Latest Borrower Defense to Repayment Numbers (US Department of Education)

The Higher Education Inquirer has received information today from the US Department of Education about Borrower Defense to Repayment claims.  Here are the results from ED FOIA 25-02047-F.  

 

Universities Brace for Endowment Tax Hike, Rethink Investment Strategies

A sweeping new tax proposal from House Republicans threatens to upend how some of the wealthiest U.S. universities manage their endowments, marking what could be the biggest strategic shift in a generation.

As part of the broader Trump-backed tax bill that passed the House last week, the proposal would raise the excise tax on endowment investment income for private universities with large endowments from the current 1.4% to a staggering 21%—the same rate levied on corporations. The bill now moves to the Senate, where its fate remains uncertain.

If enacted, this change could significantly alter how universities invest their endowment funds—often worth billions of dollars. Institutions are now weighing a move away from short-term, high-return strategies in favor of more tax-deferred investment vehicles like private equity, which typically don’t generate taxable income until years down the line.

A Shift in Strategy

The Wall Street Journal reports that officials at eight private institutions have already begun considering how to adapt. “Tax efficiency,” once a secondary concern, is becoming a central lens through which investment decisions are being made.

Yet the path forward is complex. Many university endowments are already heavily invested in long-term vehicles. While these investments can offer deferral of taxable gains, they also require capital calls—obligations to fund previously committed capital—which, coupled with the new tax burden, could strain liquidity. As a result, universities may also need to increase their holdings in cash or liquid assets, a move that could reduce overall returns.

Who’s Affected

While the increased tax burden will fall heaviest on the richest institutions—such as Harvard, Yale, Princeton, and Stanford—it could also impact dozens of other private colleges with sizable endowments. The current law applies to private schools with at least 500 students and net assets of $500,000 per student. The new plan could expand the scope and deepen the financial impact.

Critics argue that the measure is politically motivated, targeting elite institutions that have become symbols of cultural and ideological opposition for many on the right. Supporters of the bill frame it as an issue of tax fairness: why should wealthy universities—with endowments rivaling small sovereign wealth funds—pay less than corporations?

Impact on Students and Operations

The increased tax liabilities may also have a downstream effect on students, faculty, and university operations. If institutions shift more resources toward taxes and compliance, there could be less money available for financial aid, faculty hiring, and academic programming.

Universities may also respond by reducing capital commitments to private markets, pausing infrastructure projects, or placing greater emphasis on tuition revenue and donor fundraising to offset the higher tax costs.

A Broader Political Shift

The proposed tax hike is part of a larger pattern of growing political scrutiny of higher education institutions, especially elite ones. From student debt relief to DEI initiatives and Title IX regulations, universities have found themselves at the center of ideological battles. Now, their finances are becoming a new front in that war.

If the Senate passes the tax bill, universities will be forced to act swiftly. Endowment managers, already grappling with volatile markets and inflation pressures, will have to balance competing demands: protecting returns, ensuring liquidity, and staying compliant with a rapidly changing tax landscape.

In the end, the move may do more than shift investment strategies—it could fundamentally redefine the financial models of American higher education.

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For more investigative reporting on U.S. higher education and the forces shaping its future, follow the Higher Education Inquirer.

DOD Fails to Update Postsecondary Education Complaint System

Is the US Department of Defense (DOD) actually handling complaints from service members and their spouses who are using DOD Tuition Assistance and MyTAA (the education program for spouses)? It's difficult to tell, and it's unlikely that they'll tell us. 

DD Form 2961 is used for servicemembers and their spouses to make complaints about schools. And it appears up to date.  And on their website, DOD still claims to help consumers work with schools about their complaints. 

But information about the US Department of Defense Postsecondary Education Complaint System (PECS), the system that handles the complaints, has not been updated in about a decade. Here's a screenshot from May 25, 2025.  

What we do know is that DOD VOL ED and the DOD FOIA team have stonewalled us for eight years to get important information about their oversight. We also know that DOD VOL ED has allowed bad actor schools to violate DOD policies as they prey upon those who serve.  Over the years we have notified a number of media outlets about these issues but few if any have shown interest. 

Delinquent and Disillusioned: The Student Loan Crisis Reignites Amid Economic and Policy Failures

Millions of student loan borrowers in the United States are falling behind on payments now that the COVID-era federal loan pause has ended—and the economic and personal consequences are mounting fast. The recent Wall Street Journal article “Millions of Americans Had Their Student-Loan Payments Put on Pause During the Pandemic. Now They Are Back on the Hook Again” paints a sobering picture of what happens when borrowers, many already living paycheck-to-paycheck, are reinserted into a punitive debt system with little warning or preparation.

