The Newest Astroturf Attack on the G.I. Bill
The Veterans Education Project may snuff out the best chance in years to protect veteran students. Why?
In March 2005, Bridgepoint Education Inc. purchased Franciscan University of the Prairie, a small Catholic college of about 300 students located in Clinton, Iowa, the easternmost city in the Hawkeye state.
Almost immediately, Bridgepoint ditched the school’s religious affiliation, converted it into a for-profit entity, and rechristened it Ashford University. According to a complaint by the California Attorney General’s Office Bridgepoint acquired Franciscan because it wanted to gain access to its highly valued accreditation.
Over the next six years, Bridgepoint fiercely and aggressively expanded. By 2011, its online enrollment had ballooned to 83,774, making it the second largest place of higher learning in the country. This impressive growth was run out a highly pressurized sales office, in which employees were expected to make at least 100 calls per day. Employees later told the California Attorney General that the recruitment culture inside Bridgepoint was “ruthless,” “grimy,” and “brutal.” One described the venture simply as a “money grab.”
In 2019, I spoke to Richard Baca, who was enticed into signing up for a Bridgepoint education. Baca said one of the reasons he enlisted as a combat medic in the New Mexico National Guard was for the education benefits promised to him through the G.I. Bill. After twice being deployed to Iraq, he wanted to become a physician assistant. He found a website listing Ashford as friendly to service members and veterans. He said the online for-profit university promised him a comprehensive slate of classes and flexibility in scheduling them, so he signed up.
It wasn’t long, however, before everything fell apart. While Baca believed his G.I. Bill benefits would pay for his schooling, he said Ashford disputed his eligibility and wouldn’t accept them. He eventually gave up and took out $10,000 in student loans. Disappointed with his education, he quit. But, he said, the school billed him for classes he never took and wouldn’t release his transcript until he paid for them. “I would still like to go back to school, but Ashford has curtailed those efforts,” he told me.
Ashford/Bridgepoint and many other for-profit schools have long been obsessed with the G.I. Bill, which brings them lots of students, and money. These institutions are incentivized to aggressively recruit those who’ve served due to what’s known as the “90/10 loophole.” For the uninitiated, this loophole is contained within the “90/10 rule,” a statute that requires for-profit colleges get no more than 90 percent of their revenues from federal student aid. Because G.I. bill payments do not count as federal aid, predatory for-profits can use veteran students to meet the ten percent threshold.
As such, these for-profits have worked vigorously to keep this loophole intact. Since 2012, Bridgepoint has spent hundreds of thousands of dollars lobbying Capitol Hill. At least three officials with a Bridgepoint connection served in President Donald Trump’s administration (two in the White House, one in the Department of Education.) Under Trump, Bridgepoint also boosted its advocacy arm, in part by hiring a lobbyist in Matt Smith, a former Deputy Assistant Secretary of Public Affairs at the Department of Veterans Affairs.
The sway of for-profits is exemplified by U.S. Rep. Virginia Fox, a North Carolina Republican, and author of the Prosper Act, which among other things, would gut the Stafford Loan program, eliminate the Public Loan Forgiveness Program, and repeal the 90/10 rule entirely, allowing for-profits to be funded entirely by taxpayer dollars. (According to the Center for Responsive Politics, Foxx is the top recipient of campaign cash from both for-profit schools and student loan companies in Congress.)
Countering her efforts is Rep. Mark Takano, a California Democrat and Chairman of the House Committee on Veterans’ Affairs Chairman. Takano was the lead sponsor of the PRO-Students Act, which would close the 90/10 loophole. When the PRO-Students Act was first introduced in 2018, it had just two co-sponsors in the House. Foxx’s bill, on the other hand, racked up 21. Takano’s bill slowly but surely built momentum, notably in 2019, when Sen. Lamar Alexander, a Tennessee Republican andthe chairman of the Senate committee that oversees education, threw his support behind it.
Last week, Takano announced that he’d snuck language into the new $1.9 trillion coronavirus relief package to close the “90/10 loophole.” This is far from the only G.I. Bill reform required in this moment. But if Takano’s statute passes, many schools would be forced to look elsewhere for tuition than federal funds. Many would have to become more competitive and legitimate. Veterans, meanwhile, would face a new educational environment far less predatory and confusing. Yet the for-profits industry has, for years, managed to kill good reforms, and are now at it again.
Perhaps the biggest opponent to 90/10 reform is the Enlisted Association of the National Guard of the United States (EANGUS), the rare veterans’ organization opposed to G.I. Bill improvements. EANGUS’s corporate partners include for-profits schools that have accumulated myriad complaints, including Ashford, DeVry, and the University of Phoenix.
