The Patriot Post® · ITT Tech Gets the Obama Treatment, Goes Under

It’s not “back to school” as usually for more than 40,000 students. That’s the number of would-be learners the Obama administration just tossed out of their classrooms by yanking federal student aid from all students attending ITT Technical Institute schools nationwide. As a result, the for-profit college chain was forced to suddenly close 130 campuses in nearly 40 states, leaving tens of thousands of students on the curb holding their textbooks and some 8,000 employees without jobs. Thanks, Obama.

ITT’s crime? Well, none proven yet. The company is facing — and defending itself against — several investigations, including by the Consumer Financial Protection Bureau, the Securities and Exchange Commission, and the Massachusetts attorney general. But if Hillary Clinton’s presidential campaign teaches us anything, it’s that being under investigation is hardly considered problematic for the Obama administration.

Ah, but wait, ITT is a non-government, private-sector, for-profit endeavor that thrives on free-market economic principles of supply and demand. And that is apparently crime enough in Obama’s America. Last month, the Department of Education barred ITT schools from enrolling students who use federal grants and loans, claiming “it’s too risky.” In its announcement, the department cited “significant concerns about ITT’s administrative capacity, organizational integrity, financial viability and ability to serve students.”

Of course, if the government were really concerned about organizational integrity and financial viability, it would stop funding approximately 99% of federal agencies. So yeah, we don’t believe that one for a minute.

More likely is the scenario laid out by The Wall Street Journal: “ITT’s execution follows the usual pattern: A pack of regulators attack from all angles — i.e., the Accrediting Council for Independent Colleges and Schools, Securities and Exchange Commission, Consumer Financial Protection Bureau and state Attorneys General — and try to run their target out of business before it can raise a legal defense. None of their charges has been proven in court.”

Still, the verdict has been issued. As Bloomberg reports, “Last month, the feds demanded the company produce an additional $153 million in collateral — nearly double its $78 million cash on hand — to cover possible losses that the government might incur if the company were to suddenly fail.”

Ironically, the government claims its actions are to protect students and taxpayers — apparently “protection” to Washington bureaucrats involves tossing students to the curb and throwing taxpayers under the school bus. In reality, the government’s actions may end up costing taxpayers millions of dollars. How? Well, the government may end up forgiving as much as $500 million in federal student loans to ITT students. ITT has about $90 million on hand to cover loan forgiveness. Who will be stuck with the bill for the remaining $410 million? Got a mirror handy?

Unfortunately, ITT is just the latest for-profit target of the Obama administration. Last year, Corinthian Colleges, which at one time boasted 70,000 students, shut down after what NPR called “a crackdown from the Department of Education.”

For an administration that’s touted its work “to make college more accessible,” 110,000 displaced students cast some doubt on the credibility of that claim.

The good news is there is a way for-profit colleges can avoid becoming a bullseye for the federal government. Hire Bill Clinton! Indeed, as the Journal notes, “ITT investors must be wishing they had ponied up for political protection like Laureate International Universities, the for-profit college that paid Bill Clinton $17.6 million to serve as its ‘honorary chancellor.’” Hey, at least Bill’s got a successful track record of intern placement.

It seems Laureate, which incidentally, as the Journal points out, also donated somewhere between $1 million and $5 million to the Clinton Foundation, has escaped the Department of Education’s ire. This despite the fact that the college has higher student debt levels than ITT and spends even more than the industry average on the evil capitalistic practices of marketing and profit. But not to worry, Slick Willie’s got their back.

The truth is this administration can’t abide market-driven, private-sector endeavors because they threaten the government’s control and the government’s narrative that Uncle Sam knows best.

Of course, thanks to the government itself, tens of thousands of students may never believe this narrative. Perhaps in getting kicked out of school, they’ve learned the most important lesson.