Dear Commons Group,
The Wall Street Journal (WSJ)had an editorial yesterday on the buyout of the University of Phoenix by the Vistria Group. I posted about this buyout on February 9th (see below). Here is an excerpt and the conclusion from the WSJ editorial.
“Last June the U.S. Department of Education said it had created an interagency task force to bring more accountability and oversight to for-profit colleges, so it’s hard to believe that at that point Team Obama viewed companies like Apollo as operating with “the highest ethical standards.”
As recently as October the Journal reported that the “Justice Department and the Department of Education are coordinating on ongoing investigations of the University of Phoenix, a government official said Friday, a day after the Defense Department barred the for-profit giant from recruiting on military bases because of alleged recruiting violations.”
Last month the Pentagon took the school off probation so Apollo can again benefit from military subsidies. Mr. Miller tells us, “We believe there is an opportunity to improve student outcomes that distinguishes the University of Phoenix with employers and in the marketplace.”
By the way, the Obama education department will have to approve Vistria’s purchase of Apollo, and we’re told the guidelines for approval are notably vague. What better way to win a regulatory blessing than have a former senior education official like Mr. Miller commune with his old regulatory comrades. Hey, Tony, great to see you; any job for me after, say, Jan. 20, 2017?
Mr. Miller says the University of Phoenix’s “investment in and commitment to” regulatory compliance, “coupled with our commitment to sustain and improve” such practices, “gives us encouragement as we proceed with the regulatory and accreditation approval process.”
To summarize, an Obama pal is the day-to-day boss of a department that succeeds in destroying 90% of the value of a politically targeted company. Then he leaves government, buys the company at a fire-sale price and announces that the problems that attracted so much negative government attention are ending—just in time for a new Administration that might not hate for-profit education as much as this one. Government mediation sure can be a lucrative business model.”
The education-industrial complex at its ugliest!