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.

Alaska’s Colleges at the Meltdown’s Edge—Just as the Arctic Heats Up

Alaska’s higher-ed story is a preview of the national “College Meltdown,” only starker. The University of Alaska (UA) system—Anchorage, Fairbanks, and Southeast—has endured a decade of enrollment erosion and austerity politics, punctuated by a 2019 budget crisis that forced regents to declare financial exigency and consider consolidations. The immediate trigger was a proposed $130+ million state cut, later converted into a three-year reduction compact; the long tail is a weakened public research engine in the very state where climate change is moving fastest.

In 2025 the vise tightened again from Washington. UA’s president told regents that more than $50 million in grants had been frozen or canceled under the Trump administration, warning of staff cuts and program impacts if funds failed to materialize. Those freezes were part of a broader chill: federal agencies stepping back from research that even references climate change, just as the Arctic’s transformation accelerates.

This is not an abstract loss. Alaska is the frontline laboratory of global warming: thawing permafrost, vanishing sea ice, collapsing coastal bluffs. UA’s scientists have documented these trends in successive “Alaska’s Changing Environment” assessments; the 2024 update underscores rapid, measurable shifts across temperature, sea ice, wildfire, hydrology, and ecosystems. When the main public research institution loses people and projects, the United States loses the data and know-how it needs to respond.

Climate denial collides with national security

The contradiction at the heart of federal policy is glaring. On one hand, the Trump administration has proposed opening vast swaths of Alaska’s National Petroleum Reserve to drilling and reversing environmental protections—signaling a bet on fossil expansion in a region already warming at double the global rate. On the other hand, the same administration is curtailing climate and Arctic science, even as military planners warn that the Arctic is becoming a contested theater. You can’t secure what you refuse to measure.

The security stakes are real. Russia has spent the past decade refurbishing Soviet-era bases, deploying ice-capable vessels, and leveraging energy projects along the Northern Sea Route (NSR). China has declared itself a “near-Arctic” power and partnered with Moscow on patrols and infrastructure. Meanwhile, the U.S. remains short on icebreakers and Arctic domain awareness—even as traffic through high-latitude passages grows more plausible in low-ice summers. Analysts project that a meaningful share of global shipping could shift north by mid-century, and recent reporting shows the region is already a strategic flashpoint.

That makes UA’s expertise more than a local asset; it’s a pillar of U.S. national security. The University of Alaska Fairbanks hosts the Center for Arctic Security and Resilience (CASR) and degree pathways that fuse climate, emergency management, and security studies—exactly the interdisciplinary skill set defense, Coast Guard, and civil authorities will need as sea lanes open and storms, fires, and thaw-related failures multiply. Undercut these programs, and you undercut America’s ability to see, interpret, and act in the Arctic.

The costs of disinvestment

The 2019 state-level cuts did immediate damage—hiring freezes, program reviews, and fears of accreditation changes—but their larger effect was to signal instability to students, faculty, and funders. Austerity invites a spiral: as programs and personnel disappear, grant competitiveness slips; as labs lose continuity, agencies look elsewhere; as uncertainty grows, students choose out-of-state options. UA leadership has tried to reverse course—prioritizing enrollment, retention, and workforce alignment in recent budgets—but it’s difficult to rebuild a research reputation once the pipeline of projects and people is disrupted.

The 2025 federal freezes amplify that spiral by hitting precisely the projects that matter most: those with “climate” in the title. Researchers report program cancellations and re-scoped solicitations across agencies. That kind of ideological filter doesn’t just reduce funding—it distorts the evidence base that communities, tribal governments, and emergency planners depend on for everything from permafrost-safe housing to coastal relocation plans. It also weakens U.S. credibility in Arctic diplomacy at a time when the Arctic Council is strained and cooperation with Russia is largely stalled.

Why this matters beyond Alaska

Think of UA as America’s northern early-warning system. Its glaciologists, sea-ice modelers, fire scientists, and social scientists collect the longitudinal datasets that turn anecdotes into policy-relevant knowledge. Lose continuity, and you lose the ability to detect regime shifts—abrupt ecosystem changes, cascading infrastructure failures from thaw, new navigation windows that alter shipping economics and risk. Those changes feed directly into maritime safety, domain awareness, and the rules-of-the-road that will govern the NSR and other passages.

Meanwhile, federal moves to expand Arctic drilling create additional operational burdens for emergency response and environmental monitoring—burdens that fall on the same universities being told to do more with less. Opening the door to long-lived oil projects while throttling climate and environmental research is a recipe for higher spill risk, poorer oversight, and costlier disasters.

A pragmatic way forward

Three steps could stabilize UA and, by extension, America’s Arctic posture:

1. Firewall climate science from political interference. Agencies should fund Arctic research on merit, not language policing. Reinstating paused grants and re-issuing climate-related solicitations would immediately restore capacity in labs and field stations.

2. Treat UA as critical national infrastructure. Just as the U.S. is racing to modernize radar and add icebreakers, it should invest in Arctic science and workforce pipelines at UA—scholarships tied to Coast Guard and NOAA service, ship time for sea-ice and fisheries research, and support for Indigenous knowledge partnerships that improve on-the-ground resilience.

3. Align energy decisions with security reality. Every new Arctic extraction project increases environmental and emergency-response exposure in a region where capacity is thin. If policymakers proceed, they owe UA and Alaska communities the monitoring, baseline studies, and response investments that only a healthy public research university can sustain.

