Ambow Education, once linked to the Chinese Communist Party (CCP), is aggressively exporting its AI-driven education platform, HybriU™, to global markets—even as its footprint in the United States remains small and opaque. The company’s international ambitions raise questions about transparency, governance, and potential political influence.
Ambow’s recent partnership with Bamboo System Technology aims to scale HybriU’s AI-education ecosystem across Southeast Asia, touting a deeper technology stack and expanded distribution. Yet outside China, Ambow’s record is spotty, and critics warn that the firm’s rapid expansion may outpace oversight or educational rigor.
In the U.S., Ambow reportedly explored a partnership with Colorado State University (CSU), though details remain murky. Engagements like these, combined with its involvement with specialized institutions such as the NewSchool of Architecture and Design, suggest a strategy of targeting schools where oversight may be limited and innovation promises can be oversold.
That strategy has already seen major fallout. Bay State College, which Ambow once owned, officially closed its doors in 2024 after years of financial instability, regulatory scrutiny, and declining enrollment. The college’s demise, following Ambow’s acquisition and subsequent divestment, underscores the risks faced by institutions entangled with opaque foreign education firms that promise modernization but deliver financial collapse.
Despite these global ambitions, Ambow’s American presence is modest: a small office tucked in Cupertino, California, suggesting the company may be testing the waters in the U.S. market rather than committing to a major operational footprint.
Recent corporate moves add to the uncertainty. In October 2025, Ambow filed a stock offering for up to $80 million, a move that could significantly dilute existing shareholders and raise questions about its capital needs, liquidity, and long-term strategy. While the offering may be designed to fund global expansion of HybriU™, analysts have noted the lack of clear financial disclosures and the company’s history of volatile performance.
Promotional efforts also raise eyebrows. Former Adtalem executive James Bartholomew has been enlisted to boost Ambow’s profile, but whether his role is purely marketing or part of a broader legitimacy campaign remains unclear.
For U.S. institutions, Ambow’s history—including prior CCP ties, the collapse of Bay State College, and its aggressive share issuance—presents a cautionary tale: a company that combines ambitious AI promises with a murky past and minimal transparency. Ambow’s expansion illustrates a growing challenge in higher education—navigating partnerships with foreign edtech firms while safeguarding institutional integrity, regulatory compliance, and academic quality.
Sources: Ambow Education press releases, SEC filings, Bamboo System Technology announcements, Higher Education Inquirer reporting, and U.S. Department of Education data.
[In 2017, we collaborated with Crush the Street on a video describing the College Meltdown.]
“Education is not merely a credentialing system; it is a humanizing act that fosters connection, purpose, and community.”
Origins
The College Meltdown began in the mid-2010s as a blog chronicling the slow collapse of U.S. higher education. Rising tuition, mounting student debt, and corporatization were visible signs, but the deeper crisis was structural: the erosion of public accountability and mission.
By 2015, the warning signs were unmistakable to us. On some campuses, student spaces were closed to host corporate “best practices” conferences. At many schools, adjunct instructors carried the bulk of teaching responsibilities, often without benefits, while administrators celebrated innovation. Higher education was quietly being reshaped to benefit corporations over students and communities — a true meltdown.
Patterns of the Meltdown
Enrollment in U.S. colleges began declining as early as 2011, reflecting broader demographic shifts: fewer children entering the system and a growing population of older adults. Small colleges, community colleges, and regional public universities were hardest hit, while flagship institutions consolidated wealth and prestige.
Corporate intermediaries known as Online Program Managers (OPMs) managed recruitment, marketing, and course design, taking large portions of tuition while universities retained risk. Fully automated robocolleges emerged, relying on AI-driven templates, predictive analytics, and outsourced grading. While efficient, these systems dehumanized education: students became data points, faculty became monitors, and mentorship disappeared.
“Robocolleges and AI-driven systems reduce humans to data points — an education stripped of connection is no education at all.”
Feeding the AI Beast
As part of our effort to reclaim knowledge and influence public discourse, we actively contributed to Wikipedia. Over the years, we made more than 12,000 edits on higher education topics, ensuring accurate documentation of predatory practices, adjunct labor, OPMs, and corporatization. These edits both informed the public and, inadvertently, fed the AI beast — large language models and AI systems that scrape Wikipedia for training data now reflect our work, amplifying it in ways we could never have predicted.
“By documenting higher education rigorously, we shaped both public knowledge and the datasets powering AI systems — turning transparency into a tool of influence.”
Anxiety, Anomie, and Alienation
The College Meltdown documented the mental health toll of these transformations. Rising anxiety, feelings of anomie, and widespread alienation were linked to AI reliance, dehumanized classrooms, insecure faculty labor, and societal pressures. Students felt like credential seekers; faculty suffered burnout.
“Addressing the psychological and social effects of dehumanized education is essential for ethical recovery.”
Trump, Anti-Intellectualism, and Fear in the Era of Neoliberalism
The project also addressed the broader political and social climate. The Trump era brought rising anti-intellectualism, skepticism toward expertise, and a celebration of market logic over civic and moral education. For many, it was an era of fear: fear of surveillance, fear of litigation, fear of being marginalized in a rapidly corporatized, AI-driven educational system. Neoliberal policies exacerbated these pressures, emphasizing privatization, metrics, and competition over community and care.
“Living under Trump-era neoliberalism, with AI monitoring, corporate oversight, and mass surveillance, education became a space of anxiety as much as learning.”
Quality of Life and the Call for Rehumanization
Education should serve human well-being, not just revenue. The blog emphasized Quality of Life and advocated for Rehumanization — restoring mentorship, personal connection, and ethical engagement.
