The Implications of the New Gainful Employment Rule

By Dr. Peter P. Smith, Senior Vice President, Kaplan Higher Education

The 6/21/11 edition of the Chronicle of Higher Education contains a thoughtful essay by Frank Donahue on the new gainful employment rule. Donahue moves past the “won-lost” argument (i.e. the proprietary sector won) to the meat of the matter: what are the rule’s implications for the rest of higher education? He rightly concludes that, as conceived and written, GE will be difficult in varying ways, depending on the degree program the learner graduates from, since different programs tie to different careers with different earning ranges.

Then Donahue begins to ask the really confounding questions: what happens when a psych major goes to law school, moving from a low to a higher paying profession, while the accountant’s job is out-sourced to India? The underlying point, that being well-educated is its own reward is clear. Donahue uses these points to identify the reality of the gainful employment rule: it is a back door assessment of each program’s value in monetary terms dressed up as consumer protection legislation.

There are several deeply disturbing elements here, each signifying a far different role for the federal government in higher education policy.

• First, it opens the door, ultimately, to rationing academic programs, not because they lack intellectual rigor and fail to contribute to the intellectual, philosophical and personal development of the learner, but because they do not lead directly to a good job.

• Second, it opens the door to rationing opportunity, taking those same programs off the table for poor people who must rely on grants and loans.

• Third, coupled with the credit hour and state regulation rules, it opens the door to a massive federal intervention in standard setting in higher education. Something that is fundamentally contrary to the tradition of intellectual independence that characterizes American higher education.

As a former member of Congress, I believe that this is not, and should not be, the stuff of rule-making and regulation. It is the type of issue that the Congress is elected to decide and the separation of powers was designed to protect. Furthermore, as Hilary Pennington at the Gates Foundation noted in a letter to Secretary Duncan last April, regarding the credit hour rule specifically, this type of federal intervention and oversight has the consequence of stifling innovation and encouraging the status quo at precisely the time when we need more, not less innovation. I believe Pennington’s point is accurate beyond the credit hour rule alone. If higher education is going to meet the problems of the underserved, most recently articulated by Dr. Henry Louis Gates, Jr. and Gaston Caperton in their Huffington Post Article (6/20/11), “The Educational Crisis of Young Men of Color”, we need to break the bonds of tradition, much as the Fund for Improvement of Post-Secondary Education did when it was conceived in the early 1970’s.

The ultimate irony, however, is that the GE rule fails to establish the fundamental accountability that all higher education institutions owe each of their learners. Namely, that they have delivered to those learners the knowledge, skills, and abilities that their certificates and degrees stand for. So, while the politics of this emerging USDoE role play out, it is my fervent hope that the regional accreditation bodies and CHEA will include the following standard, or something like it, in their future self-study rules.

“That the institution will indicate the level of knowledge, skills, and abilities indicated by each certificate and degree, and that such standards will be linked to external references and available to independent evaluation.”

In the age of transparency, degree qualifications frameworks, such as the current Lumina Foundation project, complete with learning outcomes at the course and program levels, and the institution’s ability to deliver the value announced in the frameworks, should lie at the core of the definition of institutional academic quality.

Peter Smith is senior vice president of academic strategies and development for Kaplan Higher Eduction. A former Assistant Director-General for education of the United Nations Educational, Scientific, and Cultural Organization. Smith served as the founding president of California State University at Monterey Bay and the Community College of Vermont. He served as Vermont’s lieutenant governor from 1982–1986 and was elected to the U.S. House of Representatives in 1989.

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