Warning to Investors: Phoenix Education Partners (PXED) may present itself as a cutting‑edge solution in career-focused higher education, but it’s built on the same extractive infrastructure that powered the University of Phoenix. With nearly a million students still owing an estimated $22 billion in federal loans, backing PXED isn’t just a financial bet — it’s a moral and reputational risk.
PXED’s leadership includes powerful private-equity players: Martin H. Nesbitt (Co‑CEO of Vistria and PXED trustee), Adnan Nisar (Vistria), and Theodore Kwon and Itai Wallach (Apollo Global Management). Also in the mix is Chris Lynne, PXED’s president and a former Phoenix CFO intimately familiar with UOP’s controversial enrollment and marketing strategies. These are not educational reformers — they are dealmakers aiming to extract value from a student-debt pipeline.
Higher Education Inquirer’s College Meltdown Index highlights how PXED fits into a broader financialization of higher education. Rather than reforming the University of Phoenix, its backers have resurrected it under a new brand — one that continues to enroll vulnerable adult learners, harvest federal aid, and operate with considerably less public oversight.
Whistleblowers previously documented that Phoenix pressured recruitment staff to falsify student credentials, enrolling people who wouldn’t otherwise qualify for federal aid. Courses were allegedly kept deliberately easy — not to teach, but to keep students “active” enough to trigger aid disbursements. Internal marketing also exaggerated job prospects and corporate partnerships (e.g., with Microsoft and AT&T) to entice students.
PXED may lean on a three‑year default rate (often cited around 12–13%), but that number is deeply misleading. Many UOP students stay stuck in deferment, forbearance, or income-driven repayment, masking the real long-term risk of non-payment. This is not just a short-term liability — it’s a potentially massive, multiyear financial exposure for PXED’s backers.
There was a significant FTC settlement that canceled $141 million in student debt and refunded $50 million to some students. But the scale of harm far exceeds that payout. Untold numbers of borrowers still have unresolved Borrower Defense claims, and the reputational risk remains profound.
Beyond financial concerns, there’s a major ethical dimension. HEI’s Divestment from Predatory Education argument makes a compelling case that investing in companies like PXED — or in loan servicers that profit from student debt — is not just risky, but morally indefensible. According to HEI, institutional investors (including university endowments, pension funds, and foundations) are complicit in a system that monetizes students’ aspirations and perpetuates financial harm.
For investors, the message is clear: Phoenix is not merely an education play — it’s a high-stakes, ethically fraught extraction machine built on a legacy of indebtedness and regulatory vulnerability.
Unless PXED commits to real transparency, independent reporting on student outcomes, and accountability mechanisms — including reparations or debt relief — it should be approached not as a social-growth story, but as a dangerous gamble.
HEI. “The College Meltdown Index: Profiting from the Wreckage of American Higher Education.” Higher Education Inquirer
HEI. “What Do the University of Phoenix and Risepoint Have in Common? The Answer Is a Compelling Story of Greed and Politics.” Higher Education Inquirer
[Editor's note: Reason Foundation is a libertarian think tank. While this press release does not reflect our editorial position, we believe important information is in this report.]
Public school enrollment has dropped the most in Hawaii, New York, Mississippi, Oregon, and California, while teachers’ salaries decreased the most in North Carolina, New Mexico, South Carolina, and West Virginia.
Los Angeles (November 20, 2025)—California has increased per-student education spending the most in the nation since the COVID-19 pandemic, up 31.5% from $19,724 in 2020 to $25,941 per pupil in 2023. Since the pandemic, per-student spending has also grown by at least 15% in Michigan, Kentucky, Missouri, Hawaii, New Mexico, Arizona, Mississippi, and Alabama, according to a new Reason Foundation study.
U.S. public schools received $946.5 billion in funding in 2023, with New York topping all states by spending $36,976 per student, followed by New Jersey at $30,267 per student. The other six states that spent over $25,000 per student were Vermont ($29,169), Connecticut ($28,975), Pennsylvania ($26,242), California ($25,941), Rhode Island ($25,709), and Hawaii ($25,485).
Idaho was the only state that spent less than $12,000 per student in 2023. Utah, Oklahoma and North Carolina spent less than $14,000 per student.
While public school spending is rising, enrollment has been falling significantly since the pandemic. From 2020 to 2023, public school enrollment dropped in 39 states, the Reason Foundation report shows.
With a 6% decrease, Hawaii has experienced the largest decline in public school students since 2020. Enrollment also decreased by more than five percent in New York, Mississippi, Oregon, and California, and four percent in New Mexico, New Hampshire, Illinois, West Virginia, Colorado, Kentucky, Washington, Rhode Island, and Michigan, Reason Foundation finds.
The pandemic and inflation also hit teachers’ salaries hard. From 2020 to 2022, the average teacher’s salary decreased by more than five percent in 38 states.
Teachers’ salaries declined the most from 2020 to 2022, the most recent year with complete data available, in North Carolina (−9.6%), New Mexico (−8.8%), South Carolina (−8.7%), West Virginia (−8.6%), and Mississippi (−8.2%). Only one state, Minnesota, increased teachers’ salaries after the pandemic, the study by Reason Foundation shows.
