It's time to take a short break from failing law schools, as this will be going on for some time, and instead take a look at failing federal agencies. Namely, the Department of Education:
Last Friday, the Education Department released a memo saying that it had overstated student loan repayment rates at most colleges and trade schools and provided updated numbers.
When The Wall Street Journal analyzed the new numbers, the data revealed that the Department previously had inflated the repayment rates for 99.8% of all colleges and trade schools in the country.
The new analysis shows that at more than 1,000 colleges and trade schools, or about a quarter of the total, at least half the students had defaulted or failed to pay down at least $1 on their debt within seven years.
Well, hey, anybody can make a mistake, amirite? At least it wasn't 100%, so that counts for something! I thought IBR and PAYE and all that alphabet-soup was solving the student loan crisis so that liberty and justice could abound, among other things. What, pray tell, is the culprit here?
A spokeswoman for the Education Department said that the problem resulted from a technical programming error.
Those damn computers, lemmetellya. Continuing on:
This isn’t the first time data problems have affected the Education Department. A recent government report criticized how the department tracks information including the budgetary implications of student loan forgiveness.
“This is a quality control issue with a Department of Education that has been facing criticism already for other data issues,” Robert Kelchen, an assistant professor of higher education at Seton Hall University. The department “needs to be regularly audited so these issues can be discovered sooner.”
No college saw its repayment rate improve under the revision, and some schools saw their seven-year repayment rates fall by as much as 29 percentage points.
Wait, we have Education Professors at Seton Hall taking shots at the student loan gravy train, and demanding accountability and standards? You may want to watch your back, Professor Kelchen, as the Law School next door may have a thing to say about that. A law school, by the way, that puts approximately 25% of its class in full-time, long-term bar-passage-required jobs, at a $270k sticker price? Physician, heal thyself!
Zerohedge, as usual, cuts through the chaff:
There is another interpretation: as we reported yesterday, when we revealed that a Chinese province admitted it had fabricated fiscal data for the period 2011-2014, the reason the data were made up "because officials wanted to advance their careers." One can imagine that the career pressure for those government workers who would report, and be held accountable, for revealing the true picture of America's disastrous student loan bubble, would be likewise staggering...the far more dire implications, however, are for broader student loan market, because if the latest unfabricated data suggesting that loan delinquencies are rapidly rising toward 50% across most of America's colleges, then the US is facing a default problem of staggering proportions.
Ok, kids, non-trads, whoever: go sign up for law school, and take out those massive student loans! I'm sure IBR will be there, waiting for you. No worries. The Law School Cartel says so. I have no doubt that they all have your best interests at heart. I'm also sure the angry Senators and Representatives who feel mislead about ballooning higher education costs will get over it soon...