Marketplace - American Public Media
Just days away from midterm elections, depending on where you live, you might be getting bombarded by political ads on TV and radio. Meet one of the people behind the curtain.
Jeff Trueman runs a company called High Gravity Sounds. He works with producers and post production houses to create custom sound design. This time of year, he's busy producing music for campaign ads.
Listen to the full story in the audio player above.
It used to be that if you really wanted to scare economists and the public, you need only mention one terrifying word: inflation. But really, inflation is a lot like candy. A little bit here and there makes your life so much better, and — as millions of kids are bound to find out this weekend — too much leads to ruin.
One of the goals of Quantitative Easings I through III was to stimulate inflation up to a point; 2 percent was the Federal Reserve's stated goal. And even though inflation never quite reached that target, QE is ending.
Now Japan is picking up the torch. For decades, the once booming economic powerhouse has been suffering from stagnation, or to put it another way, a lack of inflation.
“Japan wants inflation,” says economist Justin Wolfers. “Last night they announced that they were going to buy even more bonds because they aren’t getting as much inflation as they wanted.”
So why do Japan, the U.S. and Europe want to stimulate inflation? Because inflation, in the right amount, is a sign of economic growth. In a healthy economy, wages increase steadily. In turn, businesses raise prices and that leads to inflation.
At the moment, wages in the U.S. and Japan are down when adjusted for inflation and lots of people are still looking for work. “Those of us that have jobs probably don’t feel comfortable asking for a raise, and all those people looking for work are willing to accept work at fairly low wages,” says Wolfers. “So all of that puts downward pressure on wages.”
Typically the first thing a government can do to boost the economy, cut unemployment and raise inflation is lower interest rates. But, says economist Josh Bivens, “the short term interest rates that the Fed controls directly, have been stuck at zero since about 2008 and interest rates can’t go below zero.”
Which is why the Federal Reserve and now Japan have turned to the more unconventional tool, buying trillions of dollars in bonds.
But these tools don’t get used in a political vacuum. People disagree about how much stimulus to inject into the economy. That makes finding the right amount of stimulus harder than getting a kid to sit still after eating a bag of candy.
It's Halloween, and at "Marketplace" we're getting in the spirit. Marketplace Morning Report Producer Katie Long has been working on her costume:October 31, 2014
There are plenty of stories to read and numbers to watch today — Japan's stimulus, the ongoing legal drama surrounding Ebola quarantines, the impending midterm elections — but since it's a holiday and a Friday, we're going to stick to only the spookiest numbers today.
To get us started, Quartz is featuring the ten scariest economic charts out there. From European unemployment to student debt, keep repeating to yourself "it's only a chart, it's only a chart..."
Here are some other spine-chilling stories we're reading today.2
That's how many people have died from accidentally eating THC-infused edibles since Colorado legalized medical marijuana use. Denver police have put out a PSA warning parents about the varieties of edibles that look like typical Halloween candy, the New York Times reported. There haven't been any reported cases of people passing out edibles, and some Marijuana advocates say the claims are alarmist. Others are pushing for tighter regulation of the treats.
One of the best trick-or-treating neighborhoods in the nation — Noe Valley, San Francisco — according to a study by Zillow. In last week's "Dear Prudence" column over at Slate, Prudie ripped into a self-professed one-percenter for griping about children from outside the area coming over to trick-or-treat. It's a well-known phenomenon, also explored in a Washington Post column Thursday. The conclusion: don't spend Halloween dressed up like Scrooge.
The price of Starbuck's "secret" Halloween treat, a "Franken Frappuccino." The unholy concoction is a green tea Frappuccino with three pumps of white mocha sauce, three pumps of peppermint syrup and mocha java chips, the LA Times reports. [Shudder]
Like a Halloween ghoul jumping out of nowhere with a pile of candy, Japan's central bank today announced its radically increasing its economic stimulus program. It's an effort to stop deflation and to counter act a hike in the sales tax that depressed consumers in Japan. Up went Japan's Nikkei stock index by 4 point eight percent—That's the like the Dow jumping 825 points. And there were other consequences. More on that. Plus, the two biggest cinema chains in the U.S. reported dismal summer profits this week, even though summer is supposed to be prime movie-going season. We look into the flailing movie theater industry. Plus, we've been calling our sources to see what might next Tuesday's mid-term elections mean for the economy, jobs and businesses.