One thing siphoning money away from salaries is the rising spending on employee benefits, which includes teacher retirement plans and pension debt, health insurance, and other expenses.
In 2023, New Jersey’s employee benefit costs totaled $8,333 per student. In New York, the cost of benefits was $7,949 per student. Vermont and Connecticut also spent more than $7,000 per student on employee benefits. Employee benefit costs also exceeded $5,000 per student in Pennsylvania, Illinois, Michigan, Massachusetts, Delaware, New Hampshire, Rhode Island, Wyoming, and Alaska.
Amid all the spending, students’ National Assessment of Educational Progress scores regressed from 2022 to 2024 in all but one category, and scores were worse in 2024 than in 2003.
In the long decline of American higher education, a certain class of professionals has quietly prospered—lawyers who specialize in defending institutions from the consequences of their own behavior. These attorneys rarely appear in public debates over student debt, predatory recruitment, or collapsing regional colleges. Yet their fingerprints are everywhere: in courtroom strategies designed to run out the clock, in motions that narrow the rights of borrowers, in settlement agreements that mask wrongdoing without forcing structural reform. They are the legal custodians of an industry that has spent decades avoiding accountability.
These lawyers often frame their role as neutral, simply providing representation to clients who need it. But the nature of the representation matters. When institutions mislead students, inflate job-placement claims, push them into unaffordable debt, or fire whistleblowers who object to unethical practices, these firms defend the institution—not the student, not the truth, and certainly not the public interest. Litigation summaries and public communications frequently present a parallel universe in which colleges are the victims, regulators are overreaching meddlers, and students who seek restitution are opportunists or pawns of political forces.
The legal work is highly lucrative. In many cases, struggling institutions spend more on their attorneys than they do on direct student support. Colleges on the brink of closure still find six-figure retainers to fight state attorney general investigations or borrower defense claims. Public institutions use taxpayer dollars to shield themselves from transparency, all while students—particularly first-generation, low-income, and working-class students—absorb the losses. Attorneys in this sector are acutely aware of the harms their clients may have caused, yet their work consistently prioritizes institutional preservation over student restitution.
The history of this defense strategy is well documented. In 2011, federal courts began seeing cases from former students challenging institutions for misleading claims, untransferable credits, and failure to provide promised training. Courts often compelled arbitration, effectively removing class action rights and leaving individual students to pursue costly and complex proceedings alone. This pattern set a precedent: institutional defense relied on procedural tools rather than addressing substantive misconduct. Between 2012 and 2013, state supreme courts upheld arbitration clauses that stripped students of collective redress, signaling to institutions that strategic legal defenses could block accountability. Students’ claims of misrepresentation, fraud, and breaches of enrollment agreements were repeatedly forced into private arbitration. The courts emphasized procedural enforcement over consideration of the underlying harms, allowing institutions to continue operating without public scrutiny.
From 2015 to 2018, the Department of Education’s Inspector General documented widespread mismanagement of federal Title IV funds, showing that hundreds of millions in federal loans were issued to students at institutions that were later found to have misrepresented outcomes or violated federal regulations. Lawsuits brought by former students during this period, including allegations under the False Claims Act, were often dismissed or compelled to arbitration. Institutions were shielded, while borrowers were left with debt and limited recourse.
In 2018 and 2019, state attorneys general filed enforcement actions against multiple institutions for fraudulent recruitment practices and misrepresentation of accreditation status. In almost every case, institutions relied on their legal teams to secure procedural victories: dismissal of class action claims, enforcement of arbitration clauses, and delays in settlements. While regulators attempted to intervene, the structural power of corporate legal defense delayed, diluted, or obscured accountability. During the COVID-19 pandemic in 2020–2021, students sued institutions for failure to provide adequate online instruction and for abrupt changes in course delivery. Defense attorneys successfully argued that enrollment agreements allowed these operational changes, resulting in widespread dismissal of student claims. Again, institutional defense won the day while students absorbed the financial and educational consequences.
From 2022 to 2025, the Borrower Defense to Repayment program and the SAVE Plan promised relief for students harmed by mismanaged institutions. Yet litigation and regulatory challenges have slowed implementation. Institutions and their attorneys have repeatedly used procedural maneuvers to contest forgiveness, compel arbitration, or delay repayments, leaving thousands of students in limbo while debt accumulates. Throughout this period, legal strategy has consistently prioritized institutional survival over student restitution. Arbitration clauses, procedural dismissals, and regulatory delay have allowed colleges and universities to maintain access to federal funds, complete mergers, or restructure under bankruptcy protection, all while leaving harmed students with debt, disrupted education, and minimal legal recourse.
These attorneys also help shape the narratives consumed by policymakers, journalists, and college trustees. Public-facing summaries often downplay institutional misconduct and amplify court decisions that limit student rights. They rarely acknowledge the emotional and financial devastation suffered by borrowers or the systemic risks created when institutions know their lawyers can absorb most of the blow. Instead, they champion a legal environment that treats higher education primarily as a business subject to claims risk, not as a public trust.
