Thoughts on ITT Tech Shutting down?

[DaveInPgh]

Do you think the actions of the US Department of Education was appropriate?

http://www.msn.com/en-us/money/companies/itt-tech-shutting-down-all-campuses-nationwide/ar-AAiySMt?li=BBnb7Kz

[GoodSteward]

I'm having trouble figuring out what they did wrong per say. I have seen where they were apparently selling kids on the idea that they can have a degree they really didn't have the skill for so they ended up deep in debt without any real jobs. They also seemed to cut down on the requirements which made the degree's less desirable for employers.

The only "official" thing i saw was that they failed a recent accreditation exam and didn't plan to change anything to fix that.

I can say this. I bet this is only the beginning. More like them will be closed.

[cooliemae]

Education is one of those areas that shouldn't be 'for profit.' I don't have a problem with the US Dept. of Ed. coming down on businesses that prey on students. Obviously the company had come to rely on federal student aid to stay in business otherwise I can't imagine that it would have to shutdown immediately.

For me the fact that the credits earned at ITT Tech wouldn't transfer to any other college is a big red flag. It means that once students started down the ITT path they almost had to finish with them or lose any work they'd already done. On top of that what was it about ITT Tech that other schools don't like that they won't except the credits?

[pflyers85]

Education is one of those areas that shouldn't be 'for profit.' I don't have a problem with the US Dept. of Ed. coming down on businesses that prey on students. Obviously the company had come to rely on federal student aid to stay in business otherwise I can't imagine that it would have to shutdown immediately.

For me the fact that the credits earned at ITT Tech wouldn't transfer to any other college is a big red flag. It means that once students started down the ITT path they almost had to finish with them or lose any work they'd already done. On top of that what was it about ITT Tech that other schools don't like that they won't except the credits?

I don't necessarily think its morally wrong for education to be "for profit". Many of our needs are met by acquiring the goods and services of for profit ventures. I think the issue that you correctly point out is the fact that many if not most of these "for profit" college/tech schools lack accreditation agreements with traditional "non profit" schools. My guess is the reason most "for profits" fail to reach mirroring accreditation with traditional schools is because the process to do so would render their enterprise non profitable thus defeating the purpose of their existence. Not only are they competing with the traditional non profit schools that have the benefit of wealthy alumni organizations, more government funding sources, etc but they also compete against other for profit institutions that are unethical con artists that dupe naive people into bogus degrees/certifications. I think many legitimately want to provide a valuable product while still turning a profit but the conditions are such that make it difficult to impossible.

[james.hendrickson]

Yes, the department of education appears to be ratcheting down on a lot of these alternative educational institutions. The problem is that some of them may be legitimate distance learning institutions, some however are diploma mills.

[TexasHusker]

Education is one of those areas that shouldn't be 'for profit.' I don't have a problem with the US Dept. of Ed. coming down on businesses that prey on students. Obviously the company had come to rely on federal student aid to stay in business otherwise I can't imagine that it would have to shutdown immediately.

For me the fact that the credits earned at ITT Tech wouldn't transfer to any other college is a big red flag. It means that once students started down the ITT path they almost had to finish with them or lose any work they'd already done. On top of that what was it about ITT Tech that other schools don't like that they won't except the credits?

Is it wrong to have for-profit healthcare, grocery stores, utility companies, or overnight courier service too?

[cooliemae]

Is it wrong to have for-profit healthcare, grocery stores, utility companies, or overnight courier service too?

I don't think healthcare should be for-profit, no. First I don't think that anyone should make money off of someone else's misery. Should there be fair compensation for services, yes, but profit no. Second, the healthcare market is unlike many other markets. Perhaps if there was more transparency in the market it would be better, but with most insurances you're locked into a plan, whether it's private or public. So is the consumer going to put pressure on the providers to compete for services when you either have to go to specific providers or the difference in co-pay is negligible. In emergency situations who has the time to ask what the cost of ambulance service A is compared to B, you get the one you get and in small markets there isn't even competition. (I live in a an area with an all volunteer ambulance service.)

I don't believe that utility companies should be able to have a monopoly, but again utilities are a unique product because you can't really have multiple gas lines running to your house form different companies. So if I want electricity I have to buy it from Wisconsin Public Service which is regulated company, meaning they have to get permission from the gov't (ie people) to raise rates, etc.

I can compare prices for overnight courier services and groceries. I'm not forced to purchase from specific companies, though given my rural nature I might have a chance at arguing the lack of competition.

All that being said, I know the reality is that for profit companies will crept into all facets of life. Some will be better than others, but personally I stand by my belief that a profit (profit being key word) shouldn't be made off of people's education and health.

[GoodSteward]

The problem with education being for profit is that it can cause the people in charge of showing profit to change priorities, which will reflect on the education being given to the students. I believe that is what happened here. The value of the bottom line became more important than the value of the education. To even be for profit indicates you are here to make money above all else. ITT was a publically traded company, so they HAD to show good profits to maintain share prices. There are certain areas that just shouldn't give that image. Education is one, and I think health care is another. I don't think it is evil to be profit for these categories, but it sure shows a conflict of interest when discussing value and reason for prices. All the sudden it is no longer easily justified that it is "worth it."

Credits not transferring is a common thing with tech schools. We have a local tech college that was working on getting all the teachers to get masters degrees so they could transfer credits to major 4-year colleges back when I went for a couple certifications 12 years ago. They are still not up to that standard yet, although I think some of their classes will transfer now.

[feh]

Obviously, I don't know the details of the investigation. I will say that companies being subsidized with tax dollars that are more about profit than providing a public service should be cut off.

Again, I don't know the details, but I view this as a win. It seems lobbying usually wins over the public interest.

[LivingAlmostLarge]

I'm not sure about non accredited school but like everything you do get what you put into it. I say that because DH went to a bootcamp which isn't accredited and cost us $16k tuition. The real cost however wasn't the $16k, it was the loss of income to get into the program, doing the program, and then getting a job. There were 16 people in the program and 3 people got kicked out. For not taking it seriously. So they wasted their TIME and MONEY. One of the three got a job anyway but the other two he's not sure what happened.

So I think sort of like ITT it's not just paying for courses or degrees. Sometimes even without accreditation a person can take it seriously and get a lot of it. We certainly made it back in spades. Money and timewise our "investment" was the highest return we've ever made. But others in the same opportunity didn't bother to care.

[optimist]

Here's a good summary of what ITT has done - both to students and investors.

https://www.newamerica.org/education-policy/edcentral/itt-executives-have-only-themselves-blame-companys-demise/