“Rehumanization is not a luxury; it is the foundation of meaningful learning.”
FOIA Requests and Whistleblowers
From the start, The College Meltdown relied on evidence-based reporting. FOIA (Freedom of Information Act) requests were used to obtain internal communications, budgets, and regulatory filings, shining light on opaque practices. Whistleblowers, including adjunct faculty and staff at universities and OPMs, provided firsthand testimony of misconduct, financial malfeasance, and educational dehumanization. Their courage was central to the project’s mission of transparency and accountability.
“Insider testimony and public records revealed the hidden forces reshaping higher education, from corporate influence to predatory practices.”
Historical Sociology: Understanding the Systemic Collapse
The importance of historical sociology cannot be overstated in analyzing the decline of higher education. By examining the evolution of educational systems, we can identify patterns of inequality, the concentration of power, and the commodification of knowledge. Historical sociology provides the tools to understand how past decisions and structures have led to the current crisis.
“Historical sociology reveals, defines, and formulates patterns of social development, helping us understand the systemic forces at play in education.”
Naming Bad Actors: Accountability and Reform
A critical aspect of The College Meltdown was the emphasis on naming bad actors — identifying and holding accountable those responsible for the exploitation and degradation of higher education. This included:
University Administrators: Prioritizing profit over pedagogy.
Corporate Entities: Robocolleges and OPMs profiting at the expense of educational quality.
Political Figures and Ultraconservatives: Promoting policies that undermined public education and anti-intellectualism.
“Holding bad actors accountable is essential for meaningful reform and the restoration of education's ethical purpose.”
[In 2016, we called out several bad actors in for-profit higher education, including CEOs Jack Massimino, Kevin Modany, and Todd Nelson.]
Existential Aspects of Climate Change
The blog also examined the existential dimensions of climate change. Students and faculty face a dual challenge: preparing for uncertain futures while witnessing environmental degradation accelerate. Higher education itself is implicated, both as a contributor through consumption and as a forum for solutions. The looming climate crisis intensifies anxiety, alienation, and the urgency for ethical, human-centered education.
“Climate change makes the stakes of education existential: our survival, our knowledge, and our moral responsibility are intertwined.”
Mass Speculation and Financialization
Another critical theme explored was mass speculation and financialization. The expansion of student debt markets, tuition-backed bonds, and corporate investments in higher education transformed students into financial instruments. These speculative dynamics mirrored broader economic instability, creating both a moral and systemic crisis for the educational sector.
“When education becomes a commodity for speculation, learning, mentorship, and ethical development are subordinated to profit and risk metrics.”
Coverage of Protests and Nonviolent Resistance
The College Meltdown documented student and faculty resistance: tuition protests, adjunct labor actions, and campaigns against predatory OPM arrangements. Nonviolent action was central: teach-ins, sit-ins, and organized campaigns demonstrated moral authority and communal solidarity in the face of systemic pressures, litigation, and corporate intimidation.
Collaboration and Resistance
Glen McGhee provided exceptional guidance, connecting insights on systemic collapse, inequality, and credential inflation. Guest authors contributed across disciplines and movements, making the blog a living archive of accountability and solidarity:
Guest Contributors:
Bryan Alexander, Ann Bowers, James Michael Brodie, Randall Collins, Garrett Fitzgerald, Erica Gallagher, Henry Giroux, David Halperin, Bill Harrington, Phil Hill, Robert Jensen, Hank Kalet, Neil Kraus, the LACCD Whistleblower, Wendy Lynne Lee, Annelise Orleck, Robert Kelchen, Debbi Potts, Jack Metzger, Derek Newton, Gary Roth, Mark Salisbury, Gary Stocker, Harry Targ, Heidi Weber, Richard Wolff, and Helena Worthen.
Lessons from the Meltdown
The crisis was systemic. Technology amplified inequality. Corporate higher education rebranded rather than reformed. Adjunctification and labor precarity became normalized. Communities of color and working-class students suffered disproportionately.
Dehumanization emerged as a central theme. AI, automation, and robocolleges prioritized efficiency over mentorship, data over dialogue, and systems over human relationships. Rising anxiety, anomie, and alienation reflected the human toll.
“Rehumanization, mentorship, community, transparency, ethical accountability, and ecological awareness are essential to restore meaningful higher education.”
Looking Forward
As higher education entered the Trump era, its future remained uncertain. Students, faculty, and communities faced fear under neoliberal policies, AI-driven monitoring, mass surveillance, litigation pressures, ultraconservative influence, climate crises, and financial speculation. Will universities reclaim their role as public goods, or continue as commodified services? The College Meltdown stands as a testament to those who resisted dehumanization and anti-intellectualism. It also calls for Quality of Life, ethical practice, mental well-being, environmental responsibility, and Rehumanization, ensuring education serves the whole person, not just the bottom line.
Sources and References
Washington, Harriet A. Medical Apartheid. Doubleday, 2006.
Rosenthal, Elisabeth. An American Sickness. Penguin, 2017.
Skloot, Rebecca. The Immortal Life of Henrietta Lacks. Crown, 2010.
Nelson, Alondra. Body and Soul. University of Minnesota Press, 2011.
Paucek, Chip. “2U and the Growth of OPMs.” EdSurge, 2021. link
Ravitch, Diane. The Death and Life of the Great American School System. Basic Books, 2010.
Alexander, Bryan. Academia Next. Johns Hopkins University Press, 2020.
U.S. Department of Education. “Closed School Information.” 2016–2020. link
Federal Reserve Bank of New York. Student Debt Statistics, 2024. link
Wayback Machine Archive of College Meltdown Blog: link
Borrowers just secured a MAJOR victory!InAFT v. U.S. Department of Education (ED), the Trump Administration agreed toprotect borrowers enrolled in Income-Driven Repayment (IDR) plans and deliver student debt relief to borrowers making payments under those plans for decades.
