, MOHELA, and others have struggled to process payments accurately, manage forgiveness programs, and provide reliable customer service. These failures are often framed as bureaucratic incompetence rather than as predictable consequences of outsourcing public functions to private contractors whose incentives are misaligned with borrower welfare.

Navient’s exit from federal servicing did not mark a retreat from the student loan ecosystem so much as a repositioning, as it continued to benefit from private loan portfolios and legacy SLABS exposure. Sallie Mae, rebranded and fully privatized, remains deeply embedded in the private student loan market, which continues to rely on the same nondischargeability framework that props up federal lending.

Crucially, these servicing failures cannot be separated from the earlier elimination of bankruptcy as a safety valve. In normal credit markets, distress is resolved through restructuring or discharge. In student lending, distress accumulates. Borrowers remain trapped, servicers remain paid, and policymakers are confronted with a swelling mass of unresolved debt that can be labeled a crisis at any politically convenient moment.

Under pyrrhic defeat theory, such a crisis is not merely tolerated. It is useful.

Once the federal portfolio is framed as broken beyond repair, the range of acceptable solutions expands. What would be politically impossible in a stable system becomes plausible in an emergency. Asset transfers, securitization of federal loans, expansion of SLABS-like instruments backed by government guarantees, or long-term conveyance of servicing and collection rights can be presented as pragmatic fixes rather than ideological choices.

A Trump administration would be particularly well positioned to exploit this dynamic. Skeptical of debt relief, hostile to administrative governance, and ideologically aligned with privatization, such an administration could recast the portfolio as a failed public experiment inherited from predecessors. In that framing, selling or offloading the portfolio is not an abdication of responsibility but an act of fiscal discipline.

Importantly, this need not take the form of an explicit, congressionally authorized sale. Risk can be shifted through securitization. Revenue streams can be monetized. Servicing authority can be extended indefinitely to private firms. Data control can migrate outside public oversight. Over time, these steps amount to de facto privatization, even if the loans remain nominally federal. The infrastructure, incentives, and profits move outward, while the political blame remains with the state.

This is where earlier McKinsey & Company studies reenter the conversation. Long before the current turmoil, McKinsey analyses identified high servicing costs, fragmented contractor oversight, weak borrower segmentation, and low political returns on administrative complexity. While framed as efficiency critiques, these studies implicitly favored market-oriented restructuring. In a crisis environment, such recommendations become blueprints for divestment.

The danger of a pyrrhic defeat strategy is that it delivers a short-term political win at the cost of long-term public capacity. Selling or functionally privatizing the student loan portfolio may improve fiscal optics, but it permanently weakens democratic control over higher education finance. Borrowers, already stripped of bankruptcy protections, lose what remains of public accountability. Policymakers lose leverage over tuition inflation and institutional behavior. The federal government relinquishes a powerful counter-cyclical tool. What remains is a debt regime optimized for extraction, enforced by servicers, securitized for investors, and detached from educational outcomes.

The defeat is real. It is borne by students, families, and future generations. The victory belongs to those who acquire distressed public assets and those who benefit ideologically from shrinking the public sphere.

Pyrrhic defeat theory reminds us that collapse is not always accidental. In the case of the federal student loan portfolio, what appears to be dysfunction or incompetence may instead be strategic surrender: a willingness to let a public system deteriorate so that it can be sold off, securitized, or outsourced under the banner of necessity. If that happens, it will not be remembered as a policy error, but as a deliberate transfer of public wealth and power—made possible by decades of legal engineering that began when bankruptcy protection was taken away and ended with student debt transformed into a permanent financial asset.

---

Sources

Higher Education Inquirer. “When Banks Lost Control of Student Loan Lending.” January 2025.
https://www.highereducationinquirer.org/2025/01/when-banks-lost-control-of-student-loan.html

U.S. Department of Education, Federal Student Aid. FY 2024 Annual Agency Performance Report. January 13, 2025.

U.S. Department of Education, Federal Student Aid. Federal Student Loan Portfolio Data and Statistics, various years.

Government Accountability Office. Student Loans: Key Weaknesses in Servicing and Oversight, multiple reports.

Congressional Budget Office. The Federal Student Loan Portfolio: Budgetary Costs and Policy Options.

U.S. Congress. Bankruptcy Abuse Prevention and Consumer Protection Act of 2005 and prior amendments affecting student loan dischargeability.

Pardo, Rafael I., and Michelle R. Lacey. “The Real Student-Loan Scandal: Undue Hardship Discharge Litigation.” American Bankruptcy Law Journal.

Financial Crisis Inquiry Commission materials on asset-backed securities and consumer credit markets.

McKinsey & Company. Student Loan Servicing, Portfolio Optimization, and Risk Management Analyses, prepared for federal agencies and financial institutions, 2010s–early 2020s.

Higher Education Inquirer archives on SLABS, servicers, privatization, deregulation, and student loan policy.

NACIQI Elects DEI Opponent as Chair Amid Hyper-Deregulation: What Did You Expect?

WASHINGTON, D.C., December 16, 2025 — In a predictable yet alarming turn, the U.S. Department of Education’s National Advisory Committee on Institutional Quality and Integrity (NACIQI) elected Jay Greene, a vocal opponent of diversity, equity, and inclusion (DEI) policies, as its new chair. Greene, formerly of the Heritage Foundation and now director of research at Do No Harm, won a narrow 8-7 re-vote over NACIQI vice chair Zakiya Smith Ellis, who had served as chair in February.

The vote underscores the growing partisanship on NACIQI, a body responsible for reviewing private accrediting agencies that oversee colleges and universities and gatekeep federal student aid. For the first time in NACIQI’s history, members were seated, introduced, and voted along party lines—Senate Democrats in the case of Smith Ellis, and Trump appointees, including Greene, in the other.

