College Meltdown at a Turning Point

[Image above: Turning Point USA, a neoconservative student group, has grown to more than 1100 high school and college chapters since its founding in 2012.]

The College Meltdown has been developing for decades. But now, it is at a turning point as the Trump Administration enters office.  Most likely, American colleges are headed toward more racial and ethnic tension, less transparency, and more corruption.  And the Trump Administration's solutions, which include privatization and deregulation, may not only accelerate the College Meltdown, their "hands off" approach to civil rights may increase conflicts on campus.

Donald Trump's selection of Betsy Devos and Jeff Sessions as US Secretary of Education and Attorney General have already sent a loud statement to those who research and analyze organizational effectiveness and institutional corruption in education.

The loud statement is that citizens should keep an eye out for even more discrimination, inequality, and fraud in K-12 education and higher education. Non-Christians and "others" with limited financial resources should be particularly concerned. But don't expect to get much information from the corporate controlled media--it would take too much work and it wouldn't be profitable.

For those interested in how education policy plays out over the next four years, we'll also need to know who will lead the Consumer Financial Protection Bureau, Federal Trade Commission, Securities and Exchange Commission, Federal Communications Commission, and how much those agencies will receive in funding for oversight of the US education industry.

Lack of oversight will accelerate opportunities for cronyism, nepotism, theft, lack of transparency, academic cheating, and intellectual dishonesty at the state and local levels

We also expect this increase in wrongdoing and poor decisions to be met with limited resistance and highly framed media attention.

Over the last two decades, tens of billions of dollars have already poured into charter schools despite lack of evidence about their effectiveness. Charter school enrollment has risen from about 300,000 in 1999 to about 2.5 million children in 2015 (about 5% of all school children).

Government-fed media stories may show structural failure that has been existent for generations and corruption that has cropped up in the age of increasing school choice. But ideological perspectives and power will influence which sides get the most attention, the quantity and quality of background information provided, and which stories (if any) gain the most traction.

"School choice," "empowerment," "opportunity," "religious freedom," "union corruption," "failing schools," "local control," "merit pay," "vouchers,"   "political correctness," "safe spaces," and "micro-aggressions" will be terms widely used to frame stories about US education.

For every action by all of these educational players, there will be a set of reactions from multiple sides. Vested interests include banks, private equity, hedge funds, philanthropies and foundations, for-profit and non-profit education and educational services companies, political parties, teachers union leaders, marketing and advertising companies, construction unions, pension funds, lobbying firms, think tanks, public relations businesses, and media outlets.

   Liberals may secretly like vouchers, so their children can get tuition breaks for private school attendance, or chances to get out of dangerous or failing public schools.   

Much of the action will also be at the state and local level and may not be reported by major news outlets.

The Libertarian Cato Institute has created a public schooling "battle ground" map about various neoconservative conservative social issues that are being fought across the country.

Outside players such as student debt groups, adjunct professors, and teacher resistance groups will also be involved, but will likely be marginalized or silenced.

We cannot predict what will happen exactly, but power, influence, and organizational effectiveness will be large determiners of what unfolds. And deals between power players behind the scenes may be vastly different than what is presented in the media.

• Look for changes in charter school tax credits (including New Markets Tax Credits), and other incentives as well as IPOs in the education business.
• Corporate and private capital flows to K-12 education may follow federal deregulation and block grants. This could result in irrational exuberance at the state and local levels. 

Some people will profit from the direction the nation's educational policy is going. But a larger number will suffer. We don't expect society as a whole to understand the consequences for quite some time. 

• Parents with high hopes will place their children in lotteries for high-demand charter schools. But most will be disappointed.
• About 0.5% of American children are currently enrolled in online charter schools. But this number could expand with deregulation, even if their educational value is in question.

While we construct this article, we suggest that you read three of our previous reports.

• When college choice is a fraud
• The college meltdown is painfully obvious
• Education is a racket

We invite feedback and opinions from all sides with interests in the education business and will respond to every comment we receive. Our email is dahneshaulis@gmail.com

2U-edX crash exposes the latest wave of edugrift

2U, a Lanham, Maryland-based edtech company and parent company edX, is facing layoffs of an estimated 200 to 400 workers--a significant number for a company that only employs a few thousand--amid more rumors that the company is for sale. While the pain of their firings may be consequential for those who are experiencing it, the pain of those the company has damaged, mostly striving middle-class consumers and their families, may be worse.  

2U's problems are not new. The Higher Education Inquirer first reported on the beginning of company's meltdown in October 2019.  In July 2022, 2U announced layoffs as it changed its business model (again) and the US Department of Education scrutinized the company's grad school offerings.

2U began in 2008 as an online program manager (OPM), one of a few companies offering edtech services that required large amounts of capital and labor costs. They expanded through the acquisition of other edtech firms, Trilogy Education Services (2019) and edX (2021).  edX is an education platform that was created by Harvard and MIT as a massive open online course (MOOC) platform, but as part of 2U now concentrates on selling a number of elite and brand name tech bootcamps.