According to the WSJ report, 5.6 million borrowers were marked newly delinquent in just the first quarter of 2025, as credit reporting resumed and wage garnishment letters started showing up in mailboxes. Delinquency rates surged from 0.7% to 8%, returning to pre-pandemic levels with alarming speed. While this may be a statistical “reversion to the mean” in economic terms, for those affected, it's a hard shock that could derail financial stability for years to come.

A System Ill-Equipped for Restart

The Biden administration’s temporary on-ramp expired in the fall of 2023. Since then, servicers, borrowers, and regulators have all struggled with the logistical and psychological whiplash of rebooting a system that had been on hold for over three years. Meanwhile, the Trump administration—eager to reassert austerity and fiscal discipline—has resumed the aggressive collections practices that defined the pre-pandemic era: wage garnishments, tax refund seizures, and Social Security offsets.

For millions, this reactivation has not come with transparency or support. Many received letters from unfamiliar loan servicers, the result of reshuffling in the student loan servicing industry during the pandemic. As University of Cambridge economist Constantine Yannelis told WSJ, borrowers who graduated during the payment pause may not have ever experienced repayment, and are now blindsided by bureaucratic demands and crumbling credit.

Credit Collapse and Economic Spillover

Among the most concerning revelations: borrowers with once-strong credit profiles are being dragged down. Nearly 2.4 million people with near-prime or prime credit ratings experienced sharp score declines—up to 177 points for those with scores over 720. That drop could shut borrowers out of mortgages, car loans, and even rental opportunities, extending the economic pain well beyond student debt.

Morgan Stanley economists warn that monthly student loan payments will rise by $1 billion to $3 billion, potentially shaving 0.1 percentage point from the 2025 U.S. GDP. While modest at the macroeconomic level, that drop represents hundreds of thousands of families tightening budgets, delaying major purchases, or skipping payments on other essentials.

And the demographic picture of who is struggling directly refutes tired stereotypes. University of Chicago economist Lesley Turner emphasized that those falling behind are not entitled Ivy League grads but disproportionately working-class Americans—especially those who attended for-profit or two-year colleges, or dropped out before earning a degree. Mississippi, where 45% of borrowers are delinquent, stands out as a cautionary tale in both poverty and policy failure.

A Fractured Policy Landscape

What’s happening now is not just a predictable economic phenomenon—it’s the result of a fractured and politically volatile policy environment. Biden’s efforts to implement broad debt relief through the SAVE plan and other targeted forgiveness efforts have been challenged in court and undermined by executive overreach claims. That legal uncertainty left many borrowers falsely optimistic that repayment would be permanently suspended or forgiven, influencing their financial planning.

Meanwhile, the ideological pendulum continues to swing: progressive reforms like income-driven repayment and borrower defense to repayment have been inconsistently applied, undercut by administrative churn and legal ambiguity. Now, under a returning Trump administration, the Department of Education is once again prioritizing collections over compassion.

What Happens Next?

There’s no clear trajectory forward. As Duke economist Michael Dinerstein noted, the path could go in either direction. If borrowers respond to delinquency warnings and enter into income-driven repayment (IDR) plans like SAVE, we may see stabilization. But without real outreach, forgiveness, or structural reform, millions more may default—and carry the economic scars for decades.

At the Higher Education Inquirer, we see this moment as a pivotal test—not just of financial resilience, but of our society’s willingness to reckon with an education system that has long promised mobility while delivering debt. The student loan system was broken before COVID. The pause merely masked the underlying rot. Now, with repayments back in motion, the cracks are widening into chasms.

If the U.S. is serious about building a stable middle class, supporting higher education access, and ensuring economic mobility, it must move beyond temporary pauses and court-contested forgiveness. We need durable reform, not debt servitude masquerading as opportunity. Until then, millions of Americans will remain caught in the crossfire between broken promises and broken policies.

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For ongoing investigations into student debt, contingent labor, and the collapse of trust in U.S. higher education, follow the Higher Education Inquirer. 

Grand Canyon University and the Rise of the Robocollege: Mass Education or Mass Deception?

In an age when higher education is increasingly defined by scale, automation, and profit, Grand Canyon University (GCU) has emerged as a flagship for a new breed of institution: the “robocollege.” With over 125,000 students—more than 98,000 of them online—GCU's explosive growth is a case study in what happens when business efficiency collides with educational integrity.

What exactly are these students buying? And what, if anything, are they learning?

Education at Scale—But at What Cost?

GCU’s meteoric expansion reflects the broader boom in online education and a shift toward workforce credentialing over traditional liberal arts education. In theory, this means flexible, affordable education for all. But in practice, critics argue that GCU—and similar robocolleges—deliver a watered-down, highly standardized experience that prioritizes enrollment numbers and shareholder returns over intellectual development.

