just my two cents, maybe some degradation against the peers but the new mgmt has not had much time to move the needle yet. Chase Coleman is on board and he is no fool. Viking getting long-er too.

1) We are intimately familiar with the target student demographic that for-profit institutions serve. There is no question that for-profit institutions serve a critical role in expanding access to higher education.

2) We have been to dozens of for-profit institutions owned by companies such as APOL, CECO, COCO, DV, EDMC, ESI, STRA, and privately held institutions as well. We pride ourselves on doing our homework.

3) Not all students that attend traditional academic institutions are wealthy, there’s a reason they’re taking out student loans….

We encourage you to read our original report on ESI, which includes a survey of former students. You can find it here. The feedback was not overwhelmingly positive, in fact it was negative. There are students that have good experiences at schools owned by ESI, COCO, WPO, and others, but you cannot ignore that there is a large, and growing percentage of students that are getting sub-optimal outcomes. Either they don’t graduate, or worse yet graduate, get placed, and still can’t afford to pay off student loans.

Many of these schools enroll students that shouldn’t be there, period. In other cases, the quality of programs does not match the cost. Either way, many students exit these schools worse off than when they entered.

You shrug off a 47% lifetime default rate for students attending for-profit institutions. We’re talking billions of dollars in losses here to the tax payer. We can do better. Do you think $90,000+ for a bachelor’s degree from a ITT Tech is a good investment for a student? There’s a reason the Department of Education wants to implement some sort of gainful employment provision.

Let’s address a few things in your comments: 1) the reason why people are critical of the for-profit education sector is the high default rates experienced by students attending those schools. You might not be aware, but the most recent Department of Education budget included a 47% lifetime default rate expectation for students attending for-profit institutions. You’re a tax-payer, that number should at least prompt you to think about who you went to school with and whether or not the current system delivers optimal outcomes for students and tax-payers. There is no other credit class that we know of that experiences this level of defaults (even in strong economic environments the default rate budgeted is closer to 35-40%). The reason why no one “attacks” Ivy League schools charging $100,000 in tuition is because their default rates are much, much lower. To put this in perspective the Department of Education budgets for lifetime default rates of 4-6% for graduate students. That’s 1/8th to 1/10th what is budgeted for students attending for-profit institutions. Remember, it’s you the taxpayer that’s footing the bill here.

We have also always characterized the problems with ESI’s tuition policies as part of a larger industry-wide problem. Tuition trends are unsustainable.

Finally, to your math on why return on educational investment worked for you, we would make the following points:

1) The mean gross income of high school graduates in this country was $33,000 in 2008. Your experience sounds different and were earning considerably lower levels.

2) Again, to emphasize the average high school graduate makes the same amount as someone that graduates from ITT Tech

3) At an annual earnings of $35,000 and with student loan payments of $500/monthly, that implies that you allocated 25% of your earnings to student loan payments. Most people cannot afford to do that unless they have extraordinarily cheap housing and transportation options. It’s a fact. You seem to shrug off $500/month, that’s a big burden.

4) Your absolute return might appear compelling on an absolute basis, but you should compare it to other options (attending another for-profit institution with reasonable tuition, attending a community college with cheap tuition, or not going to school at all and evaluating your salary appreciation prospects).

We’re glad you had a positive experience, it’s good for taxpayers, it’s good for this country. Thanks again for your response and insights.