This article was originally published in The Daily Pulp on December 5, 2014.
Nearly a month ago, our nation celebrated Veteran’s Day, a day that recognizes and honors the sacrifice of those who have served in the United States Armed Forces. Although the festivities, sales, and tributes of this year’s Veteran’s Day have come and gone, active members and veterans of our military continue to be a central focus of for-profit colleges. This attention, however, is far from intended to help those who sacrificed for the sake of ensuring our safety at home. Instead, current and veteran members of our armed forces are under attack by for-profit higher education companies in a ruthless scheme to maximize profit margins.
While for-profit colleges engage in a series of predatory business practices that are intended to maximize enrollment of prospective students from all walks of life, members of our armed forces are particularly profitable on several fronts.
The first can be understood in the context that until the latest withdrawal of military personnel from Iraq and Afghanistan, recent military engagements abroad have resulted in an increase of individuals entering the armed forces. Consequently, there are now vast numbers of people who are eligible for federal military education benefits.
Secondly, most of these military benefits consist of grants, rather than loans. This allows students to invest in a college degree with smaller loan burdens, which then pose less of a default risk to for-profit firms. This is very significant, since notoriously high default rates on loans throughout the for-profit higher education industry have prompted threats on behalf of the federal government to pull eligibility status for federal aid if the problem worsens. By increasing the percentage of clients who are relieved of heavier loan burdens as a result of more grant eligibility, a large amount of the collective risk is alleviated from a firm if it can capture a significant amount of military education benefits.
Lastly, although military benefits still come from federal taxpayer dollars, there is a special amendment to the Higher Education Act that designates military education benefits as being separate from the Title IV education funds that are the primary source of higher education funding from the federal government. This distinction is crucial, however, since an institution may only receive up to 90 percent of its funding from the federal government through Title IV aid under the 90/10 Rule of the Higher Education Act. Since military education benefits are classified outside of Title IV, for-profit colleges may receive virtually all of its funds from aid backed by the federal government. Consequently, this loophole has caused a surge in devoting resources to recruiting and enrolling students eligible for military education benefits.
For example, a recent Kaplan University presentation discusses plans to “spend $29 million and hire 45 people over 3 years to enroll more military personnel.” Hoping to infiltrate “key military publications and installations,” this $29 million investment will be spent to establish “broad-based outreach through phone calls, Web sites, direct-mail, and a presence at military events” (3998). Similarly, ITT’s CEO wrote in an email, “We didn’t even make the top 40 providers to the military. What an opportunity that we have in front of us,” finally insisting, “[W]e need to see how we can penetrate this world” (3460).
However, this opportunistic attitude cannot be found in the advertisements targeting their military audience. A prime example of the disingenuous narrative can be found in a 2012 “ITT Tech Special Salute to Veterans” campaign. As soft piano music plays in the background and staged men and women in uniforms embrace their families after getting off the tarmac, the following narration plays: “It took extraordinary courage, sacrifice, commitment… and most of all, it took hope. We want to thank all those men and women who have served our nation and helped to protect our freedom. Thank you, from all of us at ITT Technical Institute.”
Unbeknownst to thousands of returning veterans who watched this commercial from their living rooms, this ad was more than a simple “thank you” to them. Below the shallow surface of what aired, is a plan to capture a vast new market of profit. It is this potential source of revenue, and not that of sincere gratitude to our veterans, which has prompted new investment in the creation and airing of commercials like this.
In addition to television and online marketing strategies, for-profit firms also directly target veterans at wounded warrior centers and veterans hospitals. Bloomberg News was the first news source to expose this practice of direct sales pitches to severely injured soldiers housed in wounded warrior facilities. Daniel Golden, author of the story, comments on the account of U.S. Marine Corporal James Long, a combat victim of a traumatic brain injury. Provocatively commenting on the ethical problems of this case, Golden says that while Long “knows he’s enrolled… he just can’t remember what course he’s taking.”
This routine of seeking out wounded veterans to help boost military enrollment is, however, by no means a rare occurrence. Take Kaplan’s training materials for military recruiters:
Veterans’ hospitals are another place that you can expect to find veterans . . . many of the facilities allow schools to come on site and set up in a common area, such as a lunch room, and provide an information tables. You can expect to see not only veterans but also family members of veterans, and hospital staff that will come to your table for information. . .(4017).
Although Kaplan denies that this document reflects the official policy on training programs approved by corporate management, it is puzzling to know that this practice has been implemented by several for-profit colleges nationwide (A6-151). Grand Canyon University, for example, proves this in an exchange between a recruiter and a manager. “We were a big hit… I consolidated our position with the Army National Guard at this event… I also made many contacts with the wounded warrior unit… I also gained 5 solid leads that will turn into applications this next week” (3109).
As a result of intense marketing with a focus on military households, for-profit colleges have secured an overwhelming amount of Post-9/11 G.I. Bill Benefits. As the table below indicates, eight of the top ten recipients of such funds are for-profit higher education firms.
There are many reasons for people to be outraged at the conduct of for-profit colleges and their treatment of active and veteran members of our armed forces. Working through a loophole between federal aid programs for college students, for-profit colleges prey upon the desires and desperation of veterans and their families as a way to gain additional revenue from the federal government under the Post-9/11 G.I. Bill. Investing millions of dollars into campaigns that are conducted on television, online, and at wounded warrior centers, for-profit colleges ultimatelyextort billions of dollars from taxpayers by exploiting the loopholes of the law and the naivety of those they prey upon.
Although funds under the Post-9/11 G.I. Bill are a source of significant revenue for many for-profit firms, some institutions remain ineligible for these programs. While this may be the case, there is substantial evidence that recruiters from many of these ineligible institutions continue to lull veterans into committing to for-profit colleges through false statements concerning their eligibility status. Take the story of Army Staff Sargent, Jon Elliott, who upon his return from Iraq, decided to invest in an education at ATI Career Center in Texas. Painfully recounting his story, Elliottexplains that, “I was assured over the phone that . . . they had been accepted back in April for the Post-9/11 program. I went in, did a face-to-face with a recruitment official. Once again I asked, ‘Are you sure we’re good for the Post-9/11?’ He said, ‘Yes’ and we started doing some paperwork.”
To Sgt. Elliott’s dismay, he was notified three months later by the Department of Veterans Affairs that ATI “was not an authorized institution of higher education, and no benefits would be paid.” Unfortunately, “Sgt. Elliott could not afford to pay the tuition without using his benefits, dropped out of school, and was subsequently pursued by ATI for the $9,600 that he had been told the GI bill would pay for.” Although ATI ultimately forgave the debt in this particular case after it gained significant media attention from testimony in a Senate HELP Committee Hearing, less fortunate veterans from every corner of the country continue to face similar practices (3258).
Veteran’s Day is over. The patriotic sales and tributes to our veterans have been quickly replaced by Black Friday discounts and Christmas music. While our attention to those who serve our country has largely subsided, at least until Memorial Day, veterans of our armed forces continue to endure a merciless siege. In many cases, this is not on the frontlines of some distant region, but right here on our home front. So often, their enemy attacks them not with missiles or road-side bombs. Here at home, their enemies are dressed in suits, armed with false advertisements and empty promises.
Men and women return home from the frontlines every day, after placing themselves in harm’s way for the sake of protecting each and every one of us. We owe Army Staff Sgt. Elliot and others like him the same protection that he gave us when took an oath to defend our country. It is time for us to take our own oath to defend those who have sacrificed everything to defend us. It is time for us to hold for-profit higher education companies accountable and ensure the wellbeing of our veterans upon their return home.
Cover photo source: Source: http://bit.ly/12HW2lx.