The Rise of Christian Cybercharters: Profit, Indoctrination, and the Dangers of Faith-Based Online Education

As online education becomes an ever-expanding force in both K-12 and higher education, a disturbing trend has emerged with the rise of Christian cybercharter schools and online academies. While these institutions promise faith-based education and an alternative to secular public schooling, they also raise serious concerns about indoctrination, the commodification of education, and the profit-driven motives of their for-profit operators. For many families seeking an education aligned with their Christian values, these digital platforms offer an attractive solution. However, as the lines between faith-based learning and corporate interests blur, the question remains: what are we sacrificing in the pursuit of religiously guided education?

The Growing Influence of Christian Cybercharters

Christian cybercharter schools are part of a broader trend in which private, for-profit companies deliver education to students via online platforms. These schools, often designed to serve as alternatives to secular public education, integrate Christian teachings into core subjects such as history, science, and literature. While these schools may offer a semblance of flexibility for students in rural areas or families dissatisfied with traditional schooling, their model poses unique challenges.

Cybercharter schools are, by definition, public schools that operate entirely online and are funded with taxpayer dollars. Yet, the rise of Christian cybercharters, run by private companies, complicates the traditional understanding of education. These institutions, rather than simply providing secular education, often incorporate Christian teachings into all aspects of learning. Students may study math, science, and history through a Christian lens, learning creationism instead of evolution or receiving a heavily filtered view of history. In some cases, controversial issues such as LGBTQ+ rights and reproductive health are taught in ways that align with conservative Christian values, potentially ignoring or dismissing broader social, legal, and ethical considerations.

While these schools may appeal to parents seeking religiously grounded education for their children, concerns about the quality of education and the potential for indoctrination are mounting. Instead of offering an objective, well-rounded academic experience, these institutions may turn into ideological factories, promoting a singular worldview at the expense of critical thinking, intellectual curiosity, and open-mindedness.

James Loewen’s Lies My Teacher Told Me: Everything Your American History Textbook Got Wrong serves as a cautionary tale when examining the educational landscape shaped by these faith-based online programs. In his book, Loewen critiques the sanitized, biased versions of American history often taught in public schools—narratives that ignore uncomfortable truths about racism, inequality, and colonialism. This phenomenon is mirrored in some Christian cybercharters, where history is frequently reinterpreted to promote a specific religious or political agenda, potentially leaving students with a distorted, incomplete understanding of the world. The difference here, of course, is that rather than the state pushing a particular narrative, these programs are driven by religious agendas that prioritize faith-based views over academic rigor and historical accuracy. Just as Loewen critiques the "lies" of public school textbooks, one could argue that these Christian educational platforms sometimes present a faith-filtered version of reality—one that aligns more with ideological conformity than intellectual exploration.

The Profit Motive: Corporations, Private Equity, and the Business of Faith-Based Education

At the heart of the Christian cybercharter movement is a growing involvement of private equity firms and publicly traded companies eager to profit from the expanding online education sector. Venture capitalists have increasingly poured investments into education technology companies, including Christian online platforms. As a result, more and more online education providers—particularly Christian cybercharter schools—are becoming businesses in the traditional sense, with financial returns prioritized over educational outcomes.

Much like other for-profit charter schools, these Christian cybercharters face the same pressures to maximize revenue. While proponents of this model argue that parents should have the option to select an education aligned with their values, critics argue that profit-driven motives overshadow educational quality. In many cases, the companies running these online schools are more focused on expansion, enrollment, and financial performance than on fostering critical thinking or providing a rigorous, well-rounded education.

In the case of for-profit Christian cybercharters, this business model often leads to a corporate agenda that prioritizes market share rather than genuine educational development. Whether or not these schools offer the best or most effective education is secondary to their role as vehicles for profit. Furthermore, because many of these institutions are delivered through online platforms, the lack of direct teacher-student interaction and oversight further diminishes the opportunity for intellectual debate and inquiry.