The association’s newest offshoot appears to be the Veterans Education Project (VEP), a think tank with close ties to numerous for-profit schools, including Concorde
Many of VEP’s leaders, including its recently departed Executive Director, Daniel Elkins, came from EANGUS. VEP recently appeared, as if out of nowhere, and quickly amassed an impressive slate of advisory board members, including Jim Byrne, the VA’s former second-in-command. In a text, Byrne said he was impressed by Elkins when they met at a roundtable. Asked if he supports keeping the 90/10 loophole, Byrne wrote, “quality education outcomes for our veterans are important. Reasonable people can disagree on rules and policies to ensure this best happens.” (VEP didn’t respond to my questions.)
VEP frames the current G.I. Bill reform effort as a backwards strategy that will hurt quality institutions and limit “school choice” for veterans. This message has been pushed out through a series of tweets, policy statements, and slick YouTube videos. “For them to say that somehow or another we’re not smart enough to make the right decisions that’s—I’ve said it a bunch of times—that’s not fair at all,” one veteran argues in a VEP video spot. Another contends that, “if I can be trusted to look out for my battle buddies to my left and my right, I do believe that I should be trusted to go to the institution of education that I desire.”
G.I. Bill reform is clearly not a debate around choice, but a commonsense regulatory push to ensure positive educational outcomes. It also recognizes that veteran education includes a massive fiscal component that requires diligent monitoring. The VA’s Office of Inspector General has estimated that, if G.I. Bill oversight is not ramped up significantly, $2.3 billion in GI Bill funds could be funneled over the next five years to potentially ineligible academic programs. The watchdog believes this negligence would jeopardize the educational outcomes – and future career prospects — of more than 17,000 student veterans.
Last week, VEP published a somewhat dodgy white-paper contending that closing the 90-10 loophole will hurt students and disadvantage for-profits with positive educational outcomes. (The lead author of the report, Jason Delisle, is a former Republican senate staffer and Jeb! advisor.)
Before publication, VEP sent the paper to a number of policy experts for review. One was Clare McCann, the Deputy Director for Federal Higher Education Policy at the New America Foundation. “The report sort of misunderstands the fundamental purpose of the 90-/10 loophole and the reason lawmakers want to close it,” McCann told me. She added that the paper incorrectly presumes that schools would simply fail if the loophole is closed. “These schools are already so reliant on federal money, they have no choice but to adapt,” she contended. Asked if VEP incorporated her feedback, McCann said “they ignored most of the comments I sent.'“
Others critics of the VEP report contend, among other things, that it improperly mixes data from different time periods and asserts student outcomes and graduation rates at for-profits with more certainty than the data support.
Strangely, the VEP report also raises alarms over many “high-quality” for-profits that would be kneecapped should the 90-10 rule be reformed. One is Spartan College of Aeronautics & Technology, which raised eyebrows among creditors for using old and outdated equipment and failing to document the qualification of its instructors. Another school VEP deemed “popular with military students” is Trident University International, which has been scrutinized over its standards for awarding degrees.
The VA and veterans’ advocates have received a flurry of complaints about Trident’ and its partner school —American InterContinental University — that allege everything from shady marketing tactics to dubious financial practices. As such, the VA has flagged InterContinental on their G.I. Bill Comparison Tool. The VA also warns students that, in 2019, the school system paid $30 million to the Federal Trade Commission to settle charges that recruiters used illegal tactics to generate leads. These included falsely telling prospective students that the school was affiliated with the U.S. military. (Trident has recruited survivors of the fallen at grief camps, and greatly boosted outreach during COVID-19.)
The umbrella organization that owns both Trident and American InterContinental is Perdoceo Corporation (formerly Career Education Corporation), which, in 2019, paid out nearly $500 million over allegations it was defrauding students.
In light of this information, one may wonder why the VEP report boosts Trident's standing so aggressively. The answer may lie in the fact that one of VEP’s major partners — the Council of College and Military Educators — is overseen by a number of senior Trident officials.
On Tuesday, VEP hosted a video conference where Paul Fain — a formerly solid reporter on G.I. Bill scam beat — interviewed Delisle, the lead author of the VEP report. In his remarks, Delisle claimed that his detractors were pushing a one-sided “research agenda.” He further suggested that VEP had no political leanings and was simply focused on analyzing data and proposing commonsense policy outcomes. This characterization diverged greatly from one VEP source I spoke to who contended that “any dissenting views seemed to create animosity.”