How Politics Works--Kaplan, the Post, and Reps

The Washington Post has a good article on their Kaplan subsidiary, which started out as a test preparation business, was purchased by the Post to diversity their business, became a for-profit education business making big money off low-income students who take government loans. Ir captures some ways our political system works:

You take a worthy cause which appeals to most, especially the left--helping people get more education, particularly people who have been in the workforce and want to improve themselves and people who couldn't go to college right out of high school.  This taps into the idealism of the left.

You implement it using a method which appeals to the right: a competitive market in for-profit educational institutions and which rewards the entrepreneur.This taps into the greed of the right.

The combination of factors  means this happens when a Republican comes to power:

"One of its [GWBush's administration] key players was Sally Stroup, assistant secretary for postsecondary education, who had been a lobbyist for the biggest for-profit education company, Apollo Group. Soon the agency eased regulations, allowing companies to reward recruiters based in part on the number of students enrolled, or as one government report later called it, “asses in classes.” Like others, Kaplan made enrollment incentives one element of employees’ compensation. Stroup did not respond to request for comment.

Congress also made a change that helped spur enrollment. In 2006, Rep. John A. Boehner (R-Ohio) — then House majority leader and a major ally of for-profit education companies — pushed through legislation that lifted federal loan restrictions for online-only schools.

Our political parties also can act as checks; the story goes on:

With the election of Democrat Barack Obama to the presidency, a new team landed at the Education Department, one that took a skeptical view of the for-profit sector.

And then the magic of the market comes into play: speculators who had successfully "shorted" the housing bubble saw another opportunity to gain:

Investors were hoping the government would tighten the spigot, a move that would jolt the entire for-profit education sector while leading to a big payday for the shorts. Today, investors have sold short — in essence, bet against — shares equal to about one-tenth of The Post Co.’s outstanding stock, about 3.8 percent of Apollo’s and 31.3 percent of Corinthian’s, according to investment Web site.