Indoctrination vs. Education: The Risks of Religious-Based Learning

One of the most significant concerns with Christian cybercharters is the potential for indoctrination. Unlike secular education, where students are encouraged to explore various ideas, form their own opinions, and critically engage with the material, Christian cybercharters often deliver content that aligns solely with religious teachings. In many cases, students are not encouraged to question or challenge the material they are given, but rather to accept it as the unquestionable truth.

For example, in science courses, students may be taught creationism in place of evolution or may receive instruction that contradicts widely accepted scientific principles. In history classes, there may be a deliberate effort to present historical events through a Christian lens, prioritizing religious interpretations and avoiding broader, secular understandings. This framing can affect the way students understand the world and interact with it, teaching them to see things in a way that aligns with specific religious views, rather than providing them with the tools to critically evaluate the world around them.

Loewen’s Lies My Teacher Told Me warns of the dangers of sanitized history education. The same critique can be applied to some Christian online academies. Just as Loewen highlights how mainstream textbooks gloss over the uncomfortable truths of American history—such as the treatment of Native Americans or the legacy of slavery—Christian cybercharter schools may whitewash history to fit a specific theological or political narrative. Students may learn that America is a "Christian nation," without an in-depth exploration of the diversity of belief systems that have shaped the country, or the ways in which Christianity’s role in history has been contested and debated. The problem arises when children, instead of being equipped to navigate complex historical realities, are taught to passively accept an ideological version of the past.

When education becomes synonymous with religious indoctrination, the line between objective knowledge and belief becomes dangerously blurred. Students are taught not to think critically about their beliefs or values but to accept them as fact, leaving little room for exploration, dialogue, or intellectual growth. The digital environment, where much of the learning takes place through pre-recorded lessons and automated grading systems, exacerbates this issue by limiting opportunities for meaningful teacher-student interaction.

The Corporate Takeover of Higher Education: Robocolleges and Faith-Based Learning

The influence of private companies and venture capital isn’t just limited to K-12 education. As online education expands, the model of faith-based learning is also infiltrating higher education. Many institutions are now offering Christian-based online degree programs, promising students a “Christian worldview” in subjects ranging from business to theology. While these programs may appeal to individuals seeking a religiously informed education, they raise concerns about the quality and breadth of education students receive.

The rise of “Robocolleges”—virtual universities run by corporations that offer online degrees—is another manifestation of the growing corporate control over education. These online programs, often funded by investors looking for high returns, can prioritize cost-efficiency and marketability over rigorous academic standards. In the case of faith-based online institutions, the goal can shift from providing a comprehensive education that challenges students to think critically about the world, to creating a narrow ideological framework where students are encouraged to see the world solely through the lens of Christianity.

In this environment, the rise of “Robostudents”—individuals who navigate education through algorithms and automated platforms—further deepens the risk of creating a generation of individuals who are highly specialized but lack the broad intellectual and social competencies needed to thrive in a diverse world.

Christian Robokids: The Future of Digital Indoctrination

A particularly concerning aspect of the rise of Christian cybercharters and online academies is the emergence of Christian Robokids—students who, in addition to receiving a faith-based education, are increasingly immersed in a highly automated, digital, and corporate-driven learning environment. As Christian cybercharters adopt more sophisticated AI and data-driven learning platforms, children may begin to engage with content not only through pre-recorded lessons but through AI-powered tutors and personalized learning paths that adapt to each student's “progress.” While this may sound appealing in theory, it opens the door for a future in which students are not only learning religious doctrine but are also being trained to conform to predetermined educational frameworks, shaped more by corporate interests than intellectual freedom.

Christian Robokids would navigate a digital education system where their learning is increasingly controlled by algorithms designed to maximize efficiency and profitability. These students could interact with content tailored to reinforce a singular religious viewpoint, with little to no exposure to diverse perspectives. In a world of Robokids, students might not engage in real discussions with teachers or peers, but instead follow rigid, automated curriculums. Their development into “robostudents” is further cemented by the complete absence of opportunities for face-to-face interaction, debate, and critical engagement with differing worldviews.

