It seems these days we are seeing government regulators crack down on Wall Street with the new Financial Reform Act, and their theory is that they will now have the power to enforce regulations and prevent another global economic collapse or disintegration of the US economy us in a near depression rather than our “shallow” business cycle recessions. Is that possible? No, and let me tell you why.

Consider whether it will do so after the big S&L crash many years ago, the junk bond challenges, the Enron fiasco, or the mortgage crisis. If you remember every time more regulations were put in place, did they stop the next round of bullshit? NO. After Enron, we saw one of the largest accounting firms crash and burn, remember Arthur Anderson, and then we ended up with new accounting standards and Sarbanes-Oxley, but did that stop the next crisis? NO.

We now have a new financial regulatory reform bill, after the mortgage crash, which brought Wall Street and the global economy down. And with fire in our veins we have regulators and the Justice Department looking for heads to roll, why? To show that they are doing something, of course, and regain the confidence of consumers and investors, small businesses and foreign institutional investment. It will work? Yes, it might restore your confidence at first, but the law of unintended consequences will make it worse.

Now, let’s change the subject and talk a little about regulation in our great nation, let’s talk about the truth, the facade and the incestuous relationship between legislators, corporations, banks and those who perhaps really need regulation but are essentially safe. of not getting any. Only their competitors will be regulated in the future, as those big culprits and their lobbyists did most of the work to forge these new regulations and improve things for themselves and the way they do business, while also creating entry barriers for the rest of the countries. industry.

Not long ago, I spoke with a self-proclaimed expert in “Fair Value Accounting”, which is his profession, and then we started talking about education and costs, and the recent regulatory attacks on private corporation-style universities like; Kaplan, Apollo Group, Corinthian Colleges, University of Phoenix, DeVry, Capella Education, and Career Education, according to an August 17, 2010 Wall Street Journal article titled “For-profit schools worry about proof of reimbursement: The Department of Education report gives poor ratings to some institutions and its proposed regulations could hurt their aid and profits, “which was written by Melissa Korn.

My acquaintance actually had an MBA from a private for-profit university, and this has helped his career, but it wasn’t cheap, and it will pay for it for a while, he said. He believes that the government’s attacks on for-profit corporate universities and learning institutions are justified and I believe they are not. And don’t think American regulators are being fair, or they would shut down half of our nation’s colleges and universities.

Some private for-profit company universities underperform, perhaps, but it certainly couldn’t be worse than our overall education system? K-12 and colleges and so on, some, I agree, but not all, and universities also do it as they promise to all their students; “We placed 90% of our graduating class in the top 500 Fortune companies!” and then students get down to business with student loans etc, but when the economy took a hit, all bets were off, regardless of where the kids went to school, perhaps with the exception of Harvard, Yale, MIT, Stanford, Wharton, etc. They may have had a better chance, but there are a lot of horror stories there too, law students who can’t get a job, with an Ivy League law degree? The success of a lifetime, or so it has been said.

Recently there was a great article in the news on this topic, I recommend that you look it up and read it; “What Are They Doing After Harvard” which was an interview with Wendy Kopp by Naomi Schaefer Riley in the Wall Street Journal. And that same day another article appeared in the “Economic Times of India”, titled; “Harvard is a waste of money!” Apparently targeting the education sector for profit is a bit disingenuous on the part of our regulators, so I guess that’s another side of the argument, and the cost of Holy Toledo, which could take a while to pay off. .

And with public or private colleges and universities there is a big competition problem, so we know that they don’t like competition, they like monopolies, like the textbook scheme they put in place, in which you pay $ 250 for a textbook you need. for the class. I recommend that you read; “Textbooks Improve Your Game,” an article by Jeffrey A. Trachenberg that also appeared in the WSJ. Perhaps universities should also stop complaining that e-book readers’ textbooks hamper their style, while reconsidering their dismal performance before encouraging regulators to attack for-profit corporations that are regaining their slack? in the market?

You see, the attack on for-profit university companies is inexcusable and pathetic, it’s just the regulators trying to show that they are doing something, but are they really going to make universities guarantee jobs for those who graduate from the market? ? Any nonsense fair value assessment of what a college education is worth? I mean, we still have colleges that claim that those who graduate will earn over $ 1.5 million more in their lifetime, and yet those studies have never been peer-reviewed to the point that regulators are asking colleges of private companies to do so now.

And how many of those colleges can claim that 90% of their graduates in 2008, 2009, 2010, or 2011 went to work for America’s top 500 companies, or that those students will earn 1.5 million more during their earnings per year? life? And if someone is smart enough to overcome all those hurdles, heck, they would have been successful at anything they did anyway, they hardly needed college to be successful in life. It’s a great facade, and the truth is that universities will become less relevant as time goes on, if they don’t radically change the way they do things. So why is the Justice Department protecting an old dinosaur?

It’s about politics, folks!

What do you say about all this?

What is the true fair value of an education, and what is the market to market value of that, quickly, quickly give us the answer, we order it?

References:

  1. Wall Street Journal, “Packing for College 2010 Style; Hidden Financial Traps Trap Even the Best and Brightest on Campus – and Their Parents. Here’s How Not to Waste Money 101”, by Karen Blumenthal.
  2. Wall Street Journal, “Taking schools into their own hands”, by Joy Resmovits.
  3. WSJ, “For-profit schools put into detention”, Rolfe Winkler.
  4. WSJ, “Needs improvement: “Where Teacher Report Cards Fall Short”, by Carl Bialik.
  5. “Higher Education: How Colleges Are Wasting Our Money And Failing Our Children And What Can We Do About It”, Published by Times Books, New York, NY, pp. 271, 2010, ISBN: 978-080508-734-5.
  6. “American Can Compet”, by James Gooch, Michael L. George, Douglas Montgomery, published by the Institute of Business Technology, Dallas TX, 1987, pp. 182, Library of Congress Number; 86-083329.
  7. “Creativity in higher education”, Edited by Albert B. Friedman, for Claremont Graduate School Printing, Claremont, CA, 1964, pp. 55.
  8. “Using quality to redesign school systems: the forefront of common sense”, by Peggy Siegel and Sandra Byrne, Jossey-Bass Publishing San Francisco, CA and ASQC Quality Press, Milwaukee, WI, 1994, pp. 168, ISBN: 1-55542-649-2.

Note: The author of this quick article has read over 400 research articles and 50 books on education in the last 5 years alone, and has obviously also experienced the K-12 public school system and college as well as education for the purpose of profit.

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