Hyper-Deregulation and Systemic Vulnerabilities

Observers and experts see Greene’s leadership as part of a broader pattern of hyper-deregulation that has destabilized U.S. higher education. Decades of advocacy by David Halperin, a longtime attorney and counselor in Washington, have warned of the dangers of allowing accreditation and oversight to be politicized or weakened. Halperin spoke during today’s public comment segment, noting that the administration is pressuring schools to conform to a single ideological agenda—threatening federal funding unless colleges abandon equal opportunity, silence free speech, or police students’ personal identities.

Halperin noted that cuts to staff and regulatory enforcement, combined with the rise of predatory online program managers, for-profit chains, and unregulated private lenders, have created an environment where students bear the brunt of failed oversight.

“Accreditation review should focus on preventing shoddy practices, not protecting abusive companies or advancing a political agenda,” Halperin said. “It should be based on facts, not disinformation; consistent standards, not bias; integrity and independence, not obedience to special interests; and respect for all our children, not bigotry and persecution.”

The Stakes Are High

With Greene now in the chair, NACIQI is considering the renewal application of the Middle States Commission on Higher Education, which accredits Columbia University, the University of Pennsylvania, and other institutions previously scrutinized by the Trump administration. Experts warn that under hyper-deregulation, politically motivated evaluations could replace the standards and oversight that historically protected students, taxpayers, and educational integrity.

Halperin’s decades of work on accreditation, regulatory oversight, and student protections have long championed transparency and accountability. His comments today serve as a warning: in an era of hyper-deregulation and partisan control, the consequences for students, institutions, and the federal student aid system could be severe.

When College Eats a Third of a Household’s Income: The Most Expensive States for Public Higher Education in 2026

For millions of American families, the cost of attending a public four-year college has quietly crossed a dangerous threshold. In 2026, higher education in several U.S. states now consumes nearly one-third of a typical household’s annual income, before accounting for debt, healthcare, housing instability, or the reality that many families support more than one student.

The idea of “affordable” public higher education is increasingly detached from lived experience. Tuition alone no longer defines the price of college. Once room, board, transportation, and basic living expenses are added in, the real cost of earning a degree has become financially overwhelming for large portions of the working and lower-middle classes.

A new analysis compiled by Easy Media, based on a study conducted by University of Melbourne Online, reframes the affordability crisis by asking a more honest question: How much of a household’s income does it actually take to attend a public college today? By comparing total annual college costs to median household income, the study reveals where public higher education places the heaviest burden on residents—and where the promise of upward mobility is most fragile.

Affordability Is No Longer About Tuition Alone

For decades, policymakers and university leaders have pointed to tuition restraint as proof that college remains accessible. This analysis exposes that claim as incomplete at best. In many states, room and board costs now rival or exceed tuition, while transportation and personal expenses quietly push total costs into unsustainable territory.

According to the researchers, “What stood out wasn’t just where college is most expensive, but where it becomes hardest to afford relative to income.” States with lower median earnings are especially vulnerable. Costs that appear moderate on paper become crushing when wages fail to keep pace.

The States Where College Hits Hardest

Mississippi ranks first nationwide, with public college costs consuming 33.23 percent of median household income, the highest share in the country. While the total annual cost of $25,354 ranks only 27th nationally, Mississippi’s median household income—$76,308, the lowest in the U.S.—leaves families with little capacity to absorb even “average” college expenses. The crisis here is not runaway pricing, but chronic income inequality colliding with fixed education costs.

Vermont, ranking second, reflects the opposite dynamic. The state has the highest in-state tuition in the nation at $19,223, coupled with expensive on-campus housing. Total annual costs reach $35,131, second-highest nationally. Even with a relatively strong median household income of $105,936, college consumes 33.16 percent of earnings, highlighting how limited public options and high operating costs drive prices upward.

Kentucky places third, with college expenses consuming 32.75 percent of household income. Housing costs are particularly high, while median income ranks near the bottom nationally. Tuition alone may appear manageable, but the full cost quickly becomes prohibitive.

Pennsylvania, ranking fourth, stands out for its exceptionally high public tuition—fourth-highest in the nation at $17,909. Combined with housing and other costs, total annual expenses approach $33,000. Public higher education in Pennsylvania increasingly resembles private-sector pricing, even as household incomes struggle to keep up.

Michigan, Louisiana, West Virginia, Alabama, Ohio, and South Carolina round out the top ten, each requiring roughly 30 percent or more of median household income to cover a single year of public college. In several of these states, transportation costs rank among the highest nationally, reflecting long commutes, limited public transit, and hidden expenses that rarely appear in tuition debates.

Income, Not Geography, Defines the Crisis

One of the study’s most revealing findings is that geography alone no longer predicts affordability. Coastal states often criticized for high costs rank significantly lower once income is factored in. Meanwhile, states traditionally viewed as “low-cost” emerge as some of the least affordable because wages have stagnated for decades.

West Virginia offers a stark example. Despite relatively low tuition and total costs, the state ranks seventh overall because median household income is among the lowest in the nation. College may be cheaper on paper, but it is harder to afford in practice.

A Structural Failure, Not a Personal One

The researchers stress that affordability cannot be solved through tuition freezes alone. Housing, transportation, food, and basic living expenses now play an equal—often larger—role in determining whether college is financially realistic.

“In many cases, families are facing college costs that look manageable on paper but become overwhelming once income is considered,” the research team noted.

The consequences are already visible: rising student debt, delayed graduation, part-time enrollment, and declining participation among students from working-class backgrounds. Public higher education, long framed as a pathway to opportunity, increasingly functions as a regressive system—demanding a higher share of income from those with the least to spare.

The Question Higher Education Must Answer

If attending a public college routinely consumes 30 percent or more of a household’s income, the problem is no longer financial literacy or individual budgeting. It is systemic failure. This analysis underscores a widening disconnect between wages, public investment, and the true cost of college—one that threatens to further entrench inequality under the language of access and opportunity.