In 2022 and 2023, the Wall Street Journal (Lisa Bannon), Chronicle of Higher Education (Mike Vasquez), and USA Today (Chris Quintana) investigated 2U after a few US senators sounded the alarm about consumers being fleeced by 2U and other OPMs. 

With 2U's reputation in shambles and layoffs ahead, the parent company wrapped itself around the more respectable edX brand. Bjju's, an Indian edtech firm, was said to be looking at 2U or Chegg as a possible acquisition (Byju's is now facing its own problems).  

Concentrating on growth for years, then acquisition, then consolidation and rebranding, 2U has never generated an annual profit--and that trend doesn't appear to be changing. 

Earlier this year we listed 2U, Chegg, Coursera, and Guild Education as part of the EdTech Meltdown. 

Unlike the prior wave of for-profit college failures of Corinthian Colleges, ITT Tech, Education Management Corporation, and others that hurt working-class student debtors, 2U has collaborated with elite universities, targeting mostly middle-class folks for advanced degrees and certificates with elite brand names such as USC and UC Berkeley. Credentials that frequently are not worth the debt. Credentials that often did not lead to better paying jobs. Credentials that burden (and sometimes crush) consumers financially with private loans from Sallie Mae and others.

edX's website advertises coding, data analytics, cybersecurity, and AI bootcamps from a number of name brands: Ohio State University, Columbia University, University of Texas, Harvard University, Michigan State University, University of Denver, Southern Methodist University, University of Minnesota, University of Central Florida, Arizona State University, Northwestern University, Rice University, the University of North Carolina, and UC-Irvine.   

• Ohio State University AI Bootcamp $11,745
  
• University of Texas Coding Bootcamp $12,495
• Berkeley Extension Coding Bootcamp $13,495
• University of Pennsylvania Cybersecurity Bootcamp $13,995
  
• Columbia University Data Analytics Bootcamp $14,745 

It's not clear how well managed the programs are and how much these schools are involved in instruction and career guidance.  However, edX claims that with their bootcamp certificates, graduates will "gain  access to more than 260 employers--including half of the Fortune 100--seeking skilled bootcamp graduates." 

While the targets of for-profit colleges and 2U may have been different, their approaches were similar: sell a dream to consumers that often does not materialize. Spend tens of millions on targeted (and sometimes misleading) advertising and enrollment. Keep the confidence game going as long as it will last. But that may not be much longer.

In April 2023, 2U filed a lawsuit against the US Department of Education to avoid further government oversight. A familiar defensive strategy in the for-profit college business.

There is much we don't know about how significant the damage has been to those who bought the 2U story and spent tens of thousands on elite degrees and certificates, but it must be significant. Most US families do not have that kind of money to spend on something that doesn't result in financial gains.  

Recent reviews of edX on TrustPilot have been scathing. And social media have been brutal on 2U, Trilogy, and EdX. Reddit, for example, has posts like "The dirty truth about edX/Trilogy Boot Camps." In a more recent post about edX, there was a flurry of negative reviews.

In 2016, we wrote "When college choice is a fraud." At that time we were focusing on the tough choices that working-class people have deciding between their local community college or a for-profit career school. Little did we know that the education business was already moving its way up the food chain and that edtech companies like 2U would be engaging in the latest form of edugrift. 

Related link:

2U Virus Expands College Meltdown to Elite Universities (2019)

Buyer Beware: Servicemembers, Veterans, and Families Need to Be On Guard with College and Career Choices (2021)

College Meltdown 2.1 (2022)

EdTech Meltdown (2023)  

Erica Gallagher Speaks Out About 2U's Shady Practices at Department of Education Virtual Listening Meeting (2023)

"Edugrift" by J.D. Suenram (2020)

When college choice is a fraud (2016)

US Department of Education Fails to Recognize College Meltdown

The Department of Education's predictions about college enrollment may overestimate the number of students in 2023 by 5-7 million.  


At what point will President Donald Trump's Department of Education realize that US higher education is facing dramatic losses in enrollment, and that their rosy projections are so wrong?

According to the National Student Clearinghouse, higher education enrollment has declined by 2.4 million students since 2010-2011. And the greatest losses have come from community colleges, which have experienced a 1.6 million student decline.

The US Department of Education, however, projects a consistent upward trend in enrollment despite acknowledging consistent losses from 2011 to 2015.  

Optimistic analysts suggest that the enrollment declines are the result of an improved economy, where jobs are more prevalent. But this pollyanna analysis belies the underlying problems in higher education and the greater economy that I have been chronicling on LinkedIn and College Meltdown.

Check out the 40 hardest hit US public 2-year institutions and you will see a pattern of government austerity, localized depressions, increasing inequality and an eroding K-12 pipeline.

Now, more than 15 indicators of the college meltdown have hit yellow or red lights. Revenues, the only green light in my analysis, appear to be in decline. Increasing student loan interest rates and reductions in need based funding may also accelerate the meltdown faster than my original models.

While elite colleges and brand name state universities continue to do well, for-profit colleges, community colleges, small private rural colleges, second-tier state colleges and HBCUs face major headwinds.

