Guest Post: The Failure of Accreditation

College is the most complicated expensive purchase most people ever make. Houses are relatively easy—you can walk through ahead of time and hire an inspector to check the foundations for rot. Higher education, by contrast, is what economists call an “experiential good” – you don’t really know what you’re getting until after you’ve gotten it. That's why students and their parents need robust consumer protection. The government has a strong interest in ensuring that students get a high-quality education, particularly given the hundreds of billions of dollars in direct and indirect public subsidies that colleges receive every year.

Unfortunately, America's system of consumer protection for higher education doesn't work very well. Instead of taking responsibility for protecting students, the government has left the task in the hands of accreditors, an idiosyncratically organized group of voluntary associations that are funded and governed by colleges themselves. Much like the bond rating agencies whose financial entanglement with sub-prime mortgage packagers almost caused the next Great Depression, accreditors are averse to rendering hard judgments about the organizations that pay their bills.

As I detail in an article titled "Asleep at the Seal," published in the March/April issue of Washington Monthly, the result can be catastrophic for the most financially and academically vulnerable students. The piece describes how Southeastern University, a private non-profit college in Washington, DC, clung to accreditation through three decades of "obscurity, mediocrity, cronyism, and intermittent corruption" before finally being shut down by their accreditor, the Middle States Association of Colleges and Schools, last year.

Southeastern was founded by the YMCA all the way back in 1879. For nearly a century, it was an unaccredited trade school offering business-related courses to working adults. But by the late 1970s the federal government had begun pouring billions of dollars into higher education through Pell grants and subsidized student loans. The aid came with a condition: it could only be used to attend accredited schools. That gave colleges like Southeastern a strong incentive to enter the accreditation fold.

But soon after the university received full accreditation from Middle States—the same mark of quality given to, among others, Georgetown, Princeton, Penn, Columbia, and Cornell—it became clear that Southeastern wasn't exactly operating at the same level as its new Ivy League peers. Administrators kept getting fired or arrested for misappropriation of funds. Because the university charged private school tuition and its clients were of modest means, students often had to take out hefty loans. Unfortunately, many were unable to pay them back. Over the next three decades, the university was repeatedly sanctioned by the U.S. Department of Education for high loan default rates. Graduation rates were paltry and enrollment bottomed out on several occasions. Middle States responded by sending strongly-worded letters and putting the university on various forms of probation. But it never took away the only thing that mattered: the accreditation seal. 

Middle States finally pulled the plug in 2009, citing Southeastern's perilous finances, declining enrollment, 14 percent graduation rate, 0 percent pass rates on a number of licensure exams, and an unpaid multi-million dollar U.S. Department of Education fine. In the end, Southeastern had only six full-time faculty overseeing more than 30 academic programs. Yet it continued enrolling new students, who were under the impression that the accreditation issue was a bureaucratic affair that would soon be resolved. Many were left with worthless credits and thousands in loans to repay.

In justifying its decision to allow Southeastern to stay open for so long, Middle States said: "Ever since Southeastern University’s initial accreditation … in 1977, the Commission has recognized the University’s mission of serving diverse and underserved student populations. It is largely as a consequence of this recognition that the Commission has been so forbearing in its actions to date."

This is nonsensical. It's the equivalent of the Food and Drug Administration loosening toxicity standards for drugs taken by pregnant women. Diverse and underserved students are the most vulnerable to poor instruction, the most at-risk of dropping out of college, the most devastated when saddled with un-repayable student loans. Colleges that serve these students should be held to the highest standards, not allowed to skate by for decades on end.

The accreditors’ reluctance to play the heavy is unacceptable, but it’s also understandable. Because the American higher education system is a ziggurat of escalating privilege, with institutional resources matching students’ financial and social capital every step of the way, low-performing institutions invariably enroll a disproportionate number of low-income students who need federal aid. Cutting off the flow of federal money is the equivalent of the death penalty, and nobody likes to be the hangman.

But the result is a higher education system that operates under a polite fiction: there are no mediocre or bad colleges—just different colleges, each with its own unique academic mission and students to match. In reality, there are plenty of other Southeasterns out there. Over 250 four-year colleges had graduation rates below 33 percent in 2008. Every one of them is accredited.

Leaving the evaluation of college quality to colleges themselves simply won't work in the long run. Certainly there is a place for accreditation to provide peer-reviewed feedback and set aspirational standards of excellence in higher education. Indeed, that’s what the accreditors were founded to be—associations of truly distinguished institutions.

But the sharp-edged work of shutting down chronically low-performing colleges and protecting the public interest should be done by the government, in the same way that independent, non-partisan federal agencies regulate other vital industries, like finance, energy, and communications. For the most vulnerable collegians, the decades-long experiment of relying on higher education to police itself has proved to be a failure. Just ask the unfortunate students at Southeastern who have been left with little to show for their time at the school besides the loans they are stuck repaying.

Kevin Carey is the policy director of Education Sector, an independent think tank in Washington, DC. He is a regular contributor to the organization's "Quick and the Ed" blog and has published numerous reports, including ones on higher education accountability, student loan debt, and college rankings. In addition, he is a frequent contributor to The Washington Monthly and The Chronicle of Higher Education's Brainstorm blog. His views are his own and do not necessarily reflect those of the New America Foundation.