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
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
[Editors note: "No Stop" Heidi Weber has been a hero of ours for several years. Her courage fighting corruption at Globe University was documented on an episode of CBS Whistleblower.]
First, I would like to thank Dahn, and all the other truth tellers who work tirelessly every day and sacrifice so much to elevate truth. Without them, any whistleblower efforts would not have half the positive impact that they do.
For years, I really struggled with the title of whistleblower. I thought if I could distance myself from it, all the resulting traumas would just disappear, and life would be “normal” again.
However, I underestimated how much a landmark whistleblower case, especially in higher education, would affect and continually haunt me. I'm glad now, that it did, because it forced me to see how much of an impact it has had on an entire for-profit sector. I learned it's ok to allow myself to feel a sense of pride. After all, it was the most painful, stressful thing I imagined I'd ever go through.
Unfortunately, life didn't get that memo and still had lessons for me about the depth of pain adversity, and struggle, in ways that I never imagined.
In the middle of the pandemic, my husband’s sudden unexpected stroke forced us into a reality we weren’t prepared for. Overnight, I became his nurse, advocate, cheerleader, and his sole rehabilitation task master, simultaneously trying to maintain and hold our home together and make ends meet.
At the same time, our once close, beautiful, adult daughters estranged from us without explanation, treating us as if we do not exist, and are of no value to them... *
All I knew, was that it resulted in leaving a pain and heartache so profound that has reshaped the way I understand love, loss, and resilience.
In the midst of these personal storms, I rediscovered a purpose in educating and helping others as an advocate. So, I added two post graduate certificates and learned how to support and even the field for families who feel powerless in a biased system financially incentivized to separate families and little accountability or oversight.
Injustice and unfairness still stir a fire in me, just as it had when I made that fateful decision to become a whistleblower, and it still inspires me to be relentless in seeking truth and fairness.
Only now, I have the unique experience and knowledge to inspire/teach others.
Currently, I've been writing curricula and developing an online training program for a Certificate as a Justice Support Advocate. It focuses on some basic foundations of civics, (no longer taught in school), finding your own resilience and purpose, the various types of advocates, incorporating it into your personal and professional life, and protecting yourself and the public at the same time.
My wish is for learners to find their own fire and realize that courage is easier found when you are fighting for what you know is true and just for everyone, no matter what that is.
I've also been doing family advocacy consulting work, as an affordable option for parents, alone or as a partner to their attorney to provide non legal support, evaluation, investigation, and provide fair, logical solutions:
1. For parents facing or concerned about unethical practices in the Child Protective Services (CPS) system to audit, teach and ensure that parents are being portrayed truthfully with reasonable realistic goals to reunite the family, if indicated.
2. In high conflict custody, providing evaluation and screening for signs of parental alienation, and support, education, and resources (to both parents) on how to navigate being a divorced family, as well as providing recommendations to the Court (if indicated) centered around the best interests of the child and importance of both parents to healthy development.
If you would like to discuss either of those services or more info on the advocacy certificate course, please contact me at nostopheidi@gmail.com. I'm shooting for February or March 2026 to have the website, and course available online.
These years have been painful, transformative, and defining, but with pain comes growth and wisdom. Life still had more lessons…. to show me there is no limit to how much I can carry and keep positively moving forward.
*Adult children from “normal” average parents have become an almost celebrated (unhealthy) trend over the last ten years especially, for many adult children who have been influenced, poisoned, or alienated against one or both parents by undertrained therapists, peers, and social media influencers, allowing avoidance of responsibility, self-discipline, or concern for others.
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
Calls for divestment from exploitative industries have long been part of movements for social and economic justice—whether opposing apartheid, fossil fuels, or private prisons. Today, another sector demands moral scrutiny: the network of for-profit education corporations and student loan servicers that have turned higher learning into a site of mass indebtedness and despair. From predatory colleges to the companies that profit from collecting on student debt, the system functions as a pipeline of extraction. For those who believe education should serve the public good, the issue is not merely financial—it is moral.
