ITT Tech: Student Loan Collapse
From Former Glory Years to Student Loan Collapse
ITT Tech was once a well-respected technical training school that orignated in 1969. The headquaters was in Carmel, Indiana. By the 1980’s and 1990’s, ITT Technical Institute was synonomous with high-quality, no-nonsense education. Both young students right out of high school and older adult students would flock to ITT tech to learn the “skills of tomorrow” today (or at least according to it’s former exciting commericials).
Countless graduates of ITT Tech of older generations have successfully enjoyed entire careers based on their educational start at ITT Tech. The question immediately comes – what happened? How did this “for-profit” training school decline into a lawsuit-ridden mess that eventually closed all of its operations?
STUDENT LOAN COLLAPSE
ITT Tech found itself in the midst of the student loan system collapse. Many “for-profit” schools are now falling into this mess. Apparanetly, “for-profit” schools were once a feasible, even admirable pursuit. Then, student loan federal funding came. Once student loan and federal funding became the “norm,” many for-profit schools descended into a frenzy of bad business and recruitment activities. They had to deal with this new reality of “for-profit” schooling. It all became about student loan salesmanship.
How did the school decline? How did the school generate numerous worthless education programs that would never actually benefit the students? Part of this answer was marketing and salesmanship. The school was not marketing any more to student who would actually pay for their education. They instead marketed to students who did not understand the magnitude of student loans or federal aid that they were getting from the government. You get more creative (to say it nicely) in your marketing and program focus when you are selling something with “funny money” instead of cold, hard cash.
TIME IS SHORT: REMOVE STUDENT LOAN SPECIAL STATUS IN BANKRUPTCY
Many public schools have also followed suit. The damage to public higher educational institutions cannot be measured. Now is a crucial time because many public institutions have long followed the same road as the for-profit schools. Although many politicians are calling for elaborate fixes to the student loans system, the best option would be simple. The solution is to treat student loans the same as all other loans in bankruptcy. Currently student loans cannot be discharged in bankruptcy. Allowing student loans to be discharged in bankruptcy will “pull the plug” on the funny money of student loans. It will protect future generations from a bad educational system that saddles them with lifetime debt. It will also prevent a magnitude of previously respectable schools like ITT Tech from being brought into ruin.
