March 3, 2011

NEAL MCCLUSKEY ON THE GAO FOR-PROFIT SCHOOLS SCANDAL:

In dribs and drabs the plot thickens in the quiet little saga surrounding the GAO’s brutal and broken August report on for-profit colleges. The latest development is the near-silent transformation of the GAO office that produced the knee-capping report that was later quietly reissued with lots of new, for-profit-exonerating material.

I say “near-silent transformation” because word about it somehow got to the Coalition for Educational Success, a career college advocacy group. Yesterday, CES issued a press release on the matter, and this morning I contacted GAO’s public affairs office about it. To the GAO’s credit, their public affairs folks quickly sent me a copy of a memo announcing the end of the Forensic Audits and Special Investigations (FSI) team. Sadly, it was clear that there would be no public announcement of the change, which is utterly consistent with the behind-your-back way GAO has handled every development in this story. Well, every development save the very public release of the original, fatally flawed report. . . .

As a member of the public it sure would be nice to know the answers to these questions, especially since these are the guys who are supposed to be holding the rest of the federal government “accountable.” For proprietary schools’ employees and investors — the people who were most hurt by the dubious August report — these are thing they absolutely should know. But the GAO insists on telling us that nothing major went wrong while refusing to share information we’d need to confirm that. It’s not only totally unsatisfactory, it only makes you even more suspicious.

The attack on for-profit schools seems to have been quite political, involving a bogus report and what looks suspiciously like an effort to protect traditional Democratic constituencies against free-market competition. I’m also suspicious that the assault on Kaplan in particular is a way of keeping the Washington Post — which depends on Kaplan’s revenues to survive — in a pliable frame of mind vis-a-vis the Administration.

When you add to this the problem of insider-trading at the Department of Education where for-profit schools are concerned, it’s not clear that more government regulation is the answer.