The paradox of the College Meltdown is that it hits hardest where public knowledge is most needed. In the Lower 48, that might mean fewer nurses or teachers. In Alaska, it means flying blind in a rapidly changing theater where Russia and China are already maneuvering and where coastlines, sea ice, and permafrost are literally moving under our feet. The University of Alaska is not a nice-to-have. It is how the United States knows what is happening in the Arctic—and how it prepares for what’s next. Weakening it in the name of budget discipline or culture-war messaging is not just shortsighted. It’s a security risk.

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Sources

• University of Alaska Office of the President, FY2020 budget overview (state veto and reductions).

• University of Alaska Public Affairs timeline (2019 exigency and consolidation actions).

• Alaska Department of Administration, Dunleavy–UA three-year compact (2019).

• Anchorage Daily News, “$50M in grants frozen under Trump administration” (May 28, 2025).

• The Guardian, “Outcry as Trump withdraws support for research that mentions ‘climate’” (Feb. 21, 2025).

• UA/ACCAP, Alaska’s Changing Environment 2.0 (2024 update).

• UAF Center for Arctic Security and Resilience (programs and mission).

• Empower Alaska: UA Arctic expertise overview.

• Wall Street Journal, Russia/China Arctic power projection and U.S. capability gaps (Feb. 2025).

• The Arctic Institute, shipping projections for the Northern Sea Route.

• Arctic Review on Law and Politics, vulnerabilities and governance challenges on the NSR.

• The Guardian, rollback of protections in the National Petroleum Reserve–Alaska (Aug. 2025).

• Alaska Public Media, uneven cuts to Arctic research under Trump (Apr. 2025).

Support the Mission of the University of Oregon (United Academics of the University of Oregon)

Tuition has increased faster than inflation. State funding has increased faster than inflation. Administrator salaries have increased faster than inflation. Yet, the administration is demanding that the teachers, librarians, and researchers who drive the university’s educational mission take real wage cuts. 

While everyone acknowledges the financial challenges facing higher education, the UO is receiving more money per student than ever before. If this money isn’t going toward student education and knowledge creation, where is it going?

The Facts:

Quality Education Requires Investment in Faculty

The value of a University of Oregon degree depends on the quality of its professors, instructors, researchers, and librarians. When faculty wages erode due to artificial austerity, neglect, or slow attrition, it affects not only the quality of education and research, but also the long-term value of a UO degree for students and alumni alike.

• UO faculty salaries rank near the bottom among our peer institutions in the American Association of Universities (AAU).
• United Academics has proposed fair wage increases that would merely adjust salaries for inflation and restore them to pre-pandemic budget levels.
• Despite pandemic-related learning loss, the administration is spending less on education per student (adjusted for inflation) than before COVID-19.
• The administration has prioritized administrative growth over academic excellence, while faculty have taken on increased workloads since the pandemic.

Faculty Sacrificed to Protect UO—Now It’s Time for Fair Wages

During the pandemic, faculty agreed to potential pay reductions to help UO weather an uncertain financial future. We made sacrifices to ensure the university could continue to serve students. Now, as we bargain our first post-pandemic contract, the administration refuses to offer wage increases that:

• Cover inflation
• Acknowledge additional faculty labor since the pandemic
• Recognize our unwavering commitment to UO’s educational mission

Our Vision for UO: Excellence in Teaching & Research

The University of Oregon’s mission is clear:

“The University of Oregon is a comprehensive public research university committed to exceptional teaching, discovery, and service. We work at a human scale to generate big ideas. As a community of scholars, we help individuals question critically, think logically, reason effectively, communicate clearly, act creatively, and live ethically.”

Our vision for the University of Oregon is one where the educational and research mission are at the fore; an institution of higher learning where we attract and maintain the best researchers and instructors and provide a world class education for the citizens of Oregon and beyond. Yes, this will take a shift in economic priorities, but only back to those before the pandemic. Our demands are neither extravagant nor frivolous. Our demand is that the fiduciaries of the University of Oregon perform their primary fiduciary duty: support the mission of the University of Oregon.

Why This Matters Now

We are currently in state-mandated mediation, a final step before a potential faculty strike. Striking is a last resort—faculty do not want to disrupt student learning. However, the administration’s arguments for austerity do not align with the university’s financial situation or acknowledge the increased faculty labor and inflated economic reality since the pandemic. If the administration does not relent, we may have no choice but to strike.

We Need Your Support

A strong show of support from the UO community—students, parents, alumni, donors, legislators and citizens of Oregon and beyond—can help pressure the administration to do the right thing. 

Sign our Community Support Letter

Austerity in California

Ben Unglesbee at Higher Ed Dive this week wrote about the coming budget cuts to the University of California System and the Cal State University System. Something that EdSource, a California-based media outlet, has been reporting on for months.

Those devastating cuts, amounting to $650 million, are part of a long and important history of US higher education and austerity, beginning with Ronald Reagan when he was Governor of California. Those ideas, at least in part, continued under other administrations, as they reduced higher education for working-class citizens, especially African Americans, while giving greater opportunities to foreigners, including elite noncitizens. 

These policies and other regressive actions drove millions of folks out of California. And those policies have spread to other states, making higher education less accessible and less responsive to working-class Americans.  It's no wonder that so many have become cynical about the higher education system.  

For now, the UC System can absorb these funding losses, but the Cal State System and the people who are served by that system, will not be as resilient. On a small scale, this is another symptom of the decline of US democracy and the slow decline of the American Empire, something few folks in higher education will admit, or even discuss.  