Until housing policy, wage growth, transportation infrastructure, and state funding are addressed alongside tuition, the promise of affordable public higher education will remain out of reach for millions of Americans.

---

Acknowledgment

The data and analysis presented in this article were compiled by Easy Media, based on a study conducted by University of Melbourne Online. Easy Media contextualized the findings using publicly available data from the U.S. Census Bureau, EducationData.org, and the National Transit Database, helping to clarify how the true cost of college—when measured against household income—has become financially unsustainable across much of the United States.

The Decline of “Happily Ever After”: Teen Girls, Marriage, and Social Inequality

A profound shift is taking place in the aspirations of American teenagers. In a Pew Research analysis of 2023 University of Michigan survey data, only 61 percent of 12th-grade girls expected to marry someday, down sharply from 83 percent in 1993. Boys, in contrast, reported a stable 74 percent, surpassing girls for the first time. Alongside this, fewer teens anticipated having children or staying married for life. Only 48 percent of 12th-graders said they were “very likely” to want children, and belief in lifelong marriage dropped from 59 percent to 51 percent over three decades.

These figures are more than statistical curiosities; they reflect structural changes in the lives of young women and reveal how cultural, economic, and social inequality shape personal expectations. Access to education and professional opportunity has expanded dramatically for women, allowing them to envision futures independent of traditional marriage and family structures. Yet these gains exist alongside persistent barriers: economic instability, student debt, and unequal labor markets make long-term commitments like marriage and homeownership fraught and uncertain. For many girls, the choice to delay or reject marriage is not merely personal—it is pragmatic.

Cultural shifts amplify this trend. For decades, mainstream media promoted the narrative of “happily ever after,” equating personal fulfillment with marriage and motherhood. Today, stories about self-discovery, financial independence, and flexibility dominate the imagination of young women. In this context, marriage is no longer the default marker of adulthood or success; it is one of many possible pathways, often weighed against educational ambitions, career goals, and economic realities.

This evolution of expectations is deeply intertwined with inequality. Historically, marriage has often reinforced gendered hierarchies, particularly among working-class and minority women, for whom early marriage frequently constrained educational and career opportunities. Delaying marriage, or choosing to forgo it altogether, can represent a form of empowerment—but it also exposes young women to the structural vulnerabilities of a society where social support and economic stability are unevenly distributed. For those without family wealth or safety nets, the decision to prioritize education or autonomy over marriage is often a negotiation with risk rather than pure choice.

The broader social implications are significant. Declining enthusiasm for marriage may influence fertility patterns, reshape household structures, and challenge institutions built around traditional family models. For policymakers, educators, and social institutions, the question becomes whether systems will adapt to support diverse life paths or continue to privilege outdated models that assume early marriage and childbearing. For young women navigating these choices, the cultural shift represents both liberation and uncertainty, an opportunity to define adulthood on their own terms amid economic and social pressures.

As these teenagers mature, their choices may redefine what adulthood looks like in the United States. The decline in the “happily ever after” fantasy signals not a rejection of commitment, but a recalibration of priorities under the weight of opportunity, constraint, and inequality. It is a moment that reveals how deeply personal aspirations—love, marriage, family—are shaped by the structures, inequities, and possibilities of the world they inherit.

---

Sources:
Ms. Magazine. “Actually It’s Good That Fewer High Schoolers Want to Get Married.” 2025. https://msmagazine.com/2025/11/20/high-school-girls-marriage

New York Post. “High school girls are shifting away from marriage and 'happily ever after,' expert says.” 2025. https://nypost.com/2025/11/25/media/high-school-girls-are-shifting-away-from-marriage-and-happily-ever-after-expert-says

The Times. “Jobs, porn and manfluencers: the real reasons girls don't want to get married.” 2025. https://www.thetimes.com/us/news-today/article/why-dont-girls-plan-to-get-married-f7hr8jgp0

The Panama Deception: A Critical Tool for Understanding U.S. Intervention in Latin America

Barbara Trent’s 1992 documentary The Panama Deception remains an essential work for comprehending the nature and impact of U.S. military interventions in Latin America. Winner of the Academy Award for Best Documentary Feature, the film offers a critical examination of the December 1989 U.S. invasion of Panama—Operation Just Cause—and challenges official narratives about that intervention.

Reframing the Official Narrative

The Panama Deception scrutinizes the publicly stated justifications for the 1989 invasion, including protecting U.S. citizens, defending democracy, and combating drug trafficking. In doing so, it highlights stark discrepancies between government claims and on‑the‑ground realities, arguing that the invasion served broader strategic interests rather than solely humanitarian or legal objectives.

The film foregrounds how the U.S. government and mainstream media shaped public perceptions, often downplaying civilian casualties and simplifying complex political dynamics to justify military action. By exposing this media bias, the documentary encourages viewers to question official accounts and consider how information is framed in service of policy goals. 

Human Cost and Civilian Impact

A central contribution of the documentary is its focus on the human toll of the invasion. Using firsthand testimonies, footage of destruction, and accounts of displacement, the film documents the suffering of Panamanian civilians—particularly in impoverished neighborhoods such as El Chorrillo—which received limited attention in U.S. media coverage. 

These portrayals deepen our understanding of how military interventions affect everyday lives beyond abstract geopolitical objectives. For students and scholars of international relations, human rights, and media studies, this emphasis provides a critical counterpoint to sanitized official histories.

Historical and Geopolitical Context

The Panama Deception situates the Panama invasion within a longer history of U.S. influence in the region. It suggests that long‑standing strategic interests—including control over the Panama Canal and hemispheric dominance—shaped U.S. policy long before the invasion’s official rationales were publicly articulated.

While the Torrijos‑Carter Treaties mandated transfer of canal control to Panama by 1999, the film and many independent observers argue that U.S. policymakers were intent on maintaining influence and minimizing threats to American strategic goals. 