The Human Cost of Predatory Education
For decades, for-profit college chains such as Corinthian Colleges, ITT Tech, the University of Phoenix, DeVry, and Capella targeted low-income students, veterans, single parents, and people of color with high-pressure marketing and promises of career advancement. These institutions, funded primarily through federal student aid, often charged premium tuition for substandard programs that left graduates worse off than when they began.
When Corinthian and ITT Tech collapsed, they left hundreds of thousands of students with worthless credits and mountains of debt. But the collapse did not end the exploitation—it simply shifted it. The business model has re-emerged in online form through education technology and “online program management” (OPM) firms such as 2U, Coursera, and Academic Partnerships. These firms, in partnership with elite universities like Harvard, Yale, and USC, replicate the same dynamics of inflated costs, opaque contracts, and limited accountability.
The Servicing of Debt as a Business Model
Beyond the schools themselves, student loan servicers and collectors—Maximus, Sallie Mae, and Navient among them—have built immense profits from managing and pursuing student debt. Sallie Mae, once a government-sponsored enterprise, was privatized in the 2000s and evolved into a powerful lender and loan securitizer. Navient, its spinoff, became notorious for deceptive practices and aggressive collections that trapped borrowers in cycles of delinquency.
Maximus, a major federal contractor, now services defaulted student loans on behalf of the U.S. Department of Education. These companies profit directly from the misery of borrowers—many of whom are victims of predatory schools or structural inequality. Their incentive is not to liberate students from debt, but to sustain and expand it.
The Role of Institutional Investors
The complicity of institutional investors cannot be ignored. Pension funds, endowments, and major asset managers have consistently financed both for-profit colleges and loan servicers, even after repeated scandals and lawsuits. Public sector pension funds—ironically funded by educators—have held stock in Navient, Maximus, and large for-profit college operators. Endowments that pride themselves on ethical or ESG investing have too often overlooked education profiteering.
Investment firms like BlackRock, Vanguard, and State Street collectively hold billions of dollars in these companies, stabilizing an industry that thrives on the financial vulnerability of students. To profit from predatory education is to participate, however indirectly, in the commodification of aspiration.
Divestment as a Moral and Educational Act
Divesting from predatory education companies and loan servicers is not just an act of conscience—it is an educational statement in itself. It affirms that learning should be a vehicle for liberation, not a mechanism of debt servitude. When universities, pension boards, and faith-based investors divest from corporations like Maximus, Navient, and 2U, they are reclaiming education’s moral purpose.
The divestment movement offers a broader civic lesson: that profit and progress are not synonymous, and that investment must align with justice. Faith communities, student debt activists, and labor unions have made similar stands before—against apartheid, tobacco, and fossil fuels. The same principle applies here. An enterprise that depends on deception, coercion, and financial harm has no place in a socially responsible portfolio.
A Call to Action
Transparency is essential. Pension boards, university endowments, and foundations must disclose their holdings in for-profit education and student loan servicing companies. Independent investigations should assess the human consequences of these investments, particularly their disproportionate impact on women, veterans, and people of color.
The next step is moral divestment. Educational institutions, public pension systems, and religious organizations should commit to withdrawing investments from predatory education stocks and debt servicers. Funds should be redirected to debt relief, community college programs, and initiatives that restore trust in education as a public good.
The corporate education complex—spanning recruitment, instruction, lending, and collection—has monetized both hope and hardship. The time has come to sever public and institutional complicity in this cycle. Education should empower, not impoverish. Divestment is not merely symbolic—it is a declaration of values, a demand for accountability, and a reaffirmation of education’s original promise: to serve humanity rather than exploit it.
