Times Goes After Washington Post Co./Kaplan

YankeeFan · Nov 10, 2010

Fresh off its takedown of the Tribune Co., the Times targets the Washington Post Company and its Kaplan subsidiary.

But over the last few months, Kaplan and other for-profit education companies have come under intense scrutiny from Congress, amid growing concerns that the industry leaves too many students mired in debt, and with credentials that provide little help in finding jobs.

Reports of students who leave such schools with heavy debt, only to work in low-paying jobs, have prompted the Department of Education to propose regulations that would cut off federal financing to programs whose graduates have high debt-to-income ratios and low repayment rates.

Though Kaplan is not the largest in the industry, the Post Company chairman, Donald Graham, has emerged as the highest-profile defender of for-profit education.

Together, Kaplan and the Post Company spent $350,000 on lobbying in the third quarter of this year, more than any other higher-education company. And Mr. Graham has gone to Capitol Hill to argue against the regulations in private visits with lawmakers, the first time he has lobbied directly on a federal issue in a dozen years.

His newspaper, too, has editorialized against the regulations. Though it disclosed its conflict of interest, the newspaper said the regulations would limit students’ choices. “The aim of the regulations was to punish bad actors, but the effect is to punish institutions that serve poor students,” Mr. Graham said in an interview.

He said the regulations’ emphasis on debt would make it harder for Kaplan to serve older working students who must take out loans to attend school.

http://www.nytimes.com/2010/11/10/education/10kaplan.html?hp
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I'll bet shareholders of the New York Times Company wish they had made such a good investment.

YankeeFan · Nov 10, 2010

I don't mean to defend Kaplan. The idea of for-profit colleges is fine, but they shouldn't rely so much on Government money.

Their incentive is to enroll students, not educate them.

The University of Phoenix has more than 450,000 students, for example, and the Education Management Corporation, DeVry, Corinthian Colleges, the Career Education Corporation and Kaplan enroll more than 100,000 each.

All these schools get most of their revenue from federal student aid. Kaplan Higher Education, for example, gets 91.5 percent of its revenue from the federal government, through Pell grants, Stafford loans, military and veterans benefits and other aid.

On average, for-profit colleges spend about 30 percent of their revenue on advertising and marketing.

Lawmakers and Department of Education officials have become increasingly concerned that too much of the $26.5 billion in federal student aid that went to for-profit colleges last year enriched shareholders and company executives, rather than helping students.

Such schools enroll about 11 percent of the nation’s college students, and get a quarter of all federal student aid. But their students account for 43 percent of those defaulting on student loans.
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But it's another black eye for big media. The Washington Post's editorial position just happens to dovetail with the financial interests of their parent company. And, I doubt we'd see an article as critical as this in the Post.

Similarly, does anyone think the Times would have written this article if their parent company owned Kaplan?

AD · Nov 10, 2010

still waiting for that in-depth times takedown on carlos slim....

TheSportsPredictor · Nov 10, 2010

It's becoming more apparent that everything is a pyramid scheme.

cjericho · Nov 10, 2010

doesn't kaplan also do test preperation classes for SAT and also civil service tests?

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