Justice, in this ecosystem, becomes a matter of resources. Students and former employees face a wall of corporate legal expertise, while institutions with long records of abuse continue to operate behind settlements and sealed agreements. Attorneys who could use their considerable skills to protect the most vulnerable instead use them to reinforce a system that extracts value from students and leaves them to fend for themselves once the promises fall apart.
The Higher Education Inquirer has long documented the College Meltdown: the closures, the debt, the failed oversight, and the human cost. But the meltdown is not only a story about administrators, investors, or federal agencies. It is also a story about the lawyers who defend the indefensible and who help maintain a higher education marketplace where accountability is optional and harm is routine. They may sleep well, but only because the consequences of their work are borne by others.
The question is not how they sleep at night. The question is how many more students will lose before the legal strategies that protect institutions are no longer enough to protect the industry itself.
Sources:
U.S. Department of Education, Borrower Defense to Repayment decision data, 2022–2025
Government Accountability Office (GAO), “For-Profit Colleges: Student Outcomes and Federal Oversight,” 2021
Department of Education Office of Federal Student Aid, Borrower Defense decisions, 2020–2025
State Attorneys General filings and enforcement actions against higher education institutions, 2018–2023
U.S. Department of Education Office of Inspector General, audits and reports on Title IV program compliance, 2015–2022
GAO report on arbitration clauses in for-profit colleges, 2018
For Americans under 35, the term “democratic socialism” triggers neither fear nor Cold War reflexes. It represents something far simpler: a demand for a functioning society. Younger generations have grown up in a world where basic pillars of American life—higher education, medicine, economic mobility, and even life expectancy—have deteriorated while inequality has soared. Democratic socialism, in their view, is not a fringe ideology but a practical response to systems that have ceased to serve the common good.
Nowhere is this clearer than in higher education. Millennials and Gen Z entered adulthood as universities became corporate enterprises, expanding administrative layers, pushing adjunct labor to the brink, and relying on debt-financed tuition increases to keep the machine running. Public investment collapsed, predatory for-profit chains proliferated, and nonprofit universities acted like hedge funds with classrooms attached. Students saw institutions with billion-dollar endowments operate as landlords and asset managers, all while passing costs onto working families. When Bernie Sanders called for tuition-free public college, young people did not hear utopianism—they heard a plan grounded in global reality, a model that exists in Germany, Sweden, Finland, and other social democracies that treat education as a public good rather than a revenue stream.
Healthcare tells an even harsher story. Americans under 35 watched their parents and grandparents navigate a system more focused on billing codes than care, one where an ambulance ride costs a week’s wages and a bout of illness can mean bankruptcy. They experienced the rise of corporatized university medical centers, private equity–owned emergency rooms, and insurance bureaucracies that ration access more cruelly than any state. They saw life-saving drugs priced like luxury goods and mental health services pushed out of reach. Compare this to nations with universal healthcare: longer life expectancy, lower infant mortality, and far less medical debt. Again, Sanders’ Medicare for All resonated not because of ideology but because young people recognized it as a plausible path toward the kind of humane medical system described by scholars like Harriet Washington, Elisabeth Rosenthal, and Mahmud Mamdani, who all critique the structural violence embedded in systems of unequal care.
Life expectancy itself has become a generational indictment. For the first time in modern U.S. history, it has fallen, driven by overdose deaths, suicide, preventable illness, and worsening inequities. Younger Americans know that friends and peers have died far earlier than their counterparts abroad. They see that countries with strong public services—childcare, unemployment insurance, housing supports, universal healthcare—live longer, healthier lives. They also see how austerity and privatization have hollowed out public health infrastructure in the United States, leaving communities vulnerable to crises large and small. The message is clear: societies that invest in people live longer; societies that treat health as a commodity do not.
Quality of Life (QOL) ties all of this together. People under 35 face rent burdens unimaginable to previous generations, debts that prevent them from forming families, stagnant wages, and a labor market defined by precarity. They face the erosion of public space, public transit, libraries, and social supports—what Mamdani would describe as the slow unraveling of the civic realm under neoliberalism. When they look abroad, they see countries with social democratic frameworks offering guaranteed parental leave, subsidized childcare, free or nearly free college, universal healthcare, and robust worker protections. These are not distant fantasies; they are functioning models that produce higher happiness levels, stronger social trust, and more stable democracies.
Older generations often accuse young people of radicalism, but the reality is the reverse. Millennials and Gen Z are pragmatic. They have lived through the failures of unfettered capitalism: historic inequality, monopolistic industries, soaring costs of living, and a political class unresponsive to their material conditions. They have read Sanders’ critiques of oligarchy and Mamdani’s analyses of state power and structural violence, and they see themselves reflected in those diagnoses. Democratic socialism appeals because it is rooted in material improvements to daily life rather than in abstract political theory. It promises a society where income does not determine survival, where education does not require lifelong debt, where parents can afford to raise children, and where basic health is not a luxury good.
People under 35 are not afraid of democratic socialism because they have already seen what the absence of a social democratic framework produces. They are not seeking revolution for its own sake. They are seeking a livable future. And increasingly, they view democratic socialism not as a radical break but as the only realistic path toward rebuilding public institutions, revitalizing democracy, and ensuring that future generations inherit a country worth living in.
