Starting Wednesday, the National Advisory Committee on Institutional Quality and Integrity, an oversight body, will meet to determine whether a major college accreditor will lose recognition as a gatekeeper of federal student aid dollars.
The Accrediting Council for Independent Colleges and Schools (ACICS) is on the committee's hit list after allowing taxpayer money to go to several floundering institutions of higher education, including ITT Educational Services and the now-bankrupt Corinthian Colleges.
These high-profile failures on ACICS' part have made national headlines, and everyone from the Department of Education to the attorneys general of 13 states wants the accreditor's head. But the federal government should not simply shut ACICS down and declare victory. The problems with government involvement in higher education run much deeper than a single accreditor.
According to my analysis of Department of Education data, ACICS-approved schools have worse outcomes on average than all other major accreditors. But every single major accreditor has approved a significant number of poor-quality schools. Of the bottom tier of colleges — those with exceptionally poor student outcomes along four different dimensions — over 60 percent received accreditation from a body other than ACICS.
That ACICS has been a poor steward of taxpayer money is without question. But to revoke its recognition while failing to address problems in the rest of the system does a great disservice to students and taxpayers.
The problem is that when accreditors authorize a poor-quality school, they pay little to no price for being wrong. Only after several high-profile failures involving fraud and bankruptcy was ACICS brought to the chopping block.
Institutions that fail their students in a legal, financially sound manner rarely receive sanctions from accreditors. Over five years, accreditors revoked their approval of less than 1 percent of colleges.
On the other hand, some institutions sue their accreditors when terminated. When faced with whether to continue recognizing a poor-quality college, accreditors face two options: terminate it and face a potential lawsuit, or do nothing and face little accountability. Is it any surprise that so many accreditors opt for the latter? While accreditors are nominally private entities, they do not have several of the characteristics that make the private sector so efficient. In order to sort out the good colleges from the bad, true private-sector involvement is necessary.
But under the current system, over 90 percent of new student loans are originated by the federal government. Many colleges get a majority of their revenues from taxpayer-funded aid programs.
Policymakers should strive to bring this number down. Private lenders, as opposed to the government, have a powerful incentive to weed out poor-quality colleges — if students do not graduate or cannot find well-paying jobs, the lenders will have to take losses.
Accreditors face no financial accountability when they allow bad institutions to use federal student aid. Instead, taxpayers are the ones who lose money.
Public outrage toward ACICS presents a chance to reform accreditation and federal student aid more generally. However, if the Department of Education revokes ACICS' recognition and stops there, it will squander the opportunity. For the good of students and taxpayers, accreditation's failures beyond the ACICS debacle must not go unnoticed.
This article originally appeared on the Washington Examiner.
Preston Cooper is a policy analyst at the Manhattan Institute. You can follow him on Twitter here.
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