Exxon Mobil and Chevron report earnings on Friday, and life for Big Oil has been neither light nor sweet lately. Crude prices are at near four-year lows, and that’s not even the whole story.
Even before oil fell below $100 a barrel this fall, big companies were cutting investments and unloading assets. The business is getting more expensive as oil gets harder to find.
“No cheaper, no easier, as the oil company CEOs like to say,” says Steven Kopits of the consultancy Princeton Energy Advisors. “Where they go in deep water, for example, is smaller fields and deeper and more challenging wells. So costs have tended to rise over a period of time.”
It’s true: shale oil from fracking is getting cheaper to produce. But big companies rely on big fields. And now, oil sells for just $85 a barrel. Several majors saw profits fall a third over last year.
The good news: many of them also refine oil. And that’s profitable.
“Companies that have refineries are going to get a boost from refining margins, which is going to offset their upstream losses to a certain extent,” says analyst Amrita Sen of the London research firm Energy Aspects.
Still, low prices mostly hurt companies. And crude could stay south of $100 a barrel for awhile.
The two biggest cinema chains in the U.S. reported dismal summer earnings, not surprisingly, on the heels of a lackluster summer for films.
Revenue was down for films from $4.85 billion in summer 2013 to $4.05 billion this summer, and consequently Regal and AMC announced drops in earnings of 15 and 9 percent respectively.
That’s problematic because summer is when studios work to lure lots of eyeballs with big blockbusters.
"July was really the killer,” says Keith Simanton, managing editor of IMDB which keeps track of box office numbers through its website BoxOfficeMojo.com.
Year over year, July 2014 was down 38.5 percent. Last time it was down that much was in 1995, when "Waterworld" was the big July premiere.
“A number of films did reasonably well,” Simanton says, "but were not the gigantic smashes that was hoped or supposed.”
“Hercules," for example, brought in $99 million domestically and had a production budget that Box Office Mojo estimates at $85 million.
With the bad summer box office news, Regal Entertainment Group, which is the nation’s largest cinema chain, said it’s considering selling itself.
"It’s about the last thing I expected to hear in my lifetime,” says Barton Crockett, a media equity analyst with FBR Capital Markets.
Crockett says Regal might actually be in a position of strength at the moment, because this past summer wasn’t as much a trend as a part of a larger cycle. For one thing, there are high expectations about the slate of movies scheduled for release in 2015.
“It’s kind of smart at one level to think about selling into what seems to be a lot of investor enthusiasm about a strong 2015,” Crockett says.
That enthusiasm includes high hopes for the two films the comic book powerhouse Marvel plans to release next year: “Avengers: Age of Ultron” and “Ant-Man.” Both films are slated for summer 2015.
It's time for Silicon Tally! How well have you kept up with the week in tech news?
The dining hall at Washington College, a small liberal arts school in Chestertown, Maryland, looks more like a high-end food court.
At “The Kitchen,” the lunch menu includes garlic rosemary pork loin, vegetarian stuffed bell peppers, and lemon-glazed turkey with vegetables. At other stations, students can pick up shrimp bisque in bread bowls or gluten-free pizza. Environmentally conscious diners can mix their own smoothies with a bicycle-powered blender.
And if they still don't see something they want to eat?
“You can go up to an associate and tell them what you want, and they’ll make it for you,” says Joe Holt, chief of staff at the college.
All this choice, of course, has a price. Room and board is rising about 6 percent a year at the college, twice as fast as tuition.
Five years ago, Washington College spent almost $24 million to renovate its outdated cafeteria and hired a company called Chartwells to manage it.