Classes often rely on templated syllabi, discussion boards policed by rubrics, and preloaded lectures. Assignments are frequently graded by software or overworked adjuncts paid by the piece. While GCU markets itself as a Christian university rooted in purpose and service, the reality for many students is an educational experience that feels impersonal, mechanized, and transactional.

Robocolleges and the End of Faculty

One of the more disturbing elements of this model is the erosion of faculty roles. At institutions like GCU, full-time professors are scarce, especially in online programs. Instead, armies of contingent instructors—many of them underpaid and invisible—serve as glorified content moderators. There is little room for mentoring, dialogue, or intellectual curiosity. Students often receive form-letter feedback and never develop relationships with instructors.

This is not education in any traditional sense—it's content delivery. And it's optimized for scale, not learning.

A Pipeline to What?

GCU has positioned itself as a career-focused institution, touting job readiness and Christian values. But for many students, the end result is a generic degree, heavy student debt, and limited upward mobility. According to College Scorecard data, the median earnings for GCU graduates ten years after entry hovers around $53,000—about average, but far from spectacular considering the cost.

Even more concerning: GCU’s parent company, Grand Canyon Education, is a for-profit contractor that operates much like the controversial education conglomerates of the 2000s. While GCU converted to nonprofit status in 2018, the U.S. Department of Education has raised repeated red flags about the true nature of that arrangement. In essence, GCU's nonprofit facade masks a highly profitable business model.

The Assembly Line of the Educated Underclass

Robocolleges like GCU are not designed to cultivate critical thinkers or scholars. They are factories, churning out degrees at the lowest possible cost. The students they attract—often working adults, parents, and veterans—deserve more than this. They deserve a system that treats them as learners, not customers. But under the robocollege model, education becomes a service industry, and students are simply consumers of prepackaged content.

We are witnessing the creation of an “educated underclass”—credentialed but disempowered, trained but not transformed.

Conclusion: A Warning Signal, Not a Model

GCU’s growth is not a triumph. It’s a cautionary tale. As policymakers and the public grapple with the future of higher education, we must ask ourselves: Is mass education worth it if it sacrifices meaning, mentorship, and genuine learning? The robocollege model offers convenience and scale—but at what cost to the human spirit of education?

Until we reckon with that question, the assembly line will keep running, churning out diplomas like widgets. And students, desperate for a better life, will keep buying in.

Federal Reserve Chair Jerome Powell Praises U.S. Universities Amid Political Attacks

In a pointed yet diplomatically worded commencement address at Princeton University on Sunday, Federal Reserve Chairman Jerome Powell urged graduates to pursue public service, uphold democratic values, and appreciate the unique role of American higher education. His speech, though not directly confrontational, served as a subtle rebuke to recent political assaults on U.S. universities—particularly from former President Donald Trump.

Powell lauded America’s colleges and universities as “the envy of the world and a crucial national asset,” calling on the Class of 2025 not to take their education or democratic institutions for granted. “When you look back in 50 years,” he said, “you will want to know that you’ve done whatever it takes to preserve and strengthen our democracy and bring us ever closer to the Founders’ timeless ideals.”

These remarks arrive at a time of increasing hostility from some political quarters toward elite universities. During his presidency, Trump repeatedly threatened to cut federal funding to institutions like Harvard, Yale, and Princeton—accusing them of promoting what he described as anti-American values and discriminatory admissions practices. His administration’s Department of Homeland Security even attempted to revoke Harvard’s ability to enroll international students, a move temporarily blocked by a federal judge.

Though Powell did not mention Trump by name, the timing and tone of his remarks suggest a defense of U.S. higher education against political interference. This is not the first time Powell has found himself at odds with Trump. The former president publicly berated the Fed chair over interest rate policy and even suggested he should be fired—something Powell has said is not within the president’s authority.

Powell’s defense of public service and academic excellence comes amid a broader political campaign to undermine trust in elite institutions. The Trump-era attacks on higher education continue to resonate through Republican state legislatures and federal policy proposals, including executive orders aimed at dismantling diversity, equity, and inclusion programs and threatening Title IX protections.

Meanwhile, Powell emphasized that America's leadership in science, economics, and global innovation is no coincidence but the product of robust institutions—including its universities. “Look around you,” he told graduates. “Take none of this for granted.”

His call for public service may also ring hollow to graduates facing a daunting job market and a mountain of student debt—problems compounded by decades of underinvestment in public higher education, skyrocketing tuition, and the adjunctification of the academic workforce. Nonetheless, Powell’s appeal was rooted in idealism: that the next generation can help repair democracy and rebuild the public sector from within.