Related links:

University of California Academic Workers Strike For Economic Justice

State Universities and the College Meltdown

A People's History of Higher Education in the US 

Higher Education and the American Empire

A Syllabus of Resistance

Higher education today demands that we strip away illusions. The university is no longer a sanctuary of truth but a contested battleground of austerity, automation, and alienation. Students, adjuncts, and staff are caught in a cycle of debt, precarity, and surveillance. To resist, we need not another glossy strategic plan but a syllabus — a curriculum of solidarity, transparency, and rehumanization.

Debt defines the student experience. Student loan balances now exceed $1.77 trillion, and repayment programs like PSLF and income-driven repayment offer only partial relief. In 2024, as federal student loan payments resumed after a pandemic pause, millions of borrowers simply refused to pay, transforming individual debt into collective action. The Debt Collective has organized strikes and campaigns to cancel student debt, reframing borrowing as a political issue rather than a private burden. This movement challenges whether the entire financing model of higher education can survive.

Faculty labor is equally precarious. More than seventy percent of instructors are contingent, often earning poverty wages without benefits. At Harrisburg Area Community College, over 200 faculty went on strike in November 2025 after years of stalled negotiations, exemplifying a growing national labor movement against stagnant pay and weakened job security. Adjunct faculty unions at Rutgers and elsewhere continue to push back against layoffs and austerity measures. The crisis of contingent labor has moved from quiet exploitation to open confrontation.

Climate crisis compounds the meltdown. Universities expand globally in a frenzy of collegemania, while ignoring ecological collapse. Student activists demand divestment from fossil fuels, but boards often resist. At Princeton, campaigners uncovered that the university owns a controlling stake in PetroTiger, a fossil fuel company, profiting directly from extraction. Edge Hill University in the UK recently committed to divest from both fossil fuels and border security companies after sustained student pressure. The University of Illinois, despite pledging to divest years ago, still faces protests demanding action. These campaigns show that climate justice is inseparable from educational justice.

Surveillance intensifies alienation. Universities increasingly deploy corporate partnerships and AI tools to monitor student dissent. At the University of Houston, administrators contracted with Dataminr to scrape students’ social media activity during Palestine solidarity protests. Amnesty International has warned that tools like Palantir and Babel Street pose surveillance threats to student activists. Truthout reports that campuses have become laboratories for military-grade surveillance technology, punishing dissent and eroding trust. Education becomes transactional and disciplinary, leaving students reporting higher levels of stress and disconnection.

Resistance must also be moral. University governance remains hierarchical and opaque, resembling corporate boards more than democratic institutions. Calls for transparency and veritas are drowned out by branding campaigns and political capture. A pedagogy of resistance must be rooted in temperance, nonviolence, and solidarity. Rehumanization is the antidote to robostudents, roboworkers, and robocolleges. It is the refusal to be bots, debtors, or disposable labor, and the insistence on reclaiming education as a public good.

Developing a Democratic Syllabus of Resistance

This syllabus is not a catalog of courses but a call to action. Debt strikes, adjunct unionization, climate divestment campaigns, and surveillance pushback are fragments of a larger curriculum of resistance. But this syllabus is incomplete without you. Readers are invited to join in creating it — to add new units, case studies, and strategies that reflect the lived realities of students, workers, and communities.

For inspiration, see the Higher Education Inquirer’s earlier piece on Methods of Student Nonviolent Resistance, which documents the long history of campus activism and the evolving tactics of protest, persuasion, and noncooperation. That archive reminds us that resistance is not only possible but essential.

The classroom is everywhere, and the time is now.

Layoffs at Stanford, University of Oregon, Michigan State, Vanderbilt University Medical Center, Harvard Kennedy School

In recent weeks, several prominent institutions of higher education—including Stanford University, the University of Oregon, Michigan State University, Vanderbilt University Medical Center, and Harvard Kennedy School—have enacted rounds of layoffs, signaling broader structural challenges in the U.S. academic and healthcare sectors. Despite their elite reputations, substantial endowments, and billions in annual revenue, these institutions are shedding jobs, restructuring departments, and quietly retreating from long-standing commitments to faculty, staff, and students.

The reasons cited vary: declining enrollments in some programs, budget shortfalls, revenue realignment, digital transitions, and post-pandemic financial recalibrations. But the broader narrative is one of institutional austerity and technocratic realignment—driven not by scarcity but by strategic choices that often prioritize financial optimization over community stability.

Stanford University: "Voluntary" Departures and "Organizational Review"

In May 2024, Stanford University initiated what it called a "voluntary separation program" for staff across its libraries and various administrative departments. The move came amid a sweeping “organizational review” led by consultants and senior management. While Stanford did not initially label the departures as layoffs, internal communications revealed pressure on departments to cut personnel costs amid shifting budget priorities. Meanwhile, construction of new capital projects continued, and executive pay remained untouched. Critics see this as part of a Silicon Valley-inspired push toward leaner, more corporate university models.

University of Oregon: Retrenchment and Program Consolidation

The University of Oregon’s recent layoffs hit multiple academic and support units, including information technology, library services, and even academic advising. Faculty members in the College of Arts and Sciences have expressed concern about being asked to do more with fewer resources, especially as administrative spending has not faced equivalent cuts. The administration defended the move as necessary due to a structural deficit, though critics argue it reflects misplaced priorities, particularly as Oregon increases its investments in athletics and public-private development ventures.

