Department of Defense Appropriations Act, 2016 -- Motion to Proceed-- Continued

Floor Speech

BREAK IN TRANSCRIPT

Mr. SCHATZ. Mr. President, I thank the assistant Democratic leader for his leadership on this issue and for his willingness to educate colleagues and educate the public and to push the DOE to take much needed action in this area.

What is happening with some for-profit colleges is truly a national scandal, and it is a scandal for two reasons: First, students are being hurt, and second, we are wasting tens of billions of dollars. The numbers speak for themselves. Almost 2 million students are enrolled in for-profit colleges, and they have collectively taken on $200 billion in debt to attend, but they often leave with little to show for it. More than half drop out within a few months, and in some programs less than 5 percent of their students ever graduate. For those who leave without a degree, repaying loans is a struggle. Students at for-profit colleges default on student loans at double the rate of students at not-for-profit colleges.

People may be surprised to learn that these substandard programs are financed almost entirely by the Federal Government, and the amount is totally staggering. In total, for-profits receive over $32 billion a year in Federal financial aid--over 20 percent of the total aid--yet they serve only 12 percent of the students.

There are several for-profit companies that each take in more than $1 billion a year in Federal aid and graduate less than 10 percent of their students. Think about that. They take in more than $1 billion in Federal taxpayer money and they graduate less than 10 percent of their students. These companies include the Apollo Group, DeVry, ITT, Kaplan, and Education Management Corporation.

Not only are the educational metrics awful, but many of these for-profit colleges are also under investigation for fraud and deception. Essentially, they have been lying to students and to State and Federal agencies to cover up how bad their record is. Even while prosecutors go after these schools for fraud, they remain accredited and continue to rake in Federal funds. Here are a few examples:

Education Management Corporation, EMC, faces charges of fraud and deception brought by prosecutors in 13 States and the Department of Justice and faces a lawsuit to recover $11 billion in Federal and State funds. Yet EMC is still accredited and still receives $1.25 billion from the U.S. DOE. So the Department of Justice is trying to recover $11 billion at the same time that the Department of Education gives them $1.25 billion.

ITT Educational Services is being investigated and sued by 19 States, the SEC, CFPB, and the DOJ. It is also under scrutiny from U.S. DOE for failure to meet financial responsibility standards. Yet they are still accredited, and last year they received just under $600 million.

Another 152 schools are under investigation by a working group of 37 State attorneys general. They too are still accredited. Collectively, they received $8 billion in Federal financial aid last year.

What do all of these schools have in common? They are accredited. Accreditation is the key to the castle for accessing this spigot of Federal financial aid. It is supposed to signify that a program provides a quality education for its students. Too often, however, the accreditation means nearly nothing.

The GAO released a study on accreditation last year, and its findings are shocking. Over a 4-year period, the GAO found that accreditors sanctioned only 8 percent of the institutions they oversee and revoked accreditation for just 1 percent. Even more troubling, GAO found there was no correlation between accreditor sanctions and educational quality. In other words, schools with bad student outcomes were no more likely to be sanctioned by their accreditor than schools with good student outcomes.

Our accreditation system is broken. According to the Higher Education Act, accreditation agencies are supposed to be ``reliable authorities as to the quality of education or training offered'' by institutions of higher education.

That is the reason for making accreditation a core criterion for receiving Federal funds. How are we following the law when accreditation reviews find that 99 percent--basically, everybody--99 percent of institutions are providing an education of value? How can we say with a straight face that accreditors are acting as reliable authorities on educational quality?

The problem here is money. Incentives are lined up against being critical and against setting high standards. The problem can be traced to the funding and governance of the accrediting agencies. First, accrediting agencies are funded by the same institutions they accredit. Colleges pay an initial fee to become accredited and annual dues after that. They pay for site visits and other services.

Second, accrediting agencies are run and overseen by the institutions they accredit. The member institutions elect their own academics and administrators to serve on the board of the accreditation agency.

