Despite the apparent long term trouble in the U.S. economy, the University of Phoenix seems to be one company that’s weathering the storm very well. According to a piece by Ben Miller at Education Sector’s the Quick and the Ed:
The University of Phoenix became the first college in the history of the United States to take in more than a billion dollars worth of Pell Grants disbursements in a single academic year. Students at the for-profit chain received a total of $1,042,372,699.50 spread amongst 304,583 awards in the 2009-10 academic year.
Well, ah, good for Phoenix. The case of Phoenix is actually fairly typical. According to U.S. Department of Education information revealed yesterday, American for-profit institutions got some $7.34 billion from federal government in the form of Pell grants last year. That’s a 70 percent increase from the year before. Most of this can be attributed to the government’s increasing the maximum Pell grant by $619.
Much of this extra Pell money went to stockholders in the Phoenix case. That’s fine; that’s the Phoenix business model. As Miller rightly points out, however, what this highlights is the real problem with seeing Pell grant increases as any way to improve college access. Congressional Democrats, in particular, often talk about Pell as if it essentially represents free college assess for all poor Americans. As one explained back in January:
This legislation offers the most sweeping changes to the federal student loan program in a generation. With one move, Congress can make college more affordable, keep jobs in America, prepare young people for our global economy, and reduce our deficit by billions.
That’s George Miller, the progressive long-term congressman from California’s seventh district who serves as chairman of House Committee of Education and Labor. He was speaking specifically about the (in many ways very impressive) student-loan reforms earlier this year that generated Pell grant increases.
The trouble, however, is that Pell grants grants simply do not begin to approach tuition hikes, whether or not the colleges are proprietary. As the University of Phoenix example highlights, it’s a long way from more Pell to making “college more affordable.” [Image via]