The Higher Education Inquirer notes that Powell’s remarks reflect a quiet but important ideological struggle in American politics: between those who see universities as engines of democratic progress and economic vitality, and those who view them as bastions of liberal elitism in need of reform—or retribution.

As the political and economic landscape of higher education continues to shift, Powell’s speech at Princeton may be remembered not just as a traditional commencement address, but as a line in the sand.

US House Passes Massive Spending and Tax Bill: Austerity for the Poor, Windfalls for the Rich

In the early hours of May 22nd, the U.S. House of Representatives narrowly passed H.R. 1, the One Big Beautiful Bill Act, a sprawling 1,100-page reconciliation package reflecting the policy priorities of the Trump administration and the Republican-led Congress. The vote was 215-214, with two Republicans joining all Democrats in opposition.

Marketed as a spending and tax overhaul, H.R. 1 delivers sweeping cuts to social safety net programs while providing substantial tax breaks for high-income households and corporations. The result: an estimated $4 trillion increase in the national debt and a federal deficit projected to rise by $230 billion annually, or roughly 10%.

A Bill Few Have Read, Pushed Through at Lightning Speed

Despite its magnitude, the final text of the bill was released just hours before the vote, after a 1 a.m. session of the House Rules Committee added a 42-page “manager’s amendment” that made major last-minute changes. The rushed timeline has left lawmakers, watchdogs, and the public scrambling to understand what exactly was passed.

Slashing the Safety Net, Bolstering Security and the Wealthy

Among the most significant impacts of the bill:

• Deep cuts to SNAP and Medicaid, achieved through both reduced funding and stricter eligibility requirements.

• Increased spending for the military, border wall construction, immigration enforcement, and detention facilities, offsetting about half of the domestic cuts.

• Tax changes that disproportionately harm low-income Americans while rewarding the wealthy, including restoration of the full state and local tax (SALT) deduction, which benefits high earners in high-tax states.

According to a Congressional Budget Office (CBO) analysis, the bill will reduce “household resources”—including wages and federal benefits—by roughly 4% for the lowest-income households, while increasing them by a similar margin for the highest-income groups.

Ideological Riders: Culture War Embedded in Fiscal Policy

Tucked into the bill are provisions that go far beyond fiscal policy:

• Repeals of green energy initiatives and funding.

• A nationwide ban on gender-affirming care—not just for minors but for adults as well.

• A ban on abortion services.

• A clause limiting the federal judiciary’s ability to enforce court orders against the government, raising serious constitutional concerns.

These inclusions push the boundaries of what’s traditionally allowed in a reconciliation bill, which is supposed to be restricted to tax and spending measures.

Senate Showdown Ahead—Rules May Be Bent or Broken

The bill now heads to the Senate, where reconciliation rules technically shield it from the filibuster if its provisions are deemed budget-related. But those rules are under threat. Recent moves by the Senate—such as passing Congressional Review Act legislation in defiance of the Parliamentarian—suggest that Republican leadership may ignore or override procedural norms to push the bill through.

If H.R. 1 becomes law in its current form, it will represent one of the most radical rewritings of federal priorities in decades—tilting the scales toward militarization and wealth concentration while gutting public health programs and civil liberties.

Implications for Higher Education

While higher education is not directly targeted in the bill’s text—at least as far as early reviews can tell—the implications are ominous. Cuts to Medicaid and SNAP will harm low-income students who depend on those programs. Restrictive immigration and gender policies may force colleges into legal and ethical battles. And the bill’s broader austerity measures signal an era in which public institutions, already under stress, may face even deeper disinvestment.

As always, the devil is in the details. But for now, those details remain elusive—locked in a bill few have read and rushed through in the dead of night.

Failure to Communicate: VA Office of Inspector General no longer accepting emails and VA chatbot has no answers.

The Department of Veterans Affairs, Office of Inspector General (VA OIG), is no longer accepting tips from veterans who have been ripped off by predatory subprime colleges--at least not via email. The Higher Education Inquirer, at one time, was an important source for information for the VA OIG, but the VA's watchdogs stopped corresponding with us a few years ago for no apparent reason. This failure to communicate is part of a longstanding pattern of indifference by the US Government (VA, DOD, ED, and DOL) and veterans' organizations towards military servicemembers, veterans, and their families who are working to improve their job skills and job prospects.   

VA's chatbot also has much to be desired.

Which U.S. Colleges Spend the Most on Student Support? (Studocu)

[Editor's note: The Higher Education Inquirer is presenting this press release for information only. This is not an endorsement of the organizations mentioned in article.]

• Ivy League institutions like Yale, Harvard, and MIT top the list, spending over $100K per student on academic support.
• Yale University leads in both categories, investing $225K per student in academic support and $53K in student services.
• A modest but consistent correlation was found between student support spending and graduation rates, particularly among top-tier institutions.