It is not hard to see how the incentives are misaligned here. We have created a dysfunctional, if not corrupt, ecosystem in which it is far too easy to become and remain accredited. This system is eerily similar to the one that enabled credit rating agencies to pump out inflated asset ratings, which contributed to the worst financial crisis of our time. Like credit rating agencies, accreditors have a financial interest to churn out accreditations.

The DOE has the authority to improve accreditation. There are a lot of things that Senator Durbin and others, Senator Murphy, and I are working on in terms of changing the Higher Education Act and working in the appropriations context, but U.S. DOE has authority that it is beginning to use but needs to use more of in the accreditation space. It can and must do more to ensure that accreditors are actually looking at academic quality and holding schools to high standards. For the sake of students and taxpayers, the DOE must make this a top priority.

I thank the assistant Democratic leader for his leadership on this issue.

I yield the floor.

Mr. DURBIN. Mr. President, I hope the Senator from Hawaii can stay for just a moment.

If a student is about to graduate from high school, looking for a college, and goes online and types in the word ``college'' or ``university,'' watch what happens. The page is flooded. The University of Phoenix, DeVry, Kaplan--all of these different schools are flooding the page saying: Come to our school. How does a student know if it is good or not? The only yardstick that can be used is, well, do they receive Federal Pell grants for their students? Do their students receive Federal loans? The answer, when it comes to for-profit schools, is yes.

Senator Schatz has put his finger on the problem. They accredit themselves. They decide among themselves who will stay in business. Guess what. They all stay in business.

So the unsuspecting student goes to a worthless, for-profit school, gets a worthless diploma, goes deep in debt, and thinks, I thought this was a good school. How can I get a Federal Pell grant to this school and get a worthless diploma?

The Department of Education is not doing its job. Congress is not doing its job. We have to enforce these standards.

Corinthian was one of the giants. Corinthian went bankrupt. They measured how many students came out of Corinthian and got a job. The numbers were pretty encouraging. The Huffington Post writer started following the students that got the jobs. Do you know what Corinthian was doing? They were giving $2,000 to employers to hire their graduates for 1 month so they could report to the Federal Government that their graduates all have jobs. When they were caught with it, they went bankrupt.

Do my colleagues know what we ended up losing, what the Federal taxpayers lost? It could be billions. Who ended up on the hook? The students. The students ended up with the debt, and the taxpayers ended up as losers. Corinthian should never have been accredited.

Mr. SCHATZ. Mr. President, there are two problems here. Normally, when something is a waste of taxpayer money, it is not usually also harmful to individuals across the country, but this is a double whammy. This is harming students, causing them to collectively incur tens of billions of dollars' worth of debt, and it is a waste of money, so this really is a double whammy.

I will make this final point: The Obama administration has done the right thing in terms of going after malfeasance in this space, but they are split among their executive agencies. We have the Department of Justice who understands the fraud and deception. We even have parts of the U.S. DOE that understands what is going on, yet they have been slow on the uptake in terms of using the authority under the statute to make the accreditation process a little more reliable when it comes to students. I think that is one of the key things that we are going to be able to accomplish in the next couple of years. The U.S. DOE has to understand that there are separate accrediting agencies, but under the higher education statute, U.S. DOE has the authority to make sure that no institution that is providing a low-quality education and no institution that is engaging in fraud and deception ought to avail themselves of tens of billions of dollars in Federal financing.

Mr. DURBIN. I thank the Senator from Hawaii.

Last week, the senior Senator from Arizona came to the floor and said it was Durbin's speeches that brought down Corinthian. Correction: What brought down Corinthian was its own malfeasance. They were under investigation by 20 different attorneys general for fraud and deception. They were also under investigation by the Securities and Exchange Commission, the Department of Education, and the Department of Justice. It was their malfeasance that brought them down, as Senator Schatz has indicated. The victims: Students and taxpayers.

For purposes of this colloquy, I wish to yield to my colleague from Delaware, Senator Carper.

