Almost all universities public and private in the US are 501(3)(c) nonprofit organizations. (Some public ones are more or less an extension of the government and don't count)
For-profit universities ... aren't. They're owned and operated by for-profit companies, the accreditation is usually terrible and in no way comparable to other universities, and they deceive students into thinking they'll be getting something similar to a university degree.
For example, ITT is run by ITT Educational Services Inc
What really needs to happen, is the US needs to restrict federal student loans to programs on a whitelist of accreditors (whitelisting the accreditation organization not the program, like ABET for example) as well as restricting organizations calling themselves "institute", "university", etc. as well as giving out "degrees" without matching the whitelist.
I have _no_ problem with the concept of a for-profit university, but they're being allowed to exist with very low standards and it needs to stop.
In fact I think the whole university system needs to tighten it's belt and be made smaller and more elite. Too many people think that ticking a university box is necessary to get a job / to hire a person, especially when so many people get such low quality degrees.
I'm not even railing against soft degrees, but their contents instead. "Liberal Arts" ... if you deconstruct that you can get to the original meaning which might be rephrased something like "the skills necessary to live a free life" which a whole lot of university degrees these days do not do at all.
So, this seems to me like a problem that is almost perfectly amenable to market solutions.
University has poor standards? Don't hire their graduates, or at least, don't weight their qualifications as heavily.
I don't understand why you think Government action - that is, force - is necessary here. Or is it that you think they are defrauding their students by calling themselves Universities?
The main reason is that the government is the one holding the pursestrings that enables the whole system to operate. If federally-guaranteed student loans cannot be used by these places, their business model collapses entirely. And a big chunk of these terrible for-profit universities are also preying on veterans using their GI Bill benefits.
Accreditation organizations are private. Vetted by the Department of Education, but still private organizations.
It's just an external audit, and there's nothing at all wrong with that. These for-profit organizations are defrauding students by providing very low quality and very expensive educations, all the while passing the low quality standards set by a broken accreditor.
Market solutions don't work when the target audience are young people investing a huge chunk of their lives in education. If a new brand of coffee and it's horrible, you can just try a different brand. A college student doesn't have the same luxury.
The two big differences are that (most) private universities are accredited by some recognized body, meaning your degree from a private university will be recognized as valid by other universities if you want to transfer or continue your education somewhere else. Most for-profit schools are not accredited and thus their degree isn't recognized by other universities.
The second difference is one of structure. For-profit universities are, well, for-profit companies, meaning their top priority is to hit earning targets and satisfy shareholders, many of whom may very well put their own short term financial interests ahead of the long term well being of the school or its students. Private universities tend to be set up as non-profit trusts, answerable to a board of trustees who's priorities should be more aligned with the long term reputation and well being of the school.
Of course this is all on some sort of sliding scale and there may very well be well-run accredited for profit schools with share-holders with a long term vision for the school and there are no doubt terribly run private universities with trustees whom try to use their position to wring out personal profits. But that is the basic gist of it.
ITT is accredited by an organization recognized by the US Department of Education. It's a shitty accreditation, but it's there. (Accrediting Council for Independent Colleges and Schools)
The problem is that the government allowed the problem to persist for too long before acting. If the government wants to be in the business of approving schools (even if it's only indirectly) it should hold schools to a lot higher standards and move a lot quicker when results start to slip.
For better or worse when people see "Approved by The US Department of Education" they have (perhaps unreasonable) expectations that that means something.
I think it's important to distinguish that the government should not be directly approving of universities. Instead they should approve professional accreditation organizations that manage their own standards (which is what they do). In no circumstances do we want elected politicians to be legislating what goes into a university degree.
The Department of Education just needs to give a little bit less leeway to low quality accreditors. (and even then, the decisions should be made by career bureaucrats led by an appointed secretary, not by legislation)
Its actually pretty common for legit training programs with decent acredation to get bought out by these shady operators and then run the school at lower standards.
I once looked at art Institute and each campus location varied greatly in accreditation.