To make matters worse, public opinion about colleges has been worsening, especially among Republicans and the white working class. Whether this has already affected enrollment numbers has not been thoroughly investigated.

Inside Higher Education was bold enough to post a piece titled "What Happens If Higher Ed Collapses." But how many people read Inside Higher Education?

Potential political and cultural clashes this fall on college campuses may also worsen public opinion.

There are some positive developments happening, such as free community college in Oregon, Tennessee, New York, and Rhode Island, but this is not enough to remedy the destructive developments of defunding, deregulation, and privatization proposed by the Trump Administration.

Hyper Credentialism and the Neoliberal College Meltdown (Glen McGhee and Dahn Shaulis)

In the neoliberal era, higher education has become less a public good and more a marketplace of promises. The ideology of “lifelong learning” has been weaponized into an endless treadmill of hyper-credentialism — a cycle in which students, workers, and institutions are trapped in perpetual pursuit of new degrees, certificates, and micro-badges.

From Education to Signaling

Once, a college degree was seen as a path to citizenship and critical thought. Today, it’s a market signal — and an increasingly weak one. The bachelor’s degree no longer guarantees stable employment, so the system produces ever-more credentials: master’s programs, micro-certificates, “badges,” and other digital tokens of employability.

This shift doesn’t solve economic precarity — it monetizes it. Workers internalize the blame for their own stagnating wages, believing that the next credential will finally make them “market ready.” Employers, meanwhile, use credential inflation to justify low pay and increased screening, outsourcing the costs of training onto individuals.

A Perfect Fit for Neoliberalism

Hyper-credentialism is not a side effect; it’s a feature of the neoliberal education economy. It supports four pillars of the model:

Privatization and Profit Extraction – Public funding declines while students pay more. Each new credential creates a new revenue stream for universities, online program managers (OPMs), and ed-tech corporations.

Individual Responsibility – The structural causes of unemployment or underemployment are reframed as personal failures. “You just need to upskill.”

Debt Dependency – Students and workers finance their “reskilling” through federal loans and employer-linked programs, feeding the student-debt industry and its servicers.

Market Saturation and Collapse – As more credentials flood the market, each becomes less valuable. Institutions respond by creating even more credentials, accelerating the meltdown.

The Education-Finance Complex

The rise of hyper-credentialism is inseparable from the growth of the education-finance complex — a web of universities, private lenders, servicers, and Wall Street investors.
Firms like 2U, Coursera, and Guild Education sell the illusion of “access” while extracting rents from students and institutions alike. University administrators, pressured by enrollment declines, partner with these firms to chase new markets — often by spinning up online master’s programs with poor outcomes.

The result is a debt-driven ecosystem that thrives even as public confidence collapses. The fewer good jobs there are, the more desperate people become to buy new credentials. The meltdown feeds itself.

Winners and Losers

Winners: Ed-tech executives, university administrators, debt servicers, and the politicians who promote “lifelong learning” as a substitute for wage growth or labor rights.

Losers: Students, adjunct faculty, working-class families, and the public universities hollowed out by austerity and privatization.

The rhetoric of “upskilling” and “personal growth” masks a grim reality: a transfer of wealth from individuals to financialized institutions under the guise of opportunity.

A System That Can’t Redeem Itself

As enrollment declines and public trust erodes, the industry doubles down on micro-credentials and “stackable” pathways — small fixes to a structural crisis. Each badge, each certificate, is sold as a ticket back into the middle class. Yet every new credential devalues the old, producing diminishing returns for everyone except those selling the product.

Hyper-credentialism thus becomes both the symptom and the accelerant of the college meltdown. It sustains the illusion of mobility in a collapsing system, ensuring that the blame never reaches the architects of austerity, privatization, and financialization.

Sources and Further Reading

Brown, Wendy. Undoing the Demos: Neoliberalism’s Stealth Revolution.

Giroux, Henry. Neoliberalism’s War on Higher Education.

Cottom, Tressie McMillan. Lower Ed: The Troubling Rise of For-Profit Colleges in the New Economy.

The Higher Education Inquirer archives on the college meltdown, OPMs, and the debt economy.

The Layoff.com: Observations of College Meltdown in Real Time (Updated September 29, 2024)

The Layoff.com is a "simple discussion board" for workers who would like to learn more about the rumors or possibility of job cuts in their organization. It's also been helpful for us to understand what has been happening behind the scenes in the US Higher Education business. 

 

We have been observing and participating on this website for more than a dozen years, watching the fall of Corinthian Colleges (Everest College, Wyotech, and Heald), ITT Tech, Education Management Corporation (the Art Institutes and South University), the partial collapse of Apollo Group (University of Phoenix), Perdoceo (formerly Career Education Corporation), and Laureate International, and the transformation of Kaplan University to Purdue University Global and Bridgepoint Education (Ashford University) to University of Arizona Global.   

As the College Meltdown has advanced, we have also observed a number of private schools collapse and public colleges and universities struggle. As enrollments continue to drop, we can expect more layoffs to occur and for education related businesses to struggle more.  