Media Critique and Public Perception

One of the documentary’s most enduring contributions lies in its examination of media complicity. The Panama Deception demonstrates how mainstream outlets often uncritically echoed government talking points, marginalizing dissenting voices from Panamanian civilians, independent journalists, and human rights advocates. 

This critique remains relevant for students exploring how propaganda, framing, and selective reporting can influence public support for foreign policy decisions. The film thus serves as a case study for media literacy alongside political critique.

Conclusion: Educational and Analytical Value

The Panama Deception offers a multifaceted analysis of U.S. interventionism that transcends a single historical event. By combining archival evidence, eyewitness accounts, and critical commentary, it provides learners with a structured means to examine the intersections of power, narrative, and human consequence. For educators and researchers in Latin American studies, political science, and media studies, the film underscores the importance of questioning official narratives and exploring the lived effects of foreign policy decisions.

---

Selected Sources

• The Panama Deception (1992 documentary overview and details). 

• Analysis of the film’s critique of U.S. media and government narratives. 

• Historical context on media bias and human impact. 

• Wider context on the invasion and implications related to Panama Canal treaty issues. 

Gunman in deadly Brown University shooting still at large after person of interest released (CNN)

 

University of Michigan: USU Members turn out in Freezing Temperature to Fight for Fair Wages

USU members & union allies turned out in droves for a picket at the University of Michigan winter commencement on Sunday, December 14th over stalled contract negotiations due to management’s proposal on salary. The proposed 3% yearly salary increase for the Ann Arbor campus and 1% yearly salary increase for the Dearborn and Flint campuses was roundly rejected by USU’s bargaining team. 3% salary increases are standard on the Ann Arbor campus and would not cover the cost of dues, a staple of our platform. 1% salary increases for the Dearborn and Flint campuses were received as an insult to the staff who work there and goes against our commitment to parity among the campuses. Staff, faculty, and community allies turned out to make our voices heard and add pressure to management to pay its employees a dignified wage. Watch CBS News video coverage of the event here and read about the picket in the Michigan Daily here. Thank you to everyone who joined USU on the picket line and all the union allies who came out to support USU’s fight for fair wages! If you were not able to join us out on the picket line yesterday (or even if you could!), please sign and send a letter to support our fight for fair wages.

Sent via Action Network, a free online toolset anyone can use to organize. Click here to sign up and get started building an email list and creating online actions today.

The Five Pillars of the College Meltdown

Demographics

The first pillar of the College Meltdown is demographic decline. Following the Great Recession, U.S. birthrates dropped sharply, creating a smaller pipeline of traditional college-age students. Nathan Grawe’s projections and WICHE’s Knocking at the College Door reports point to a steep enrollment cliff between 2025 and 2029, with some regions—particularly the Midwest and Northeast—facing the most severe contractions.

Case Study: Dozens of small private colleges in the Midwest, such as Iowa Wesleyan University (closed in 2023), have already succumbed to shrinking student pools. These closures foreshadow the demographic cliff that will hit hardest in tuition-dependent institutions.

Economics

The second pillar is economic fragility. Tuition and fees have risen faster than inflation and wages, leaving families burdened with debt. Student loan balances now exceed $1.7 trillion, with many graduates trapped in lifetime debt peonage. State disinvestment has shifted costs onto students, while tuition-dependent small colleges and regional universities face existential threats.

Case Study: The collapse of Mount Ida College in Massachusetts (2018) illustrates how tuition-driven institutions can fail suddenly when enrollment drops and debt obligations mount. Similar financial stress has led to mergers, such as the consolidation of Pennsylvania’s state universities.

Integrity (Fraud and Trust)

The third pillar is integrity. Enrollment fraud has become a systemic issue, with ghost students, bots, and synthetic identities siphoning off Pell Grants and other aid. Documented losses exceed $100 million annually, but California officials estimate that nearly a third of applications in 2024 were fraudulent. Fraud not only drains resources but also distorts enrollment data, masking the severity of demographic decline and eroding trust in higher education institutions.

Case Study: California Community Colleges uncovered tens of thousands of fraudulent applications in 2021–2022, with bots and synthetic identities targeting federal aid. This distorted enrollment figures and forced institutions to spend millions on fraud detection systems.

Governance and Labor

The fourth pillar is governance and labor. Higher education has been corporatized, with growing reliance on Online Program Managers (OPMs), outsourcing, and profit-driven models. Faculty labor has been deskilled, with adjuncts and contingent instructors making up the majority of teaching staff. Administrative bloat contrasts with shrinking instructional budgets, and some institutions resemble “robocolleges” with minimal full-time faculty presence.

Case Study: The University of Phoenix, once the largest for-profit college, closed hundreds of campuses and shifted to online models heavily reliant on OPMs. Meanwhile, adjunct faculty at many regional universities report poverty wages and no job security, even as administrative salaries rise.

Culture and Public Trust

The fifth pillar is cultural erosion. Public confidence in higher education has plummeted, dropping from 57 percent in 2015 to just 36 percent in 2024. Skepticism about the value of a degree has grown, with alternatives like certificates, apprenticeships, and direct-to-work pathways gaining traction. Political polarization and media narratives of closures, mergers, and scandals reinforce the perception of a system in meltdown.

Case Study: Gallup polls show declining trust across political and demographic groups. Regional newspapers covering closures of institutions like Green Mountain College (Vermont, 2019) and Becker College (Massachusetts, 2021) amplify public skepticism, reinforcing the narrative that higher education is no longer a safe investment.

The Pillars Weakening 

The College Meltdown is not the result of a single factor but the convergence of demographics, economics, integrity failures, governance issues, and cultural distrust. Each pillar weakens the foundation of higher education, and together they accelerate its unraveling. Case studies from across the country show that the meltdown is not theoretical—it is already happening. Recognizing these interconnected forces is essential if policymakers, educators, and communities hope to address the crisis before the collapse becomes irreversible.