Moreover, the lack of teacher oversight in an entirely virtual system means that students may miss out on developing social and emotional intelligence, important for engaging in the complex, pluralistic world beyond the screen. The robotic nature of learning—where students become passive recipients of information rather than active participants—poses long-term risks to the intellectual and social development of children in these environments.

The Biggest Christian Online Academies

Several major Christian online academies are leading the charge in this digital faith-based education landscape, offering K-12 programs that blend academic rigor with Christian values. These academies not only cater to homeschool families but also serve as alternatives to public school systems, providing religiously grounded curricula that focus on both intellectual development and spiritual growth. Some of the largest and most well-known Christian online academies include:

1. Liberty University Online Academy – This academy offers a comprehensive K-12 online program with a strong focus on biblical teachings alongside standard academic subjects. Liberty University, a major Christian institution, has established a reputation for delivering accredited programs that combine faith and learning.

2. BJU Press Online Academy – Known for its biblical integration and classical Christian education approach, BJU Press offers a fully accredited K-12 online program that focuses on a Christ-centered worldview while delivering high-quality academics.

3. Alpha Omega Academy (AOP) – A significant player in the Christian homeschooling space, AOP’s online academy offers a customizable, accredited K-12 curriculum. Its flexible approach allows families to integrate Bible-based teachings into core subjects.

4. The King’s Academy – A Christian online school that blends academic excellence with spiritual development, providing a biblically integrated curriculum from kindergarten to high school.

5. Veritas Scholars Academy – Known for its classical Christian education model, Veritas offers online courses with a focus on critical thinking, intellectual development, and biblical integration for students in K-12.

These online academies reflect the growing demand for faith-based education in the digital era, offering flexible options for families who prioritize both academic excellence and spiritual growth. However, as these institutions scale and continue to integrate new technologies, the risk of further corporate influence and educational homogenization grows, raising questions about the long-term impact on students' ability to think critically and engage with a diverse world.

The Danger of "Garbage In, Garbage Out" in Faith-Based Education

A worrying byproduct of the corporate-driven Christian cybercharter model is the “Garbage In, Garbage Out” phenomenon. Just as for-profit companies may prioritize profits over educational outcomes, so too does this model risk producing students who are poorly prepared for the real world. If the content students are being fed is biased, ideologically driven, or scientifically flawed, the result will be a generation of graduates whose knowledge is narrow, incomplete, and disconnected from the realities of an increasingly diverse and complex world.

Christian cybercharters, while offering a religious alternative to public schools, risk leaving students unprepared for intellectual challenges and social engagement. Without the opportunity to engage with diverse perspectives or develop critical thinking skills, students may find themselves ill-equipped to navigate the broader society or the ever-changing workforce.

Conclusion: The Future of Faith-Based Education

As the trend of Christian cybercharters and online academies continues to grow, the future of faith-based education remains uncertain. Will these digital platforms provide students with the academic rigor, critical thinking skills, and social understanding they need to thrive in a complex world, or will they become vehicles for ideological conformity and corporate profit? As parents and educators, it is critical to carefully evaluate these programs, balancing faith-based values with a commitment to fostering intellectual independence and a well-rounded education that prepares students for life beyond the classroom.

CBO's Revised Student Loan Projections and FSA Operational Costs (Glen McGhee)

The Congressional Budget Office (CBO) has dramatically revised its projections for the federal student loan program, transforming what was once expected to be a profitable government investment into a significant fiscal liability. This report examines the details of these projection changes and analyzes the operational costs of the Federal Student Aid (FSA) program.

The CBO's updated budget projections released in 2024 reveal a stark shift in the expected financial performance of the federal student loan program. These projections represent a significant revision from earlier expectations and highlight growing concerns about the sustainability of current student lending policies.

