Too Big–and Too Awful–to Fail

ACADEME BLOG

The Department of Education and Corinthian Colleges have been engaged in extended negotiations over how the for-profit corporation will either shut down or scale down its various entities, including the Everest University, WyoTech, and Heald College chains.

The government actions against Corinthian Colleges came after the Harkin Report highlighted Corinthian’s extraordinarily high student-loan default rate, its abysmally low graduation rate, and its clearly predatory marketing and recruiting practices.

Given the scope of the problems at Corinthian Colleges, one might wonder why the government simply does not shut the whole thing down.

The most often cited reason is that some 72,000 students are still enrolled with Corinthian and simply closing Corinthian would prevent them from completing the degrees that they are pursuing.

The actual reason is that just about the only way that a student can escape paying off student loans is that the college closes and the student either ceases…

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