Education for profit or Public Good?

Education for profit or Public Good?

The mushroom growth of private institutions of higher education in India has given rise to question whether such institutions are money spinning machines or serving public interest. In the absence of any reliable data it is difficult to find any answer to this question for the time being. However, a recent article published in Japan Times by Hiroaki Sato depicts a sordid state of affairs in private educational institutions in the United States. While lamenting that American insistence on free-market notions has brought the matter to the other extreme in higher education, Sato asserts that it has spawned education profiteers. Worse, many of these colleges get most of their ‘revenues’ from the government. According to a report published by US Government Accountability Office (GAO), most these private educational institutions encourage fraud and pursue the "deceptive and questionable marketing practices." The US Department of Education (DOE) followed GOA’s report with findings that student loan default rates were rising — with rates at for-profit colleges (11.6 percent) twice as high as those at public ones (6 percent) and three times as high as those at private, nonprofit ones (4 percent).

The GAO report says there are 2,000 for-profit colleges, of which 15 are publicly traded corporations. Kaplan is one of the latter. In US, for-profit colleges have resorted to aggressive marketing efforts by allocate a bewildering 30 percent of their income for marketing. And their academic accomplishments are dismal. The graduation rate for for-profit four-year colleges is 22 percent today, in contrast to 55 percent for public colleges and 65 percent for private ones. Then there is the real aim of these for-profit entities: to enrich those who run them.

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