We need a definition of "Gainful Employment" now!
On June 16, the U.S. Department of Education proposed some important new regulations aimed at ensuring that taxpayer dollars are spent appropriately and effectively on federal student aid, but it did not issue a draft regulation defining "gainful employment". Each year, students borrow and taxpayers spend billions of dollars to subsidize attendance at programs required by law to "prepare students for gainful employment in a recognized occupation." Yet current regulations include no definition of "gainful employment," leaving the law unenforceable.
Secretary of Education Arne Duncan has said that the Department will issue the draft regulations on the definition of gainful employment "shortly", but if the Department doesn't issue them by the first week of July, these rules likely won't go into effect until July 2012! In the next year alone, taxpayers will likely underwrite more than $30 billion in loans to students attending programs that are required to prepare them for gainful employment. Students and taxpayers shouldn't have to wait another year to be protected from rip-off career education programs that over-charge and under-deliver.
Go to www.protectstudentsandtaxpayers.org today and urge Education Secretary Arne Duncan, OMB Director Peter Orszag and your Members of Congress to make sure that next year strong regulations protect students and taxpayers from exploitative career education programs.
Private Student Loan Update
On Friday, Senate and House negotiators reached agreement on historic financial reforms, including creating a much-needed Consumer Financial Protection Bureau (CFPB) with authority over risky private student loans. The legislation contains big wins for students and borrowers, although it does not have everything we sought. The Senate and House are scheduled to vote on the final bill this week, and we strongly urge its passage so President Obama can sign it into law.