Sources:
U.S. Department of Education, Borrower Defense to Repayment Reports
Senate HELP Committee, For Profit Higher Education: The Failure to Safeguard the Federal Investment and Ensure Student Success (2012)
Consumer Financial Protection Bureau (CFPB) enforcement actions against Navient and Sallie Mae
The Century Foundation, Online Program Managers and the Public Interest
Student Borrower Protection Center, Profiting from Pain: The Financialization of the Student Debt Crisis
The U.S. Senate’s vote to reopen the federal government on Sunday will likely end a painful 40-day shutdown, but it does so at a cost that goes far beyond missed paychecks and delayed services. The deal, driven by pressure to restore “normalcy,” comes with an implicit betrayal: millions of Americans who rely on Affordable Care Act (ACA) subsidies are being left in limbo.
Those subsidies—lifelines for low- and middle-income Americans—are now set to expire at the end of the year. The so-called “continuing resolution” passed the Senate with bipartisan relief, but no guarantee that these critical supports will continue. In practical terms, Congress chose to reopen the government by walking away from those who most need its help.
A Shutdown Ends, but the Austerity Logic Continues
The 2025 shutdown was the longest in modern U.S. history, the result of partisan fights over spending and political maneuvering around health care. During that time, millions of Americans faced uncertainty: furloughed workers, delayed SNAP benefits, shuttered Head Start centers, and frozen federal contracts.
Now that the government is back in business, the same austerity logic remains intact. While defense spending and tax breaks for the wealthy are protected, basic supports like subsidized health insurance are treated as optional. It’s a familiar story—one that echoes through higher education, housing, and labor markets.
The End of ACA Subsidies Means a New Working-Class Squeeze
The ACA subsidies that expanded during the pandemic allowed millions of Americans—often those working multiple jobs without employer coverage—to afford health care for the first time. With their expiration looming, premiums are expected to skyrocket. For some, costs could double or triple.
This isn’t just about “health care.” It’s about how the American system continually shifts burdens downward. Families will make impossible choices: health coverage or rent, insulin or food, doctor visits or student loan payments.
At the same time, Senate Republicans have embraced Donald Trump’s renewed call to “replace Obamacare”—a move that could dismantle what’s left of the safety net altogether.
The Broader Pattern: Abandoning the Working Class
The Senate’s actions fit a larger pattern of bipartisan neglect. Each “deal” that avoids short-term crisis seems to deepen long-term inequity.
In health care: subsidies expire, Medicaid rolls shrink, and hospital mergers raise costs.
In higher education: student debtors are promised relief but face new barriers, while for-profit and “online program management” companies continue to profit.
In housing: low-income tenants are told to prove future earnings or risk eviction, even as rent outpaces inflation.
In labor: wage stagnation persists, union power declines, and automation and AI make employment more precarious.
For Generation Z and millennials—already burdened with debt, low job security, and unaffordable housing—the message is consistent: you’re on your own.
Health and Education: Two Fronts of the Same Struggle
Health and education are supposed to be public goods, but both have become profit centers managed by corporate intermediaries and politicians chasing donors.
In health care, private insurers dominate ACA marketplaces. In higher ed, the same dynamic exists: online program managers (OPMs) and corporate lenders extract money while students shoulder debt. The government’s role becomes one of stabilizing markets—not stabilizing lives.
And when the working class pushes back—through union drives, debt strikes, or demands for universal health care—they’re met with the same refrain: “We can’t afford it.”
Austerity in a Time of Plenty
What’s striking is that this “fiscal responsibility” always targets the vulnerable. There’s no serious debate about clawing back corporate tax breaks or limiting Pentagon contracts. But when it comes to healthcare subsidies or student loan forgiveness, the belt suddenly tightens.
The working class subsidizes the rich, while being told that government aid is an indulgence. This political economy of scarcity has consequences—measured in bankruptcies, untreated illness, and despair.
Which Side Are You On?
When Woody Guthrie’s generation faced inequality, they had a rallying cry:
“Which side are you on, boys, which side are you on?”