‘I’m disappointed in our country’: Brown University student reacts to campus shooting (MS Now)

 

Brown University teaching assistant recalls shooter opening fire in his class (CNN)

Why the AI Bubble Is Actually a $60T Black Hole (GEN)

 

The Pritzker Paradox: Elite Influence and For‑Profit Exploitation in Higher Education

As the 2028 presidential race accelerates, J.B. Pritzker has emerged as a favored candidate among Democratic power brokers. His public image—competent, pragmatic, socially liberal, and reliably anti-Trump—has been carefully shaped to appeal to voters exhausted by polarization and chaos. But beneath this polished surface lies a deep and troubling contradiction that the public, and especially those affected by the student-debt crisis, cannot afford to ignore. This contradiction, the Pritzker Paradox, stems from the profound dissonance between Pritzker’s public rhetoric about educational opportunity and the private capital networks that have fueled both his family’s wealth and his political ascent.

The Pritzker family has long been intertwined with for-profit higher education and its surrounding ecosystem of lenders, service providers, and private-equity investors. These sectors have collectively played a major role in producing the contemporary student-debt crisis. While J.B. Pritzker often presents himself as a champion of equity, public investment, and educational access, his family’s financial history reveals an alignment with institutions that have extracted billions from low-income students, veterans, and Black and Latino communities through high-cost, low-value educational programs.

This is not simply a matter of past investments. It is part of an ongoing and highly influential political economy in which wealthy Democratic donors, private-equity executives, and education “reformers” operate as a unified class. Central to that class formation is The Vistria Group, a Chicago-based private-equity firm founded by Marty Nesbitt, a close friend of Barack Obama. Vistria stands at the intersection of Democratic power and education profiteering. After the collapse of scandal-ridden chains like Corinthian Colleges and ITT Tech, Vistria did not step in to dismantle the exploitative for-profit model. Instead, it strategically acquired distressed educational assets and reconstructed them into a new generation of institutions that presented themselves as “nonprofits” while maintaining tuition-driven, debt-laden business models. Former Obama administration officials moved seamlessly into Vistria and related firms, raising serious questions about regulatory capture and revolving-door governance.

Pritzker moves within this same Chicago-centered network. His political donors, associates, and advisers overlap significantly with the circles that built Vistria’s ascent. The structural relationships matter more than any single investment. A Pritzker administration would not exist outside this ecosystem; it would be shaped by it. The question, therefore, is not whether Pritzker personally signed a for-profit acquisition deal but whether the political world that produced him can be trusted to regulate higher education fairly and aggressively. The answer, based on the last twenty years of policy and practice, is no.

This is especially troubling because presidents play a decisive role in higher-education oversight. Through the Department of Education, a president can strengthen or weaken borrower protections, set standards for nonprofit conversions, determine enforcement priorities, and decide whether private-equity extraction will be challenged or quietly accommodated. Millions of borrowers harmed by predatory institutions are currently awaiting relief through borrower defense, income-driven repayment audits, and Gainful Employment rules. The integrity of these processes depends on political leadership that is independent from the private-equity interests that helped create the crisis.

Pritzker’s political style—managerial, technocratic, deeply rooted in elite networks—suggests continuity rather than challenge. The neoliberal framework he embodies does not confront structural inequalities; it manages them. It does not dismantle extractive systems; it attempts to regulate their excesses while leaving their core intact. In higher education, this approach has already failed. It is the reason the for-profit sector was allowed to expand dramatically under both Republican and Democratic administrations. It is why private-equity firms continue to control large segments of the educational marketplace through complex ownership structures and shadow nonprofits. And it is why millions of borrowers remain trapped in debts for degrees that offered little or no economic return.

The Pritzker Paradox is therefore not a story about one wealthy governor. It is a story about the consolidation of political and economic power within a narrow elite that has profited handsomely from the financialization of education while promising, cycle after cycle, to reform the very problems it helped create. Vistria exemplifies this dynamic. The Pritzker family’s history echoes it. And a Pritzker presidency would likely entrench it further.

America needs leadership willing to challenge private-equity influence in higher education, not leadership bound to it. The country needs a president who understands education as a public good, not a marketplace. For borrowers, students, and communities harmed by decades of predatory practices, the stakes could not be higher. The choice before the nation is not simply whether Pritzker is preferable to Trump. It is whether the country will continue to entrust its public institutions to elites who speak the language of equity while advancing the interests of the very networks that undermined educational opportunity in the first place.

Sources
Public reporting on Pritzker family investments in for-profit and education-related sectors; investigations by the Senate HELP Committee, GAO, and CFPB; reporting on The Vistria Group’s acquisitions and nonprofit conversions; analyses of private-equity influence in U.S. higher education; academic literature on neoliberalism and elite capture.

Renting While Educated: The Housing Crisis and the Rise of the Educated Underclass

In the United States, a college degree once promised a path to stability — a steady job, a livable wage, and a secure place to call home. Today, that promise has fractured. Millions of degree-holders and would-be graduates find themselves unable to afford even modest housing, trapped in what can only be described as the educated underclass: people with credentials but without the economic security those credentials were supposed to guarantee.

The latest data from the National Low Income Housing Coalition (NLIHC) makes clear that the housing crisis is not just about poverty — it is about the shrinking distance between the working poor and the working-educated. The gap between wages and rent has widened so dramatically that even college-educated workers, adjunct faculty, nonprofit staff, social workers, and early-career professionals are drowning in housing costs.

The Housing Wage and the Broken Promise of Higher Ed

According to NLIHC’s Out of Reach 2025 report, a full-time worker in the U.S. needs to earn $33.63 an hour to afford a modest two-bedroom apartment and $28.17 an hour for a one-bedroom. That’s far higher than what many degree-holders earn, especially those in education, public service, healthcare support, and the nonprofit sector.