Sources
Sanders, Bernie. Our Revolution: A Future to Believe In.
Sanders, Bernie. Where We Go from Here: Two Years in the Resistance.
Mamdani, Mahmood. Define and Rule: Native as Political Identity.
Mamdani, Mahmood. Neither Settler nor Native: The Making and Unmaking of Permanent Minorities.
Washington, Harriet. Medical Apartheid.
Rosenthal, Elisabeth. An American Sickness.
Skloot, Rebecca. The Immortal Life of Henrietta Lacks.
Baldwin, Davarian. In the Shadow of the Ivory Tower.
Bousquet, Marc. How the University Works.
Over the past four decades, neoliberalism has reshaped higher education into a market-driven enterprise, producing what can only be described as a global College Meltdown. Once envisioned as a public good—a tool for civic empowerment, social mobility, and national progress—higher education in the United States, the United Kingdom, and China has been transformed into a competitive market system defined by privatization, debt, and disillusionment.
The United States: From Public Good to Profit Engine
Nowhere has neoliberal ideology had a more devastating effect on higher education than in the United States. Beginning in the 1980s, with the Reagan administration’s cuts to federal grants and the expansion of student loans, higher education funding shifted from public investment to individual burden. Universities adopted corporate governance models, hired armies of administrators, and marketed education as a private commodity promising personal enrichment rather than collective advancement.
The results are visible everywhere: tuition inflation, student debt exceeding $1.7 trillion, and the proliferation of predatory for-profit colleges. Elite universities transformed into financial behemoths, hoarding endowments while relying on contingent faculty. Meanwhile, working-class and minority students were lured into debt traps by institutions that promised upward mobility but delivered unemployment and despair.
The U.S. College Meltdown—a term that describes the system’s moral and financial collapse—is a direct consequence of neoliberal policies: deregulation, privatization, and austerity disguised as efficiency. The profit motive replaced the public mission, and the casualties include students, adjuncts, and the ideal of education as a democratic right.
The United Kingdom: Marketization and Managerialism
The United Kingdom followed a similar trajectory under Margaret Thatcher and her successors. The introduction of tuition fees in 1998 and their tripling in 2012 marked the formal triumph of neoliberal logic over public investment. British universities became quasi-corporate entities, obsessed with league tables, branding, and global rankings.
The result has been mounting student debt, declining staff morale, and a hollowing out of intellectual life. Faculty strikes over pensions and pay disparities underscore a deeper crisis of purpose. Universities now function as rent-seeking landlords—building luxury dorms for international students while cutting humanities departments. The logic of “student-as-customer” has reduced education to a transaction, and accountability has been redefined to mean profit margin rather than social contribution.
The UK’s College Meltdown mirrors that of the U.S.—a story of financialization, precarious labor, and the erosion of public trust.
China: Neoliberalism with Authoritarian Characteristics
At first glance, China seems to defy the Western College Meltdown. Its universities have expanded rapidly, producing millions of graduates and investing heavily in research. But beneath this apparent success lies a deeply neoliberal structure embedded in an authoritarian framework.
Since the 1990s, China’s higher education system has embraced competition, rankings, and market incentives. Universities compete for prestige and funding; families invest heavily in private tutoring and overseas degrees; and graduates face a saturated labor market. The result is mounting anxiety and unemployment among young people—known online as the “lying flat” generation, disillusioned with promises of meritocratic success.
The Chinese model fuses state control with neoliberal marketization. Education serves as both an instrument of national power and a mechanism of social stratification. In this sense, China’s version of the College Meltdown reflects a global truth: the commodification of education leads to alienation, regardless of political system.
A Global System in Crisis
Whether in Washington, London, or Beijing, the pattern is strikingly similar. Neoliberalism treats education as an investment in human capital, reducing learning to a financial calculation. Universities compete like corporations; students borrow like consumers; and knowledge becomes a tool of capital accumulation rather than liberation.
This convergence of economic and ideological forces has created an unsustainable higher education bubble—overpriced, overcredentialized, and underdelivering. Across continents, graduates face debt, underemployment, and despair, while universities chase rankings and revenue streams instead of justice and truth.
Toward a Post-Neoliberal Education
Reversing the College Meltdown requires more than reform; it demands a new philosophy. Public universities must reclaim their civic mission. Education must once again be understood as a human right, not a private investment. Debt forgiveness, reinvestment in teaching, and democratic governance are essential first steps.
Neoliberalism’s greatest illusion was that markets could produce wisdom. The College Meltdown proves the opposite: when education serves profit instead of people, it consumes itself from within.
Sources:
Wendy Brown, Undoing the Demos (2015)
David Harvey, A Brief History of Neoliberalism (2005)
Tressie McMillan Cottom, Lower Ed (2017)
The Higher Education Inquirer archives on the U.S. College Meltdown
BBC, “University staff strikes and student debt crisis,” 2024
Caixin, “China’s youth unemployment and education anxiety,” 2023
For many observers, Jeffrey Epstein, Alan Dershowitz, and Larry Summers appear as separate figures orbiting the world of elite academia, finance, and politics. But together—and through the long lens of history—they represent something far more revealing: the modern expression of a centuries-old system in which elite institutions protect powerful men while sacrificing the vulnerable.