Holt says what they do costs more “than the old system where you got the gallon can of corn and you cranked it open and put it in a serving dish, and that was your meal.”
Washington College couldn’t afford not to upgrade, says Holt. The competition for students is fierce, and the amenities arms race is part of what’s driven the price of room and board up 50 percent at private colleges over the last 25 years (after adjusting for inflation), according to the College Board. At public universities, it’s up 67 percent.
Students—and their parents—have higher standards than they used to, says David Bergeron, vice president of postsecondary education policy at the Center for American Progress and a former official in the U.S. Department of Education.
“We’re expecting college students to be exposed to healthier eating options, more fruits and vegetables, better quality food,” he says.
That’s just the “board” side of the equation. Students also want single rooms and private bathrooms, and colleges are building luxury dorms to accommodate them.
But if today’s students are pickier, they don’t necessarily own up to it. Washington College students Michelle Coleman and Leon Newkirk say the dining hall didn’t really figure when they shopped for colleges.
“I’m not a picky eater,” Coleman says. “I’ve always just eaten what’s given to me.”
“Same here,” says Newkirk.
Still, as they load their plates with pierogi in wild mushroom sauce and grilled chicken, both say they like the food and are willing to pay more for it.
In an interview with Marketplace's Kai Ryssdal, Secretary of Education Arne Duncan said new rules targeting vocational college programs that leave students with too much debt and too few job prospects were designed with "outcomes, not inputs" in mind.
"The worst-case scenario is when you go to college, accumulate debt, and then don't graduate," Duncan said.
When asked if he thought everyone should go to college, Duncan said he believed everyone needed additional education beyond high school: "If young people drop out of high school today, they are basically condemned to poverty and social failure. There are no good jobs out there... the economy has changed."
Duncan said the so-called "gainful employment rules" target middling-to-failing vocational education programs–most of which are offered by for-profit universities and community colleges–in order to provide meaningful post-secondary education across economic classes.
The final draft of the rules released on Thursday relaxed some earlier provisions, drawing criticism from some education groups and for-profit education providers, who say their programs may be the only option for thousands of low-income students. Duncan said no programs will be shut down without "time to improve."
"We invest $22 billion each year in these programs," Duncan said referring to the federal financial aid that pays tuition for most students in for-profit programs. "We want to see strong programs grow, and expand and serve more students. And we want to see programs that aren't doing a good job either improve or cease to exist... Shutting them down is not our goal, but we will have that ability. It's when training is leading to jobs that don't exist, or where debt is unmanageable... that's what we're pushing back against."
The debt-load requirements in the new rules target only vocational training programs and schools. Duncan says the Obama administration has expanded investment in Pell Grants, pushed for broader state-led initiatives and encouraged universities themselves to fight higher tuition overall. He - along with his boss - has also discussed a "more transparent" rating system, which, as one education official told the New York Times, should be a straightforward process, "like rating a blender."
"I don't know whether that's the right analogy or not, but let me say this: We as taxpayers... we invest $150 billion in grants and loans each year to make grants and loans accessible. That's the right thing to do, if we are focused on outcomes.
You can listen to the interview on this evening's Marketplace, or on the audio player at the top of the page.
In a classic "good news, bad news, good news" situation, the San Francisco Giants won the 2014 World Series, and pitcher Madison Bumgarner won the MVP award.
His prize was a 2015 Chevy Colorado truck, which was recalled a couple of weeks ago by GM for faulty airbags. GM caught most of them before they left the assembly plant.
So good news: Bumgarner is going to be fine.
Apple CEO Tim Cook became on Thursday the first Fortune 500 CEO to be out, in public, as gay.
"I'm proud to be gay," he wrote in a Bloomberg Businessweek op-ed, "and I consider being gay one of the greatest gifts God has given me."
"Part of social progress is understanding that a person is not defined only by one’s sexuality, race, or gender,” he continued.
But while we can see signs of that progress all around us, there's still a long way to go — especially when it comes to the C-suites of companies like Apple.
