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How the Financing of Colleges May Lead to Disaster!
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How the Financing of Colleges May Lead to Disaster!

Rana Foroohar
The New York Review of Books, 2016
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Editorial Rating

8

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Recommendation

A financial bubble burst due to student loan defaults is just one problem the “financialization” of US higher education has produced. Author and TIME editor Rana Foroohar paints a dire picture of the consequences the US economy could face unless the government radically changes its approach to educational investment. In this timely warning, Foroohar provides both context and positive steps to avoid an otherwise inevitable avalanche of economic damage and destruction. getAbstract recommends her analysis to higher education supporters and anyone concerned with the US economy.

Summary

In the 1990s, private higher education entities in the United States started going public – that is, trading on NASDAQ alongside Fortune 500 firms. Since then, the for-profit education sector has multiplied its stock holdings, increased its enrollment by more than 60% and begun spending more money on marketing than Apple does.

The “financialization” of college maintains that the market knows best, even in the education sector. However, the monetary success of these “diploma mills” doesn’t...

About the Author

Rana Foroohar is an assistant managing editor at TIME and the author of the book Makers and Takers: The Rise and Fall of American Business.

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