The academic workforce itself is emblematic of the problem: adjunct instructors with master’s degrees — sometimes PhDs — often earn poverty-level wages. Yet the rents they face are no different from those of skilled professionals in high-paying industries.

Higher education promised mobility; instead, it delivered a generation of renters one missed paycheck away from eviction.

An Educated Underclass Renting in Perpetuity

NLIHC’s data shows a national shortage of affordable housing: only 35 affordable and available homes exist for every 100 extremely low-income renters. While this crisis hits the lowest-income Americans hardest, it also drags down millions of educated workers who now compete for the same shrinking stock of affordable units.

This convergence — between the working poor and the working educated — reflects a structural breakdown:

• New graduates carry student debt while starting in low-wage jobs.

• Millennial and Gen Z workers face rents that have grown far faster than wages.

• Former middle-class professionals, displaced by automation and recession, re-enter the workforce at lower wages that no longer match their credentials.

• Public-sector and nonprofit workers do “mission-driven” work but cannot afford to live in the communities they serve.

Increasingly, higher education is not a safeguard against housing insecurity — it is a gateway into it.

The Spiral: Student Debt, Rent Burden, and Delayed Adulthood

The educated underclass faces a double bind:
High rents prevent saving, while student debt prevents mobility.

NLIHC data shows that renters who are cost-burdened (spending more than 30% of income on housing) or severely cost-burdened (over 50%) are forced to cut spending on essentials. For many degree-holders, this means:

• Delaying or abandoning homeownership

• Working multiple jobs to cover rent

• Moving back in with parents

• Delaying marriage and child-rearing

• Relocating constantly in search of slightly cheaper housing

This is not “adulting” — it’s economic triage.

The educated underclass is increasingly indistinguishable from the broader working class in terms of economic vulnerability, yet still burdened by expectations that their degrees should have delivered them stability.

When Housing Costs Undermine Higher Education Itself

The affordability crisis is reshaping entire higher education ecosystems:

• Students struggle to find housing close to campus, leading to long commutes, couch surfing, or dropping out.

• Graduate students and postdocs — essential academic labor — increasingly rely on food aid, emergency grants, and organizing unions just to survive.

• Colleges in high-cost cities cannot hire or retain staff because employees cannot afford to live nearby.

• Public institutions face declining enrollment because families see no payoff to degrees that lead to poverty wages and unaffordable housing.

If higher education cannot provide a pathway out of housing insecurity, its legitimacy — and its future — is in question.

Toward Real Solutions: Housing as an Educational Issue

Solving this crisis requires acknowledging a simple truth: housing policy is higher-education policy.
The educated underclass is not a natural outcome of individual failure; it is the product of a system that overcharges for education and underpays for labor while allowing rents to skyrocket.

Real solutions would include:

• Large-scale public investment in deeply affordable housing

• Expansion of rental assistance and housing vouchers

• Living-wage laws that reflect real housing costs

• Student-housing development tied to public colleges

• Forgiveness of rental debt accumulated during economic shocks

• Strengthening unions among educators, adjuncts, graduate workers, and other low-paid professionals

The promise of higher education cannot be realized while a degree-holder earning $20, $25, or even $30 an hour still cannot afford a one-bedroom apartment.

The Verdict: Housing Is the Fault Line of the New Class Divide

NLIHC’s data confirms what millions of renters already know: the U.S. housing market punishes workers regardless of education level, and higher education no longer protects against precarity. The educated underclass is not a fringe category — it is becoming the norm.

Until wages align with housing costs and the housing system is restructured to serve people rather than profit, the divide between those who can afford stability and those who cannot will continue to widen. And higher education, once marketed as the bridge to a better life, will remain yet another broken promise — one rent payment away from collapse.

Sources
National Low Income Housing Coalition, Out of Reach 2025
NLIHC Research and Policy Briefs
NLIHC Affordable Housing Data and Fact Sheets

Nonprofits and Nothingness: Follow the Money

In the world of higher education and its orbiting industries—veteran-serving nonprofits, student-debt advocacy groups, educational charities, “policy” organizations, and campus-focused foundations—there is a great deal of motion but not always much movement. Press releases bloom, awards are distributed, partnerships are announced, and donors beam from stages and annual reports. Yet too often, the people who most need substantive support—servicemembers, student-loan borrowers, contingent faculty, low-income students, and other working-class communities—receive only fragments of what the glossy brochures promise.

To understand why, you need only follow the money.

  

The Neoliberal Philanthropy Trap

Over the last four decades, American nonprofit culture has been reshaped and disciplined by neoliberal capital. So-called “impact philanthropy” and “venture philanthropy” introduced a corporate mindset: donors expect brand alignment, flattering metrics, and ideological safety. The result is a nonprofit sector that frequently mimics the institutions it claims to critique.

Organizations become risk-averse. They avoid structural analysis. They sidestep direct confrontation with the powerful. They produce white papers instead of organizing. They praise the very elite funders who limit their scope.

The most severe problems facing servicemembers and veterans—predatory for-profit schools, Pentagon-to-college corruption pipelines, GI Bill waste, chronic under-support—rarely get the oxygen they deserve. Advocacy groups that rely on neoliberal donors often focus on “financial literacy” workshops rather than taking on the multi-billion-dollar scams that actually trap servicemembers in debt.

Student-debt nonprofits, similarly, lean into “awareness campaigns” and technocratic fixes that avoid challenging lenders, profiteering institutions, or federal policy failures. Many will deliver testimonials and infographics, but few will call out the philanthropic class whose own investments are entangled in servicing and securitizing student debt.

And when it comes to helping working-class people more broadly—those navigating food insecurity, unstable housing, wage stagnation, and the crushing costs of education—the nonprofit sector too often does what neoliberal donors prefer: it performs compassion rather than redistributing power. It focuses on individual resilience rather than collective remedy.
Appearance Over Impact

This creates a strange ecosystem in which organizations are rewarded for looking productive rather than for being productive.