Tim Cook is, after all, a white man — like more than 90 percent of Fortune 500 CEOs and less than 35 percent of all Americans.
"It does not reflect at all the population," says Vanessa Cárdenas, who focuses on changing demographics at the liberal-leaning Center for American Progress.
By 2050, according to her projections, the majority of Americans will be people of color and the majority of the workforce will be women. Why don't we see that diversity among our corporate leadership?
"We’d all like to know that answer," says Donna Dabney, executive director of the Governance Center at the Conference Board. "I think we need to focus on what happens at the middle level: the middle management level."
Dabney says women make up 40 percent of the workforce, but only 15 percent of C-suite executives. One problem: "Men tend to get sponsored, and women get mentored," Dabney says.
Advice is nice, but having someone actively advocate for you is more critical for advancement.
Another problem is just getting on the ladder in the first place.
"We know that Fortune 500 companies often target their recruiting at elite colleges," says Alexandria Walton Radford, who directs the Transition to College program at RTI International. "And because we know that lower-income students are underrepresented at elite colleges as are Hispanic and African-American students, that just affects this pipeline."
The overriding theme is that altering the diversity picture requires stepping outside your comfort zone.
"What really plays into this whole equation, and why I think we have such a huge gap, is because of unconscious bias," says Dr. Shirley Davis, president of SDS Global Enterprises.
Even where explicit racism is absent, people tend to pick people like them--to hire and to help them advance. The vicious cycle has helped the top levels of corporations remain much less diverse than the country as a whole.
"The typical profile of a corporate executive, CEO or board of director is a white male in his late 40s or 50s that’s straight," says Davis.
On that last score, at least, Tim Cook just shifted the needle.
When it comes to the global smartphone market, everybody knows about Samsung and Apple. But do you know who number three is?
Xiaomi, an upstart Chinese company you’ve probably never heard of, has taken the smartphone bronze, based on sales this summer. It edged past players like LG on the way.
“So far, Samsung still remains number one. Number two is Apple. But now Xiaomi is number three,” says Linda Sui with the research and consulting firm Strategy Analytics.
Analysts say this growth is incredible, given that Xiaomi only sold its first phone three years ago. The Chinese company has passed Samsung and Apple in China, and sold between 17 and 18 million phones in Asia last quarter.
“Because it’s only within Asia, that’s a huge number,” says Ramon Llamas with IDC.
He adds that these phones are “feature-packed, easy to use and rather inexpensive. And that really appeals to millions and millions of users. And here’s the scary thing: It’s just getting started.”
Xiaomi is expanding in India, with an eye on Brazil, Mexico and more countries in Southeast Asia. But not the U.S. — yet.
“You cannot jump from the Chinese market straight to the U.S. markets,” says Boris Metodiev, a research manager with 451 Research.
Customers in emerging markets prioritize cost and value, he says, while customers in the U.S. tend to stay loyal to brands like Apple.
So Xiaomi has to keep growing.
“Conquering step by step the developing markets,” Metodiev says. “And once their name becomes more and more popular, then they will eventually move to the U.S. markets, to the West European markets, and so on and so forth.”
Even if Xiaomi continues to expand, it might not hold onto the number three spot. That’s because its competition just grew. Lenovo announced today it has completed its acquisition of Motorola Mobility.
For five years, John Eldridge and his team at Profectus Bioscience have developed and tested their Ebola vaccine. First it was on guinea pigs, then monkeys.
At that point, Eldridge realized monkeys weren't getting sick.
“When I saw those results, I realized that we had a real vaccine candidate which had the potential to make a real difference for mankind,” he says.
But before it can go to market, the vaccine must be tested on humans, a timely and expensive proposition for tiny start-ups like Profectus. And this is where things get tricky. Despite this year’s outbreak, there is virtually no commercial market for Eldridge’s vaccine. In other words, it’s financially difficult for a drug maker of any size to justify the expense of development and production with little payout in return.