This is a huge milestone. At the time AFT originally filed the lawsuit in March 2025—represented by Protect Borrowers and Berger Montague—the Trump Administration had removed the application to enroll in IDR from government websites and had issued a secret order to student loan contractors to halt all IDR enrollment and processing. After we filed, the government quickly resumed accepting applications and, months later, began processing those applications again. ED’s recent agreement is the first time the Trump Administration has publicly committed its intent tofollow the law, after representations it made that it wouldn’t cancel debt under certain—and at times, any—IDR plan.
The Administration has now agreed to:
Cancel student debt for all eligible borrowers enrolled in Income-Based Repayment (IBR), Income-Contingent Repayment, and Pay As You Earn payment plans and the Public Service Loan Forgiveness (PSLF) program;
Refund any borrower who makes additional payments beyond the date of eligibility for IDR cancellation;
Process IDR applications and PSLF Buyback applications—including applications for the IBR plan from borrowers without a partial financial hardship.
Recognize the date a borrower becomes eligible for cancellation as the effective date of discharge and not issue IRS forms suggesting that cancelled debt is taxable for borrowers whose effective date is on or before December 31, 2025; and
File six monthly status reports with the court on the status of its IDR and PSLF application and loan cancellation processing—increasing transparency and accountability.
This relief will extend to all borrowers.
Borrowers urgently needed this agreement. Prior to it, borrowers eligible to have their loans cancelled in 2025 were at risk of getting stuck with a large tax bill due to the Administration’s processing delays. This is because Trump and Congressional Republicans’ “One Big Beautiful Bill Act” (OBBBA) permanently extended Congress’s 2018 action to exclude cancelled debts for death or disability from federal taxable income—but not all cancelled student loan debt. As a result, millions of borrowers who earn debt relief under an IDR plan after January 1, 2026, could see their taxes skyrocket. Working families can’t shoulder thousands of dollars in additional taxes—they’re already stretched thin by rising costs of living, a weak job market, mounting levels of debt, and OBBBA’s historic cuts to public benefits.
Nursing has long been romanticized as both a “calling” and a profession—an occupation where devotion to patients is assumed to be limitless. Nursing schools, hospitals, and media narratives often reinforce this ideal, framing the nurse as a tireless caregiver who sacrifices for the greater good. But behind the cultural image is a system that normalizes exhaustion, accepts overwork, and relies on the quiet suffering of an increasingly strained workforce.
The cultural expectation that nurses should sacrifice their own well-being has deep historical roots. Florence Nightingale’s legacy in the mid-19th century portrayed nursing as a noble vocation, tied as much to moral virtue as to medical skill. During World War I and World War II, nurses were celebrated as patriotic servants, enduring brutal conditions without complaint. By the late 20th century, popular culture reinforced the idea of the nurse as both saintly and stoic—expected to carry on through fatigue, trauma, and loss. This framing has carried into the 21st century. During the COVID-19 pandemic, nurses were lauded as “heroes” in speeches, advertisements, and nightly news coverage. But the rhetoric of heroism masked a harsher reality: nurses were sent into hospitals without adequate protective equipment, with overwhelming patient loads, and with little institutional support. The language of devotion was used as a shield against criticism, even as nurses themselves broke down from exhaustion.
The problem begins in nursing education. Students are taught the technical skills of patient care, but they are also socialized into a culture that emphasizes resilience, self-sacrifice, and “doing whatever it takes.” Clinical rotations often expose nursing students to chronic understaffing and unsafe patient loads, but instead of treating this as structural failure, students are told it is simply “the reality of nursing.” In effect, they are trained to adapt to dysfunction rather than challenge it.
Once in the workforce, the pressures intensify. Hospitals and clinics operate under tight staffing budgets, pushing nurses to manage far more patients than recommended. Shifts stretch from 12 to 16 hours, and mandatory overtime is not uncommon. Documentation demands, electronic medical record systems, and administrative oversight add layers of clerical work that take time away from direct patient care. The emotional toll of constantly navigating life-and-death decisions, combined with lack of rest, creates a perfect storm of burnout. The grand irony is that the profession celebrates devotion while neglecting the well-being of the devoted. Nurses are praised as “heroes” during crises, but when they ask for better staffing ratios, safer conditions, or mental health support, they are often dismissed as “not team players.” In non-unionized hospitals, the risks are magnified: nurses have little leverage to negotiate schedules, resist unsafe assignments, or push back against retaliation. Instead, they are expected to remain loyal, even as stress erodes their health and shortens their careers.
Recent years have shown that nurses are increasingly unwilling to accept this reality. In Oregon in 2025, nearly 5,000 unionized nurses, physicians, and midwives staged the largest health care worker strike in the state’s history, demanding higher wages, better staffing levels, and workload adjustments that reflect patient severity rather than just patient numbers. After six weeks, they secured a contract with substantial pay raises, penalty pay for missed breaks, and staffing reforms. In New Orleans, nurses at University Medical Center have launched repeated strikes as negotiations stall, citing unsafe staffing that puts both their health and their patients at risk. These actions are not isolated. In 2022, approximately 15,000 Minnesota nurses launched the largest private-sector nurses’ strike in U.S. history, and since 2020 the number of nurse strikes nationwide has more than tripled.