A new report by Studocu highlights the U.S. colleges investing most heavily in academic and student services and explores whether that support is linked to graduation outcomes.

Drawing on the most recent fiscal year data from IPEDS (2023), the study found a positive relationship between support spending and graduation rates, suggesting that per-student spending on departments which directly support student learning and wellbeing improve outcomes.

The analysis covered over 1,000 degree-granting institutions across the United States, each enrolling more than 100 undergraduate students. Financial data was compared against graduation rates to uncover trends in institutional spending.

The findings show that top-tier schools like Yale, Harvard, and MIT spend significantly more per student than the national average:

• National average for academic support: $2,933 per student
• National average for student services: $4,828 per student

Top Institutions on Academic Support per Student

Top Institutions on Student Services per Student

When comparing graduation rates to institutional spending, the study found:

• A 0.259 correlation between academic support spending and graduation rates
• A 0.23 correlation between student services spending and graduation rates

While the correlations indicate a positive relationship between support spending and graduation rates, it's important to note that other factors also play a role.

However, the findings still suggest that well-funded student support services may provide meaningful benefits especially for students who might otherwise might have failed.

 

About Studocu:

StuDocu is a student-to-student knowledge exchange platform where students can share knowledge, college notes, and study guides.

Methodology

Institutions were selected based on the following criteria:

• Enrollment of over 100 undergraduate students
• Offering degree-granting programs
• For multi-campus institutions, the largest campus was used

Institutions were divided into tiers:

• Tier 1: This typically includes Ivy League schools (Harvard, Yale, Princeton, etc.), as well as other top-tier highly selective institutions such as Stanford, MIT, and Caltech.
• Tier 2: This category can include strong public universities, well-regarded liberal arts colleges, and other private universities. Examples might include schools like NYU, the University of Michigan.
• Tier 3: These institutions are often regional colleges and universities.

Community colleges and technical colleges were not included in the study.

Spending was calculated per undergraduate student, and graduation rate was used as the primary indicator of academic success.

Sources

Data for this analysis was obtained from the IPEDS, including:

• Graduation rates
• Undergraduate enrolment
• Academic support and student services expenditures

Caveats

• Financial data is current through the 2023 fiscal year * the latest available data
• Institutional reporting standards may vary, between public, private non-profit, and for-profit institutions
  

Between Empire and Enterprise: Harvard, Trump, and the Exploitation of International Students

As the Trump administration again targets immigrants and global institutions with punitive policies, international students at Harvard University—one of the world’s most prestigious academic brands—are experiencing what one student leader called “pure panic.” At the center of the storm: a now-halted move by the White House to revoke Harvard’s certification in the Student and Exchange Visitor Program, threatening the legal status of thousands of students from nearly every country in the world.

Harvard responded with swift legal action, accusing the federal government of ideological retaliation. But while the Trump administration deserves criticism for its xenophobic and authoritarian maneuvers, it is equally important to interrogate Harvard’s own role in creating a system where international students are treated as both intellectual capital and financial assets.

Nearly 27% of Harvard’s student body—close to 7,000 individuals—comes from abroad. For decades, Harvard has positioned itself as a global institution, a magnet for the so-called "best and brightest" regardless of national origin. It has used this cosmopolitan image to bolster its prestige, attract philanthropic donations, and justify sky-high tuition rates. In reality, Harvard is not just a university—it is a flagship enterprise in the global neoliberal order.

This model—recruiting international students as both symbols of diversity and sources of income—reflects the logic of global capitalism more than the ideals of education. Harvard’s operations increasingly mirror those of a multinational corporation: high-end branding, worldwide recruitment, aggressive legal defense, and political lobbying. The foreign students it attracts are often among the global elite, or, in many cases, indebted strivers betting their futures on the supposed merits of a Harvard degree. When the political winds shift, as they have under Trump, these students are left exposed.

This is precisely what’s happening now.

Abdullah Shahid Sial, co-president of Harvard’s student body and a Pakistani national, told CNN that students are “very clearly, extremely afraid” about their legal status and whether they can return to campus. Some are stuck abroad, unsure if they’ll be allowed back. Others face suspended research projects or financial uncertainty. Sial praised Harvard officials for trying to help but also acknowledged the limitations. The window to transfer to other schools is closed for many. Aid packages, crucial to international students, don’t travel with them.

This crisis reveals the tension at the heart of elite higher education’s global ambitions. Harvard, like other elite U.S. universities, thrives on internationalism—so long as it serves its institutional goals. But when international students are treated not as community members but as liabilities or bargaining chips in political disputes, the myth of benevolent globalization unravels.