 

The contents of this article are updated periodically, to illustrate trends in the College Meltdown.  The most recent update was published September 29, 2024.  2U, the online program manager for elite university certificates has been the poster child in 2024, but there are many other companies and institutions in peril.  

 

2U and edX 

 

Adtalem Global Education  

 

Albright College

Barnes and Noble College Booksellers

 

Cengage

Chegg

 

Concordia University, Ann Arbor

Coursera

 

Delta State University 

 

DeVry University 

 

Emerson College 

 

Gwynedd-Mercy University 

 

Keystone College  

 

Maximus 

 

National American University 

 

Navient 

 

Northern Illinois University 

 

Penn State University  

 

Perdoceo   

 

Saint Cloud State University 

 

Sallie Mae  

 

Udemy 

University of Arizona 

University of Maryland Global 

 

University of New Orleans 

 

University of North Carolina, Asheville

 

University of Phoenix 

 

University of Wisconsin-Milwaukee 

 

Walden University 

 

Western Illinois University   

West Virginia University 

 

Wittenberg University 

Can College Presidents Tell Us the Truth?

“Truth? You can’t handle the truth!” Jack Nicholson’s Colonel Jessup in A Few Good Men captures the tension at the heart of American higher education: can college presidents confront veritas—the deep, sometimes uncomfortable truths about their institutions—or will they hide behind prestige, endowments, and comforting illusions?

At the foundation of academia lies veritas, Latin for truth or truthfulness, derived from verus, “true” or “trustworthy.” Veritas is not optional decoration on a university crest; it is a moral and intellectual obligation. Yet 2025 reveals a system where veritas is too often sidelined: institutions obscure financial mismanagement, exploit adjunct faculty, overburden students with debt, and misrepresent outcomes to the public.

The Higher Education Inquirer (HEI) embodies veritas in action. In “Ahead of the Learned Herd: Why the Higher Education Inquirer Grows During the Endless College Meltdown,” HEI demonstrates that truth-telling can thrive outside corporate funding or advertising. By reporting enrollment collapses, adjunct exploitation, and predatory for-profit practices, HEI holds institutions accountable to veritas, exposing what many university leaders hope will remain invisible.

Leadership failures are a direct affront to veritas. “Scam Artist or Just Failed CEO?” scrutinizes former 2U CEO Christopher “Chip” Paucek, revealing misleading enrollment tactics and financial mismanagement that serve elite universities more than consumers. These corporate-style decisions in a higher education setting betray the very principle of veritas, prioritizing appearance and profit over educational integrity and human outcomes.

Student journalism amplifies veritas further. Through Campus Beat, student reporters uncover tuition hikes, censorship, and labor abuses, demonstrating that veritas does not belong only to administrators—it belongs to those who seek to document reality, often at personal and professional risk.

Economic and political realities also test veritas. In “Trumpenomics: The Emperor Has No Clothes,” HEI exposes how hollow economic reforms enrich a few while leaving the majority behind. Academia mirrors this pattern: when prestige is elevated over substance, veritas is discarded in favor of illusion, leaving students and faculty to bear the consequences.

Structural crisis continues. In “College Meltdown Fall 2025,” HEI documents federal oversight erosion, AI-saturated classrooms with rampant academic misconduct, rising student debt, and mass layoffs. To honor veritas, leaders would confront these crises transparently, but too often they choose comforting narratives instead.

Debt remains one of the clearest tests of institutional veritas. HEI’s “The Student Loan Mess: Next Chapters” shows how trillions in student loans have become instruments of social control. The Sweet v. McMahon borrower defense cases illustrate bureaucratic inertia and opacity, directly challenging the principles of veritas as thousands of debtors await relief that is slow, incomplete, and inconsistently applied.

Predatory enrollment practices further undermine veritas. Lead generators, documented by HEI, exploit student information to drive enrollment into high-cost, low-value programs, prioritizing revenue over truth, clarity, and student welfare. “College Prospects, College Targets” exposes how prospective students are commodified, turning veritas into a casualty of marketing algorithms.

Through all of this, HEI itself stands as a living testament to veritas. Surpassing one million views in July 2025, it proves that the public demands accountability, clarity, and honesty in higher education. Veritas resonates—when pursued rigorously, it illuminates failures, inspires reform, and empowers communities.

The question remains: can college presidents handle veritas—the unflinching truth about student debt, labor exploitation, mismanagement, and declining institutional legitimacy? If they cannot, they forfeit moral and public authority. Veritas is not optional; it is the standard by which institutions must be measured, defended, and lived.

---

Sources

• Calling All Campus Reporters: Help Us Tell the Truth

• Trumpenomics: The Emperor Has No Clothes

• HEI Resources Fall 2025

• College Meltdown Fall 2025

• Why the Higher Education Inquirer Continues

• Higher Education Inquirer Surpasses 1 Million Views

• Scam Artist or Just Failed CEO?

• Lead Generators in Higher Education

• The Student Loan Mess: Next Chapters

• Sweet

• Elite University Presidents: Most Hated Men (and Women) on Campus

• Elite Universities on Lockdown. Protestors Regroup.