Mr. CARPER. Mr. President, I want to thank the Senator for inviting us to come to the floor this afternoon and have this conversation. It is great to be with our colleague from Hawaii as well.

Senator Durbin and I came to the House of Representatives together in 1982. I had been a State treasurer and before that I was a naval flight officer. I was a P-3 aircraft mission commander. I served three tours in Southeast Asia. In 1968, the P-3 four-engine aircrafts were on 12-hour surveillance flights tracking Soviet nuclear submarines all over the world. We flew a lot of missions off the coast of Vietnam and Cambodia, low-level missions tracking infiltration. That is what I did on three tours over there.

I came back from overseas after the last tour, 5 years, and moved from California where my station was home ported, where my squad was home ported during the war, and I ended up moving across the country. I found Delaware on the map, drove my Volkswagen across the country, and enrolled in business school.

I signed up with the GI Bill. I remember the first check I got was $250. I was thrilled. I used that money to help pay my expenses, and I signed up with a Reserve P-3 aircraft squadron up at the naval air station north of Philly and started flying the same aircraft and a new squadron. I did that for another 18 years and then retired as a Navy captain.

As Senator and as a Governor for 8 years and as commander in chief of the Delaware National Guard--they have a special spot in my heart. A couple of months ago, a delegation with the Governor were sending off the 300 men and women from the Delaware National Guard to eventually end up in Afghanistan. I suspect they are there by this time. I said to the men and women and their families as they were preparing to leave--I told them about my GI Bill and how grateful I was to have it for my generation. I talked to them about their GI Bill. I said: When you come home, if you have 3 years of service during your time in Afghanistan, here is what you are going to get. If you go to Delaware State University, University of Delaware, Delaware Tech Community College, you go for free--tuition, free; books, free; fees, tutoring, free. Plus you get a $1,500 a month housing allowance. People said: Wow. And I said: If the GI doesn't use it--the Delaware National Guardsman--if you guys don't use it when you come home, your spouse can use it. If your spouse doesn't use it, your dependent children can use it. It is the most incredible GI bill benefit ever. My generation, we got $250 a month. I am happy for the folks today who serve in Afghanistan and in Iraq for the benefit they receive.

It has not only been a great benefit for the veterans and their families, it puts in the words of--I think it is Polly Petraeus who works at the Consumer Financial Protection Bureau. Polly said that what the GI bill does is it also puts a silver bull's-eye on the veterans because they come back and what happens is a lot of colleges and universities and training schools want to help those GIs and their spouses and maybe their kids go to school. Some of them are for-profits and some of them are non-profits; some of them are public colleges and universities. Some of them do a great job. Some of the for-profits even do a great job. But some of them--and the Senator from Illinois has mentioned some of them here today--do not. They spend more money on trying to recruit people to come to their schools than they actually spend educating them. They are preparing them for careers, allegedly, for what there are no jobs. Senator Durbin mentioned what Corinthian has done to place people in work opportunities for a month or so just so it will look like people are being gainfully employed.

There is a lot of money to be made by these for-profit colleges and universities, and for the ones that aren't the white hats but the black hats, what is happening to the GIs and, frankly, to taxpayers is shameful. It is just shameful.

I want to say around maybe 1992, maybe the early 1990s, maybe on this floor, the Senate debated whether or not there should be some way to harness market forces to ensure that--whether it is people using Pell grants or other Federal aid programs, or maybe the GI bill--they could somehow harness market forces to ensure that taxpayer money going to people going to college was being well used. Initially, when the Congress adopted something called the 85-15 rule, the idea was that for at least 15 percent of the students in the school, if they were receiving Federal assistance, 85 percent of those students would have to be coming on nonFederal money. That seemed to make sense, so for a while, that worked pretty well.

Then the rule was changed to the 90-10 rule so that at least 10 percent of the revenues had to come from nonFederal sources. The idea was to use market forces to ensure that the quality of the diploma was actually worthwhile at the school.