That’s why the little agency no one has ever heard of – the Biomedical Advanced Research and Development Authority (BARDA) – is so important.
“They are investing in things that would die if they didn’t have additional funding,” says Boston University’s Kevin Outterson.
Outterson says getting any product from the lab to the market is called "crossing the valley of death." For products like Eldridge’s, which has little financial appeal but huge public health upside, that valley is deeper and longer.
“You can think of BARDA almost like a venture capital firm buried in the U.S. government,” he says.
To find an Ebola treatment, BARDA is investing in the most promising drugs and vaccines. That money, about $30 million just for vaccines so far, changes the equation so it makes better business sense for companies big and small to bring drugs to market. Unlike venture capitalists, BARDA won’t take a cut; in fact, more money may be on the way, with the President expected to seek additional funding from Congress.
“When we decided to put our pedal to the metal, everybody could accelerate and get to a finish line we are aiming for,” says Dr. Nicole Lurie, assistant secretary for preparedness and response at HHS, who oversees BARDA.
She says vaccine development would usually take up to 10 years. “We are moving forward in unprecedented speed.”
With this Ebola crisis, Lurie says Washington and industry are hand-in-glove. Lurie’s hoping to avoid mistakes from the 2009 H1N1 pandemic, when nearly 61 million Americans got sick and the virus killed more than 12,000 – all while the government, working with drug makers, couldn’t get enough flu vaccine manufactured.
“We learned that we needed much stronger relationships with our industry partners,” says Lurie.
She sees signs of a massive Ebola manufacturing mobilization, from giants like GlaxoSmithKline to the little guys like Profectus and John Eldridge, who says he’s actually been given enough money to do the work this time.
“We negotiated the contract. They came to us multiple times and said, ‘we need to supply you with adequate funding that you can move as rapidly as possible,’” he says.
Eldridge still doesn’t know if his vaccine works. But thanks to the tiny office no one has ever heard of, there’s a chance.
It has been a big year for the luxury department store chain Neiman Marcus.
The Dallas-based retailer announced earlier this year that they are building their first Neiman Marcus store in Manhattan, with doors set to open in 2018, joining Bergdorf Goodman the company’s only New York City outlet to date. They also launched a shopping app earlier this week called “Slyce," which lets users take pictures of any item they want to buy, and suggests something similar available at Neiman Marcus – the latest in a long line of technological experiments Neiman Marcus Group CEO, Karen Katz, has brought to the company.
Katz describes the company's customers: “She is very deliberate in how she is spending her money. There has to be a real value... pre-recession, I like to say, she was shopping with abandonment. She wasn’t looking at prices. If she liked something, she bought two of them... I think the world has changed post-recession. We’re much more in tune with how she wants to think about things.”
You can hear the full conversation on the Oct. 30 episode of Marketplace with Kai Ryssdal, or listen using the audio player at the top of the page. Here are some excepts from their conversation:
Impact of digital interaction: 24 percent of business at Neiman Marcus is now done online, and 70 percent of customers go to the website to research by category before going into the store.
On the risks of working in retail: Katz says, “That’s somewhat the thrill of the business.”
The Neiman Marcus Christmas Catalog item at the top of Kai’s wishlist? That would be the 100th anniversary Neiman Marcus limited edition Maserati Ghibli S Q4.
An earlier version of this story misspelled "Neiman Marcus." The text has been corrected.
The U.S. gross domestic product grew 3.5 percent in the third quarter, the Commerce Department announced Thursday, beating expectations and showing healthy growth after a wildly uneven first half of the year. Stocks rallied Thursday afternoon following the news, and the faster-than-expected growth stoked speculation about an interest rate hike.