• Events over empowerment.
• Reports over results.
• Branding over coalition-building.
• Strategy sessions over structural change.

The donor’s name gets its plaque, its press release, its tax receipt. The nonprofit gets to survive another cycle. But the problems—deep, persistent, systemic—remain unchallenged.

Nonprofits that speak too directly about exploitation in higher education risk alienating the very people who write the checks. Some are nudged away from naming predatory universities. Others are steered toward “innovation,” “entrepreneurship,” or “student success” frameworks that sanitize the underlying issues. Many are encouraged to “partner” with the same institutions harming the people they were formed to help.

In the end, we get a sector filled with earnest staff but hollowed-out missions—organizations doing just enough to appear active but rarely enough to threaten the arrangement that keeps donors comfortable and inequality intact.

 
What Could Be—If Nonprofits Were Free

Imagine a nonprofit sector liberated from neoliberal constraints:
Organizations could openly challenge predatory colleges instead of courting them as sponsors.
Veteran-serving groups could expose fraud rather than “collaborate” with federal contractors.
Debt-advocacy groups could organize mass borrower actions rather than hold polite policy forums.
Working-class students could find allies who fight for public investment, not piecemeal philanthropy.

We could have watchdogs instead of window dressing.
We could have mobilization instead of marketing.
We could have justice instead of jargon.

But as long as donor-driven nonprofits prioritize appearance over impact, we’re left with what might be called “nonprofits and nothingness”: organizations whose glossy public-facing work obscures the emptiness underneath.

 
The Way Forward: Independent, Ground-Up Power

Real change in higher education—on affordability, accountability, labor rights, and fairness—will not come from donor-managed nonprofits. It will come from independent journalism, grassroots organizing, debt-resistance movements, student-worker coalitions, and communities willing to challenge elite decision-makers directly.

Those efforts don’t fit neatly into annual reports. They don’t flatter philanthropists. They don’t offer easy wins. But they build the kind of power that higher education, and the country, desperately needs.

Until more nonprofits break free from the neoliberal donor leash, we should continue to follow the money—and then look beyond it, to the people whose work actually changes lives.

Sources
— Eikenberry, Angela. The Nonprofit Sector in an Age of Marketization.
— Giridharadas, Anand. Winners Take All.
— Reich, Rob. Just Giving: Why Philanthropy Is Failing Democracy.

Preston Cooper Is Wrong: Enrollment Is Only One of Higher Education’s Many Crises

In a recent American Enterprise Institute article, Preston Cooper insists that the post-2010 collapse in college enrollment is “a correction, not a crisis.” According to Cooper, students are becoming more discerning consumers, abandoning low-value colleges and low-ROI degrees while flocking to higher-quality institutions and more lucrative majors. In this narrative, the system is simply shedding inefficiencies. The market is working.

But this argument is incomplete to the point of distortion. Enrollment decline is not a tidy market correction. It is a symptom of profound structural problems: affordability, inequality, political interference, labor exploitation, deteriorating academic quality, widespread cheating, and the growing reliance on “robocolleges” and automated learning platforms with questionable educational value. Cooper’s analysis ignores all of this and reduces higher education to a single variable—student choices—when the system is being reshaped by forces far larger and more corrosive than consumer preference.

Affordability remains the biggest barrier to access. Surveys repeatedly show that adults who never enrolled or who dropped out cite cost as their primary obstacle, and higher education leaders themselves acknowledge that families often do not understand the real price until they are already overwhelmed. Tuition, fees, housing, food, and transportation are enough to make college inaccessible for millions. This is not a sign of students shopping wisely; it is evidence of a system that has priced out vast segments of the population.

Cooper’s argument also ignores how structural inequalities determine who even reaches the point of decision-making. Research from multiple institutions shows that disparities in academic preparation—rooted in racial segregation, school funding inequity, socioeconomic status, and access to quality teachers—heavily influence college-going patterns. Students from under-resourced schools or low-income families do not have equal access to information, support systems, or opportunities. The idea that they are “choosing” not to attend low-value schools disregards the constraints that shape those choices.

Meanwhile, colleges themselves are destabilizing. Shrinking enrollments and stagnant public funding have produced financial crises across the sector. Even reputable institutions rely on aggressive discounting, program cuts, hiring freezes, and dependence on contingent faculty. Student support services shrink while administrative costs continue to rise. Cooper’s framing of “let the weak fail” overlooks the collateral damage: students denied needed resources, programs eliminated, and entire communities harmed when regional colleges collapse.

The crisis extends beyond finances. Students’ freedom of speech is increasingly under pressure as state legislatures, governors, and politically reactive boards restrict curricula, censor faculty, and monitor student organizations. Expression around race, inequality, gender, and geopolitical issues is under surveillance or actively punished. Whether driven by conservative politics, donor pressure, or administrative fear of controversy, the suppression of student and faculty voices undermines the university’s democratic mission.

Cooper also fails to address the degrading working conditions of adjunct faculty, who now make up the majority of instructors. Adjuncts often earn poverty-level wages, lack health insurance, and have no job security. Many teach at multiple institutions simply to survive. The system Cooper describes as “self-correcting” rests on the exploitation of the people responsible for delivering the education students are supposedly choosing.

Then there are the emerging problems he completely ignores: robocolleges and AI-driven instruction. As institutions cut costs, many outsource teaching to automated platforms, online mega-providers, and algorithmic tutoring systems. These “robocolleges” promise efficiency but often deliver shallow instruction, predatory recruitment, weakened student support, and minimal human interaction. They generate revenue, but not always learning. Cooper assumes that students are leaving low-value institutions, yet many of these automated systems are themselves low-value—and increasingly difficult to regulate or evaluate.