Alongside strikes, nurses are pushing for legislative solutions. At the federal level, the Nurse Staffing Standards for Hospital Patient Safety and Quality Care Act has been introduced, which would mandate minimum nurse-to-patient ratios and provide whistleblower protections. In New York, the Safe Staffing for Hospital Care Act seeks to set legally enforceable staffing levels and ban most mandatory overtime. Even California, long considered a leader in nurse staffing ratios, has faced crises in psychiatric hospitals so severe that Governor Gavin Newsom introduced emergency rules to address chronic understaffing linked to patient harm. Enforcement remains uneven, however. At Albany Medical Center in New York, chronic understaffing violations led to hundreds of thousands of dollars in fines, a reminder that without strong oversight, even well-crafted laws can be ignored.
The United States’ piecemeal and adversarial approach contrasts sharply with other countries. In Canada, provinces like British Columbia have legislated nurse-to-patient ratios similar to those in California, and in Quebec, unions won agreements that legally cap workloads for certain units. In the United Kingdom, the National Health Service has long recognized safe staffing as a matter of public accountability, and while austerity policies have strained the system, England, Wales, and Scotland all employ government-set nurse-to-patient standards to protect both patients and staff. Nordic countries go further, with Sweden and Norway integrating nurse well-being into health policy; short shifts, strong union protections, and publicly funded healthcare systems reduce the risk of burnout by design. While no system is perfect, these models show that burnout is not inevitable—it is a political and policy choice.
Union presence consistently makes a difference. Studies show that unionized nurses are more successful at securing safe staffing ratios, resisting exploitative scheduling, and advocating for patient safety. But unionization rates in nursing remain uneven, and in many states nurses are discouraged or even legally restricted from organizing. Without collective power, individual nurses are forced to rely on personal endurance, which is precisely what the system counts on.
The outcome is devastating not only for nurses but for patients. Burnout leads to higher turnover, staffing shortages, and medical errors—all while nursing schools continue to churn out new graduates to replace those driven from the profession. It is a cycle sustained by institutional denial and the myth of infinite devotion.
If U.S. higher education is serious about preparing nurses for the future, nursing programs must move beyond the rhetoric of sacrifice. They need to teach students not only how to care for patients but also how to advocate for themselves and their colleagues. They need to expose the structural causes of burnout and prepare nurses to demand better conditions, not simply endure them. Until then, the irony remains: a profession that celebrates care while sacrificing its caregivers.
Sources
American Nurses Association (ANA). “Workplace Stress & Burnout.” ANA Enterprise, 2023.
National Nurses United. Nursing Staffing Crisis in the United States, 2022.
Bae, S. “Nurse Staffing and Patient Outcomes: A Literature Review.” Nursing Outlook, Vol. 64, No. 3 (2016): 322-333.
Bureau of Labor Statistics. “Union Members Summary.” U.S. Department of Labor, 2024.
Shah, M.K., Gandrakota, N., Cimiotti, J.P., Ghose, N., Moore, M., Ali, M.K. “Prevalence of and Factors Associated With Nurse Burnout in the US.” JAMA Network Open, Vol. 4, No. 2 (2021): e2036469.
Nelson, Sioban. Say Little, Do Much: Nursing, Nuns, and Hospitals in the Nineteenth Century. University of Pennsylvania Press, 2001.
Kalisch, Philip A. & Kalisch, Beatrice J. The Advance of American Nursing. Little, Brown, 1986.
Oregon Capital Chronicle, “Governor Kotek Criticizes Providence Over Largest Strike of Health Care Workers in State History,” January 2025.
Associated Press, “Oregon Health Care Strike Ends After Six Weeks,” February 2025.
National Nurses United, “New Orleans Nurses Deliver Notice for Third Strike at UMC,” 2025.
NurseTogether, “Nurse Strikes: An Increasing Trend in the U.S.,” 2024.
New York State Senate Bill S4003, “Safe Staffing for Hospital Care Act,” 2025.
San Francisco Chronicle, “Newsom Imposes Emergency Staffing Rules at State Psychiatric Hospitals,” 2025.
Times Union, “Editorial: Hospital’s Staffing Violations Show Need for Enforcement,” 2025.
Oulton, J.A. “The Global Nursing Shortage: An Overview of Issues and Actions.” Policy, Politics, & Nursing Practice, Vol. 7, No. 3 (2006): 34S–39S.
Rafferty, Anne Marie et al. “Outcomes of Variation in Hospital Nurse Staffing in English Hospitals.” BMJ Quality & Safety, 2007.
Aiken, Linda H. et al. “Nurse Staffing and Education and Hospital Mortality in Nine European Countries.” The Lancet, Vol. 383, No. 9931 (2014): 1824–1830.
The term authoritarian plutocracy captures how higher education is being reshaped: rather than overt state control in classic fascist style, what we are witnessing is the systematic hollowing of regulatory protections, the transfer of public funding into private profit, and the disciplining of institutions and individuals by political fiat. In the most recent year, several policy shifts make this trajectory unmistakably visible.