Yes, the Trump administration’s policies are driven by xenophobia and an open hostility to intellectual exchange. But they also expose the fragility and hypocrisy of the global education marketplace. International students are recruited into a system that offers opportunity but no guarantees, prestige but little protection.

Harvard cannot simply claim the moral high ground by suing the federal government. It must also reckon with its deep entanglement in the very structures that commodify students and expose them to geopolitical risk. For all its rhetoric about global citizenship, Harvard’s model remains fundamentally extractive—built to serve elite interests, not global equity.

If the United States is to remain a serious destination for global education, and if Harvard is to be more than a luxury brand in academic robes, the model must change. International students deserve more than branding and brochures. They deserve stability, legal protection, and a voice in the institutions that profit from their presence.

Until then, they remain trapped—between the nationalist paranoia of Washington and the neoliberal empire of Cambridge.

Preliminary Injunction Halts Dismantling of the Department of Education (Todd Wolfson, AAUP)

We got great news yesterday: In a suit we brought with Democracy Forward, the AFT, and other allies in the labor movement, a district court in Massachusetts issued a preliminary injunction halting the Trump administration’s unlawful effort to dismantle the Department of Education.  The massive reduction in force proposed by the administration would decimate crucial services the department provides to families across the country, severely limit access to education, and eviscerate funding for HBCUs and tribal colleges. We can’t do this work without your support. Will you become a member or make a donation to the AAUP Foundation today? Here’s some background on the case. In March, after having repeatedly expressed a desire to eliminate the Department of Education, the Trump administration announced a reduction in force that would cut its staff in half. Recognizing that the department was created by an act of Congress and was mandated to carry out a number of statutorily required programs, the administration claimed that it was not trying to eliminate the department but rather was seeking to improve “efficiency” and “accountability.” The court definitively rejected this claim, saying that the “defendants’ true intention is to effectively dismantle the Department without an authorizing statute. . . . A department without enough employees to perform statutorily mandated functions is not a department at all. This court cannot be asked to cover its eyes while the Department’s employees are continuously fired and units are transferred out until the Department becomes a shell of itself.” The court also highlighted the impact of the cuts on students, educational institutions, and unions. For example, the court found that “higher education is also likely to become more expensive for students” as the staffing cuts “will put federal funding for Pell grants, work-study programs and subsidized loans at risk, reducing the pool of students able to attend college and posing an existential threat to many state university systems such as those intended to serve first generation college students.” The court found that the administration had violated two clauses of the US Constitution, and that its actions were beyond its authority as well as arbitrary and capricious. Therefore, the court issued a preliminary injunction requiring the department to reinstate staff and resume operations disrupted by the cuts. Perhaps because of skepticism about the administration’s willingness to follow directives of the judiciary, the court specifically required that the administration provide notice of this order of preliminary injunction within twenty-four hours to all its officers, and that it “file a status report with this Court within 72 hours of the entry of this Order, describing all steps the Agency Defendants have taken to comply with this Order, and every week thereafter until the Department is restored to the status quo prior to January 20, 2025.” What’s next: It is almost certain that the administration will appeal this decision and will likely seek to have the preliminary injunction stayed by the court of appeals while the case is pending. Trump’s agenda is a clear path to setting America back in quality and fairness in education. The AAUP will continue to stand up against these attacks and fight for a higher education system that serves all Americans. We can’t do it without you. Please join us as a member or make a donation today! In solidarity, Todd Wolfson, AAUP President Veena Dubal, AAUP General Counsel

HEI Investigation: Campus.edu

In a sector under constant strain, Campus.edu is being heralded by some as the future of community college—and by others as a slick repackaging of the troubled for-profit college model. What many don’t realize is that before it became Campus.edu, the company was known as MTI College, a private, for-profit trade school based in Sacramento, California.

Campus.edu rebranded in 2020 under tech entrepreneur Tade Oyerinde, is backed by nearly $100 million in venture capital. Campus now markets itself as a tech-powered alternative to traditional community colleges—and a lifeline for students underserved by conventional higher ed.

The rebranding, however, raises red flags. While Campus.edu pitches a student-first mission with attractive promises—zero-cost tuition, free laptops, elite educators—the model has echoes of the troubled for-profit sector, with privatization, outsourcing, and digital-first delivery taking precedence over public accountability and academic governance.

The Promises: What Campus.edu Offers

Campus.edu markets itself with a clean, six-step path to success. The pitch is aspirational, accessible, and designed to appeal to working-class students, first-generation college-goers, and those shut out of elite institutions. Here’s what the company promises:

1. Straightforward Application – A simple application process, followed by matching with an admissions advisor who helps identify a student's purpose and educational fit.