That question remains as urgent as ever. The Senate’s decision to reopen government while discarding health care protections for millions tells us whose side Washington is on—and it’s not the side of the working class.
Until policymakers see health, housing, and education as human rights rather than bargaining chips, “reopening government” will be little more than a hollow ritual of restoration—for a system that keeps leaving its people behind.
Sources:
Time: “What to Know About the Deal to End the Shutdown” (Nov. 2025)
Al Jazeera: “US Senate nears vote on bill to end 40-day government shutdown” (Nov. 2025)
Financial Times: “Senators take first step to end US government shutdown” (Nov. 2025)
The Guardian: “Senate Republicans embrace Trump’s call to replace Obamacare” (Nov. 2025)
Detroit Free Press: “Michigan's U.S. senators reject deal to end shutdown” (Nov. 2025)
From the Gilded Age to the digital era, muckraking has served as a check on concentrated power. It has exposed exploitation in factories, corruption in government, racial terror, and corporate deceit. Today, that same spirit is urgently needed in higher education—an industry that has become both immensely wealthy and profoundly unequal.
Ida B. Wells and the Moral Foundation of Muckraking (1890s)
Modern investigative reporting begins with Ida B. Wells, who in the late 19th century documented the horrors of lynching and the complicity of institutions in perpetuating racial terror. In Southern Horrors (1892) and The Red Record (1895), Wells used data, testimony, and moral clarity to challenge both white supremacy and institutional silence.
Her courage established muckraking not just as journalism but as moral resistance—a template for confronting systemic injustice, whether in government, business, or education.
Thorstein Veblen and the Rise of the Business University (1918)
By the early 20th century, universities themselves had become powerful institutions. Thorstein Veblen, in The Higher Learning in America (1918), described how trustees, presidents, and donors increasingly treated scholarship as a commodity. The pursuit of truth was subordinated to the pursuit of prestige and profit. Veblen’s critique presaged the administrative bloat, branding culture, and market-driven priorities now standard in higher education.
Upton Sinclair and The Goosestep (1923)
Upton Sinclair, in The Goosestep: A Study of American Education (1923), argued that elite universities were “factories for the ruling class.” Trustees dictated policy, suppressed dissenting faculty, and produced graduates conditioned to serve wealth and power. Sinclair’s critique resonates a century later, as universities remain highly responsive to donors and financial interests rather than the public good.
Jessica Mitford and Corporate Exploitation (1960s)
Jessica Mitford, best known for The American Way of Death (1963), brought investigative rigor to industries that relied on secrecy, public trust, and consumer inattention. Her work exposed how profit motives could exploit vulnerability and regulatory gaps. Mitford’s methodology—meticulous documentation, ethical outrage, and clear writing—provides a model for exposing modern higher education practices that prioritize revenue over students’ welfare.
Digital Muckraking: OPMs and 2U (21st Century)
In the 21st century, online program managers (OPMs) like 2U, Inc. have commercialized education in new ways. Chip Paucek, co-founder and longtime CEO of 2U, built partnerships with elite universities offering certificates and degrees that were sometimes of questionable value, while profiting from revenue-sharing agreements.
When independent journalists examined these arrangements and their implications for students and adjunct labor, they sometimes faced threats of litigation. The ongoing Paucek v. Shaulis case (filed 2024, and still pending) illustrates the modern challenge: exposing systemic issues in higher education can trigger lawsuits designed to intimidate or silence critics.
The Chilling Effect of Legal Retaliation
Even unfounded lawsuits can suppress critical reporting. Independent journalists, adjuncts, and whistleblowers often lack the resources to defend themselves against legal pressure. This modern form of censorship echoes the intimidation faced by Wells, Sinclair, and Mitford in their respective eras.
Higher education, increasingly operated like a business, has become vulnerable to this kind of silencing. Public interest and accountability require journalists who are willing to persist despite the risks.
