Despite a small glimmer of hope from last Friday’s unemployment rate drop to 9.1%, business leaders know nearly all other economic figures continue to point to an anemic recovery or worse, a double-dip recession.

In reaction to the jobs numbers, Home Depot co-founder, Bernie Marcus had this to say on Politico:

While some may be relieved at today’s jobs numbers, the reality is that our economy is struggling to recover. And a big reason for that is the federal government. The impediments that the government imposes are impossible to deal with. Every day you see rules and regulations from a group of Washington bureaucrats who know nothing about running a business. And I mean every day. It’s become stifling.

And this is a theme that business leaders continue to make: over-burdensome regulations from Washington are stifling the economy and preventing serious job growth while the Obama administration only continues to make the problem worse.

Lets take a look at the cold hard numbers. In the past few weeks, major American companies had to announce more layoffs:

- Borders – 400 stores will close, costing almost 11,000 jobs.

- Boston Scientific – Announced restructuring that will cost up to 1,400 jobs.

- Goldman Sachs – Will let go 1,000 employees, or nearly 3 percent of their workforce.

- Merck – Will layoff 13,000 workers to cut costs.

- State Street – Announced it will cut 850 jobs, in a second round of layoffs within a year.

With all of this going on, President Barack Obama is promising (yet another) renewed focus on job creation. But what is his administration doing? Contrary to Obama’s promised regulatory reform from earlier this year, the administration continues to say one thing and do another.

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Over the last month, Barack Obama has toured a number of community colleges and job training facilities promoting what he believes is the next great job-creation and employment strategy: training young people graduating from high school and adult workers who have been laid off from their initial careers in the skilled trades. Experts estimate that nearly half a million skilled trade jobs remain unfilled because Americans simply lack the expertise necessary to fill these positions, and Obama is aiming to close the widening employment gap and give some semblance of normalcy to an increasingly irritated public by pushing programs that will get Americans back to work: training people to use the shovels for the shovel-ready jobs, if you will.

Of course, there’s a major flaw in his plan. While Obama is out promoting community colleges and job training programs, his administration is actively killing one of the most successful job training operations. Just last month, Obama’s Department of Education passed what is now called the “Gainful Employment rule,” a rule that severely limits the amount of federal financial aid students may receive to attend for-profit and career colleges – the very colleges that are training low-income, disadvantaged, minority and non-traditional students to enter or re-enter a dramatically changing workforce.

Obama’s Department of Education and it’s supporters in Congress claim that career and for-profit colleges have problems: that their students have a low graduation rate, a low employment rate following graduation and have a difficult time repaying loans. These concerns, they say, led to the need to limit the financial contribution taxpayers make to their education and opportunity. It’s understandable, except that the agenda really isn’t saving taxpayers money. The agenda is, instead, creating a preferential environment for incubators of the next Democratic generation: non-profit schools. If the agenda were saving taxpayer dollars, they might be targeting the very programs Obama is asking Americans to further contribute their support to.

Now, obviously, the educational elite are not fans of for-profit education.

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The Obama Administration’sDepartment of Education has been working for months on an attack that would severely cripple career colleges in the United States, schools that help American students pursue educational options outside of the four-year non-profit universe.

Charging that these career colleges mislead students into believing they’ll obtain employment upon graduation, and that these schools mislead students into taking on debt, the Administration has proposed a “gainful employment” rule that would severely limit students’ financial aid options if they chose for-profit colleges over the Administration’s preferred four-year university route.

According to sources, the “gainful employment” proposal has been fueled by reports from the U.S. Government Accountability Office (GAO) as well as news media that have painted the career university system as predatory. However, many of these reports, including the one from the GAO, were revised after questions were raised about the accuracy of their initial drafts – and many of these reports fail to provide information about similar tactics and return on investment data for four year schools, a mis-step that, this week, Jamie Farrell at Forbes brought to light.

As congressional talks surrounding the negative impact online education has had on graduation rates and specifically loan default rates; what we are not hearing are long term solutions. We are hearing suggestions of Band-Aids.

Do I like the idea of the gainful employment laws? Yes! That said, if we are going to implement them, it should be done across the board and it needs government support to get started. What these lawmakers are failing to recognize is that it took guts, innovation, large investments and a lot of time NOT being profitable for these for profit online education companies to get where they are today…and the model is less than TEN YEARS OLD.

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Big Government has covered the Obama Administration’s war on career colleges before, particularly the the Wall Street connections: noted short-seller Steve Eisman, who’s testimony in front of the Department of Education and in Congressional committees is shaping the Administration’s policy and potentially earning Eisman millions. Now, it seems Eisman is trying desperately to distance himself from what appears to be a destructive policy for America’s low-income and minority students.

Recently, the Administration and Education Secretary Arne Duncan proposed that career colleges and other for-profit educational institutions, be governed by the so-called “gainful employment rule” – a rule that limits or ends federal grant and student loan money for students at for-profit institutions with low graduation rates or low post-graduation employment. Although for-profit schools face essentially the same problems as not-for-profit institutions, students at for-profit schools tend to be lower-income and minority communities, who rely heavily on government assistance to earn the kind of education and skill level necessary to succeed in today’s harsh economic climate.

The rule has met with overwhelming opposition from a number of organizations and communities, and much of that criticism has been leveled at how the Administration came up with the “gainful employment rule.” Recently, it’s become apparent that Steve Eisman’s testimony motivated the Administration’s actions, even if he’s reticent to admit it.