Then, we had this new GI bill. We have spent, I think--and the Senator from Illinois probably knows better than me, but I think we have spent today close to $50 billion on the Iraq-Afghanistan GI bill, close to $50 billion. It probably dwarfs whatever we spent for folks coming back from the Vietnam war.

Some of the smart for-profit colleges figured out a loophole, though, and what they figured out is the law, when it was first adopted, didn't really focus on the GI bill because it wasn't all that robust, and the 90-10 rule--85-15 and 90-10--focused on things that did not include the GI bill. So when veterans go to college and the GI bill helped to pay for their tuition, or for that of their spouses or their children, that does not count toward the 90 percent.

So as a result, what we have is a loophole that allows a college or university, a private college or university, to realize as much as 100 percent of their revenues from the Federal Government--100 percent. There is nothing about market forces; 10 percent, 15 percent of your students have to come by nonFederal means. All of them are there on the Federal Government's dole.

Among the people who pushed for the 85-15 rule, I think, were Bob Dole and Phil Gramm, and they said a long time ago that we ought to have something like the 90-10 rule. A couple of years before that, the guy that Senator Durbin will remember named William Bennet--remember him, the Secretary of Education--here is what he called for-profit trade schools. Here is what he called them in 1987. He said:

Diploma mills, designed to trick the poor and to take on Federally-backed debt, milk them for their loan money and then wash them out or graduate them, ill-prepared to enter the job market and pay off their loans.

That is what he called them. As I said earlier, there are some for-profits that do a good job, but there are a bunch that don't. That was the case in 1987 and, unfortunately, it is the case today.

I just want to say we--you have, I have, Tom Harkin in past years--have continuously drawn this to the attention of our colleagues and anybody who wants to listen this issue. This needs to be fixed. It needs to be fixed.

I thank Senator Durbin for working so hard and letting me help him a little bit on this stuff. I think we are starting to break through.

Some of the folks who are the worst actors in this business are starting to fold, and that is a good thing.

Mr. DURBIN. I want to thank Senator Carper.

Let me show the Senator briefly what has happened to the enrollment of for-profit colleges and universities as people have come to realize they are wasting their time, and many times their GI bill benefits, debt, and ending up with a diploma that doesn't take them anywhere.

Look at the University of Phoenix--this is the mother ship that launched this industry--peak enrollment was nearly 500,000 in 2010. Now it is 227,000, a nearly 50-percent loss.

ITT, which advertises constantly, had enrollment in 2010 of 88,000, and now they are down to 53,000. Career Education Corporation enrolled 41,000 students in 2014 compared to 118,000 in 2010--a 65-percent decrease. Education Management Corporation is down 25 percent. DeVry has declined in enrollment. What is happening here?

I talked to some of the people from some of these for-profit colleges. Parents and families are finally realizing that this is a waste of time and money. It is time for taxpayers to realize the same thing. I overhear my colleagues--conservative colleagues--preaching to me about the miracle of free markets. We are talking about the most heavily subsidized industry in America, accounting for over 40 percent of the student loan defaults with 10 percent of the students enrolled.

I thank the Senator from Delaware for coming, and I yield to the Senator from Massachusetts, Ms. Warren.

Ms. WARREN. I thank the Presiding Officer and thank Senator Durbin for calling us together to discuss this important issue.

Our higher education system is broken. Right now a student borrows money to go to college, and the college gets paid in full regardless of whether the college provides a decent education. In fact, Federal loan money is so easy to come by that a new business model of for-profit colleges has sprung up, spending more money on advertising to attract students than actually teaching them anything.

Consider three numbers--10, 20, 40. Just over 10 percent of all college students attend a for-profit college. Yet they take in about 20 percent of all Federal student aid and they account for about 40 percent of all student loan defaults. Many for-profit colleges target young vets and single moms for programs that promise the Moon but end up delivering nothing more than heartache.

