Tag: david halperin
Top Donor For House Education Chair Is For-Profit College Facing Federal And State Fraud Probes

Top Donor For House Education Chair Is For-Profit College Facing Federal And State Fraud Probes

by David Halperin, Republic Report.

As reported recently by OpenSecrets, Representative Virginia Foxx (R-NC) has no serious opposition in her bid for re-election, yet has received more than $800,000 in campaign contributions. More than half of that money has come from outside North Carolina, much of it from corporate special interests.

The biggest industry donating to Foxx, who is chair of the House Subcommittee on Higher Education, is the for-profit education industry, which is fighting to stop the Obama administration’s “gainful employment” rule. That regulation, for which public comments are due this week, would hold predatory companies in the career education industry accountable for its heavily documented waste, fraud, and abuse of federal tax dollars and for the countless students across the country who have been left with worthless degrees and overwhelming debt.

For-profit colleges don’t have any credible arguments against the gainful employment rule, so instead they use the thing that talks loudest in Washington: money. And they have plenty of it; despite declining enrollments and plunging share prices amid mounting public awareness of industry abuses, the for-profit colleges have cash to spend, because their industry has been getting as much as $33 billion per year from taxpayers.

The single biggest donor group to Foxx, by almost a factor of two, is Santa Ana, California-based, for-profit Corinthian Colleges.

Corinthian, which operates Everest, Heald and WyoTech colleges, has a troubling record. The company faces a major lawsuit from California attorney general Kamala Harris, who has charged that Corinthian has engaged in “false and predatory advertising, intentional misrepresentations to students, securities fraud and unlawful use of military seals in advertisements.” Corinthian is also under investigation by a group of 16 state attorneys general (Arkansas, Arizona, Colorado, Connecticut, Hawaii, Idaho, Iowa, Kentucky, Missouri, Nebraska, New Mexico, North Carolina, Oregon, Tennessee, Washington and Pennsylvania) into its recruiting and business practices, and faces a separate probe by Massachusetts’ AG.

Federal investigators also are probing Corinthian. In June 2013, the Securities and Exchange Commission issued a subpoena to the company concerning student recruitment, degree completion, job placement, loan defaults and compliance with U.S. Education Department rules. In September 2013 Corinthian reported that the U.S. Justice Department is investigating claims that the company violated the False Claims Act with respect to its recruiting and financial aid practices and by, among other things, manipulating attendance records to keep federal aid for students no longer in attendance. In December 2013, the Consumer Financial Protection Bureau notified Corinthian that it expected to pursue legal action against the company for violation of federal laws with respect to private students loans.

And in January, even the U.S. Department of Education, whose enforcement efforts have generally failed to address for-profit colleges abuses, moved toward taking tough measures with Corinthian, saying in a letter to the company that there were signs of “systematic deficiencies” in its operations and charging that the company “has admitted to falsifying placement rates and/or grad and attendance records at various institutions and because of ongoing state and federal investigations into serious allegations.”

Corinthian fared poorly under a trial run of an earlier version of the gainful employment rule, which would take away eligibility for federal student grants and loans from schools whose graduates and dropouts are consistently unable to repay their student loans. Schools with high prices and poor records of training and placing students tend to flunk the gainful employment test, because their students borrow too much and earn too little after leaving.

Foxx in the past has invoked the Nazi Holocaust in discussing regulation of for-profit colleges, and on another occasion stated that she has ”very little tolerance for people who tell me that they graduate with $200,000 of debt or even $80,000 of debt.”

Corinthian is a member of the for-profit trade association APSCU, which is leading the opposition to the gainful employment rule. Corinthian also spent $310,000 in the first quarter of 2014 for its own lobbying team, included former Rep. Vic Fazio (D-CA) from the law firm Akin Gump.