The Epstein-Dershowitz-Summers triangle is not a scandal of individuals gone astray. It is the predictable result of structures that make such abuses almost inevitable.
The Modern Version of an Old System
Jeffrey Epstein built his influence not through scholarship or scientific discovery—he had no advanced degrees—but by inserting himself into the financial bloodstream of the Ivy League. Harvard and MIT accepted his money, his introductions, and his promises of access to ultra-wealthy networks. Epstein did not need credibility; he purchased it.
Larry Summers, as president of Harvard from 2001 to 2006, continued to engage with Epstein after the financier’s first arrest and plea deal. Summers’ administration accepted substantial Epstein donations, including funds channeled into the Program for Evolutionary Dynamics. Summers and his wife dined at Epstein’s Manhattan home. After leaving Harvard, Summers stayed in touch with Epstein even as the financier’s abuses became increasingly public. Summers used the same revolving door that has long connected elite universities, Wall Street, and presidential administrations—moving freely and comfortably across all three.
Alan Dershowitz, former Harvard Law Professor and Epstein’s close associate and legal strategist, exemplifies another pillar of this system: elite legal protection. Dershowitz defended Epstein vigorously, attacked survivors publicly, and remains embroiled in litigation connected to the case. Whether one believes Dershowitz’s claims of innocence is secondary to the structural fact: elite institutions reliably shield their own.
Together, Epstein offered money and connections; Summers offered institutional prestige and political access; Dershowitz offered legal insulation. Harvard, meanwhile, offered a platform through which all three profited.
Knowledge as a Shield—Not a Light
For centuries, elite universities have served as both engines of knowledge and fortresses of power. They are not neutral institutions.
They defended slavery and eugenics, supplying “scientific” justification for racial hierarchies.
They exploited labor—from enslaved workers who built campuses to adjuncts living in poverty today.
They marginalized survivors of sexual violence while protecting benefactors and faculty.
They accepted fortunes derived from war profiteering, colonial extraction, hedge-fund predation, and private-equity devastation.
Epstein did not invent the model of the toxic patron. He merely perfected it in the neoliberal era.
A Four-Step Pattern of Elite Impunity
The scandal surrounding Epstein, Dershowitz, and Summers follows a trajectory that dates back centuries:
Wealth accumulation through exploitation
From slave plantations to private equity, concentrated wealth is generated through systems that harm the many to benefit the few.
The purchase of academic legitimacy
Endowed chairs, laboratories, fellowships, and advisory roles allow dubious benefactors to launder reputations through universities.
Legal and cultural shielding
Elite lawyers, confidential settlements, non-disclosure agreements, and institutional silence create protective armor.
Silencing of survivors and critics
Reputational attacks, threats of litigation, and internal pressure discourage transparency and accountability.
Epstein operated within this system. Dershowitz defended it. Summers benefited from it. Harvard reinforced it.
Larry Summers: An Anatomy of Power
Summers’ career illuminates the deeper structure behind the scandal. His trajectory—Harvard president, U.S. Treasury Secretary, World Bank chief economist, adviser to hedge funds, consultant to Big Tech—mirrors the seamless circulation of elite power between universities, finance, and government.
During his presidency, Harvard publicly embraced Epstein’s donations. After Epstein’s first sex-offense conviction, Summers continued to meet with him socially and professionally. Summers leveraged networks that Epstein also sought to cultivate. And even after the Epstein scandal fully broke open, Summers faced no meaningful institutional repercussions.
The message was clear: individual wrongdoing matters less than maintaining elite continuity.
Higher Education’s Structural Complicity
Elite universities were not “duped.” They were beneficiaries.
Harvard returned only a fraction of Epstein’s donations, and only after the press exposed the relationship. MIT hid Epstein’s gifts behind false donor names. Faculty traveled to his island and penthouse without demanding transparency.
Meanwhile:
Adjuncts qualify for food assistance
Students carry life-crippling debt
Administrators earn CEO-level pay
Donors dictate priorities behind closed doors
This is not hypocrisy—it is hierarchy. A system built to serve wealth does exactly that.
A Timeline Much Longer Than Epstein
To understand the present, we must zoom out:
Oxford and Cambridge accepted slave-trade wealth as institutional lifeblood.
Gilded Age robber barons endowed libraries while crushing labor movements.
Cold War intelligence agencies quietly funded research centers.
Today’s oligarchs, tech billionaires, and private-equity titans buy influence through endowments and think tanks.
The tools change. The pattern does not.
Universities help legitimate the powerful—even when those powerful figures harm the public.
Why This Still Matters
The Epstein scandal is not resolved. Court documents continue to emerge. Survivors continue to speak. Elite institutions continue to stall and deflect. Harvard still resists meaningful transparency, even as its endowment approaches national GDP levels.
The danger is not simply that another Epstein will emerge. It is that elite universities will continue to provide the conditions that make another Epstein inevitable.