2. Tech for Those Who Need It – A free laptop and Wi-Fi access for students who lack them, ensuring digital inclusion.

3. Personal Success Coach – Each student is assigned a personal success coach, offering free tutoring, career advising, and 24/7 access to wellness services.

4. Elite Educators – Courses are taught live via Zoom by faculty who also teach at top universities like Stanford and Columbia.

5. Enduring Support – Whether transferring to a four-year college or entering the workforce, Campus promises help with building skills and networks.

6. More Learning, Less Debt – For Pell Grant-eligible students, Campus markets its programs as costing nothing out-of-pocket, with some students completing degrees debt-free.

It’s a compelling narrative—combining social mobility, digital access, and educational prestige into a neat online package.

Behind the Curtain: MTI College and the For-Profit Legacy

Campus.edu did not rise out of nowhere. It emerged from the bones of MTI College, a long-running, accredited for-profit vocational school. MTI offered hands-on training in legal, IT, cosmetology, and health fields—typical offerings in the for-profit world. The purchase and transformation of MTI into Campus.edu allowed Oyerinde to retain accreditation, avoiding the long and uncertain process of seeking approval for a brand-new college.

This kind of maneuver—buying a for-profit and relaunching it under a new brand—is not new. We’ve seen similar strategies with Kaplan (now Purdue Global), Ashford (now the University of Arizona Global Campus), and Grand Canyon University. What makes Campus.edu unique is the degree to which it blends Silicon Valley aesthetics with the structural DNA of a for-profit college.

Missing Data, Big Promises

Campus.edu boasts high engagement and satisfaction, but as of now, no independent data on student completion, debt outcomes, or long-term career impact is publicly available. The company remains in its early stages, with aggressive growth goals and millions in investor backing—but little regulatory scrutiny.

With investors like Sam Altman (OpenAI), Jason Citron (Discord), and Bloomberg Beta, the pressure to scale is intense. But scale can come at the expense of quality, especially when students are promised the moon.

Marketing Meets Memory

Campus.edu is savvy. Its marketing strikes all the right notes: digital equity, economic mobility, mental health, and student empowerment. It presents itself as the antidote to everything wrong with higher education.

But as its past as MTI College shows, branding can obscure history. And as for-profit operators adapt to a new digital age, it’s essential to distinguish innovation from opportunism. Without transparency, regulation, and democratic oversight, models like Campus.edu could replicate the same old exploitation—with better user interfaces.

The stakes are high. For students already at the margins, a false promise can be more damaging than no promise at all.

Mental Health for the Working Class: Who’s Behind the Therapy Boom?

The Affordable Care Act (ACA), commonly known as Obamacare, has significantly expanded access to mental health services in the United States, particularly for working-class individuals and families. The expansion of Medicaid and marketplace plans has made therapy and psychiatric care more accessible. However, the infrastructure supporting this mental health revolution is complex, under-resourced, and increasingly influenced by private equity. As more Americans seek care, questions arise about who is delivering that care—and whether the system prioritizes well-being or profits.

The Workforce Patchwork

The delivery of mental health services today relies on a varied network of professionals. In community clinics, federally qualified health centers, and outpatient networks, the bulk of therapeutic care comes from mid-level clinicians: Licensed Clinical Social Workers (LCSWs), Licensed Professional Counselors (LPCs), and Marriage and Family Therapists (MFTs). These are master's-level professionals who carry substantial educational and clinical training but are frequently underpaid and overworked.

Psychiatric Nurse Practitioners have also filled a critical gap, often handling medication management in lieu of psychiatrists, especially in rural and underserved areas. Meanwhile, case managers and peer support workers—some with minimal formal education—are tasked with providing wraparound services like housing support, job placement, and crisis management.

Psychiatrists and doctoral-level psychologists, though highly trained, are in short supply and are often unwilling to accept Medicaid or ACA plan reimbursements. This leaves many lower-income patients with few options for specialized care.

Enter Private Equity

In recent years, private equity (PE) firms have aggressively moved into the mental health space. Attracted by rising demand for services and relatively stable reimbursement streams from public insurance programs, PE investors have acquired numerous outpatient mental health clinics, telehealth platforms, and addiction treatment centers. Research indicates that PE firms now account for as much as a quarter of practices providing behavioral health services in some states (OHSU, 2024).

While this influx of capital has allowed for rapid expansion, it has also introduced new pressures on the workforce. To maximize returns, many PE-backed firms rely heavily on newly licensed clinicians or even graduate students under supervision. In some cases, providers are pushed into independent contractor roles to reduce labor costs and avoid benefit obligations.