Since assuming (his current) office, Trump’s administration has embarked on sweeping reforms and legislative changes that illustrate how deregulation and elite enrichment are prioritized over the welfare of students, lenders, and institutions. Legislative changes embodied in the Reconciliation Law (signed July 4, 2025) carry radical higher-education implications: it overhauls the federal student aid system; imposes limits on borrowing for graduate and professional students and for parent borrowers; reduces the number and generosity of income-based repayment plans; rolls back accountability measures aimed at protecting students from fraud; delays or reverts protections for those wronged by their institutions; and makes cuts that affect affordability and access. TICAS
One prominent change under the new law is the elimination of the Graduate PLUS loan program, replaced with new annual and lifetime borrowing caps for graduate and professional students. Parent PLUS loans likewise face severe new restrictions. Borrowers in many categories will lose access to multiple repayment plans now in use (e.g. ICR, PAYE, REPAYE, SAVE) and effectively be pushed into just two new repayment pathways: a standard plan and a new “Repayment Assistance Plan.” These reforms will kick in for new borrowers after July 1, 2026, and for current borrowers by 2028 in many cases. TICAS
Another significant shift involves interest and repayment policy for millions of borrowers. The Department of Education has restarted interest accrual on federal student loans under the SAVE plan as of August 1, 2025, following court rulings that blocked parts of the plan. This means those enrolled will begin seeing their loan balances grow again, while being urged to move to other repayment regimes that conform to legal constraints. U.S. Department of Education
Regulatory changes in other areas also reflect the same pattern. Final regulations published in early 2025 address Return to Title IV Funds (R2T4) and rules for distance education and TRIO programs, scheduled to take effect in mid-2026 unless otherwise noted. These rules both tighten and loosen oversight in ways that can benefit institutional actors at the expense of students—by giving schools more flexibility on refunds, changing how module-based courses are treated, and slowing implementation of reporting requirements. NACUBO Meanwhile, some proposed regulatory changes—in cash management (how institutions manage and use financial aid dollars), state authorization, accreditation—were withdrawn by December 2024, signaling a retreat from tighter controls. SPARC+1
Perhaps most emblematic is the ongoing effort to reduce or even dismantle parts of the federal oversight apparatus. In March 2025, Trump signed an executive order directing the Secretary of Education to “facilitate the closure of the Department of Education and return authority over education to the States and local communities.” Simultaneously, a major workforce reduction was announced in the Department. Roughly half of its employees were targeted in layoffs or reassignments as part of a broader reorganization affecting Federal Student Aid and the Office for Civil Rights. A federal court blocked part of the mass layoff effort in May, but the direction is clear: less oversight, fewer protections, more discretion for institutions and private actors. Wikipedia
The cumulative effect of these changes is consistent with what authoritarian plutocracy demands. Borrowers now face fewer repayment options, steeper obligations, and less protection from predatory behavior. Institutions, freed from some regulatory strictures, may gain flexibility—and private firms (including lenders, servicers, edtech providers, OPMs) stand to benefit. The regulatory wind has shifted to favor profit and power; public accountability, student welfare, and equity are increasingly secondary.
In higher education, as elsewhere, what matters isn't only what laws are passed but what and who those laws empower—and what they disable. For students, faculty, and institutions without deep political connections or financial buffers, the risk is that higher education becomes less a public good and more a venture to be leveraged by the powerful.
Recent Sources & Reporting
“Provisions Affecting Higher Education in the Reconciliation Law,” TICAS, July 15, 2025 TICAS
U.S. Department of Education press release on SAVE plan interest accrual policy, July 9, 2025 U.S. Department of Education
“ED Finalizes Rules on Return to Title IV and Distance Education,” NACUBO, Jan. 2025 NACUBO
“2024 U.S. Department of Education Negotiated Rulemaking,” SPARC Open SPARC
“ED Finalizes Biden-Era Regulations, Withdraws Proposals Amid Transition,” ACE, Jan. 13, 2025 American Council on Education
Reporting on proposed closure / layoff / reorg in the Department of Education
In 1857, Herman Melville published The Confidence-Man: His Masquerade, a cryptic, satirical novel set aboard a Mississippi steamboat. The titular character—ever-shifting, ever-deceiving—exploits the trust of passengers in a society obsessed with profit, spectacle, and moral ambiguity. That same year, the United States plunged into its first global financial crisis, the Supreme Court issued the Dred Scott decision denying citizenship to Black Americans, and violence erupted in Kansas over slavery. The nation was expanding westward while morally imploding.
Fast forward to 2025, and the parallels are chilling.
The Collapse of Confidence
The Panic of 1857 was triggered by speculative bubbles, banking failures, and the sinking of a gold-laden ship meant to stabilize Eastern banks. In 2025, the U.S. faces a different kind of panic: record-high debt servicing costs, a fragile labor market dominated by gig work, and a public increasingly skeptical of financial institutions. The Department of Government Efficiency (DOGE), led by Elon Musk, has slashed federal jobs and privatized public services, echoing the confidence games of Melville’s era.
Trust—once the bedrock of civic life—is now a currency in freefall.
Judicial Earthquakes and Political Fragmentation
In 1857, the Supreme Court’s Dred Scott decision shattered any illusion of unity. Today, the return of Donald Trump to the presidency has reignited deep political divisions. Executive orders, agency dismantling, and immigration crackdowns have triggered constitutional challenges reminiscent of the 1850s. The rule of law feels increasingly negotiable.
Higher education institutions, once bastions of reasoned debate, now find themselves caught between political polarization and economic precarity. Faculty are pressured to conform, students are surveilled, and public trust in academia is eroding.
Spectacle, Deception, and the Digital Masquerade
Melville’s confidence man sold fake medicines and bogus charities. In 2025, deception is digitized: AI-generated content, deepfakes, and influencer culture dominate public discourse. The masquerade continues—only now the steamboat is a livestream, and the con artist might be an algorithm.
Universities must grapple with this new epistemological crisis. What is truth in an age of synthetic media? What is scholarship when data itself can be manipulated?
Moral Reckonings and Institutional Failure
In both 1857 and 2025, America faces a reckoning. Then, it was slavery and sectional violence. Now, it’s climate collapse, racial injustice, and the erosion of democratic norms. The question is not whether institutions will survive—but whether they can evolve.
Higher education must decide: Will it be a passive observer of decline, or an active agent of renewal?