According to the Committee for a Responsible Federal Budget (CRFB), the estimated federal cost of student loans issued between 2015 and 2024 has increased by $340 billion – transforming from a projected gain of $135 billion in the 2014 baseline to an expected loss of $205 billion in the 2024 baseline15. This represents a complete reversal in the financial outlook for the program over the past decade.

This dramatic shift is particularly evident when examining the changing projections for specific loan cohorts. In 2014, the CBO projected that taxpayers would generate an 11-cent profit for every dollar of student loans issued by the federal government in fiscal year 2024. However, the most recent projections indicate that taxpayers will instead incur a 20-cent loss per dollar of loans issued this fiscal year6.

Looking ahead, the situation appears even more concerning. Over the 2024-2034 budget window, the CBO expects federal student loans to cost taxpayers $393 billion1. This amount exceeds the $355 billion CBO expects to be spent on Pell Grants, the flagship college aid program for low-income students, over the same time period1.

The projected $393 billion cost includes several components:

• $221 billion in losses on the $1.1 trillion in student loans the federal government will issue during this period
• $140 billion in re-estimates of the losses taxpayers will bear on outstanding loans
• $34 billion toward administering the student loan programs6

One particularly concerning aspect of the CBO projections is the growing cost of graduate student loans. These loans are expected to make up around half of new student loans originated in the current fiscal year11. The CBO projects that taxpayers will lose $102 billion on lending to graduate students over the coming decade11. According to the CRFB, graduate school loans are now nearly as subsidized as undergraduate loans and make up half of the cost of newly issued student loans15.

The dramatic increase in projected costs has several primary causes, as identified in the CBO reports and analyses by financial experts.

The primary catalyst for the growing losses is the expansion and increased utilization of income-driven repayment (IDR) plans6. While a borrower repaying loans under a traditional fixed-term repayment plan typically repays more than the initial amount borrowed, a typical borrower using an IDR plan will repay significantly less than the original loan amount6.

The CBO projects that taxpayers will lose between 30 and 48 cents for every dollar in federal student loans issued in fiscal year 2024 and repaid on an IDR plan1. Preston Cooper notes in his LinkedIn post that "the role of IDR plans in driving these costs can't be overstated. CBO generally expects taxpayers to profit on loans repaid through traditional fixed-term repayment plans. But loans repaid on IDR plans will incur losses ranging from 30 to 48 cents on the dollar"1.

The Biden administration's student loan forgiveness initiatives are cited as significant contributors to the growing cost of the program. The House Budget Committee press release states that "$140 billion or over a third of this cost directly stems from President Biden's student loan forgiveness schemes"7. These initiatives include changes to income-driven repayment plans to make them more generous1.

Beyond the projected losses on the loans themselves, the Federal Student Aid (FSA) program incurs significant operational costs to administer federal student aid programs.

According to FSA's 2024 annual report, the agency operated on an annual administrative budget of approximately $2.1 billion during FY 20244. As of September 30, 2024, FSA was staffed by 1,444 full-time employees who are primarily based in FSA's headquarters in Washington, DC, with additional staff in 10 regional offices throughout the country4.

The Department of Education's Salaries and Expenses Overview provides additional insight into how these administrative funds are allocated. The Student Aid Administration account consists of two primary components:

1. Salaries and Expenses
2. Servicing Activities

In the fiscal year 2020 budget request, for example, the Student Aid Administration account totaled $1,812,000,000, with $1,281,281,000 allocated for Salaries and Expenses and $530,719,000 for Servicing Activities5.

The latest CBO projections highlight a dramatic shift in the financial outlook for the federal student loan program. What was once projected to be a profitable government investment has transformed into a significant fiscal liability, with taxpayers expected to lose hundreds of billions of dollars over the next decade.

This transformation raises important questions about the sustainability of current policies and the potential need for reforms to address growing costs. The substantial operational budget of FSA ($2.1 billion annually) adds to the overall fiscal impact of federal student aid programs.

As policymakers consider the future of federal student aid, they will need to grapple with balancing access to higher education with fiscal responsibility and ensuring that federal resources are allocated efficiently and effectively.