The rise of automated education connects directly to another crisis: academic integrity. AI-assisted cheating is now widespread across campuses. Students, overwhelmed by cost pressures, mental health struggles, large class sizes, and insufficient support, increasingly rely on AI tools to complete assignments without understanding the material. Instructors struggle to identify misconduct, institutions scramble to respond, and genuine learning becomes harder to guarantee. This is not the sign of a system “correcting” itself. It is evidence of a sector that has lost its footing and is failing to uphold educational standards.

Cooper’s argument rests on the assumption that higher education should primarily be judged by short-term labor-market returns. But higher education is more than a job-training pipeline. It is a public good that supports social mobility, civic participation, community development, scientific and cultural advancement, and democratic life. A system that suppresses speech, exploits faculty, overrelies on automated instruction, and cannot distinguish real learning from AI-generated work is not corrected. It is in crisis.

The enrollment decline is real, but it is only the surface. Beneath it lies a system plagued by affordability barriers, entrenched inequality, political intrusion, labor precarity, academic degradation, technological misuse, and rising distrust. To call this a “correction” is to look away from the deeper rot. For students, educators, and communities, it is a crisis—one that demands urgent structural reform rather than market-based optimism.

Sources
National Association of Student Financial Aid Administrators (NASFAA). “The Biggest Barriers to Higher Education Enrollment Are Cost and Lack of Financial Aid.”
Inside Higher Ed. “Student Success Leaders Worry About Affordability, AI, and DEI.”
Brookings Institution. “Persistent Gaps in Academic Preparation Generate College Enrollment Disparities.”
Deloitte Insights. “Top Risks in Higher Education.”
Independent Institute. “Higher Education’s Triple Crisis.”
PEN America. “Tracking Campus Free Speech Legislation and Suppression.”
American Federation of Teachers / AAUP. “The Gig Academy: Precarity and the Exploitation of Adjunct Labor.”
The Century Foundation. Analyses of Online Program Management (OPM) and automated higher education risks.
Inside Higher Ed and Times Higher Education reporting on AI-driven cheating and academic integrity.

The Prestige of Partnership — and the Problem of Unclear Payoff

For more than a decade, 2U has presented itself as a premier intermediary between elite universities and the expanding global audience for online higher education. The company’s roster of partners includes some of the most recognizable names in academia, as well as a growing list of selective, mid-tier, and international institutions. On its public site, 2U highlights collaborations with universities such as Yale, Northwestern, North Carolina–Chapel Hill, Pepperdine, Maryville, and the University of Surrey. The message is unmistakable: if universities of this caliber trust 2U with their online programs, then students should as well.

These partnerships have fueled the impression that 2U-supported programs deliver high-quality, academically rigorous education backed by prestigious institutional brands. For many learners, especially working adults, international students, and career switchers, such arrangements offer a seemingly ideal blend: the name of an elite university, the flexibility of online learning, and access to fields where credentials are increasingly necessary.

Yet beneath the glossy presentation and impressive partner list, fundamental questions remain unanswered. Despite working with many of the world’s most respected institutions, 2U still does not provide sufficient data to determine the true value of the programs it supports. Even as universities lend their names and curricula, the real-world outcomes of students enrolled in 2U-powered programs remain opaque.

The core difficulty lies in the mismatch between the prestige of the institution and the limited transparency around program performance. For years, 2U issued annual “Transparency and Outcomes” reports designed to demonstrate impact and accountability across its portfolio. But the most recent report available to the public is from 2023. In the fast-moving world of online education—where competition has intensified, student expectations have shifted, and 2U itself has undergone significant financial turmoil—data that old is no longer a reliable indicator of the current state of programs.

This lack of updated reporting is especially notable given 2U’s recent trajectory. After years of rising debt and declining investor confidence, the company filed for Chapter 11 bankruptcy in 2024. Although it has since emerged under new ownership with a streamlined balance sheet, questions persist about its future direction, the stability of its services, and whether its partnerships will endure in their current form. For universities, outsourcing key functions such as marketing, recruitment, student support, and technological infrastructure may expand enrollment and revenue, but it also raises concerns about the consistency and quality of the student experience—areas that become even more vulnerable when the partner company faces financial strain.

This structural opacity makes it nearly impossible for students, policymakers, or even universities themselves to determine whether these programs provide a meaningful return on investment. A degree or certificate bearing the name of Yale or Pepperdine may confer a level of brand recognition, but what does it signify in practice? Are students completing programs at comparable rates to on-campus peers? Are they finding jobs in their fields? Are they earning more than they would have without the credential? Are they satisfied with the instruction, advising, and support they receive? Without rigorous, current, and independently verified data, these remain open—and critical—questions.

The challenge is not solely financial or operational. It is also conceptual. The surge in online learning has created a vast gray zone between institutional brand and educational substance. While universities retain control over academic content, the underlying delivery mechanisms are increasingly intermediated by firms like 2U. Students may assume that an online master’s degree from a prestigious university carries the same weight as an on-campus equivalent, but the learning environments, student services, and community-building opportunities differ dramatically. In many cases, the online experience is shaped more by 2U’s systems and staff than by the university itself.

For prospective students, the implication is clear: a well-known university name is not a guarantee of value. For universities, the stakes are equally high. Partnering with a third-party company can expand their reach, but it can also blur the boundaries of academic identity and accountability. And for anyone tracking the direction of higher education more broadly, 2U’s situation serves as a cautionary example of how prestige can mask the absence of meaningful transparency—and how quickly the economics of online learning can shift.

Until 2U produces up-to-date, independently verifiable data about program quality and student outcomes, the value of its offerings remains an open question. The partnerships look impressive. The marketing is compelling. But the evidence is missing.

---

Sources

2U Partners Page
2U 2023 Transparency and Outcomes Report
2U announcements on new degree partnerships and expansions
Washington Post coverage of 2U’s 2024 bankruptcy filing
PR Newswire statements on 2U’s financial restructuring and emergence as a private company