The Confidence Man Returns
Melville’s novel ends without resolution. The confidence man disappears into the crowd, leaving readers to wonder whether anyone aboard the steamboat was ever truly honest. In 2025, we face a similar uncertainty. The masquerade continues, and the stakes are higher than ever.
For higher education, the challenge is clear: to restore trust, to defend truth, and to prepare students not just for jobs—but for citizenship in an age of confidence games.
The American Federation of Teachers (AFT) has filed an amended complaint against the U.S. Department of Education and Secretary Linda McMahon, seeking class action status on behalf of millions of borrowers. The lawsuit alleges that the Department is unlawfully delaying or denying student loan forgiveness under income-driven repayment (IDR) and Public Service Loan Forgiveness (PSLF).
On paper, this is a fight about administrative backlogs and program freezes. In reality, it exposes how the U.S. higher education system continues to operate as a debt trap, where promises of relief are routinely broken, and working families are forced to subsidize a predatory credential economy.
Debt as a Business Model
The Department of Education froze IDR processing for months, building a backlog that once stood at more than two million borrowers. Even after “restarting” the system, more than a million remain stuck. PSLF’s “Buyback” program alone is stalled with 74,000 unresolved cases.
These are not small bureaucratic hiccups—they are structural features of a system designed to delay cancellation for as long as possible. Borrowers who have made 20, 25, or even 30 years of payments are told to keep paying while they wait for forgiveness that may never come. Refunds are promised but often months away. Meanwhile, loan servicers continue to collect billions in revenue from a population already ground down by decades of repayment.
This isn’t simply mismanagement. It’s debt peonage, engineered by policymakers who present repayment as a civic duty while ensuring that the cycle of indebtedness continues.
The Human Cost
The lawsuit documents borrowers choosing between student loan payments and medical care, postponing life decisions like marriage or homeownership, and even contemplating bankruptcy. Beyond the financial harm, there is profound psychological damage—stress, sleeplessness, and a deepening sense of betrayal by a government that promised relief in exchange for decades of faithful repayment.
The looming “tax bomb” magnifies the crisis. Unless forgiveness is processed before January 1, 2026, discharged balances under IDR will once again be taxable income. That means borrowers who finally achieve cancellation could be hit with crushing IRS bills. Congress has already acted to expand eligibility under the “One Big Beautiful Bill Act,” but the Department continues to deny applications based on rules that no longer exist.
Historical Parallels: A Long Tradition of Debt Betrayal
The student debt crisis is only the latest in a series of American debt struggles where relief was promised but strategically withheld:
Farm Debt in the 1980s: Family farmers were told federal programs would help restructure loans. Instead, banks and agencies delayed, forcing foreclosures that devastated rural America.
The GI Bill’s Unequal Promise: While the GI Bill created new opportunities, Black veterans were systematically denied benefits through local gatekeeping. Access existed in theory but was obstructed in practice.
The Mortgage Crisis of 2008: Homeowners seeking modifications found banks losing paperwork, delaying applications, and profiting from continued payments—an eerie echo of today’s student loan servicing delays.
Each moment reflects the same pattern: debt relief as rhetoric, obstruction as reality.
A System Rigged to Fail Workers
The AFT’s legal filing is narrowly focused on the Administrative Procedure Act, accusing the Department of unlawfully withholding benefits and acting arbitrarily. But the larger structural truth is clear: the U.S. economy relies on debt as a mode of governance.
Student debt now exceeds $1.6 trillion. Universities raise tuition, Wall Street profits from securitized loans, and loan servicers pocket fees from keeping borrowers in repayment limbo. Meanwhile, adjunct professors earn poverty wages, and graduates face underemployment that makes repayment impossible. Higher education is no longer a ladder to the middle class—it is a system of extraction.
Looking Ahead: 2027 and Beyond
Even if courts intervene before the 2026 tax deadline, borrowers face another looming threat: the 2027 austerity cuts, including deep reductions in Medicaid.
For working families, this collision will be devastating. Many borrowers already choose between student loan payments and medical care. When Medicaid cuts hit, tens of millions will lose access to basic health coverage. The financial vise will tighten: loan payments on one side, healthcare costs on the other. The most vulnerable—low-income borrowers, caregivers, the disabled—will be left with no safety net.
In this light, the Department’s refusal to process loan forgiveness is not just bureaucratic delay. It is part of a broader austerity regime that disciplines workers through debt, strips away public benefits, and reinforces a permanent underclass of the indebted.
What’s at Stake
The AFT is asking the courts to compel the Department to process long-overdue discharges. Hearings are expected this fall, with a ruling possible before year’s end. But even if the courts side with borrowers, the deeper crisis remains: a political economy that treats debt not as a temporary burden but as a permanent condition of American life.
For borrowers, this case is about more than loan forgiveness. It is about whether the U.S. will continue its long tradition of promising relief while delivering betrayal—or whether working families will finally break the cycle of debt dependency before the coming wave of austerity in 2027 makes it even harder to escape.
Sources
American Federation of Teachers, Amended Complaint Against Department of Education (2025)
U.S. Department of Education, IDR and PSLF Program Guidance
The College Investor, “Education Dept. Accused of Blocking Student Loan Forgiveness” (2025)
Michael Hudson, Killing the Host (2015)
Maurizio Lazzarato, The Making of the Indebted Man (2012)
In a move that has rattled institutions, students, and advocates, the U.S. Department of Education under the Trump administration has announced it will eliminate approximately $350 million in discretionary grant funding for dozens of minority-serving institutions (MSIs) nationwide. The cuts affect seven major grant programs that support Hispanic-Serving Institutions, Predominantly Black Institutions, Alaska Native and Native Hawaiian-Serving Institutions, and Asian American, Native American, and Pacific Islander-Serving Institutions.