From Business Week:

On April 16, Eisman met with Education Department officials, including acting deputy assistant education secretary David Bergeron, according to Justin Hamilton, a department spokesman. He sent multiple e-mails to a number of Education Department officials, including Duncan, on May 28, two days after airing his views at the Sohn conference in New York. He warned against the watering down of gainful employment, according to the documents obtained through a Freedom of Information Act request…

‘He shared a PowerPoint that he intended to use for a speech he was planning to give in May,’ Bergeron, the acting deputy assistant education secretary, said in a telephone interview. “It would have been inappropriate for us not to meet with someone that indicated that he had done serious research on the industry.’”

That Power Point contained some very important suggestions, designed to target the problem Mr. Eisman believed for-profit education was causing. One of those suggestions was a very coincidentally named “gainful employment” rule on slides 33 and 34 of his extensive presentation.

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Liberals will tell you they support freedom of choice, but they won’t tell you that freedom they are willing to extend you begins and ends with abortion. Try to exercise it in any other aspect of your life and they’re there, ready to pounce with some regulation or law forbidding you from moving forward with your liberty workout. It doesn’t matter to them what the impact is, they want what they want and they’re willing to step all over you to impose it.

The latest whipping boy in the crosshairs of these statists is the post-secondary for-profit education system. Odds are this battle won’t impact your life directly, but their attacks rarely do. They never attack the heart of that which they seek to control or destroy, they chip away at the edges until it no longer resembles that which it was. It still exists, but in such a way so as to no longer function effectively and eventually dies. Look at what they’ve done to off-shore drilling without so much as passing a law.

For-profit education is the choice for millions of Americans who, for any number of reasons, can’t or choose not to matriculate to traditional colleges and universities. The reasons vary – poor grades in high school, young children at home, etc. These schools serve mostly poor, underprivileged students who have very limited options. You’d think liberals would be for anything that helps the very people they claim to champion. But their rhetoric rarely matches their actions.

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Over the last several months, as attention has been focused elsewhere, the Obama Administration and Education Secretary Arne Duncan have been waging a quiet war against for-profit schools and universities – educational institutions that offer  job training and degrees in in-demand fields to students looking for an alternative to four-year non-profit schools, or a more accessible price tag.

The Administration has fired a number of rounds at the industry, but recently unveiled it’s secret weapon: a “gainful employment” restriction on federal loan money available to students at for-profit schools. While for-profit schools have had their difficulties, their deficiencies aren’t that dissimilar to those of their not-for-profit counterparts, but this weapon could kill off for-profits as a viable option to not-for-profit education. Essentially, students at for-profit schools that have either a low graduation rate or an unacceptably high number of unemployed, graduated students would be denied federal student loan and grants. As Forbes points out, these schools serve primarily lower-income and minority communities who depend so heavily on student loans, such a restriction could put the whole industry in jeopardy.

Which, of course, is exactly what the Obama Administration would like to see happen. And, from recent news, it seems that they and their network of associates will do just about anything to make sure it happens.

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Florida trial attorney Chris Hoyer, who along with his wife, has donated close to $30,000 to President Barack Obama and other Democratic candidates and causes over the last decade, appears to be curiously in-tune with the Democratic administration’s agenda on higher education.

Hoyer, through his James/Hoyer Law Firm, is targeting for-profit career schools for class actions at around the same time the Obama administration Department of Education appears to be targeting that same industry through aggressive new regulatory action and rule making.

Hoyer has filed a lawsuit against Westwood College, claiming the school lied about tuition costs and future salary potential for graduating students. As with any class action situation, where the people who benefit are primarily the attorneys, Hoyer’s class action pursuits should not be taken lightly. His 2008 action against Waste Management Company yielded each plaintiff a whopping $25.

But the underserved, largely black and Hispanic students who tend to enroll in similar career schools need to worry that their education choices are under legal assault. “I’m not trying to attack the whole for-profit school industry,” Hoyer maintains. Nevertheless, James/Hoyer claims on its website that it is “investigating” no fewer than seven such for-profit colleges.

As it happens, the Department of Education has begun an aggressive campaign to enforce a beefed up “Gainful Employment” rule. As former New Jersey Governor and 9/11 Commissioner Thomas Kean recently pointed out, this “Gainful Employment” rule appears to be specifically targeted at the same career schools in Chris Hoyer’s laser scope:

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For-profit education is under assault from elitists who hate the idea of free market educational institutions.  It is also under attack from bureaucrats at the U.S. Department of Education who are trying to make it hard for students to arm themselves with the education needed to find a job.  Elitism is alive and well at the Department of Education.

The Department of Education announced this week that they are “on schedule to implement new regulations of the for-profit education sector dealing with gainful employment and 13 other issues to protect students and taxpayers.”  The non-profit sector feels threatened; therefore allies in the Administration are trying to use the power of the federal government to provide non profit schools a competitive edge to slow the growth of for-profit institutions.  For-profit institutions are the trend and they are becoming more popular.

Senator Jim Risch (R-ID) has introduced legislation to prevent the Department of Education from denying federal financial aid to students attending for-profit colleges and vocational certificate programs.  Senator Risch said of his effort:

The ‘gainful employment’ rules could deny hundreds of thousands of students access to the training and skills development they need to secure a job in today’s troubled economy.  Highly-skilled workers are in high demand in certain sectors and propriety schools are uniquely qualified to meet that need.  It is simply irresponsible for the government to throw roadblocks in front of students and institutions at a time when job creation in America should be the administration’s number one priority.

Senator Risch’s legislation, S.3837, the Education for All Act, would forbid the Department of Education from singling out students from proprietary and vocational institutions and treat them differently than other students.  These institutions have proven to be uniquely qualified to help students find jobs in today’s complex economy. (more…)