I have met with student veterans at terrific public colleges and universities across Massachusetts, such as UMass Lowell and Bunker Hill Community College. These schools are working hard to reach vets and to help them get a first-rate education through their Office of Veterans Service and other resources. It is an exciting story, but time after time the for-profit colleges got there first, so young vets show up already tens of thousands of dollars in debt and without a single credit that will transfer to a decent public college. This makes me sick. These for-profit schools are stealing more than money. They are stealing the hard work and dreams of some of our finest young people.

There are 347 colleges in the United States in which the majority of the students have defaulted or failed to begin paying down their loans. Of these colleges, 85 percent are for-profit. Even with those huge default rates keep raking in the Federal loan dollars and paying out millions of dollars in dividends to their shareholders. These 294 for-profits are sucking down $2.2 billion in Federal assistance and leaving the majority of their students unable to repay their loans.

The business model of for-profit colleges challenges the conventional wisdom that a college degree is always a smart investment. A recent study found that the average salary increase of for-profit graduates isn't even enough to cover the costs of attending a typical for-profit institution. The research is clear: attendance at a typical for-profit college is simply not worth the cost. It is a bad return on investment.

For-profit colleges know this, but too often the potential students don't. Instead of taking the tough steps necessary to improve the value of the education they offer, most of these for-profit institutions have simply ramped up their marketing operations--and some just flatout break the law--to keep the gravy train going. These colleges have engaged in fraud in order to swindle more and more students and suck down more and more Federal funds.

Corinthian College is a prime example. At its peak, Corinthian was the Nation's largest for-profit chain, with 120 campuses enrolling over 100,000 students. It was massive. Corinthian built its business model to scoop up Federal financial aid by any means necessary--including fraud. Corinthian was trying to rope students in by using false and misleading information and then saddling them with debt that would be impossible to repay.

Federal policymakers had concerns about Corinthian's conduct for years and had the tools to shut off the Federal loan supply, but instead of acting, the Department of Education allowed Corinthian to keep recruiting more and more students and sucking down more and more Federal funds. When Corinthian's dangerous mix of mismanagement and deception finally blew up, the Department of Education even stepped in to bail out the college and keep it running a little while longer. Now Corinthian is bankrupt and its students are scrambling to start over.

Last week--due to a lawsuit brought by the Consumer Financial Protection Bureau--a Federal judge ruled Corinthian broke Federal consumer protection laws and ordered the company to pay $531 million for its illegal behavior, but Corinthian is dead broke, and its executives are off the hook for the financial liability. Plus students and taxpayers are left holding the bag.

Corinthian got people to sign up for student loans by scamming them. If an insurance salesman or a car dealer did that, the buyer wouldn't have to pay. The law is just as clear here, when a school breaks the law, students are entitled to cancel their student loans. That is why this week several of my Democratic colleagues are sending a letter to the Department of Education telling them they have dragged their feet long enough. These students don't owe the student loans that Corinthian tricked them into signing.

Schools like Corinthian make it clear that the Federal Government needs to be more aggressive and more willing to cut off the money faster when schools defraud students. When schools such as Corinthian break the law, their executives shouldn't be allowed to walk away from the mess. They should pay real penalties.

This is about basic fairness. Neither students nor taxpayers should be on the hook to a for-profit college that makes its money by cheating its students. It is time for the Federal Government to step up and do its job to hold for-profit colleges accountable and to ensure that higher education remains a real pathway to success for all hard-working students.

Thank you, Mr. President.

I yield the floor back to Senator Durbin.

Mr. DURBIN. I thank Senator Warren, and before we recognize the Senator from Connecticut, I would like to make a point about executive compensation, which is something we should not overlook.

We take a look at the actual amount of money that is being paid to executives of these for-profit colleges and universities. It is dramatically larger than what is being paid to presidents of public universities. I will put this information in the Record at a later point.