Here are other stories we're reading, and numbers we're watching, Thursday:2009
That's when Blackberry's popular Bold line of smartphones first debuted. In the tech world, five years old qualifies as "Classic," and that's how Blackberry has branded a new line of phones with the tactile keyboards and trackpads that have defined the brand, the Wall Street Journal reported. Blackberry has struggled to adapt to the "black touchscreen slab" smartphone market, and the company hopes a return to its roots will draw customers back.83 percent
The portion of gay, lesbian and bisexual people who hide aspects of their identity at work, according to a report cited by the New York Times' Upshot. Apple CEO Tim Cook joined an extremely small group of openly gay executives by penning an op-ed for Bloomberg Businessweek. "We pave the sunlit path toward justice together, brick by brick," Cook wrote. "This is my brick."$20,000
That's how much a Pfizer political action committee donated to Missouri Attorney General Chris Koster, the New York Times reported in an investigation published Wednesday, donations that may have prompted the state to settle with the company in a fraud case for much less than other states. The PAC also reportedly invited Koster to speak at a breakfast days before the settlement. The attorney general is now facing an investigation by state lawmakers over the Pfizer case, and Koster's treatment of other campaign contributors.
North Dakota has always been a friendly, easy place to vote. It is the only state in the country without voter registration, and precincts are small enough that poll volunteers often recognize the people who come through the door.
"It’s kind of like a reunion," said Bonnie Fix, who has worked elections since 2001. "Kind of like a family picnic."
Running for office in North Dakota has historically been equally low-key – and low budget, with winning candidates for state offices raising less than a few thousand dollars each. But the oil boom has changed all that. The 2014 election cycle looks like it will be the most expensive ever in state history, with over $17 million in campaign contributions.
"It’s gotten ugly," said Jim Fuglie, the former head of the Democratic Party in North Dakota and a political commentator. "We’ve never had an industry this big, with this much money, have this much influence on an election."
Fuglie believes the tone of politics has changed, too, and points to negative campaign ads like the one calling the Democratic candidate for Agriculture Commissioner, Ryan Taylor, a "tree-hugger."
The ad, which ran on commercial radio stations leading up to the election, was paid for by a local political action committee or PAC, funded by the national Republican State Leadership Committee. Some of its top donors are oil and gas companies like Devon Energy and ExxonMobil.
Between PACs, trade groups and corporations, the oil and gas industry has spent $1.3 million on the 2014 election in North Dakota, according to data from the North Dakota Secretary of State. Some races matter more to the industry than others - like the Agriculture Commissioner race. While the title sounds irrelevant to oil and gas, as one of three officials who sit on the state's Industrial Commissin, the agriculture commissioner has a lot of power to regulate the oil and gas industry.
So far, the oil and gas industry has kicked in $73,000 to support Republican Doug Goehring - about a quarter of all the money he's raised. They're worried that if Taylor, the Democratic challenger, wins, he’ll slow the pace of development.
"The oil and gas industry has been somewhat successful in characterizing any questioning of the speed as potentially threatening everything," said Nicholas Kusnetz, a reporter with the Center for Public Integrity who’s written extensively on the industry’s influence on politics in North Dakota.
Another issue, however, has attracted even more money, both from the oil and gas industry and others: The North Dakota Clean Water, Wildlife and Parks Amendment, also known as Measure 5. Measure 5 would create a constitutional amendment setting aside five percent of the oil extraction tax for conservation projects. Even though it doesn’t create new taxes, the oil and gas industry strongly opposes it.
Ron Ness, president of the North Dakota Petroleum Council, said oil companies want to see as much money as possible go directly to the boomtowns, fixing roads and building schools and housing. "The more oil tax money going back to those communities helps to attract and retain workforce," he said.
The American Petroleum Institute has also weighed in, calling Measure 5 "a disservice to the state's economy and its residents." To help defeat it, API has spent over a million dollars on yard signs, magnets and a website. And it’s sponsoring phone calls. Carmen Miller is the director of public policy for Ducks Unlimited, a conservation group backing Measure 5. She knows about the anti-Measure 5 phone bank, because she received a call.
"If you’re calling the proponents of the measure, you must be calling just about every phone number in the state," she said.