Clinicians report being pressured to increase their patient loads, reduce session times, and adhere to standardized scripts or protocols designed for efficiency, not individualized care. Turnover is high, and burnout is common. A 2023 survey by the American Psychological Association found that over 60% of mental health practitioners reported experiencing symptoms of burnout (Therapy Wisdom, 2024).

The Role of Robocolleges in the Mental Health Pipeline

The rise of online, for-profit, and quasi-public "robocolleges"—such as Walden University, Purdue University Global, the University of Phoenix, Capella University, and others—has significantly shaped the labor pipeline for mental health services. These institutions mass-produce degrees in psychology, counseling, and social work, often catering to nontraditional and working adult students with limited time and financial resources.

Programs are designed for scale and efficiency, not necessarily for rigor or clinical depth. Courses are often asynchronous, adjunct-taught, and heavily standardized. Clinical placements and supervision, vital components of a therapist’s training, are sometimes outsourced or inadequately supported—leaving graduates with inconsistent real-world experience.

These institutions also disproportionately enroll students from lower-income and minority backgrounds, many of whom take on significant debt for degrees that may lead to low-paying, high-stress jobs in underfunded clinics or PE-owned mental health companies.

While robocolleges expand access to credentials, they may also contribute to a deprofessionalized, precarious workforce—one in which therapists are underprepared, underpaid, and overextended. Their graduates often fill the lower rungs of the mental health care ladder, working in environments where quality and continuity of care are compromised by systemic churn.

Quality and Equity in the Balance

The result is a mental health system that, while more accessible than in previous decades, is increasingly stratified. Working-class patients often receive care from entry-level or overburdened professionals, while wealthier clients can afford private practitioners who offer more time, continuity, and personalized care.

This imbalance is further complicated by a lack of oversight. Licensing boards and state agencies struggle to monitor the growing number of clinics and telehealth services, many of which operate across state lines or rely on algorithms to triage patients.

Meanwhile, the very people the ACA aimed to help—those juggling low-wage jobs, family stress, and systemic disadvantage—are left in a system where care may be quick, transactional, and occasionally substandard.

The Role of Traditional Higher Education

Traditional colleges and universities play a dual role: they continue to train therapists and counselors in more rigorous academic environments, but they also face growing pressure to "compete" with robocolleges in terms of cost, speed, and flexibility. At the same time, these institutions increasingly outsource student counseling services to external mental health platforms—some of them owned by private equity firms.

Thus, the cycle continues: higher education feeds the mental health system, while also adopting many of its structural compromises.

Conclusion

The expansion of mental health coverage under the ACA is a major public policy achievement. But access alone is not enough. The quality of care, the working conditions of providers, and the growing influence of profit-seeking investors and education mills all demand greater scrutiny.

For working-class Americans, mental health has become another arena where the promise of care often collides with the reality of austerity and privatization. And for those training to enter the profession, especially through robocolleges, the path forward may be just as precarious.

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References:

• Private Equity’s Inroads Into Mental Health Bring Concern

• The State of the Behavioral Health Workforce, November 2024 – HRSA

• Private Equity’s Move into Behavioral Health Care and Disparities

• Therapist Burnout and Toxic Private Equity in 2025

• Private Equity Is Gutting Autism Services – The Nation

• OHSU Study: Private Equity Expanding into Mental Health

• University of Phoenix and the Business of Selling Degrees

• The Cost of a Walden Degree

One Big, Ugly, & Deadly Bill (Reverand William Barber)

 

Watch now   One Big, Ugly, & Deadly Bill We must sharpen our language & clarify what is at stake now William J. Barber, II May 21   READ IN APP   This morning I joined Amy Goodman on Democracy Now to talk about the bill that House Republican leadership worked through the night to push toward a vote on the floor. The more Americans learn about what’s in this bill, the more outrage there will be that House members are willing to vote for cuts that will devastate communities so their billionaire donors can have a massive tax break. (That’s why they’re meeting to talk about the details in the middle of the night.) We must sharpen our language to make clear what’s at stake in this one big, ugly, and death-dealing bill. And we must prepare ourselves for moral action. We are glad to announce that Indivisible, the national organization behind “No Kings Day” on June 14th, has joined our Moral Monday partners to mobilize a mass action on June 2 outside of the US Capitol. We invite you to register here if you can join us for Moral Monday on June 2. To learn more, plan to join me and Indivisible co-founder Ezra Levin for a Substack Live on Tuesday, May 27, at 12pm ET. I’m also looking forward to a conversation here on Substack next week with Robert Reich. We will be live Wednesday, May 28, at 5:30pm ET/2:30pm PT. To join live conversations with us on Our Moral Moment, you just need to download the Substack app, subscribe for free, and turn out notifications. You’ll get a notice on your phone that we are going live.