HEI Resources 2025

[Editor's Note: Please let us know of any additions or corrections.]

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• Vedder, R. (2004). Going Broke By Degree: Why College Costs Too Much.
• Veysey Lawrence R. (1965).The emergence of the American university.
• Washburn, J. (2006). University Inc.: The Corporate Corruption of Higher Education
• Washington, Harriet A. (2008). Medical Apartheid: The Dark History of Medical Experimentation on Black Americans from Colonial Times to the Present. Anchor. 
• Whitman, David (2021). The Profits of Failure: For-Profit Colleges and the Closing of the Conservative Mind. Cypress House.
• Wilder, C.D. (2013). Ebony and Ivy: Race, Slavery, and the Troubled History of America's Universities. 
• Winks, Robin (1996). Cloak and Gown:Scholars in the Secret War, 1939-1961. Yale University Press.
  
• Woodson, Carter D. (1933). The Mis-Education of the Negro.  
• Zaloom, Caitlin (2019).  Indebted: How Families Make College Work at Any Cost. Princeton University Press. 
• Zemsky, Robert, Susan Shaman, and Susan Campbell Baldridge (2020). The College Stress Test:Tracking Institutional Futures across a Crowded Market. Johns Hopkins University Press. 

 

Activists, Coalitions, Innovators, and Alternative Voices

• Academe Blog
• Adjunct Crisis
• Adjunct Nation
• American Federation of Teachers Adjunct-Contingent Faculty Caucus
• Bryan Alexander (Futurist)
• Campus News (New York)
• Clery Center
• Coalition of Contingent Academic Labor
• College Futures Foundation (California, K-20)
• College is a Risky Business (Thomas B. Walsh)
• College Promise (Free Community College)
• College Tuition Advisory Services (CTAS)
• College Viability App (Gary Stocker)
• Con Job: Stories of Adjunct and Contingent Faculty
• Confessions of a College Professor (Professor Doom)
• Debt Collective
• Deep Thoughts on Higher Education (Jeff Doyle) 
• Diane Ravitch (K-12)
• EdTrust
  
• Higher Ed Not Debt
• Higher Education Labor United  
  
• Higher Education Strategy Associates
• I Am Ai
• ITT Tech Warriors
• Jim Wolfston and the Social Mobility Index (CollegeNet)
  
• Jonathan Kozol (K-12)
• Kelchen on Education
  
• National Consumer Law Center
• New Faculty Majority (Adjuncts)
• New Laws For America (Bob Hertz)
• Outside the Law School Scam
• Presidents Alliance on Higher Education and Immigration 
• Project on Predatory Student Lending
  
• Randall Collins (Credentialism and Credential Inflation)
• Remaking the University
• Republic Report (David Halperin)
• Saving For College (Mark Kantrowtitz)
• SEIU Faculty Forward (Adjuncts)
• Steve Foerster (Technologist and Educator)
• Strike Debt Portland
• Student Borrower Protection Center
• Student Debt Crisis
• Student Loan Justice
• Terri Givens (Radical Empathy)
• The Best Classroom is the Struggle (Joshua Sooter) 
• TuitionFit (Mark Salisbury)
• Whistleblower Revolution (Heidi Weber)
• Workplace: A Journal for Academic Labor
• Wrench in the Gears: A Skeptical Parent's Thoughts on Digital Curriculum (K-12)

 College Choice and Career Planning Tools

• Modern States (free college credits)
  
• College Promise
• TuitionFit 
• College Viability App
• College Scorecard (NCES) 
• Washington Monthly College Rankings 
• Apprenticeship Finder (US Department of Labor)
• FinAid
• College Navigator (NCES)
• Best Value Colleges (PayScale)  
• Hechinger Report College Fitness Tracker
  
• NBC News Investigation: Certificate schools are leaving many students in debt and unable to find jobs
• 2/3s of US Employees Regret Their College Degrees (CBS News)
• The Future of Work Won't Be About College Degrees (CNBC, Stepane Kasriel)
• Student Loan Meltdown (Dave Ramsey)
• Permanent Underemployment for College Grads (Burning Glass Technologies)
• College Is A Risky Proposition For The Working Class (Jon Marcus, Hechinger Report)
• Apprenticeships are a trending alternative to college — but there’s a hitch (Jon Marcus, Hechinger Report) 
• 15 Things College Doesn't Teach You
• Best Colleges for Social Mobility (CollegeNet)
• The Case Against Higher Education (Bryan Caplan)
• College May Not Pay Off For Everyone (Liberty Street Economics/NY FED)
• Online Education Has Questionable Outcomes (IHE)
• Colleges Where Most Students Borrow and Few Repay (TICAS)
• Broke, Busted, and Disgusted Trailer (Student Loan Debt)
• The Confusing Information Colleges Provide Students About Financial Aid (The Atlantic)
• College Affordability and Transparency Center (ED)
• Public College Dropout Factories (Third Way)
• Outcomes By Major (NY FED)
• Third Way
• GI Bill Comparison Tool (VA)
• 8 Tips to Help Vets Pick the Right College (Military Times)
• Warrior Scholar (For Veterans)
• Service to School (For Veterans)
• Peer Advisors for Veteran Education (PAVE)