What Breaking the Pattern Requires
Ending this system demands more than symbolic gestures or public-relations apologies. Real reform requires:
Radical donor transparency—with all gifts, advisory roles, and meetings disclosed Worker and student representation on governing boards Strong whistleblower protections and the abolition of secret NDAs Robust public funding to reduce reliance on elite philanthropy Independent journalism committed to exposing institutional power
Ida B. Wells, Jessica Mitford, Upton Sinclair, and other muckrakers understood what universities still deny: scandals are symptoms. The disease is structural.
Epstein was not an anomaly.
Dershowitz is not an anomaly.
Summers is not an anomaly.
They are products of a system in which universities serve power first—and truth, only if convenient.
If higher education wants to reclaim public trust, it must finally decide which side of history it is on.
For Generation Z, the old story of social mobility—study hard, go to college, work your way up—has lost its certainty. The class divide that once seemed bridgeable through education now feels entrenched, as debt, precarious work, and economic volatility blur the promise of progress.
The new economy—dominated by artificial intelligence, speculative assets like cryptocurrency, and inflated housing markets—has not delivered stability for most. Instead, it’s widened gaps between those who own and those who owe. Many young Americans feel locked out of wealth-building entirely. Some have turned to riskier bets—digital assets, gig work, or start-ups powered by AI tools—to chase opportunities that traditional institutions no longer provide. Others have succumbed to despair. Suicide rates among young adults have climbed sharply in recent years, correlating with financial stress, debt, and social isolation.
And echoing through this uncertain landscape is a song that first rose from the coalfields of Kentucky during the Great Depression—Florence Reece’s 1931 protest hymn, “Which Side Are You On?”
Come all you good workers,
Good news to you I’ll tell,
Of how the good old union
Has come in here to dwell.
Which side are you on?
Which side are you on?
Nearly a century later, those verses feel newly urgent—because Gen Z is again being forced to pick a side: between solidarity and survival, between reforming a broken system or resigning themselves to it.
The Class Divide and the Broken Ladder
Despite record levels of education, Gen Z faces limited social mobility. College remains a class marker, not an equalizer. Students from affluent families attend better-funded universities, graduate on time, and often receive help with housing or job placement. Working-class and first-generation students, meanwhile, navigate under-resourced campuses, heavier debt, and weaker professional networks.
The Pew Research Center found that first-generation college graduates have nearly $100,000 less in median wealth than peers whose parents also hold degrees. For many, the degree no longer guarantees a secure foothold in the middle class—it simply delays financial independence.
They say in Harlan County,
There are no neutrals there,
You’ll either be a union man,
Or a thug for J. H. Blair.
The metaphor still fits: there are no neutrals in the modern class struggle over debt, housing, and automation.
Debt, Doubt, and the New Normal
Gen Z borrowers owe an average of around $23,000 in student loans, a figure growing faster than any other generation’s debt load. Over half regret taking on those loans. Many delay buying homes, having children, or even seeking medical care. Those who drop out without degrees are burdened with debt and little to show for it.
The debt-based model has become a defining feature of American life—especially for the working class. The price of entry to a better future is borrowing against one’s own.
Don’t scab for the bosses,
Don’t listen to their lies,
Us poor folks haven’t got a chance
Unless we organize.
If Reece’s song once called miners to unionize against coal barons, its spirit now calls borrowers, renters, adjuncts, and gig workers to collective resistance against financial systems that profit from their precarity.
AI and the Erosion of Work
Artificial intelligence promises efficiency, but it also threatens to hollow out the entry-level job market Gen Z depends on. Automation in journalism, design, law, and customer service cuts off rungs of the career ladder just as young workers reach for them.
While elite graduates may move into roles that supervise or profit from AI, working-class Gen Zers are more likely to face displacement. AI amplifies the class divide: it rewards those who already have capital, coding skills, or connections—and sidelines those who don’t.
Crypto Dreams and Financial Desperation
Locked out of traditional wealth paths, many young people turned to cryptocurrency during the pandemic. Platforms like Robinhood and Coinbase promised quick gains and independence from the “rigged” economy. But when crypto markets crashed in 2022, billions in speculative wealth evaporated. Some who had borrowed or used student loan refunds to invest lost everything.
Online forums chronicled not only the financial losses but also the psychological fallout—stories of panic, shame, and in some tragic cases, suicide. The new “digital gold rush” became another mechanism for transferring wealth upward.
The Real Estate Wall
While digital markets rise and fall, real estate remains the ultimate symbol of exclusion. Home prices have climbed over 40 percent since 2020, while mortgage rates hover near 8 percent. For most of Gen Z, ownership is out of reach.
Older generations built equity through housing; Gen Z rents indefinitely, enriching landlords and institutional investors. Without intergenerational help, the “starter home” has become a myth. In America’s new class order, those who inherit property inherit mobility.
Despair and the Silent Crisis
Behind the data lies a mental health emergency. The CDC reports that suicide among Americans aged 10–24 has risen nearly 60 percent in the past decade. Economic precarity, debt, housing insecurity, and climate anxiety all contribute.