Citations:

1. https://www.linkedin.com/posts/preston-cooper-479331a4_the-congressional-budget-office-cbo-released-activity-7209166019871809536-8vM2
2. https://www.farmers.gov/sites/default/files/2021-10/usda-farmloans-factsheet-10-20-2021.pdf
3. https://www.cbo.gov/publication/59499
4. https://studentaid.gov/sites/default/files/fy2024-fsa-annual-report.pdf
5. https://www.ed.gov/media/document/w-seoverviewpdf-39165.pdf
6. https://www.forbes.com/sites/prestoncooper2/2024/06/19/cbo-cost-of-federal-student-loans-nears-400-billion/
7. https://budget.house.gov/press-release/via-forbes-cbo-cost-of-federal-student-loans-nears-400-billion
8. https://www.fsa.usda.gov/resources/programs/farm-operating-loans
9. https://www.opm.gov/healthcare-insurance/flexible-spending-accounts/
10. https://crsreports.congress.gov/product/pdf/R/R46143
11. https://edworkforce.house.gov/uploadedfiles/2.5.25_cooper_testimony_house_ed_and_workforce_final.pdf
12. https://studentaid.gov/data-center/student/portfolio
13. https://www.agcredit.net/loans/beginning-farmer-loans/fsa-loans
14. https://www.oklahomafarmreport.com/okfr/2025/01/07/usda-increases-funding-for-new-specialty-crop-program-reminds-producers-of-upcoming-deadlines/
15. https://www.crfb.org/blogs/student-loans-cost-340-billion-more-expected
16. https://farmdoc.illinois.edu/wp-content/uploads/2022/09/USDA-FSA-Your-Guide-to-Farm-Loans.pdf
17. https://www.cbo.gov/publication/59946
18. https://gaswcc.georgia.gov/document/document/microloans-fact-sheet-aug-2019/download
19. https://www.cbo.gov/publication/60682
20. https://www.farmraise.com/blog/fsa-loan-types
21. https://www.cbo.gov/publication/60713
22. https://www.fsa.usda.gov/programs-and-services/farm-loan-programs/farm-operating-loans
23. https://www.cato.org/briefing-paper/ending-federal-student-loans
24. https://fsapartners.ed.gov/knowledge-center/fsa-handbook/2022-2023/vol3/ch2-cost-attendance-budget
25. https://www.congress.gov/crs-product/R43571
26. https://fsapartners.ed.gov/knowledge-center/fsa-handbook/2023-2024/vol3/ch2-cost-attendance-budget
27. https://sustainableagriculture.net/publications/grassrootsguide/credit-crop-insurance/direct-and-guaranteed-farm-loans/
28. https://www.ed.gov/sites/ed/files/about/overview/budget/budget24/summary/24summary.pdf
29. https://studentaid.gov/sites/default/files/fy2023-fsa-annual-report.pdf
30. https://bipartisanpolicy.org/explainer/federal-student-aid-an-overview/
31. https://www.ed.gov/about/ed-organization/functional-statements/fsa-functional-statements/finance
32. https://www.pgpf.org/our-national-debt/
33. https://www.cbo.gov/publication/60419
34. https://www.mercatus.org/research/data-visualizations/cbo-export-import-bank-fha-mortgage-guarantees-and-doed-student-loan
35. https://www.crfb.org/papers/analysis-cbos-march-2024-long-term-budget-outlook

Higher Education Inquirer continues to follow IPO/sale of University of Phoenix

On March 6, 2025, Apollo and Vistria publicly announced a possible IPO or sale of the University of Phoenix.  These companies have been trying to sell the University of Phoenix since 2021, but there have been no takers. The owners claim the school is worth $1.5B to $1.7B, but we (and experts we know) are skeptical, given the financials we have seen so far. The University of Phoenix was previously on sale for about $500M-$700M but the University of Arkansas System, the State of Idaho, and apparently other colleges declined the offers. 