Michigan State University: Fallout from Scandal and Financial Strain

Michigan State University, still grappling with reputational damage and legal costs from high-profile scandals, has trimmed staff in several support areas while quietly shelving plans for new academic initiatives. Some layoffs have come in student affairs and auxiliary services, disproportionately affecting non-tenured staff and hourly workers. Union leaders have pushed back against the lack of transparency and what they view as an erosion of the university’s mission in the name of risk mitigation and corporate-style management.

Vanderbilt University Medical Center: Layoffs in a Profitable Sector

Perhaps the most controversial layoffs have occurred at Vanderbilt University Medical Center (VUMC), a health system that reported strong financials in previous years. In June 2025, VUMC laid off more than 100 employees, including nurses, administrative personnel, and technicians. The center cited the need to reduce costs amid “changing patient volumes” and “shifts in healthcare delivery.” Yet critics point to a broader trend among elite medical centers: aggressive expansion, high executive compensation, and an overreliance on precarious labor—even as core medical services are under strain. The layoffs at VUMC come amid growing public scrutiny of hospital labor practices and the commodification of healthcare within nonprofit medical institutions.

Harvard Kennedy School: Cutting Diversity and Public Policy Staff

At Harvard Kennedy School, layoffs have disproportionately affected staff involved in diversity initiatives and student services, raising questions about the university’s commitment to equity and public interest education. In May 2025, at least 20 staff positions were eliminated, including roles related to community engagement, public service programming, and DEI (Diversity, Equity, and Inclusion) work. The cuts occurred just as Harvard faced external criticism over its tepid response to national and international crises. While the school defended the layoffs as part of a broader “strategic restructuring,” students and faculty protested what they saw as a retreat from the school’s mission of fostering ethical and inclusive leadership.

A Symptom of Deeper Malaise

These layoffs are not isolated incidents. They are part of a larger transformation within higher education and affiliated medical centers—one shaped by managerialism, austerity policies, declining public investment, and a technocratic ethos that often sidelines human costs. Even as tuition rises and research funding grows in some areas, universities and academic health centers increasingly rely on contingent labor while outsourcing vital functions and reducing core services.

What’s being lost is not just jobs, but trust—between institutions and their workers, students, and the broader public. As layoffs mount in places once considered recession-proof and mission-driven, a pressing question remains: what kind of future are these institutions building, and for whom?

Sources

• Stanford Daily, May 2024

• Oregon Public Broadcasting, June 2024

• Lansing State Journal, April 2024

• Nashville Scene, June 2025

• Harvard Crimson, May 2025

• The Chronicle of Higher Education

• Internal communications and faculty council statements

• National Nurses United reports on hospital layoffs

• Interviews with laid-off staff and faculty union representatives

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For more investigative reporting on U.S. higher education and academic labor, follow the Higher Education Inquirer.

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.]

     

Lee Zeldin as EPA Administrator: A Deregulatory Revolution and Its Risks

Lee Michael Zeldin’s January 2025 confirmation as Administrator of the U.S. Environmental Protection Agency (EPA) has triggered the most sweeping rollback of environmental protections in the agency’s history. Installed during President Trump’s second term, Zeldin’s tenure is marked by a radical deregulatory agenda that favors economic growth and fossil fuel interests over climate science, public health, and environmental justice.

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Deregulation as Doctrine

Within weeks of taking office, Zeldin unveiled the “Powering the Great American Comeback Initiative,” a deregulatory blitz that erased 31 major environmental rules in a single day. This initiative aims to dismantle longstanding safeguards in pursuit of what Zeldin terms “energy realism” — a euphemism for expanding fossil fuel production and reducing regulatory hurdles.

Key actions include:

• Repealing vehicle emissions standards that had helped reduce greenhouse gases and urban pollution

• Weakening pollution controls on coal and natural gas power plants

• Narrowing the scope of the Clean Water Act, reducing protections for rivers, wetlands, and drinking water sources

• Fast-tracking permits for oil, gas, and mining projects, often at the expense of environmental review

Environmental advocates warn these rollbacks jeopardize public health and the environment by prioritizing short-term corporate profits over scientific evidence.

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Climate Denial by Policy: The Endangerment Finding Under Siege

Perhaps the most consequential move is Zeldin’s effort to repeal the 2009 “Endangerment Finding,” which legally classified greenhouse gases as harmful to public health under the Clean Air Act. This ruling underpinned decades of federal climate regulation.

Zeldin claims repealing it will save $54 billion annually in compliance costs, calling it a “correction of regulatory overreach.” Legal experts and scientists counter that overturning the finding would strip the federal government of its ability to enforce climate protections and likely violate established legal precedents. Lawsuits challenging the repeal are already in preparation.

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Budget Cuts and the Gutting of EPA Science

Zeldin’s deregulatory campaign is matched by a dramatic downsizing of the EPA itself. The Trump administration’s 2025 budget slashed the agency’s funding by 55%, gutting its scientific capacity.

Among the casualties:

• Cancellation of $3 billion in climate justice block grants aimed at addressing environmental disparities in low-income communities

• Elimination of clean energy funding for rooftop solar programs

• Cuts to Superfund site cleanups and environmental justice research

The Office of Research and Development, the EPA’s scientific core, has been dismantled, with thousands of staff reassigned or laid off. The agency now emphasizes “state collaboration” and “industry efficiency,” shifting regulatory power to often under-resourced states and industry self-policing.