The average pay for college presidents is less than $500,000 a year. There is an executive at the University of Phoenix who was paid over $8 million in 1 year. When we wrote to the Department of Justice recently, we asked how many of these people are going to be held personally accountable. They left the students holding the bag with student loans and worthless diplomas or dropouts. They left the taxpayers holding the bag because the students can't pay back their loans, and now they are going to go away scot-free after taking billions of Federal dollars? If there is any justice, they need to be held accountable.

I yield to my colleague Senator Murphy.

Mr. MURPHY. I thank Senator Durbin very much.

This article is a few years old, but it underscores his point. Here is the opening line of an article from CNBC on this question of salaries for the CEOs of for-profit universities. The article opens by saying: ``Forget Wall Street and Silicon Valley. If you're looking to rake it in post-graduation, set your sights on the executive floor at one of the nation's for-profit colleges.''

That is an article from CNBC detailing the fact that in their article--again this is a few years old--the salary of the head of Phoenix University was $11 million, and the CEO of Bridgepoint, another national for-profit university, was making over $20 million a year.

You can say to yourself: These are private, for-profit companies. Why should Congress be in the business of caring what the CEO of Phoenix University makes or what the CEO of Bridgepoint or ITT or DeVry makes?

Harry Truman made his name as a critic of wartime profiteering. LBJ made his name as a young Member of Congress doing the same. Their idea was that it is all well and good to make yourself rich in the most dynamic capitalist economy in the world, but it is another thing to be getting rich off the taxpayers. It is another thing to be making your fortune almost exclusively coming from sources of money that really is all of our constituents' money in the form of the taxes they pay.

That is what we are talking about today. What we are talking about are executives who are getting rich off of companies that are 90 percent funded by the U.S. taxpayer because this 90-10 rule we talked about is an important rule for these companies. They run their revenue right up to the limit. So for many of these for-profit universities, their revenue is 70, 80, 90 percent from the taxpayers of the United States, and their CEOs are making $11 million, $12 million, sometimes $20 million a year.

Listen, I am all for people making a million dollars. I have a lot of people in Connecticut who are making $20 million, but if we are being good stewards of the taxpayers' dollars, we should be wary of those who are making their fortune off of the Federal dole. That is what is happening today.

Senator Durbin, I just wanted to add in this conversation a note of accountability. That is one of the things that used to unite Republicans and Democrats. Frankly, the Republicans, I admit, cared more about accountability in Federal dollars than sometimes the Democrats did. It was the Republicans in the second Bush administration who started attaching strings to education dollars that were flowing out of Washington to make sure there was actually quality attached to the money that was coming from U.S. Federal taxpayers, but that era seems to be over.

Unfortunately, we don't have a bipartisan consensus on accountability. We are about to approve a budget that a lot of Republicans and a lot of Democrats will vote for that will send $140 billion in higher education aid to universities all across this country. It will come with almost no strings attached. It will come with almost no expectations that schools give a degree to kids that will actually get them a job or attempt to keep them in school so they can get some return on investment for the money we are all paying to them.

Senator, you might have talked about it already today, but the numbers of for-profit colleges that just came out today are absolutely stunning. I don't know if you talked about the ``Trends in Student Aid'' report that just came out today from the College Board.

Here is an amazing statistic. What this survey says is that borrowers who don't graduate from public and private nonprofit 4-year schools default at about the same rate as borrowers who do graduate from for-profit schools. Think about that. You are just as likely to not be able to pay back your student loan if you get a degree from a for-profit school as if you had dropped out of a not-for-profit school.

Here are the numbers: 14 percent of for-profit graduates default; 15 percent of not-for-profit 4-year college nongraduates default. That is a really stunning number. Yet we are just sending money willy-nilly out to these schools that are not putting students in degrees. Why are they not putting students in degrees? Because they are marketing themselves in a way that just does not square with the job market today.

As part of one of these attorney general lawsuits--there is a litany of stories about the abusive marketing techniques of these for-profit universities.