Foxx, along with House Education Committee chairman John Kline (R-MN), another major recipient of for-profit college campaign cash, has led the effort in the House to oppose the gainful employment rule and other measures to curb abuses by for-profit colleges. Foxx is lead sponsor of the “Supporting Academic Freedom Through Regulatory Relief Act,” which has nothing to do with actual academic freedom, but instead would block the gainful employment rule and also would relax federal standards so for-profit college boiler room operations can more easily engage in coercive recruiting of students.

CQ has reported that Kline is urging House Appropriations Committee members to include a policy rider in the Labor-HHS-Education bill blocking the gainful employment rule.

This article originally appeared on Republic Report.

This article also appears onHuffington Post.

Photo: Rep Virginia Foxx via Flickr

Study: Blacks, Latinos, Low-Income Live Closest To Dangerous Chemical Plants

Study: Blacks, Latinos, Low-Income Live Closest To Dangerous Chemical Plants

by David Halperin, Republic Report

new study released Thursday finds that the Americans who live near hazardous chemical industrial facilities are disproportionately African American or Latino, are more likely to live in poverty, and have lower incomes and education levels than the national average.  These trends accelerate rapidly as one gets closer to the “fenceline” areas nearest dangerous chemical plants.

More than 134 million people live in danger zones created by about 3,400 U.S. facilities that manufacture chemicals, produce paper, treat water, generate electric power, refine petroleum, or otherwise use or store hazardous materials. Millions more people work in or visit these areas.

The study examined the people living close to chemical plants and found:

  • The poverty rate for the fenceline zones is 50 percent higher than for the U.S. as a whole.
  • Average household incomes in the fenceline zones are 22 percent below the national average.
  • The percentage of adults in the fenceline zones with less than a high school degree is 46 percent greater than for the U.S. as a whole.
  • The percentage of Blacks in the fenceline zones is 75 percent greater than for the U.S. as a whole.
  • The percentage of Latinos in the fenceline zones is 60 percent greater than for the U.S. as a whole.

The study was produced by The Environmental Justice and Health Alliance for Chemical Policy Reform, a group of organizations connected to the Coalition for Chemical Safety (in which I participate as an advisor to Greenpeace).

In the wake of the April 2103 West, Texas, chemical plant explosion, which killed 15 people and injured 160 more, President Obama issued an executive order directing federal agencies to improve the safety of our industrial chemical plants. The Obama administration is now conducting a review of these issues.

There are serious risks that today’s chemical plants could unleash a catastrophic accident, like the 1984 pesticide plant disaster at Bhopal, India, which caused 20,000 deaths. In an average year, the U.S. Chemical Safety Board reviews some 250 high-consequence chemical incidents involving death, injury, evacuation, or serious environmental or property damage.

There is also the possibility that terrorists could trigger a chemical plant attack in our country. In 2003, a government panel warned that chemical plants in the U.S. could be al Qaeda targets. Media investigations have highlighted weak or nonexistent security at these facilities, with gates unlocked and chemical tanks unguarded. As a senator, Barack Obama referred to chemical plants as “stationary weapons of mass destruction spread all across the country.”

For years, our coalition has  urged the government to take action to move chemical plants toward safer chemicals and processes. Now, Christine Todd Whitman, head of the EPA under President George W. Bush, and Lisa Jackson, who held the same job under President Obama, have each called for government to mandate safer chemicals.  But wealthy chemical companies, like the ones owned by the Koch brothers, and their lobbyists have long used campaign contributions as weapons to block reforms, and they are still doing so today. Again, it was Senator Obama who said it best: “We cannot allow chemical industry lobbyists to dictate the terms of this debate. We cannot allow our security to be hijacked” by special interests.

Today’s study defines this struggle: on the one hand, some of the wealthiest Americans, like the Koch brothers, pressing Washington to stop reforms to make chemical plants safer; and on the other, the poorest, least powerful people in society at greatest risk of harm or death from these facilities.

President Obama needs to make the right choice to protect all Americans and our national security.

This article originally appeared on Republic Report.