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Conspiracies, Culture Wars, and Science Under Siege

Zeldin’s EPA has also ventured into controversial territory, endorsing investigations into weather modification and “geoengineering transparency,” areas often linked to conspiracy theories. Internally, climate education materials are under review, and there are reports of pressure on universities to defund or redirect climate research away from contentious topics.

This ideological shift threatens to politicize science and erode the integrity of federal partnerships with academic institutions.

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Implications for Higher Education

Though the EPA does not directly govern education policy, its policies and budget cuts send shockwaves through higher education, especially at public and land-grant universities focused on environmental science and agriculture.

• EPA grant funding for climate and environmental research faces severe cuts, jeopardizing ongoing projects and future STEM initiatives.

• Scientific partnerships between universities and the EPA are imperiled, risking a loss of federal research infrastructure.

• Climate policy education is increasingly vulnerable to ideological scrutiny and defunding pressures.

• Programs designed to encourage STEM participation among underserved communities are at risk of collapse without federal support.

These trends threaten to dismantle vital components of the STEM pipeline and undermine America’s ability to educate the next generation of environmental scientists and policymakers.

Lee Zeldin’s EPA represents a historic pivot away from climate action and environmental protection toward deregulation, austerity, and ideological control. The long-term consequences for public health, environmental justice, and higher education remain deeply uncertain — but the alarm bells are ringing loud.

Sources

• Environmental Protection Agency. “Administrator Zeldin Announces Powering the Great American Comeback Initiative.” epa.gov. March–July 2025.

• Winston & Strawn LLP. “EPA Launches Historic Deregulatory Plan.” March 2025.

• The Washington Post. “EPA Moves to Overturn Endangerment Finding.” July 29, 2025.

• Associated Press. “Democrats Say EPA Budget Cuts May Kill People.” July 2025.

• The Guardian. “EPA Halts $3 Billion Climate Justice Program; Lawsuit Looms.” August 5, 2025.

• The Week. “How the EPA Plans to Nullify Climate Science.” July 2025.

• New York Post. “Zeldin Aims to Cut ‘Woke’ Climate Spending, Slash Energy Costs.” July 2025.

• Times Union (Albany). “Editorial: EPA’s Dangerous Ignorance.” July 2025.

• CNN Interview. “Zeldin Defends Record, Faces Tough Questions.” July 2025.

Neoliberalism and the Global College Meltdown

Over the past four decades, neoliberalism has reshaped higher education into a market-driven enterprise, producing what can only be described as a global College Meltdown. Once envisioned as a public good—a tool for civic empowerment, social mobility, and national progress—higher education in the United States, the United Kingdom, and China has been transformed into a competitive market system defined by privatization, debt, and disillusionment.

The United States: From Public Good to Profit Engine

Nowhere has neoliberal ideology had a more devastating effect on higher education than in the United States. Beginning in the 1980s, with the Reagan administration’s cuts to federal grants and the expansion of student loans, higher education funding shifted from public investment to individual burden. Universities adopted corporate governance models, hired armies of administrators, and marketed education as a private commodity promising personal enrichment rather than collective advancement.

The results are visible everywhere: tuition inflation, student debt exceeding $1.7 trillion, and the proliferation of predatory for-profit colleges. Elite universities transformed into financial behemoths, hoarding endowments while relying on contingent faculty. Meanwhile, working-class and minority students were lured into debt traps by institutions that promised upward mobility but delivered unemployment and despair.

The U.S. College Meltdown—a term that describes the system’s moral and financial collapse—is a direct consequence of neoliberal policies: deregulation, privatization, and austerity disguised as efficiency. The profit motive replaced the public mission, and the casualties include students, adjuncts, and the ideal of education as a democratic right.

The United Kingdom: Marketization and Managerialism

The United Kingdom followed a similar trajectory under Margaret Thatcher and her successors. The introduction of tuition fees in 1998 and their tripling in 2012 marked the formal triumph of neoliberal logic over public investment. British universities became quasi-corporate entities, obsessed with league tables, branding, and global rankings.

The result has been mounting student debt, declining staff morale, and a hollowing out of intellectual life. Faculty strikes over pensions and pay disparities underscore a deeper crisis of purpose. Universities now function as rent-seeking landlords—building luxury dorms for international students while cutting humanities departments. The logic of “student-as-customer” has reduced education to a transaction, and accountability has been redefined to mean profit margin rather than social contribution.

The UK’s College Meltdown mirrors that of the U.S.—a story of financialization, precarious labor, and the erosion of public trust.

China: Neoliberalism with Authoritarian Characteristics

At first glance, China seems to defy the Western College Meltdown. Its universities have expanded rapidly, producing millions of graduates and investing heavily in research. But beneath this apparent success lies a deeply neoliberal structure embedded in an authoritarian framework.

Since the 1990s, China’s higher education system has embraced competition, rankings, and market incentives. Universities compete for prestige and funding; families invest heavily in private tutoring and overseas degrees; and graduates face a saturated labor market. The result is mounting anxiety and unemployment among young people—known online as the “lying flat” generation, disillusioned with promises of meritocratic success.

The Chinese model fuses state control with neoliberal marketization. Education serves as both an instrument of national power and a mechanism of social stratification. In this sense, China’s version of the College Meltdown reflects a global truth: the commodification of education leads to alienation, regardless of political system.

A Global System in Crisis

Whether in Washington, London, or Beijing, the pattern is strikingly similar. Neoliberalism treats education as an investment in human capital, reducing learning to a financial calculation. Universities compete like corporations; students borrow like consumers; and knowledge becomes a tool of capital accumulation rather than liberation.