One of them said: I told the enrollment representative that I did not want to sign the loan unless I was guaranteed a job because I knew that I would not be able to pay it back. She told me that the school placed 99 percent of the students and they could guarantee a job after I finished my externship. She told me that I would be making between $18 and $20 an hour after completing the program. No worries about the loan. She told me career services could place me in a job and that she makes sure everybody who enrolls gets placed.

These are the claims that are being made. So it is frankly not surprising, when you have these for-profit universities enrolling thousands of kids in video game design degrees, that you are just as likely to default on a loan if you graduate from some of those worthless programs as if you don't graduate from a not-for-profit university.

So last Congress, Senator Schatz and I, joined by Senator Murray and Senator Sanders, introduced a piece of legislation that would start to require some real outcomes from universities. We applied it to for-profit and not-for-profit universities. We said: You have to show that you are giving kids a chance to succeed and get a job, that you are keeping your tuition at reasonable levels. If you do that, then you can continue to get title IV dollars.

But if they don't, we are not going to continue to send money to these schools that simply are not producing graduates who are ready to compete or that are deceptively drawing students in based on claims that just do not wash out in the end.

So, yes, we have to shut down these fraudulent institutions like Corinthian. But we could just make a decision, Republicans and Democrats, to put some additional accountability standards on title IV dollars, apply it to for-profit and not-for-profit schools, and say: If you have a certain number of students who are defaulting, you are not going to continue to get title IV dollars. If you have a rate of tuition increase that is way above that of the national average, you are not going to continue to get title IV dollars.

We know by statistics that this would put a good number of for-profits out of business. It might even touch a handful of the lower performing not-for-profits. But it should be something on which both sides can come together, just some basic accountability for higher education, a basic accountability for the $140 billion we send, because this does not make sense. It does not make sense to pad the pockets of these CEOs who are making $20 million a year off of our taxpayers when they are not delivering results that are actually making our economy better.

Thank you, Senator Durbin, for bringing us together here. I hope that as we debate the Higher Education Reauthorization Act in front of the HELP Committee--I think Senator Alexander is very interested in some of these debates. So we are going to add some accountability standards. We are talking about these for-profits, but if we really are being good stewards of the taxpayer dollars, we should expect some results.
Mr. DURBIN. I thank Senator Murphy for his comments.

I will tell you that it is interesting to me that when you take a look at what Wall Street thinks about the for-profit colleges and universities, they are certainly bearish. You would think from what Congress is doing--sending billions of dollars to this industry and propping it up--we are bullish. Take a look at the stock prices of the major for-profit colleges and universities since 2010. The University of Phoenix went from a high of $57 a share down to $7.50. This was after the Department of Defense suspended their activities under the GI bill. ITT Tech--a high of $92 a share in 2011 and they now trade at $3 a share. Career Education was $20 a share in 2011 and was $3.80 yesterday. Education Management Corporation withdrew their stock from NASDAQ so they would not have to make reports to the Securities and Exchange Commission. In 2014, they lost $684 million. This is an industry which is failing as a business, but sadly it is dragging along students and families and taxpayers with it. That is why we have to come to grips.

I endorse your idea. Apply the standards across higher education, to for-profit and not-for-profit. I can tell you, these for-profits cannot live with that standard. Thank you, Senator Murphy.

I thank Senator Blumenthal from Connecticut for joining me.

Mr. BLUMENTHAL. Mr. President, I thank my great colleague from Illinois and my friend and partner from Connecticut for their very powerful analysis, along with Senator Warren and Senator Carper, because there really is a need for dispassionate, objective, and targeted consideration of this area of education.

The Senator from Connecticut is absolutely right that we need accountability in both the for-profit and nonprofit areas. Senator Durbin has emphasized that fact repeatedly. I am here as a former member of the Health, Education, Labor, and Pension Committee who participated with Senator Harkin in announcing a report more than 2 years ago that highlighted many of the abuses in this area. Still, Corinthian has happened since then. There are still abuses in the for-profit area. But there is a need for accountability in the nonprofit area as well.