The University of Phoenix offers subprime education to folks, historically targeting servicemembers, veterans, and people of color. While some students may profit from these robocollege credentials, one wonders what these workers actually learn. The current student-teacher ratio at the University of Phoenix, according to the US Department of Education, is 132 to 1.   

The University of Phoenix has faced a number of scandals, sometimes getting away with no penalty, and other times paying large fines.  

In 2023 we made a Freedom of Action (FOIA) request to the US Department of Education (ED) to get Phoenix's most recent audited financials. In March 2025, more than 20 months later, we were provided with a 35-page report, audited by Deloitte, with numbers from 2021 and 2022. 

HEI has filed a number of FOIAs with ED and discovered that almost 1 million former University of Phoenix students owe approximately $21.6 Billion in student loan debt. In addition, about 19,000 borrowers have had their student loans forgiven as a result of the Sweet v Cardona Borrower Defense to Repayment case.  According to ED FOIA 23-02373-F, more than 73,000 have filed fraud claims against the school. 

This month the Higher Education Inquirer followed up with a Freedom of Information request with the ED to obtain more up-to-date financial numbers for the University of Phoenix. We hope they will be responsive and timely enough to get the word out to the public.   

Borrower Defense Case Goes to US Supreme Court. How will it decide?

On January 10, 2025, the U.S. Supreme Court granted the Department of Education’s petition for a writ of certiorari to review the U.S. Court of Appeals for the Fifth Circuit’s decision in Career Colleges and Schools of Texas v. Department of Education. The Fifth Circuit had preliminarily enjoined the 2022 Borrower Defense to Repayment (BDR) final rule on a nationwide basis. This rule, published on November 1, 2022 (87 Fed. Reg. 65,904), is a key component of the Biden administration’s broader student loan forgiveness efforts.

The Supreme Court’s review will focus on one pivotal question: whether the court of appeals erred in holding that the Higher Education Act does not permit the assessment of borrower defenses to repayment before default, in administrative proceedings, or on a group basis. Notably, the Court will not address the second question posed by the Department: whether the appeals court erred in ordering the district court to grant preliminary relief on a universal basis.

Background and Legal Battle

The lawsuit originated on February 28, 2023, when the Career Colleges and Schools of Texas (CCST) filed in the United States District Court for the Northern District of Texas. CCST sought to enjoin and vacate the 2022 BDR rule, arguing that it creates unlawful processes, serves no legitimate purpose under the Higher Education Act, and constitutes executive overreach by the Biden administration, violating the Department’s statutory authority and the Constitution’s separation of powers.

After the U.S. District Court for the Western District of Texas denied the preliminary injunction, CCST pursued an interlocutory appeal to the Fifth Circuit. On April 4, 2024, the Fifth Circuit overturned the lower court’s decision and, despite the Department’s objections, postponed the effective date of the 2022 BDR rule pending final judgment. The Department’s petition for rehearing was denied, prompting its appeal to the Supreme Court.

What’s at Stake

The Supreme Court’s decision will likely have significant consequences for both borrowers and institutions. If the Court rules against the Department of Education, it could severely limit the scope of borrower defense claims, especially on a group basis, making it harder for defrauded students to receive relief. For-profit colleges and other institutions might feel emboldened to challenge similar regulations and forgiveness measures.

A ruling in favor of the Department, while seemingly less likely given the Court’s conservative majority, would affirm the Biden administration’s approach to processing borrower defenses and may secure loan forgiveness for thousands of borrowers who attended predatory institutions.

The Political Dimension

The timing of this case is crucial. Just days before the Supreme Court granted certiorari, the Biden administration announced the cancellation of loans for 150,000 borrowers—most of which were through the borrower defense process. Shortly afterward, additional forgiveness for income-based repayment plan borrowers and individual borrower defense approvals was announced. However, the future of these forgiveness efforts remains uncertain, as the second Trump administration has signaled intentions to rollback or revise Biden’s loan forgiveness policies.