This convergence of economic and ideological forces has created an unsustainable higher education bubble—overpriced, overcredentialized, and underdelivering. Across continents, graduates face debt, underemployment, and despair, while universities chase rankings and revenue streams instead of justice and truth.

Toward a Post-Neoliberal Education

Reversing the College Meltdown requires more than reform; it demands a new philosophy. Public universities must reclaim their civic mission. Education must once again be understood as a human right, not a private investment. Debt forgiveness, reinvestment in teaching, and democratic governance are essential first steps.

Neoliberalism’s greatest illusion was that markets could produce wisdom. The College Meltdown proves the opposite: when education serves profit instead of people, it consumes itself from within.

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Sources:

• Wendy Brown, Undoing the Demos (2015)

• David Harvey, A Brief History of Neoliberalism (2005)

• Tressie McMillan Cottom, Lower Ed (2017)

• The Higher Education Inquirer archives on the U.S. College Meltdown

• BBC, “University staff strikes and student debt crisis,” 2024

• Caixin, “China’s youth unemployment and education anxiety,” 2023

20th Anniversary of Reclaiming the Ivory Tower: Organizing Adjuncts to Change Higher Education

First published in November 2005 by Monthly Review Press, Reclaiming the Ivory Tower quickly became a breakthrough organizing handbook for contingent, often adjunct, faculty in U.S. higher education. Authored by Joe Berry, a labor educator with the Chicago Coalition of Contingent Academic Labor, the book combined structural analysis with practical organizing tools and remains widely influential. 

Author’s Ongoing Influence

Joe Berry’s longstanding work—as a historian and labor educator affiliated with institutions like the University of Illinois’s Chicago Labor Education Program and Roosevelt University—has helped shape adjunct organizing both in Chicago and beyond. Berry's most recent focus is with a new project, Higher Ed Labor United (HELU), and with Democratic Socialists of America.

Two Decades On: The Struggle Persists

Though adjunct faculty now make up the majority of instructors at many colleges, the precarious conditions Berry described—marked by low pay, limited benefits, and job insecurity—endure. His organizing models, featuring campus committees and community alliances, have borne fruit in isolated victories. Yet, systemic inequities remain.

Reclaiming the Ivory Tower remains a foundational resource for grassroots organizing in academia. Its emphasis on coalition-building and collective action continues to inspire adjuncts, labor activists, and academic allies.

Power Despite Precarity 

Just at the time of HELU’s birth, and as COVID was still raging, Berry and his colleague, partner and fellow contingent faculty Helena Worthen, published a follow up book, Power Despite Precarity: Strategies for the contingent faculty movement in higher education (2021, Pluto Press). Using one of the most successful local unions in higher education, the CA Faculty Association (SEIU, AAUP) for contingents, the book tells the story of their limited, but very real, successes, and suggests some strategic visions for the movement and our goals for higher education.

A New Wave of National Coordination

In March 2024, Inside Higher Ed reported that Higher Ed Labor United—a developing national coalition—was emerging to bridge divisions between higher education workers, regardless of union affiliation or job title. Joe Berry serves on its interim steering committee, signaling his continued leadership in academic labor unity.

HELU’s vision is threefold: to serve as a political voice, a think tank for higher education labor, and a supporting infrastructure for organizing across campuses. The coalition thus builds on Berry’s grassroots foundations by adding a national dimension to the effort.

Timeline of Adjunct Organizing: 2005–2025

2005–2009: Organizing spreads through AFT and NEA-affiliated adjunct campaigns, adopting Berry’s strategies of solidarity with tenure-track faculty and students.
2010–2014: Digital movements like #AdjunctNation increase visibility. Labor drives gain traction at private and niche institutions.
2015–2019: The SEIU’s Faculty Forward initiative secures pay gains and multi-year contracts in cities like Boston and LA.
2020–2022: COVID-19 exacerbates adjunct precarity. Virtual organizing leads to some wins, but layoffs and instability rise.
2023–2025: Broader solidarity emerges—adjuncts band with student and staff labor movements. Union campaigns increasingly connect to critiques of austerity and corporatization.

Looking Ahead

With its 20th anniversary slated for November 2025, Reclaiming the Ivory Tower stands as much more than a historical landmark—it’s a blueprint for current and future organizing. While awareness of adjunct labor issues has grown, sustainable and structural transformation requires persistent organizing, cross-campus solidarity, and the sort of national coalition-building that HELU represents.

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Sources

• Berry, Joe. Reclaiming the Ivory Tower: Organizing Adjuncts to Change Higher Education. Monthly Review Press, 2005. [monthlyreview.org reference; meet the author site]

• “Higher Ed Workers Seek to Coordinate Nationally.” Inside Higher Ed, March 26, 2024. Includes details on HELU and Joe Berry’s role

• National Center for the Study of Collective Bargaining in Higher Education and the Professions data trends

• Inside Higher Ed reporting on adjunct unionization, strikes, and SEIU campaigns 

When American Greed is the Norm

Greed is no longer a sin in America—it’s a system. It’s a curriculum. It’s a badge of success. In the American higher education marketplace, greed is not the exception. It’s the norm.

We see it in the bloated salaries of university presidents who deliver austerity to everyone but themselves. We see it in billion-dollar endowments hoarded like dragon’s gold while students drown in debt. We see it in the metastasizing ranks of middlemen—consultants, online program managers, enrollment optimization firms—who profit off the dreams and desperation of working-class families.

