Public colleges, especially two-year community schools, have higher rates of student loan defaults than even for-profit schools. (Just 20 percent of full-time students (in two-year colleges) seeking a degree get one within three years. That number rises to 35 percent after five years, but by then another 45 percent have given up completely and are no longer enrolled. With graduation rates that low, community colleges can be dead ends rather than gateways for students. NYT 3-11-15).
The main reason is they simply are not prepared for college, academically or sometimes emotionally. The vast majority of two-year community colleges have a success rate (graduation within three years) of less than 50%. Some states are far worse. In New Jersey the average success rate for its seventeen schools is 37% and none reach the 50% level. Do you still think the problem is tuition?
And yet our politicians see the solution as making such a non-education “free.”
Of the 593,000 borrowers entering default in the most recent cohort, roughly 52 percent of them attended public colleges. Slightly more than a third attended for-profit colleges. Yet this one-third has been the primary target of the lion’s share of political rhetoric and rulemaking by the Obama Administration.
Certainly, for-profit colleges deserve closer scrutiny, particularly where taxpayer dollars are concerned. For-profits have a default rate of 15 percent, which is higher than the overall public sector rate of 11.3 percent. But this rate lumps in flagship public universities with community colleges. Among two-year institutions only, public schools fare worse, with a default rate of 18.5 percent, compared to 16.9 percent in the for-profit sector.