American education policy is guided by two disparate forces: expanding access to higher education and privatizing the costs of that access.

The policy platform of President Trump and Education Secretary Betsy DeVos has given for-profit higher-education institutions new hope by reversing protections implemented by the Obama administration, changes that would enable many for-profit colleges to again profit at the expense of students and taxpayers.

Broadening access helps historically under-served students — the poor, minorities, single women, veterans, etc. Privatizing access has exploded the growth of government-provided loans now totaling $1.5 trillion, with a disproportionate amount going to for-profit institutions as the principal source of their revenue.

There are 45 million student-loan borrowers with an average debt of $27,975, making this the second leading category of private debt in the U.S. Also troubling, 16.9 percent of these borrowers are either delinquent or in default. For-profit institutions have significantly higher default rates than students from public or nonprofit colleges.

This debt crosses all socioeconomic, racial, gender and age demographics, leaving many in financial ruin. Student-loan debt inhibits economic growth by reducing aggregate expenditures, leaving many millennials unable to purchase homes. Fortunately, Utah has the lowest debt per graduate in the nation, at $7,545, compared to the highest, at $27,167, for New Hampshire.

The 2012 Senate Harkin Report on for-profit colleges documented exorbitant tuition and predatory recruiting practices, regulatory evasion and manipulation and abysmal outcomes in students attaining gainful employment. For-profits spend on average 23 percent of revenues on marketing, exceeding the amounts spent on instruction. The Harkin report further noted that 54 percent of students dropped out without a degree or certificate.

Those who graduated left with higher student-loan debt, higher loan defaults, failed licensing exams and no job in their area of study. More recently, a 2016 report by Treasury Department economist Nicholas Turner and George Washington University economist Stephanie Cellini concluded that, overall, for-profit colleges leave students worse off.

The 2017 Student Loan Report noted an average default rate for for-profit colleges of 15 percent, public colleges 11 percent and private non-profit colleges 7 percent. Of the 43 colleges in Utah, five are non-profit, eight are public and 30 are for-profit. Utah for-profits default on average 11.28 percent, public 8.39 percent and nonprofit 4 percent (with our institution, Westminster College, at 2.7 percent). The worst 10 Utah for-profits defaulted on average at 19.73 percent, with the highest at 26.8 percent.

Protecting the interests of students and taxpayers requires regulatory reform. Stringently enforce the 90-10 rule and consider returning to the 85-15 rule. The 90-10 rule limits an institution’s revenue from federal aid to 90 percent (99.7 percent of four-year public colleges, 95.5 percent four-year nonprofits and 84.7 percent of for-profits are compliant with this rule). Also include veterans’ benefits that support education in the 90-10 calculation.

Require the collection of comprehensive student-outcome information, as the Centers for Medicare and Medicaid does with hospitals. Establish uniform and accurate methods for tracking job placement rates. Prohibit institutions from using federal-aid dollars to advertise. Develop a more rigorous accreditation system as a gatekeeper for determining institutional eligibility to federal financial aid.

Variance in quality and outcomes in the health care sector is much smaller than in higher-ed. Why? Because the oversight and regulatory structure for health care is significantly more consistent and rigorous than higher-ed. The Department of Education recognizes more than 60 institutional and programmatic accrediting commissions covering all types of institutions. Health care has three institutional accreditors, with one primary accreditor, The Joint Commission, which accredits nearly 21,000 health care organizations and programs. As Susan Dynarski, a professor at the University of Michigan, notes, “In the hospital industry, there are at least clear standards that all institutions, including for-profits, must follow. Regulation and oversight of colleges is far weaker than this.”

In an environment where students increasingly assume responsibility for funding their education, and where the federal government often pays for substandard education, protecting both students and taxpayers requires a less opaque and more consistent system of regulatory oversight. Reducing the number of authorized accreditors is key to ensuring more consistent measurements of quality and student learning. All institutions should be accountable to the students they serve.

The point of government-funded student loans should not be to enrich a few, but to provide students well-paying jobs and society a highly-skilled labor force.

James “Cid” Seidelman | Westminster College

James “Cid” Seidelman is distinguished service professor of economics and former provost of Westminster College and former chair of the Northwest Commission on Colleges and Universities.

John Watkins | Westminster College

John Watkins is professor of economics at Westminster College