Innovation and Reform

• Faculty Focus
  
• Strategies for Improving Student Success (Inside Higher Education)
• CUNY ASAP 
  
• Gap Year Basics (NYU)
• Union Plus Free College 
  
• Maryland Student Loan Debt Relief Tax Credit
• Canceling Student Loan Debt Would Grow Economy and Add Jobs (Levy Institute)
• Beyond Tuition: Promises for Affordability, Quality, and Accountability in Higher Education (Center for American Progress)
• Georgia State Turnaround (CHE)
• Spelman Health Initiative (IHE)
• University of Kansas: BA In Three Years
• Shady Grove: Nine Campuses in One (WAPO)  
  

Higher Education Policy

• Veterans’ Education Advocates Celebrate Closure of the 90/10 Loophole
• College Transparency Act (Senate Bill 800)
• Dropping Gainful Employment Rules Gives Billions to Subprime Colleges (Inside Higher Education)
• ED Announces Steps to Hold Institutions Accountable for Taxpayer Losses
• FTC Head Says Supreme Court Ruling Puts More Than $2 Billion for Cheated Consumers at Risk (Brent Kendall, WSJ)
• GAO Report Regarding Online Program Managers
• How to Stop Sudden College Closures (Century Foundation)
• Improving Outcomes Data for Online Programs (Robert Kelchen, Inside Higher Education)
• Spelman College Replaces NCAA Sports with Wellness Programs
• Strengthening Rural Anchor Institutions: Federal Policy Solutions for Rural Public Colleges and the Communities They Serve (Alliance for Research on Regional Colleges)
• The Distributional Effects of Student Loan Forgiveness (BFI Working Paper, Sylvain Catherine and Constantine Yannelis)
• The for-profit college system is broken and the Biden administration needs to fix it (Brookings)
• The Impact of a National Program of Free Tuition at Public Community Colleges and Free Tuition for Most Students at Public Four-Year Colleges and Universities on College Enrollments, Graduations, and the Economy (Robert Shapiro and Isaac Yoder)
• Three Things Policymakers Can Do to Protect Online Students (Century Foundation)  
  

Data Sources

• American Association of Colleges and Universities  
  
• American Association of State Colleges and Universities
• American Indian Higher Education Consortium
• Academic Labor Force Trends (AAUP)
• Century Foundation 
  
• Closed Schools Report (US Department of Education)
• College Closing Projections (EY)
• College Costs Increasing Over Time (College Board)
• College Debt Inhibits Home Buying (CNBC)
• Complete College America
  
• Debt by Degrees (Pro Publica)
• Department of Defense
• Education Statistics by Institution
• Enrollment Numbers 
• Excelencia in Education
• Foundation for Research on Equal Opportunity
  
• Growing Inland Achievement 
• Hechinger Report
• Heightened Cash Monitoring
• Long-term Student Loan Default Rates
• Lumina Foundation 
  
• National Association of College and University Business Officers (NACUBO)
• National Assessment of Educational Progress
  
• National Association of Student Financial Aid Administrators (NASFAA)
• National Center for Education Statistics
• NCES Blog
  
• National Student Clearinghouse 
• Predicting College Closures and Financial Distress (Philadelphia Federal Reserve)
  
• School Counselor Numbers (ASCA)
• Scientists Leaving Academia in Droves
• Starving the Beast: The Battle to Disrupt and Reform America’s Public Universities
• State by State College Debt (TICAS)
• Student Loan Debt By State (Urban Institute)
• Student Loan Debt Clock
• Student Loan Debt Inhibits Home Buying (CNBC)
• Student Loan Default Projections (Brookings)
• Subprime Colleges (David Halperin)
• The 74: America's Education News Source
  
• Third Way Reports
• Tracking College Closures (Hechinger Report) 
  
• Transfer Credit Problems (GAO)
• United Negro College Fund
  
• University Business Officers Reports
• US Financial Aid (2024 Annual Report) 
  
• Veterans Affairs (GI Bill)

Trade publications

• Chronicle of Higher Education
• Diverse Issues in Higher Education 
• EdSurge
  
• Higher Ed Dive
• Inside Higher Ed
  

 

What happens to the American Dream during the College Meltdown?

American cultural outlets are slowly recognizing just how unequal society has become.  Traditional images of the American Dream and the values of meritocracy are being challenged by more critical discussions about a dangerously unequal society, including the increasingly corrupt and caste-like nature of  higher education.  The following quotes highlight this slow change in consciousness:

"...Public universities and colleges no longer offer the same degree of opportunity they provided to low and moderate income Americans as recently as a generation ago (Dr. Suzanne Mettler in "Degrees of Inequality").