In all of these areas, there is a need for facts. There are more facts that may be available more recently that ought to be considered, indications that some of the for-profit colleges are doing a better job than others. Kaplan, for example, has recently released facts. None of us can vouch for them independently. The Department of Education has an obligation to do better and more to make sure it keeps faith with American students and American taxpayers in the way dollars are allocated to those for-profits.

I am particularly concerned, as the ranking member of the Veterans' Affairs Committee, with the impact of some of these abusive practices on veterans. One of the really unacceptable facts about this industry is the way it can sometimes exploit and take advantage of our veterans. Senator Carper put it very well when he discussed how the for-profit schools are prohibited from receiving more than 90 percent of their total revenue from Federal student aid, but VA educational benefits are not counted toward that 90 percent. This 90/10 loophole causes the for-profits to target veterans and to rake in billions of dollars in VA educational benefits. In fiscal year 2014, the for-profit schools received over $2 billion in VA educational benefits--that is our money, taxpayer funds--including post-9/11 GI benefits.

As ranking member of the Senate Veterans' Affairs Committee, I am working to help protect our Nation's veterans and the GI bill benefits they have earned. In fact, I have introduced legislation--the Career-Ready Student Veterans Act--to ensure that GI bill funding is not squandered on education programs that lack appropriate programmatic accreditation.

Facts are stubborn things, as Ronald Reagan famously said. Facts are what we need. Accreditation and verification and credibility in this area is essential rather than painting with a broad brush every for-profit, rather than tarring all of them. Facts are necessary here, and there is a need for accreditation and for facts that show credibility and legitimate course work.

I will be introducing another bill this week to provide relief to veteran students who have been harmed by for-profit schools. I want to repeat that point. These veterans have been harmed directly and tragically by some of these practices. We owe them better. We need to keep faith with them. That is the reason I am going to be introducing the Veterans Education Relief and Reinstatement Act. That will give the VA Secretary authority to reinstate GI bill entitlements that a veteran has used at a school that abruptly closed--think Corinthian--where veterans have lost those benefits and they need a remedy, not just a right but a remedy.

I am hopeful that we can advance these bills through the Veterans' Affairs Committee and stop for-profit colleges like Corinthian from scamming our Nation's veterans. Like my colleagues, I could cite real-life instances of nonveterans as well. But the evidence is overwhelming, and it is acknowledged by some in the industry who say there is a need for corrective measures here, and some of the outliers need to be treated with the strong discipline and discouragement they merit.

I am proud to join my colleagues in this effort. I am hopeful that the report Senator Harkin and the HELP Committee produced years ago will finally reach fruition and that action will be taken by the Department of Education and by this Senate to take measures that protect taxpayer dollars, protect students of America, and protect our veterans.

Mr. DURBIN. I thank my colleague from Connecticut, Senator Blumenthal, for joining in this colloquy this afternoon.

What we have tried to do with a number of Senators is to lay out the case that when we go to higher education reauthorization, we owe the taxpayers and we owe families across America the responsibility to look at this industry. What is happening here in inexcusable and unacceptable. It is unfair. Ten percent of the high school graduates, 20 percent of the Federal aid education, 40 percent of all student loan defaults.

Senator Murphy pointed to the statistics that came out today. You are in just as bad shape with a diploma from a for-profit school as if you drop out of school at a not-for-profit school. That is a damning statistic, just like the 40 percent in student loan defaults.

We cannot continue to look the other way. Wall Street is not looking the other way; they are downgrading these for-profit colleges and universities because they believe this model is flawed. They don't believe it can be sustained. Why do we kid ourselves? Let's apply standards across higher education--standards that are fair to students, fair to families, and fair to the schools--and say to them: This is what we expect as a minimum if you are going to offer higher education to the students across America.

I ask unanimous consent that this transcript from Sharyl Attkisson's television program ``Full Measure'' which played last Sunday be printed in the Record.

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