Therapists describe “financial trauma” as a defining condition for Gen Z—chronic anxiety rooted in systemic instability. Universities respond with mindfulness workshops, but few confront the deeper issue: a society that privatized risk and monetized hope.
They say in Harlan County,
There are no neutrals there—
Which side are you on, my people,
Which side are you on?
The question lingers like a challenge to policymakers, educators, and investors alike.
A Two-Tier Future
Today’s economy is splitting into two distinct realities:
The secure class, buffered by family wealth, education, AI-driven income, and real estate assets.
The precarious class, burdened by loans, high rents, unstable work, and psychological strain.
The supposed democratization of opportunity through technology and education has in practice entrenched a new feudalism—one coded in algorithms and contracts instead of coal and steel.
Repairing the System, Not the Student
For Generation Z, the American Dream has become a high-interest loan. Education, technology, and financial innovation—once tools of liberation—now function as instruments of control.
Reforming higher education is necessary, but not sufficient. The deeper work lies in redistributing power: capping predatory interest rates, investing in affordable housing, curbing speculative bubbles, ensuring that AI’s gains benefit labor as well as capital, and confronting the mental health crisis that shadows all of it.
Florence Reece’s song endures because its question has never been answered—only updated. As Gen Z stands at the intersection of debt and digital capitalism, that question rings louder than ever:
Which side are you on?
Sources
Florence Reece, “Which Side Are You On?” (1931).
Pew Research Center, “First-Generation College Graduates Lag Behind Their Peers on Key Economic Outcomes,” 2021.
Dēmos, The Debt Divide: How Student Debt Impacts Opportunities for Black and White Borrowers, 2016.
EducationData.org, “Student Loan Debt by Generation,” 2024.
Federal Reserve Bank of St. Louis, Gen Z Student Debt and Wealth Data Brief, 2022.
CNBC, “Gen Z vs. Their Parents: How the Generations Stack Up Financially,” 2024.
WUSF, “Generation Z’s Net Worth Is Being Undercut by College Debt,” 2024.
Newsweek, “Student Loan Update: Gen Z Hit with Highest Payments,” 2024.
The Kaplan Group, “How Student Debt Is Locking Millennials and Gen Z Out of Homeownership,” 2024.
CDC, Suicide Mortality in the United States, 2001–2022, National Center for Health Statistics, 2023.
Brookings Institution, “The Impact of AI on Labor Markets: Inequality and Automation,” 2024.
CNBC, “Crypto Crash Wipes Out Billions in Investor Wealth, Gen Z Most Exposed,” 2023.
Zillow, “U.S. Housing Affordability Reaches Lowest Point Since 1989,” 2024.
“Education, once defended as a public good, now functions as a vehicle for private gain.”
From Collapse to Contagion
The College Meltdown never truly ended—it evolved.
After a decade of spectacular for-profit implosions, the higher education sector has reconstituted itself around new instruments of profit: debt servicing, edtech speculation, and corporate “partnerships” that disguise privatization as innovation.
The College Meltdown Index—tracking a mix of education providers, servicers, and learning platforms—reveals a sector in quiet decay.
Legacy for-profits like National American University (NAUH) and Aspen Group (ASPU) trade at penny-stock levels, while Lincoln Educational (LINC) and Perdoceo (PRDO) stumble through cost-cutting cycles.
Even the supposed disruptors—Chegg (CHGG), Udemy (UDMY), and Coursera (COUR)—are faltering as user growth plateaus and AI reshapes their value proposition.
Meanwhile, SoFi (SOFI), Sallie Mae (SLM), and Maximus (MMS) thrive—not through learning, but through the management of debt.
The Meltdown Graveyard
Below lies a sampling of the education sector’s ghost tickers—the silent casualties of a system that turned public trust into private loss.
Symbol
Institution
Status
Approx. Closure/Delisting
CLAS.U
Class Technologies
Defunct
2024
INST
Instructure (pre-acquisition)
Acquired by Thoma Bravo
2020
TWOUQ
2U, Inc.
Bankrupt
2025
CPLA
Capella University
Merged with Strayer (Strategic Ed.)
2018
ESI-OLD
ITT Technical Institute
Defunct
2016
EDMC
Education Management Corporation
Defunct
2018
COCO-OLD
Corinthian Colleges
Defunct
2015
APOL
Apollo Education Group (U. of Phoenix)
Taken Private
2017
Each ticker represents not only a failed business model—but a generation of indebted students.
The Phoenix That Shouldn’t Have Risen
No institution better symbolizes this moral decay than the University of Phoenix and Phoenix Education Partners (PXED).
At its height, Phoenix enrolled nearly half a million students. By 2017, following federal investigations and mass defaults, Apollo Education Group—its parent company—collapsed under scrutiny.
But rather than disappearing, Phoenix was quietly resurrected through a private equity buyout led by Apollo Global Management, Vistria Group, and Najafi Companies.
Freed from public oversight, the university continued to enroll vulnerable adult learners, harvesting federal aid while shedding accountability.