"...Mergers are a hot topic for all kinds of schools, regardless of race and mission. They are presented by legislators as a way to save taxpayer money, strengthen research and educational opportunities, and to increase visibility in a hyper-competitive rush for student enrollment. But beneath the surface, it is part of a far more dangerous plan to divide the haves and have nots..." (Jarret L. Carter, HBCU Digest).

36% of colleges with endowments under $25 million are spending more than 5% per year from their endowment. It's unsustainable. (Dr. Robert Kelchen, Seton Hall University)

"If current trends continue over the next few decades, most state university systems would soon lose all funding from their states....In 2025 Colorado would become the first state to allocate zero funding to higher ed; Iowa would follow in 2029, then Michigan (2030), then Arizona (2032).  Most states wouldn't appropriate any university funding by 2050." (Alia Wong, The Atlantic)   

"You just have to walk through the Yale campus to see what money will buy you, which is a country club, right?...But we have to look at this in the big picture: There are tons and tons of other students at other colleges who are carrying enormous debt loads through their 20s and even into their 30s because school has gotten so expensive." (Malcolm Gladwell, NPR's Weekend Edition)

"...with the higher education industry growing faster than nearly any other industry in the world, we can probably expect its corruption and cronyism to grow just as fast." (Jesse Nickles, College Times)

There is also a growing body of literature critical of US higher education and specifically its institutional financing, service delivery (including the exploitation of adjuncts), student access, student outcomes, and accreditation.

The US college meltdown is deeper than most critics know.   How many people are examining Student Loan Asset-Backed Securities (SLABS) and higher education construction bonds?   

How many citizens really know how their local university and college endowments are getting consistent double digit returns?  Has your school received a valid stress test (NACUBO, 2015)?   

Powerful critics such as Bain Capital (Denneen & Dretler, 2012) and the New America Fund (Selingo, et al, 2013) argue that colleges are spending beyond their means, using outmoded teaching methods, becoming less accessible to students and their families, and refusing to be accountable for student graduation and default rates and “gainful employment” numbers.

Other sources have called the US higher education system's ancillary student loan businesses and accrediting agencies as either criminal or immoral.   For decades now, the student loan industry has been a racket: a scheme between corporations and government resulting in debt peonage for millions of working Americans.   

These harsh judgments are coming at at time of increasing government austerity towards higher education and college tuition costs that are out of reach for many students and their families.

While some may invite the US college crash as a form of “creative destruction” (Johnson, 2014, Economist, 2014), working families are discovering that higher education is an expensive if not risky proposition, sewing “seeds of discontent” among students as well as teachers (Frey, 2013, Chomsky, 2014, Mettler 2014, Lawler, 2015).

Knowing the perils that colleges, students, and families face, this briefing is a starting point to

• Identify whether your school is “at risk” (stress testing)
• Identify where changes can be made, and
• Discuss the importance of being personally and socially involved in making changes

Truthfully, most major "elite" schools are growing in power in wealth.  But this is education for the few.  My purpose here is to educate and agitate people about the college meltdown which is now underway at for-profit colleges, community colleges, Historically Black Colleges and Universities (HBCUs), tribal colleges, schools with endowments below $50 million, and academic programs, such as law schools, at public colleges and universities facing state budget issues.

"For decades, bad actors in this (for-profit) industry have engaged in awful abuses, and for five years we’ve seen steady revelations of such misdeeds, including blatant deceptions by for-profit colleges to students and government overseers." (David Halperin)

"After reviewing the data compiled by several researchers...community colleges are pretty much a mess.  They get far too few of their students on the road to good jobs or four-year college degrees.   Many of their classes are poorly taught.  many of their programs are poorly organized.  Even their best effort are poorly funded."  (Jay Matthews, Washington Post)

"The problem (with community colleges) isn't tuition.  It's guidance and teaching.  Students are turned off not by the cost of community college but the frustrating entrance standards and classes that do not take them in the directions they want to go.  They are given little assistance in navigating the confusing requirements." (Jay Matthews) 

According to Johnny C. Taylor, president & CEO of the Thurgood Marshall College Fund, 50 to 60 percent of HBCUs don’t have a long-term optimistic outlook and about 10 percent are in imminent trouble.

"HBCU dorms have fallen into serious disrepair. Classrooms are in need of updating, and academic programs have suffered. Some schools have had to reduce faculty and staff. To be blunt, it’s the result of years and years of financial neglect. Some of these schools are in need of a major infusion of cash." (Lynette Holloway in The Root).

"These (tribal) colleges not only have high costs per graduate, but also weak educational results. The reasons are complex, but they start with the fact that many reservations are places of despair with levels of alcoholism, drug use, suicide, out-of-wedlock childbearing, violence, and unemployment that would shock the average American. Despondency rules."  (Tom Burnett)

"Law schools face real business challenges. Demand has declined every year since 2010—not just a little but by nearly 40 percent. The same number of law schools have 33,000 fewer prospective customers than they had five years ago."

Those who are sufficiently concerned need to read more about this issue and must follow up with their own homework and social action.

Elite private schools and State Flagship Universities that possess multi-billion dollar endowments, perpetual tax breaks, and renewing government grants promise to get wealthier and more powerful, leaving hundreds of poorer schools in peril.