But it's not just oil and gas companies that are spending heavily on this election. National conservation groups like Ducks Unlimited and The Nature Conservancy have kicked in a combined $4.8 million to support Measure 5. Miller wouldn't comment on whether proponents of Measure 5 had planned to spend that much initially, or if they had upped their spending in response to oil industry donations. But four days after American Petroleum Institute spent its million to defeat the measure, The Nature Conservancy chipped in $600,000.
Democrat Ryan Taylor has raised nearly $300,000 for his campaign to become Agriculture Commissioner -- about a quarter from out-of-state donors. That's more than twice as much as the winning candidate raised in 2006.
For Bob Harms, the chairman of the North Dakota Republican Party, the levels of spending are indicative of how much money is now flowing into state coffers. The state gets about $9 million every day in oil tax revenue.
"We have more money to fight over," he said, "and we have more money to fight with."
On Thursday, the U.S. Education Department issues new rules designed to address rising indebtedness and high default rates among graduates of for-profit vocational college programs. A new standard for graduates' loan-payments-to-income will penalize schools that fail to measure up, threatening them with exclusion from government student loan and grant programs, including Pell Grants for low-income students and education benefits under the GI bill.
The government provides $22 billion annually to support so-called ‘gainful employment’ post-secondary education programs, according to Secretary of Education Arne Duncan.
Kai Ryssdal will interview Secretary of Education Arne Duncan. Listen to the show, or check back here for the podcast later this afternoon.
This includes training in culinary arts, truck-driving, IT, health care, auto repair and the like. Under the new rules to be issued Thursday, schools will risk being cut off from government student-assistance programs unless a typical graduate’s loan payment is less than 20 percent of their discretionary income, or 8 percent of their total earnings.
An earlier draft rule also would have set a standard for graduates’ student-loan default rates; default rates for graduates of for-profit colleges are considered excessively high by education advocates and the Obama Administration. Default rates will be tracked and publicly reported under the new rules, but won’t be a criterion for punishing schools and excluding them from government loan and grant programs.
In a statement emailed to Marketplace, the Association of Private Sector Colleges and Universities, which represents for-profit higher-education providers, rejected the new regulations as a "bad-faith attempt to cut off access to education for millions of students who have been historically underserved by higher education," according to CEO Steve Gunderson.
"In this case, the Department favored public institutions that benefit from generous taxpayer operational subsidies, but have lower graduation rates and higher default rates, over programs at private sector institutions where graduates are achieving real earning gains and successfully repaying their loans," according to the statement.
The industry has been critical of the Education Department for allegedly favoring publicly-funded community colleges over for-profit colleges that specialize in career training.
Consumer advocates also criticized the revised regulations that the Education Department has settled on.
“The final gainful employment regulation does not do enough to stop the fleecing of students and taxpayers," said Pauline Abernathy, vice president of The Institute for College Access & Success, in an emailed statement. “In particular, the final regulation lets programs where most students borrow but few graduate keep using taxpayer dollars to bury students in debt they can’t repay, so long as they limit the debt of the few students who complete.”
In five days, the polls will be open. And with gains for Republicans predicted but not assured, we turn to a person who tracks the future of the federal budget like a gearhead follows cars.
Stan Collender contributes to Forbes, and once upon a time was a staffer for both the House and Senate Budget Committees. He joined host David Brancaccio to discuss what a Republican majority would mean for budget cuts in Washington.
Click the media player above to hear Stan Collender in conversation with Marketplace Morning Report host David Brancaccio.
First, economic growth in America. GDP was quite solid as the summer wore on. More on that. And one of the most influential business tycoons in the world has come out publicly as gay: Tim Cook, the CEO of Apple. We spoke with actor and social justice advocate George Takei about the importance of Cook's Op-ed. Plus, passengers increasingly bring their own entertainment with them aboard flights...on their mobile devices. Now, airlines are responding, possibly with a policy of BYOD: bring your own device.
Signing bonuses for new college grads nearly disappeared after the recession but are slowly becoming more common, according to a Michigan State University survey of employers.What percentage of employers offer signing bonuses to new college graduates?