But greed in American higher education is more than a few bad actors or golden parachutes. It is institutionalized, normalized, and weaponized.

The Student as Customer, the Campus as Marketplace

It began with the rebranding of education as a “return on investment,” a transaction rather than a transformation. The purpose of college was no longer to liberate the mind but to monetize the degree.

By the 1990s, under bipartisan neoliberal consensus, public colleges were defunded and forced to adopt the private sector’s logic: cut costs, raise prices, sell more. Tuition rose. Debt exploded. The ranks of administrators swelled while faculty were downsized and adjunctified. The market had spoken.

But even that wasn’t enough. A generation of edu-preneurs emerged—Silicon Valley-funded disruptors, for-profit college chains, and online program managers—who turned learning into a scalable commodity. Robocolleges like Southern New Hampshire University, Purdue Global, and the University of Phoenix began operating more like tech platforms than institutions of thought.

The result? Diploma mills at the front end and collection agencies at the back.

Greed in the Name of God and Country

Greed doesn’t always look like Wall Street. Sometimes it wears the face of morality. Religious colleges, some of them under the protection of nonprofit status, have become breeding grounds for political operatives and ideological grooming—while raking in millions through taxpayer-funded financial aid.

Liberty University, Grand Canyon University, and a host of lesser-known Bible colleges operate under a warped theology of prosperity, turning salvation into a subscription plan. Meanwhile, they push anti-democratic ideologies and funnel money toward political causes far removed from the mission of education.

Accreditation as a Shell Game

The accreditors—the supposed watchdogs of educational quality—have been largely asleep at the wheel or complicit. When greed is the norm, accountability is an inconvenience. For-profit schools regularly reinvent themselves as nonprofits. Online program managers operate in regulatory gray zones. Mergers and acquisitions disguise collapse as growth.

Accreditation agencies rubber-stamp it all, as long as the paperwork is tidy and the lobbyists are well-compensated.

Debt as Discipline

More than 43 million Americans carry federal student loan debt. Many will never escape it. This debt is not just financial—it’s ideological. It keeps the workforce compliant. It disciplines dissent. It renders critical thought a luxury.

And those who push for debt relief? They are met with moral lectures about personal responsibility—from the same lawmakers who handed trillions to banks, defense contractors, and fossil fuel companies.

Silicon Valley's Hungry Mouth

The new frontier of greed is AI. Tech giants like Google, Amazon Web Services, and Meta are embedding themselves deeper into education—not to empower learning, but to extract data, monetize behavior, and deepen surveillance. Every click, every quiz, every attendance record is a monetizable moment.

Universities, starved for funding and afraid of obsolescence, are selling access to students in exchange for access to cloud infrastructure and algorithmic tools they barely understand.

Greed Isn’t Broken—It’s Working as Designed

In this system, who wins? Not students. Not faculty. Not society.

The winners are those who turn knowledge into a commodity, compliance into virtue, and inequality into inevitability. Those who build castles from the bones of public education, then retreat behind walls of donor-backed endowments and think tanks. The winners are few. But they write the rules.

A Different Future Is Possible

If American greed is the norm, then what remains of education’s soul must be found in the margins—in the community college professor working three jobs. In the librarian defending open access. In the adjunct organizing a union. In the students refusing to be pawns in someone else’s game.

The antidote to greed is not charity—it’s solidarity.

Until justice is funded as well as football. Until learning is valued more than branding. Until access is more than a talking point on a donor brochure—then greed will remain not just a sin, but a system.

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Sources

• U.S. Department of Education, National Center for Education Statistics

• The Century Foundation, “The OPM Industry: Profits Over Students” (2023)

• Chronicle of Higher Education, “Administrative Bloat and the Adjunct Crisis”

• IRS Nonprofit Filings, Liberty University and Grand Canyon University

• Debt Collective, “The State of Student Debt” (2025)

• Public records and audits of Title IV institutions, 2022–2024

• Higher Education Inquirer archives

Will Maximus and Its Subsidiary AidVantage See Cuts?

Maximus Inc., the parent company of federal student loan servicer Aidvantage, is facing growing financial and existential threats as the Trump administration completes a radical budget proposal that would slash Medicaid by hundreds of billions of dollars and cut the U.S. Department of Education in half. These proposed changes could gut the very federal contracts that have fueled Maximus's revenue and investor confidence over the last two decades. Once seen as a steady player in the outsourcing of public services, Maximus now stands at the edge of a political and technological cliff.

The proposed Trump budget includes a plan to eliminate the Office of Federal Student Aid and transfer the $1.6 trillion federal student loan portfolio to the Small Business Administration. This proposed restructuring would remove Aidvantage and other servicers from their current roles, replacing them with yet-unnamed alternatives. While Maximus has profited enormously from servicing loans through Aidvantage—one of the major federal loan servicers—it is unclear whether the company has any role in this new Trump-led student loan regime. The SBA, which lacks experience managing consumer lending and repayment infrastructure, could subcontract to politically favored firms or simply allow artificial intelligence to replace human collectors altogether.

This possibility is not far-fetched. A 2023 study by Yale Insights explored how AI systems are already outperforming human debt collectors in efficiency, compliance, and scalability. The report examined the growing use of bots to handle borrower communication, account resolution, and payment tracking. These developments could render Maximus’s human-heavy servicing model obsolete. If the federal government shifts toward automated collection, it could bypass Maximus entirely, either through privatized tech-driven firms or through internal platforms that require fewer labor-intensive contracts.