The administration’s stated rationale is that these programs violate constitutional equal protection principles by limiting eligibility based on race and ethnicity. A Solicitor General determination in July argued that some of these programs run afoul of the Fifth Amendment’s Equal Protection Clause. As a result, the Department of Education says it must terminate these discretionary funds and “reprogram” them into initiatives without race or ethnicity as eligibility criteria.
These grants have been essential for many MSIs: they have financed academic support services, facility improvements, staffing, mentoring and advising programs, and Science, Technology, Engineering, and Mathematics pathways aimed at underrepresented students. They have also helped institutions meet accreditation requirements and federal compliance demands. In the California State University system, for instance, 21 of its 22 campuses qualify as Hispanic-Serving Institutions. CSU Chancellor Mildred GarcÃa has warned that the loss of funding will cause “immediate impact and irreparable harm” across the system, with many of those campuses having Hispanic students constituting nearly half of their enrollment.
Legally, the Department of Justice has declined to defend several of these MSI programs in litigation filed by Tennessee and Students for Fair Admissions. The core legal claim is that race- or ethnicity-based eligibility constitutes an unconstitutional preference not sufficiently justified under strict scrutiny. The administration has portrayed its actions not only as legal necessities but as aligning with broader priorities that avoid what it sees as constitutionally weak race-based criteria.
The consequences are likely to be broad. Without this discretionary funding, many MSIs will struggle to maintain programs focused on student persistence, remedial education, and equity‐oriented innovation. Services and supports for students who already face systemic barriers risk being cut. For students, this could translate into higher dropout rates, longer time to degree, and fewer resources. More broadly, institutions serve as engines of social mobility; removing a key source of institutional support may disproportionately harm communities of color and rural or underserved areas.
These changes arrive amid growing concerns about campus safety and the psychological toll inflicted by fear and disruption. In recent days several Historically Black Colleges and Universities (HBCUs) have been forced into lockdown or canceled classes following hoax threat calls—“swatting” incidents—that mimic real violence but are ultimately false. Schools including Virginia State University, Hampton University, Alabama State University, Bethune-Cookman University, Spelman College, Morehouse, Clark Atlanta, Southern University & A&M College, and others faced terroristic threat letters or hoax calls that led to shelter-in-place orders, lockdowns, and heightened security measures. Though the FBI confirms that as of now no credible threat has been identified in many cases, the disruption has been real and traumatic for students, faculty, and administrators. These events underscore how fragile promises of safety can be, especially in institutions that already contend with systemic underfunding and inequity.
Administrations of affected universities have responded with caution. Some campuses suspended operations entirely, others canceled classes for multiple days, and many restricted access and tightened identification requirements. There are also broader legal and psychological costs: the stress, fear, and interruption to learning can exacerbate existing inequities in mental health and academic performance.
Even congressionally mandated funding—approximately $132 million that cannot immediately be reprogrammed—is under review for constitutionality. If more funding is cut or reallocated, more programs that target underrepresented populations by race or ethnicity may be dismantled.
Reaction from campus leaders, student advocates, and civil rights organizations has been swift. Many insist that these MSI programs are essential for closing equity gaps and forging institutional capacity that benefits all students. They argue that the cuts and these swatting-style threats combine to send a message: that institutions serving marginalized communities are especially vulnerable, legally and physically. The administration holds that it is compelled by constitutional law to end programs it deems indefensible, and that reprogramming funds to race-neutral programs is the correct path forward.
Looking ahead, legal challenges are almost certain. Questions include: what justifications are required under constitutional scrutiny; whether socioeconomic, geographic, or first-generation status metrics can be substituted for race or ethnicity eligibility; how institutions will respond financially and operationally; and what role Congress might play in defending or restructuring funding mandates. Meanwhile, ensuring physical and psychological safety on campuses—especially HBCUs—will remain a pressing concern in a climate where hoaxes and threats have become disturbingly frequent.
The elimination of $350 million in discretionary grants to minority-serving institutions marks a major shift in federal higher education policy. For MSIs, their students, and the communities they serve, the immediate effects may be devastating. But the broader questions raised—about constitutional limits, equity, race as public policy, and the safety of marginalized communities—are likely to echo well beyond this administration.
Sources
Diverse: Issues in Higher Education, “Trump Administration Cuts $350 Million in Grants to Minority-Serving Colleges,” September 2025.
AP News, “Historically Black Colleges Issue Lockdown Orders, Cancel Classes After Receiving Threats,” September 2025. apnews.com
Washington Post, “Multiple Historically Black Colleges Launch Lockdowns After ‘Terroristic’ Threat,” September 2025. washingtonpost.com
Axios, “’Terroristic threats’ disrupt life at HBCUs across the U.S.” axios.com
People Magazine, “Threats Force Multiple HBCUs Across Southern U.S. to Lock Down, Cancel Classes.” people.com
The Guardian, “Black students and colleges across US targeted with racist threats day after Charlie Kirk killing.” theguardian.com
The Higher Education Inquirer has crossed another milestone, reaching more than 600,000 views over the past quarter. For a niche publication without corporate backing, this is a significant achievement. But the real measure of success is not in page views—it is in the stories that matter, the investigations that refuse to die even when the higher education establishment would rather they disappear.
Since its inception, HEI has taken the long view on the crises and contradictions shaping U.S. colleges and universities. We continue to probe the issues that mainstream media outlets often skim or ignore. These are not passing headlines; they are structural problems, many of them decades in the making, that affect millions of students, faculty, staff, and communities.
Among the stories we continue to pursue:
Charlie Kirk and Neofascism on Campus: Tracing how right-wing movements use higher education as a recruiting ground, and how student martyrdom narratives fuel a dangerous cycle.
