The Clintons Just Made a Big Move Against Student Debt

April 16th 2015

Dante Atkins

Update 4/25: Former President Bill Clinton stepped down from his role as "honorary chancellor" for the Laureate for-profit college chain, an international for-profit college network. In a statement, Clinton said: “Laureate students represent the next generation of leadership. I have seen a commitment to quality and leadership throughout the Laureate network, and I have enjoyed being a part of it.”

Since Hillary Clinton last held elected office, the for-profit college industry has exploded. The pace of expansion has been rapid: for-profit colleges had over three times as many students enrolled in 2010 as they did in 2001. Between 1998 and 2008, increases in enrollment at for-profit colleges outpaced increased in enrollment at all degree-granting institutions by a factor of over seven to one. Unfortunately for their enrollees, many of these colleges have unscrupulous business practices and charge very high tuition for degrees that are essentially worthless. Many students never actually finish the degree programs, and those that do often find that their job prospects are no better than when they started—but just more urgent because of the massive load of student debt they accumulated in the process. For-profit colleges can be twice as expensive as Ivy League universities and often charge 20 times what public community colleges do for the same two-year programs. For-profit college corporations have also been found to drastically overstate job placement rates in order to aid marketing and recruitment efforts and artificially inflate the perceived value of a degree.

Is Hillary Clinton involved in the for-profit college industry?

There’s a hint of smoke—and because this is politics, some people are jumping up and down screaming “fire.” That’s not exactly accurate, but there are concerns.

At her first campaign event, Ms. Clinton took aim at for-profit colleges for charging exorbitant rates with little actual value in return—no doubt influenced by the recent spate of bad headlines about the industry. But this opening campaign appearance wasn’t the first time she has gone after the industry: according to the Las Vegas Sun, she also attacked “fly-by-night for-profit schools” at a keynote speech at UNLV last year.

But there is one tie between the Clintons and one particular for-profit college corporation that was troublesome. Her husband, former President Bill Clinton, was the Honorary Chancellor of Laureate International Universities, a subsidiary of US-based for-profit college corporation Laureate. Laureate only operates five campuses in the United States; the bulk of its business comes from buying distressed campuses in foreign countries and imposing the for-profit model of part-time faculty, lower admissions standards, and massive enrollment increases. According to the conservative news site The Daily Caller, Laureate is also a substantial donor to the Clinton Global Initiative, the international development nonprofit run by the Clinton family. The Daily Caller also reports that Laureate was part of the State Department’s Global Partnership while Ms. Clinton was Secretary of State, but no other source seems to verify that claim. Laureate’s CEO, however, was a major donor to Ms. Clinton’s political campaigns—and one of Laureate’s significant private investors is billionaire liberal financier George Soros.

So, what does that say about Ms. Clinton’s position on for-profit colleges? Very little. To begin with, it’s irresponsible (and also possibly sexist) to assume that any involvement Mr. Clinton has in a marketing role with a for-profit corporation that uses his famous name abroad will affect Ms. Clinton’s perceptions of the industry in the United States. Second, in her first campaign appearance, she reiterated her position in support of President Obama’s plan to make community college free. That position won’t endear her to the for-profit college industry: community colleges are the most direct competition to for-profit colleges in their quest to enroll as many students as possible.

While this could be considered an evolution of sorts on Ms. Clinton’s position on for-profit colleges, it’s hard to say for sure. The negative press about the industry started proliferating after she left the Senate in 2009 to become Secretary of State—and in that capacity, she was obligated to spend her time focusing on international affairs rather than domestic education policy. That gives us very little to go on regarding what her views may have been previously.

No matter where she stood before, however, the positions that Ms. Clinton staked out recently separate her from Republican presidential contenders. For instance, Sen. Rand Paul (R-Ky.) recently came out against President Obama’s free community college plan. Former Florida Governor Jeb Bush, another leading contender for the Republican nomination, has been actively opposing the new accountability regulations that President Obama has been putting in place for the for-profit college industry.

The influence of the “Warren Wing” of the Democratic Party

But for some progressives, simply being better than the Republicans isn’t good enough. The cost of education and the crippling effects of student debt are right up top on the list of concerns, and some Democrats, specifically Senator Elizabeth Warren (D-Mass.), who was the author of a progressive student loan bill that died in the Senate last Congress, have been more outspoken on these issues.

Warren, who has achieved rockstar status with the progressive left for her advocacy on behalf of consumers against the financial industry, is unlikely to run for president, however. As the days go by and Ms. Clinton builds her campaign, the odds that a candidate with a better reputation among progressives, such as Warren or even Senator Bernie Sanders (I-VT), will enter the race continue to decrease—and the more likely it seems than it does already that Ms. Clinton will be the Democratic nominee. But to the Warren Wing, that won’t mean that that the “draft Warren” effort to convince her to run for president will have been a failure. Instead, the goal will simply be to encourage Ms. Clinton to take a stronger stand on the issues that mobilize the party’s left flank.

“Ideas like President Obama's plan for free community college and other more audacious plans calling for free tuition at all public colleges and universities are incredibly important, but Warren Wing voters know we can't stop there,” Neil Sroka, communications director for Democracy for America (DFA), told ATTN:. DFA is a progressive organization that signed up over 300,000 people in support of a Warren candidacy.

“The more than $1 trillion in student debt that Americans are struggling with today means that Democrats need to offer ideas that can responding to the crushing impact of existing student debt -- in addition to finding ways to drive down the costs for community colleges, trade schools, and universities," Sroka continued. "In 2016, the grassroots progressives expect the Democratic nominee to push for an aggressive, populist progressive response to both the rising cost of higher education and the crushing levels of student debt that young workers, their families, and our nation's economy is struggling with today,”

To learn more about Hillary Clinton's positions on five issues you care about, check out our summary here and watch our video:.

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Posted by ATTN: on Sunday, April 12, 2015