On the health and human services side of the business, Maximus is also exposed. The company has long served as a contractor for Medicaid programs across several states, managing call centers and eligibility support. But with Medicaid facing potentially devastating cuts in the proposed Trump budget, Maximus’s largest and most stable contracts could disappear. The company’s TES-RCM division has already shown signs of unraveling, with anonymous reports suggesting a steep drop-off in clients and the departure of long-time employees. One insider claimed, “Customers are dropping like flies as are longtime employees. Not enough people to do the little work we have.”

Remote Maximus employees are also reporting layoffs and instability, particularly in Iowa, where 34 remote workers were terminated after two decades of contract work on state Medicaid programs. Anxiety is spreading across internal forums and layoff boards, as workers fear they may soon be out of a job in a shrinking and increasingly automated industry. Posts on TheLayoff.com and in investor forums indicate growing unease about the company’s long-term viability, particularly in light of the federal budget priorities now taking shape in Washington.

While Maximus stock (MMS) continues to trade with relative strength and still appears profitable on paper, it is increasingly reliant on government spending that may no longer exist under a Trump administration intent on dismantling large parts of the federal bureaucracy. If student loan servicing is eliminated, transferred, or automated, and Medicaid contracts dry up due to funding cuts, Maximus could lose two of its biggest revenue streams in a matter of months. The company’s contract with the Department of Education, once seen as a long-term asset, may become a political liability in a system being restructured to reward loyalty and reduce regulatory oversight.

The question now is not whether Maximus will be forced to downsize—it already is—but whether it will remain a relevant player in the new federal landscape at all. As artificial intelligence, austerity, and ideological realignment converge, Maximus may be remembered less for its dominance and more for how quickly it became unnecessary.

The Higher Education Inquirer will continue tracking developments affecting federal student loan servicers, government contractors, and the broader collapse of the administrative state.

When college choice is a fraud

Students are targeted and lied to by subprime colleges and they are often treated with indifference by public education.

In 2014, USC graduate student Constance Iloh and her advisor Dr. William Tierney examined the "rational choices" behind college choice. Their subjects were more than 130 students who had chosen either a community college or for-profit college for a vocational nursing or surgical technician associate’s degree.

Rational choice, a common theory in mainstream economics, refers to the theory that individuals make decisions to maximize their benefits and minimize their costs. By talking to focus groups, the researchers hoped to find out why students chose a $30,000 for-profit education lasting 13 months or a $5,000 public program taking two years to finish. Both schools had graduation rates of about 30%.

In the Iloh and Tierney study, students who chose for-profit colleges said that community colleges presented too many barriers and that their schools offered more convenience and accessibility in scheduling and location. With accelerated schedules, for-profit students thought they could graduate earlier than if they attended a community college--which was important as they weighed important family obligations.

Some for-profit college students also believed their education was superior to a community college because it offered more "hands on" opportunities. The researchers did not dig deeper though, to investigate how the students came up with their ideas.

Although most of the students were probably women, and many were working-class people and people of color, the researchers did not discuss important race, class, and gender issues. The researchers also ignored examining cross-culturally: what other nations have done to make higher education more effective, socially just, and democratic, or even how various states in the United States have made college free or low cost to its citizens.

"Rational choice" in US education, however, must be examined in a society affected by deindustrialization and deskilling of work, government austerity and the defunding of public education, neoliberalism, structural racism, increasing economic inequality and reduced intergenerational social mobility, social myths perpetuated by predatory marketing, and ultimately--difficult choices caused by "the injuries of class."

The truth is, millions of hard working low-wage workers (including single mothers, disabled military veterans, struggling immigrants, people with learning challenges or those who have had fewer educational opportunities) may be looking for the most obvious way to achieve the American Dream, whether it's from a message in their email inbox or a friendly voice at the other end of the telephone.

But that's the essence of the for-profit con--something that Iloh and Tierney downplay.  There are subprime schools regularly trolling for the most vulnerable people.

The researchers also fail to recognize that some for-profit students continue along the more financially expensive route, even after realizing they've made a bad choice, believing they have sunk too much into their investment to quit--and knowing that their credits won't transfer.

Theories of Sunken Investment, Time Discounting, and Asymmetric Information may be useful in understanding the difficult personal choices that working class people face--but theories of justice must also be utilized.

Sadly, this study really shows the dysfunctional nature of US education in general. Whether a working class student chooses a for-profit college, community college, or public or private university, he or she is taking on significant risks of either not graduating, taking on enormous debt, subjecting family members to debt obligations, or being taken away from important family interests.

Dr. Tierney is not an objective researcher (no researcher is). He is a tenured professor at an elite university who believes for-profit colleges have a role in American neoliberal society. And he has colleagues who have profited from this line of thinking. Tierney believes for-profit schools have problems, but that they can be reformed. With the poor state of many subprime for-profit colleges and community colleges, it's difficult to imagine how educational reform is possible.

To make better informed choices, working-class people surely need to learn about the myths of college and the sales pitches that are used to hook unsuspecting prospects. But even that is not enough. Without social justice, fairness, and access in society, people will be compelled to pray and make the best of unjust and limited "rational" choices.

"If we expect to increase the rate of degree completion, we must invest in early childhood education and enhance the quality of precollegiate education, especially for students who are African American, Hispanic, and low income" --Diane Ravitch

An earlier version of this article is available at https://www.linkedin.com/pulse/college-choice-rational-dahn-shaulis?trk=mp-author-card