A Conservative Court’s Approach to Executive Power

Given the Supreme Court’s current composition and its recent track record in cases like West Virginia v. EPA, it seems likely that the justices will scrutinize the executive authority wielded in crafting the BDR rule. The conservative majority may favor a narrow interpretation of the Higher Education Act, signaling that large-scale forgiveness should come from Congress rather than executive agencies.

Conclusion

The Supreme Court’s ruling on the 2022 BDR rule will set a precedent that could define the future of student debt relief and the Department of Education’s authority. For borrowers hoping for widespread relief, the outcome could mean the difference between long-awaited forgiveness and a protracted legal battle. For institutions, particularly for-profits, a ruling against the Department could bolster their resistance to accountability measures.

A Planned Failure? The Dangerous Path to Privatizing Student Loans

In a move that has raised eyebrows across Washington and beyond, President Donald Trump recently announced a plan to transfer the U.S. Department of Education’s vast student loan portfolio—totaling a staggering $1.8 trillion—to the Small Business Administration (SBA). Ostensibly, the goal is to "reorganize" and streamline the management of federal student loans. But behind the curtain, some experts and insiders are questioning whether this bold move is merely the beginning of a much darker plan: privatization at the expense of millions of American borrowers.

The Alleged 'Rescue' of the Loan Portfolio

The White House has framed the transfer as a necessary step to relieve the Department of Education (ED) of a heavy burden, positioning the Small Business Administration as the new "caretaker" of the nation’s student debt. According to President Trump, the SBA—under the leadership of Kelly Loeffler—will now handle the $1.8 trillion student loan portfolio, while the Department of Education focuses on other key educational initiatives.

For some, the move seems like a fresh approach to a problem that has long plagued U.S. higher education: the overwhelming student debt crisis. However, a deeper look into the mechanics of the transfer suggests that this could be the first step toward a far more troubling goal: the dismantling of the federal student loan system and the privatization of debt, a shift that could harm millions of consumers in the process.

The SBA’s Inexperience with Student Loans

For starters, the SBA has no real experience with managing educational debt. Historically, the agency has focused on small business loans, a niche financial product entirely different from student loans. The SBA is not equipped to handle the complex structure of federal student loans, which include income-driven repayment plans, loan forgiveness programs, and myriad protections for borrowers struggling to repay their debt.

While the SBA does have experience guaranteeing loans, it has never managed a portfolio of this size or complexity. With the agency also facing a 43% workforce reduction, including 2,700 staff members, it seems highly unlikely that the SBA will be able to competently manage the student loan system—especially when 40% of these loans are already in default or behind on payments.

This raises an obvious question: is the SBA being set up to fail?

The Planned Failure

According to several former senior officials within the Department of Education and others close to the discussions, the transfer of the student loan portfolio to the SBA could very well be a deliberate failure. These sources suggest that the true purpose of the transfer is not to improve the system, but to destabilize it—creating a crisis that would ultimately justify selling off the loan portfolio to private companies. In other words, the apparent "failure" of the SBA to manage the loans could be the prelude to a much broader and more damaging shift.

“This is the classic playbook of the privatization agenda: create a crisis, then say the only solution is to sell off the asset to the private sector,” one former senior Education Department employee explained. “If the SBA fails to manage the portfolio, it will create a narrative that only the private sector can do it effectively, and that will pave the way for Wall Street to swoop in.”

This strategy mirrors similar efforts in other sectors, where privatization has often been sold as a solution to government inefficiency. In the case of student loans, the "failure" of the SBA to properly manage the portfolio could lead to a private sector takeover, where for-profit companies would be free to set the terms of repayment, charge higher interest rates, and strip away borrower protections—all at the expense of consumers.

The Consumer Cost

While the government may pocket the short-term profits from selling off the portfolio, it is borrowers who will feel the brunt of the consequences. Private companies, driven by the desire for profits, would have little incentive to offer the same borrower-friendly protections currently available under the federal student loan system.

