Price determination of intellectual resources

Higher Ed: Profit, Price, & Performance  May 16, 2017 – 11:04 pm
I suppose due to the publicity surrounding larger rulings, I missed the courts striking down President Obama’s Gainful Employment rule:

The for-profit college industry, long under attack by Obama administration bureaucrats as well as short-sellers like Steve Eisman, scored a big victory yesterday when a federal court in Washington, D.C. rejected new rules that would have made it harder for their students to obtain federal loans.

In a decision dated June 30, U.S. District Judge Rudolph Contreras rejected most of the Education Dept.’s 2010 rules that would have subjected for-profit colleges to three new tests based on the ability of their students to repay their loans. The judge said a test that would have eliminated the bottom 25% of schools from student-loan eligibility was “arbitrary and capricious” because it wasn’t based on any economic studies suggesting students from those schools had a harder time finding jobs. [...]

The judge dismissed most of the for-profit colleges arguments against the new rules, saying it was reasonable for the administration to tie the concept of “gainful employment” specified in the law to ability to repay. ““The real question …is not how much gain is enough but rather how much preparation is enough, ” he said. He also rejected the argument that the new rules were an “elephant in a mousehole, ” exceeding the Education Dept.’s authority to assess the performance of schools in graduating well-trained students. Under the new rules, schools whose students were left with loan repayments that exceeded 8% of their average annual income or 30% of discretionary income would be in danger of losing funding.

Source: The League of Ordinary Gentlemen

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