This article also appears on Huffington Post

Photo: Eric Allix Rogers via Flickr

Jeb Bush To Address Convention Of Predatory For-Profit Colleges

Jeb Bush To Address Convention Of Predatory For-Profit Colleges

by David Halperin, Republic Report

Former Florida governor Jeb Bush (R) will be the keynote speaker at the Las Vegas annual convention of the trade association of for-profit colleges, APSCU, according to the group’s website.  Although some reputable, responsible colleges are members of APSCU, the organization is dominated by large companies, many of which — Corinthian, ITT, Education Management Corp., Kaplan, Career Education Corp., DeVry — are now under investigation by federal law enforcement agencies, state attorneys general, or both. Pending lawsuits brought by government authorities charge that big for-profit colleges have engaged in deceptive advertising; coercive boiler room recruiting targeted at veterans, single mothers, and others; misrepresentations about programs costs and job placement; student loan fraud; and other misconduct.

President Obama has said that some for-profit colleges are “trying to swindle and hoodwink” students, because they only “care about the cash.” Their students, the president has said, “can’t find a job. They default…. Their credit is ruined, and the for-profit institution is making out like a bandit.” Acting to protect the bad behavior of such companies, APSCU has led the charge to block President Obama’s proposed “gainful employment” rule, which would cut off federal aid to career college programs that, because of a toxic combination of high prices and low quality, consistently leave their students with insurmountable student loan debt.

As Bush weighs a run for the White House in 2016, he may be attracted to the immense wealth of the for-profit college industry, which has been receiving more than $33 billion a year from federal taxpayer money, and uses a good chunk of that money to make campaign contributions and buy the allegiance of politicians in Washington. Although the industry provides plenty of cash to Capitol Hill Democrats, it is closely aligned with the Republican Party, and in 2012 it bet big on Mitt Romney, who praised for-profit colleges on the campaign trail and turned out himself to be an investor in the industry.

But as the public becomes increasingly aware that for-profit colleges have been ripping off taxpayers and ruining students’ lives, there are risks of keynoting the APSCU conference.  In 2012, Michelle Rhee took some heat — and not just from me — for speaking. (The other keynote that year, Bush’s brother, former President George W. Bush, stressed his commitment to accountability for K-12 schools receiving federal money, an applause line that got no applause among the for-profit college barons in attendance, since their lobbying is focused precisely on avoiding accountability.)

In 2013, APSCU announced its keynote would be Admiral Mike Mullen, former chairman of the Joint Chiefs of Staff and boasted that Mullen’s appearance at the convention would “be a truly extraordinary moment for private sector education, bringing increased visibility and respect to the sector.” For reasons unknown, Mullen canceled. (I had written an article questioning his decision to appear, given the well-documented abuses and deception of veterans by many players in the for-profit college industry.)  APSCU then found a willing replacement for Mullen — former presidential candidate General Wesley Clark.

But although those speakers addressed a for-profit college industry whose abuses were already well-known, the  industry’s reputation is even worse now, as the federal Consumer Financial Protection Bureau, Securities and Exchange Commission, Federal Trade Commission, Justice Department, and Department of Education have launched investigations or filed lawsuits against APSCU members, and more than 30 state attorneys general are collaborating on major probes of the industry. Prospective students and investors have been getting the message, and enrollments and share prices have plummeted.

But rather than commit to serious reforms, the industry continues to focus on its biggest strength: lobbying and buying influence with politicians.  Joining Jeb Bush as an APSCU speaker this year is former senator Bob Kerrey (D-NE), who has financial ties to the industry.

Bush has made K-12 education “reform” a central component of his policy agenda, with a focus on privatization — charter schools and vouchers.  While APSCU’s name — which stands for Association of Private Sector Colleges and Universities — stresses the free market image it wants to project, the biggest for-profit colleges receive about 86 percent of their revenue from taxpayer dollars.

This article originally appeared on Republic Report.

This article also appears on Huffington Post

Photo: Gage Skidmore via Flickr