Academic Labor and Adjunctification: Investigating the systemic exploitation of contingent faculty, who now make up the majority of the academic workforce.
Higher Education and Underemployment: Examining how rising tuition, debt, and credentials collide with a labor market that cannot absorb the graduates it produces.
EdTech, Robocolleges, and the University of Phoenix: Following the money as education technology corporations replace faculty with algorithms and marketing schemes.
Student Loan Debt and Borrower Defense to Repayment: Tracking litigation, regulatory shifts, and the human toll of a $1.7 trillion debt system.
U.S. Department of Education Oversight: Analyzing how federal enforcement waxes and wanes with political cycles, often leaving students exposed.
Online Program Managers and Higher Ed Privatization: Investigating the outsourcing of core academic functions to companies driven by profit, not pedagogy.
Edugrift and Bad Actors in Higher Education: Naming the profiteers who siphon billions from public trust.
Medugrift and University Medicine Oligopolies: Connecting elite medical centers to systemic inequality in U.S. healthcare.
Student Protests: Documenting student resistance to injustice on campus and beyond.
University Endowments and Opaque Funding Sources: Pulling back the curtain on how universities build wealth while raising tuition.
Universities and Gentrification: Exposing the displacement of working-class communities in the name of “campus expansion.”
Ambow Education as a Potential National Security Threat: Tracking foreign-controlled for-profit education companies and their entanglements.
Accreditation: Examining the gatekeepers of legitimacy and their failure to protect students.
International Students: Covering the precarity of students navigating U.S. immigration and education systems.
Student Health and Welfare: Looking at how universities fail to provide adequate physical and mental health support.
Hypercredentialism: Interrogating the endless inflation of degrees and certificates that drain students’ time and money.
Veritas: Pursuing truth in higher education, no matter how uncomfortable.
These are the stories that make HEI more than just a blog—they make it a watchdog. As higher education drifts deeper into corporatization and inequality, we will keep asking difficult questions, exposing contradictions, and documenting resistance.
The numbers are gratifying. But the truth is what matters.
Anosognosia is the inability to recognize one’s own illness or disability. In higher education, it describes the chronic denial of a system in crisis—one that refuses to admit its own collapse.
For decades, U.S. higher education has been sold as the great equalizer. The story was simple: borrow, study, graduate, succeed. But the data show the opposite. What we are witnessing is a long college meltdown, masked by denial at the highest levels of government, university administrations, and Wall Street.
The Debt Trap
Outstanding student loan debt now exceeds $1.77 trillion, burdening more than 43 million Americans.
Nearly 20 percent of borrowers are in default or serious delinquency.
Black borrowers, especially Black women, carry the heaviest burdens and are least likely to see upward mobility from their degrees.
Many in income-driven repayment programs will never pay off principal, living in a permanent state of debt peonage.
Universities and policymakers insist debt is an “investment.” But for millions, it is a generational shackle.
The Exploited Faculty
More than 70 percent of college instructors are contingent.
Adjuncts often earn less than $3,500 per course, with no healthcare, no retirement, and no security.
Roughly one in four adjuncts relies on public assistance.
Universities still market themselves as communities of scholars. In reality, they operate on the same exploitative labor practices as Uber or Amazon.
The Employment Mismatch
Four in ten recent grads work in jobs that don’t require a degree.
One-third of graduates say their work is unrelated to their major.
Median real wages for college graduates have been flat for 25 years.
Still, higher ed pushes “lifelong learning” credentials, turning underemployment into a new revenue stream.
Prestige as Denial
At Ivy League universities, 40 percent of students come from the top 5 percent of households.
Fewer than 5 percent come from the bottom fifth.
Endowments soar—Harvard’s sits at $50 billion—but tuition relief and faculty wages barely budge.
This is not mobility. It is a hereditary elite cloaked in the language of meritocracy.
Climate Contradictions
Universities promote sustainability but invest billions in fossil fuels.
Campus expansion and luxury amenities drive up emissions, water use, and labor exploitation.
Even here, anosognosia reigns: branding over reality.
The Meltdown Denied
The college meltdown has been unfolding for more than a decade:
Small liberal arts colleges shuttering.
Regional publics bleeding enrollments.
For-profits morphing into “nonprofits” while still funneling money to investors.
State funding eroded, shifting the cost to students and families.
But instead of confronting the collapse, higher ed leaders rely on rhetoric: “innovation,” “resilience,” “access.” Like anosognosia, denial itself becomes survival.
The Human Cost
The denial is not harmless. It is measured in:
The indebted graduate delaying family formation and homeownership.
The adjunct commuting across counties to string together courses while living below the poverty line.
The working-class family betting their savings on a degree that will not deliver mobility.
The meltdown is here. Higher education’s inability—or refusal—to admit it ensures the damage will deepen.
Truth and Healing
Anosognosia prevents healing because it prevents recognition of the problem. U.S. higher education cannot admit its own disease, so it cannot begin recovery. Until it does, students, families, and workers will bear the costs of a system in denial.
Sources
Federal Reserve Bank of New York, Quarterly Report on Household Debt and Credit (2025)
National Center for Education Statistics (NCES), Digest of Education Statistics (2023)
American Association of University Professors (AAUP), Annual Report on the Economic Status of the Profession (2024)
Pew Research Center, The Rising Cost of Not Going to College (2023 update)
The Century Foundation, Adjunct Project (2022)
Chetty et al., Mobility Report Cards: The Role of Colleges in Intergenerational Mobility (2017, with updates)
IPEDS (Integrated Postsecondary Education Data System), U.S. Department of Education