In 2023, the University of Idaho’s proposed acquisition of Phoenix provoked national outrage, forcing state officials to confront a basic question: Should a public university absorb a for-profit brand built on exploitation?
The deal collapsed—but the temptation to monetize Phoenix’s infrastructure remains. In 2025, a small portion became publicly traded. Its call centers and online systems remain models of enrollment efficiency, designed to extract just enough engagement to secure tuition payments.
From Education to Extraction
The sector’s transformation reveals a deeper moral hazard.
If students succeed, investors profit.
If students fail, federal subsidies and servicer contracts ensure the money keeps flowing.
Executives face no downside. Shareholders are protected. The losses fall on students and taxpayers.
In this sense, the “meltdown” is not a market failure—it’s a market design.
“The winners are those who most efficiently extract value from hope.”
Public universities increasingly partner with private Online Program Managers (OPMs), leasing their brands to companies that control marketing, pricing, and student data. The once-clear line between public and for-profit education has blurred beyond recognition.
The Quiet Winners of Collapse
A few companies continue to prosper by aligning with “practical” or “mission-safe” sectors:
Adtalem (ATGE) in nursing and health education,
Grand Canyon Education (LOPE) in faith-branded online degrees,
Bright Horizons (BFAM) in corporate childcare and workforce training.
Yet all remain heavily dependent on public dollars and tax incentives. The state subsidizes their existence; the market collects the rewards.
Meanwhile, 2U’s bankruptcy leaves elite universities scrambling to explain how a publicly traded OPM, once championed as the future of online learning, could disintegrate overnight—taking with it a network of high-priced “nonprofit” certificate programs.
A Reckoning Deferred
The College Meltdown Index exposes a system that has internalized its own failures.
Fraud has been replaced by financial engineering, transparency by outsourcing, and accountability by spin.
The real collapse is not in the market—but in moral logic. Education, once the cornerstone of social mobility, has become a speculative instrument traded between hedge funds and holding companies.
Until policymakers—and universities themselves—confront the ethics of profit in higher education, the meltdown will persist, slowly consuming what remains of the public good.
“The real question is not whether the system will collapse, but who will rebuild it—and for whom.”
Sources:
Higher Education Inquirer, College Meltdown 2.0 Index (Nov. 2025)
SEC Filings (2010–2025)
U.S. Department of Education, Heightened Cash Monitoring Reports
An American Sickness – Elisabeth Rosenthal
The Goosestep – Upton Sinclair
Medical Apartheid – Harriet A. Washington
Body and Soul – Alondra Nelson
The Immortal Life of Henrietta Lacks – Rebecca Skloot
Negotiated rulemaking, in which the federal government convenes representatives of affected parties before implementing major policy changes, is one of the wonkier topics in higher education. (I cannot recommend enough Rebecca Natow’s book on the topic.) Negotiated rulemaking has been in the news quite a bit lately as the Department of Education works to implement changes to federal student loan borrowing limits passed in this summer’s budget reconciliation law.
Since 2006, students attending graduate and professional programs have been able to borrow up to the cost of attendance. But the reconciliation law limited graduate programs to $100,000 and professional programs to $200,000, setting off negotiations on which programs counted as “professional” (and thus received higher loan limits). The Department of Education started with ten programs and the list eventually went to eleven with the addition of clinical psychology.
In this short post, I take a look at the debt and earnings of these programs that meet ED’s definition of “professional,” along with a few other programs that could be considered professional but were not.
Data and Methods
I used program-level College Scorecard data, focusing on debt data from 2019 and five-year earnings data from 2020. (These are the most recent data points available, as the Scorecard has not been meaningfully updated during the second Trump administration. Five-year earnings get students in health fields beyond medical residencies. I pulled all doctoral/first professional fields from the data by four-digit Classification of Instructional Programs codes, as well as master’s degrees in theology to meet the listed criteria.
Nine of the eleven programs had enough graduates with debt and earnings to report data; osteopathic medicine and podiatry did not. There were five other fields of study with at least 14 programs reporting data: education, educational administration, rehabilitation, nursing, and business administration. All of these clearly prepare people for employment in a profession, but are not currently recognized as “professional.”
Key takeaways
Below is a summary table of debt and earnings for professional programs, including the number of programs above the $100,000 (graduate) and $200,000 (professional) thresholds. Dentistry, pharmacy, and medicine have a sizable share of programs above the $100,000 threshold, while law (the largest field) has only four of 195 programs over $200,000. Theology is the only one of the nine “professional” programs with sufficient data that has higher five-year earnings than debt, suggesting that students in other programs may have a hard time accessing the private market to fill the gap between $200,000 and the full cost of attendance.
On the other hand, four of the five programs not included as “professional” have higher earnings than debt, with nursing and educational administration being the only programs with sufficient data that had debt levels below 60% of earnings. More than one-third of rehabilitation programs had debt over the new $100,000 cap, while few programs in other fields had that high of a debt level. (Education looks pretty good now, doesn’t it?)
I expect the debate over what counts as “professional” to end up in courts and to possibly make its way into a future budget reconciliation bill (about the only way Congress passes legislation at this point). Until then, I will be hoping for newer and more granular data about affected programs.