The Enduring Importance of Muckraking
From Wells’ moral courage, to Veblen’s economic critique, Sinclair’s exposé of elite conformity, and Mitford’s corporate investigations, muckrakers have shaped public understanding and accountability. Today, independent journalism is one of the few mechanisms capable of exposing predatory practices, financial manipulation, and labor exploitation in higher education.
As Wells wrote, “The way to right wrongs is to turn the light of truth upon them.” That light has always been costly—but without it, universities risk becoming oligarchies rather than public institutions.
Reclaiming the Public Good (If That's Possible)
Muckraking is civic duty. It insists that higher education be judged not by prestige or endowment size, but by service to students and society. Independent journalists must continue the Wells–Veblen–Sinclair–Mitford tradition, confronting power, exposing exploitation, and demanding accountability.
Sources
Ida B. Wells, Southern Horrors (1892); The Red Record (1895)
Thorstein Veblen, The Higher Learning in America (1918)
Upton Sinclair, The Goosestep: A Study of American Education (1923)
Jessica Mitford, The American Way of Death (1963)
Harriet A. Washington, Medical Apartheid (2006)
Elisabeth Rosenthal, An American Sickness (2017)
Higher Education Inquirer archives, 2014–2025
Paucek v. Shaulis (filed October 2024, pending 2025)
[Editor's note: On October 29, 2025, the Higher Education Inquirer emailed South University for a status update. South University did not respond. On November 1, 2025, Benjamin DeGweck replaced Steven Yoho as CEO and Chancellor.]
South University, a former for-profit college network now operating under nonprofit ownership, is facing a$35 million balloon payment this month on a loan obtained through theFederal Reserve’s Main Street Lending Program. The looming debt and the school’s status onHeightened Cash Monitoring (HCM)raise questions about financial stability and the adequacy of regulatory oversight in the nonprofit higher education sector.
A Heavy Loan Load
According to publicly available financial statements, South University carries more than $35 million in long-term debt maturing this month, part of a $50 million Main Street loan issued during the COVID-19 pandemic. The approaching balloon payment represents a major financial test for an institution already under federal scrutiny and struggling with declining enrollment.
Heightened Cash Monitoring—But Limited Oversight
South University is currently listed under Heightened Cash Monitoring (HCM) by the U.S. Department of Education, a status that requires extra documentation before federal aid funds are released. While the designation signals potential financial or compliance issues, it does not necessarily result in strong day-to-day oversight.
The school remains accredited by the Southern Association of Colleges and Schools Commission on Colleges (SACSCOC)—an accreditor known for minimal intervention in institutional finances unless there is clear evidence of collapse. This means that despite the HCM flag, South University continues to operate with significant autonomy, even as federal and student aid dollars flow through additional administrative checks.
A Complicated Legacy
South University’s story is deeply tied to the rise and fall of the for-profit college industry. Once part of Education Management Corporation (EDMC), the school was sold in 2017 to the ill-fated Dream Center Education Holdings (DCEH). When DCEH collapsed in 2019, the Education Principle Foundation (EPF)—a nonprofit—took over South University and The Art Institutes. South University is now an independent non-profit enterprise.
A Pattern of Fragile Conversions
South University’s precarious position reflects a larger trend: the conversion of failing for-profit schools into nominal nonprofits that rely on tuition, federal aid, and private service contracts to survive. These conversions often preserve the same management structures and business practices while benefiting from the public trust and tax advantages of nonprofit status.
The $35 million balloon payment highlights the risks of these financial engineering strategies—especially when public money is involved but public accountability is weak.
What Comes Next
With the 2025 deadline approaching, South University faces a pivotal decision: refinance the Main Street loan, restructure operations, or seek new capital through other partners.
If the institution falters, students could once again be caught in the aftermath of a sector-wide collapse—echoing the failures of EDMC, DCEH, and the Art Institutes.
For now, South University continues to operate with limited transparency, under a light-touch accreditor, and with a multimillion-dollar federal debt hanging over its future.