 Institutions at Risk (“Stress Test”)

If higher education administrators, accrediting agencies, and teachers union officials refuse to be transparent and accountable to students and former students, alumni, adjuncts, and communities, the US college meltdown promises to be more cataclysmic.

Denneen and Dretler (2012) identify at least 13 metrics to identify whether your school is in financial trouble. If your school is not an elite private or public university with a large endowment, you might be at risk if your school is experiencing:

1. Falling admissions
2. Median salaries of graduates are flat
3. Reductions in funding
4. Taking on more debt
5. Tuition increases
6. Reducing faculty head count
7. Cut backs on financial aid

Best and Best (2014) argue that public universities that rely on out-of-state and international students may also be taking on risk that is not readily apparent.

Where to Make Changes
Daneen and Dretler (2012) outline four major areas to make changes.

1. Developing a clear strategy focused on the core of the institution (places that clearly add value)
2. Reducing support and administrative costs (fragmentation, redundancy, unneeded hierarchy, need to outsource some functions—caution reducing instruction costs)
3. Freeing up capital in non-core assets (real estate, physical assets, intellectual property)
4. Strategically investing on innovative models (flexibility for students)

Selingo, et al (2013) mention similar strategies and add several more options in reforming colleges, including:

• Stronger partnerships with community colleges
• Online offerings, hybrid courses
• Data driven student advising system
• More flexible and effective learning systems (online tutorials more effective than lecturing, personalized systems)
• Targeted financial aid
• Peer tutors and supplemental instruction
• Forging partnerships with business and government
• Make transferability more accessible
• Performance based funding

Exemplars of Innovation
No one can tell a community and its colleges what they must do to save resources and generate long-term resources. But there are exemplars of schools doing the right thing for their communities and their student bodies.

Coops are innovative partnerships that allow students to gain work experience before graduating. While coops have been an integral part of wealthy schools such as Drexel University, they can also be used to provide people with needed skills to serve a community. In another briefing, I highlight the growth and success of training at Working Class Accupuncture.

In Rockville, Maryland, nine public colleges and universities are housed in one campus--called the Universities at Shady Grove.  The program began 16 years ago  to "produce an educated workforce and encourage college completion among populations that traditionally struggle to get their ­degrees."

Innovative projects may require some pain, but may lead to even stronger and more mindful and sustainable programs.

Spelman College, for example, saved money by removing interscholastic sports, but replaced them with wellness programs that are an incubator for a "wellness revolution."

Social Involvement
Getting institutions to cut administrative fat, reduce cronyism and “dead wood”, and become more innovative will often result in resistance, even as other schools become more innovatative (Lederman, 2013). According to Daneen and Drettler (2012), in order for change to occur, an institution must

• Bring in key stakeholders to make needed change
• Acknowledge that change is necessary throughout the institution
• Address not only cost cutting, but adding value (e.g. consolidation can improve efficiency)
• Be clear about roles and accountability (functional accountability)

Conclusions
People in the US are living in times of increasing government austerity and declining percentages of traditional college-age students. These are political and social realities that are not going away soon. These realities make it vital that students, families, teachers, educational support staff, administrators, business people, taxpayers, alumni, and community members be actively involved in making colleges accessible, accountable, and responsive to society.

Strategic plans require informed input from an array of stakeholders who must be willing to sacrifice and to innovate. Without this, communities should be prepared for their schools to fail financially. Colleges should pay attention to their core missions, be wary of fads, and be able to adapt as their communities and their economies change. I hope that some of the ideas have prompted readers to think about what they can do to promote change in their colleges.

If you are not a member of an elite institution, how will your local school or alma mater listen and respond? Will they keep their heads buried in the sand, or will all stakeholders work together to be more socially responsive and responsible? If administrators and political leaders are unwilling to offer substantive changes, will students, teachers, and communities take a much larger and more active role in governing institutions, as they appear to be starting to do?

Epilogue: A Sincere Effort from Everyone
There is no shortage of knowledge about what works in US higher education. However, politics and power often get in the way of change (Habley, Bloom & Robbins, 2012, Mettler, 2014).

Those in power hoping to keep critics at bay by offering stakeholders a voice--but not actually considering any of their substantive or "radical" ideas--put themselves and their institutions and communities in peril (Hogan, 2003). It may give breathing room for those on the way out, but it doesn't ensure that the institution can survive for the longer run.

Let's get real. Political officials, regents, board members, and administrators know about lucrative and shady business deals, crony administrative positions, and high-priced pet projects. Teachers and teachers unions know about boring, uncaring, and unprofessional teachers who should be fired. Students know about ill-prepared disinterested peers and those who are cheating their way through school. Citizens know about the lack of access for particular people in their neighborhood and the maldistribution of resources. But it takes courage (and outstanding organization) to get everyone working, and struggling together, before a college fails in its mission.

While those with power may argue that others are at fault, they cannot disregard their own duties to facilitate the education and betterment of their communities.

[First edition posted as "The US College Meltdown," April 13, 2015.]