The end of income-driven repayment options, the loss of loan forgiveness programs, and an end to the temporary moratorium on student loan payments could push millions of borrowers into even deeper financial distress. Higher interest rates, less favorable repayment terms, and a complete lack of support for struggling borrowers are all potential outcomes if the loans are sold to the private sector.

Moreover, the move could disproportionately affect low-income borrowers and those already in default, who would likely face harsher terms under a privatized system. For many, this could mean years—or even decades—of paying off debt that continues to balloon, with no hope of relief.

A Dangerous Precedent

If this plan succeeds, it will set a dangerous precedent. The government's involvement in student loans has, for decades, been a safety net for borrowers. The idea of privatizing this essential system could open the floodgates for more essential public services to be sold off to private corporations, with little regard for the public good.

“Once you give the private sector control over something as critical as education debt, it’s hard to see where it stops,” said another insider. “This is not just about student loans. It’s about how we view the role of government in providing public services.”

The Long-Term Fallout

In the long run, the privatization of student loans could exacerbate the country’s growing wealth inequality, widen the racial wealth gap, and place an insurmountable burden on future generations of borrowers. For many, student loans are not just a financial issue—they are a life issue, affecting everything from career prospects to the ability to buy a home or start a family. The sale of the loan portfolio could result in an economic landscape where the cost of education becomes a permanent burden on a generation, with few avenues for relief.

A Predatory Scheme?

The proposed transfer of the student loan portfolio to the SBA may appear to be an effort to reform the system, but closer inspection reveals a much darker agenda: one that seeks to create a crisis that will pave the way for the privatization of federal student loans. While the government may stand to gain in the short term, the long-term consequences for borrowers could be devastating.

In the end, the real price of this maneuver will be paid by consumers, who could face higher costs, fewer protections, and more financial instability. If this plan moves forward as expected, it will be a devastating blow to the millions of Americans who rely on the federal student loan system—a Pyrrhic victory that benefits private interests, but leaves consumers to bear the consequences.

In the quest for privatization, the true cost of this gamble may well be borne by those who can least afford it: the borrowers.

AFT President Selling Out to Edtech?

American Federation of Teachers (AFT) President Randi Weingarten is scheduled to speak at the upcoming ASU-GSV summit. For 16 years, the conference has been a space for those in edtech to hype their ideas, both good and bad.  We have noted a few of these bad ideas from bad actors over the years, to include 2U, Guild, and Ambow Education. 

Given Weingarten's track record as President of AFT, we don't expect much from her in terms of speaking truth to power. There are many people in edtech that Weingarten should criticize at the summit. But she is too much of a politician to do such a thing when it is needed.  

Weingarten has been the President of AFT since 2008, a union with about 1.7 million members across the US. While AFT has had some victories, those victories were won by the rank-and-file and the hard work of AFT organizers, not due to the actions of Weingarten. With numbers that large, AFT could pose as a serious presence at demonstrations in DC and across the nation. They have done that, when they had to, but not when other folks' lives were at stake. 

In 2013, while Weingarten was President of AFT, we recommended that the union use its clout to tell teachers' pension programs and state retirement funds from investing in for-profit colleges like Corinthian Colleges, Education Management Corporation, ITT Tech, and the University of Phoenix. They refused. We have not forgotten how AFT was unwilling to defend consumers, student debtors, and retirees. 

Since that time, AFT has done little to defend folks against subprime robocolleges and online program managers like 2U and Academic Partnerships/Risepoint when they certainly needed to call them out. And now their ranks are full of educators and administrators with marginal online degrees.

States, Suing Trump Over Gutting of Education Dept., Cite Threat of Predatory College Abuses (David Halperin)

Twenty-one Democratic state attorneys general sued President Trump and Secretary of Education Linda McMahon today, 48 hours after the Department of Education announced it was firing more than 1,300 employees, which, combined with previously Trump-Musk efforts to cull the staff, reduced the employee roster to less than half of the 4000+ person team that was working as of January.

The 53-page complaint, filed in federal court in Massachusetts, alleges that the staff reductions are illegal and unconstitutional, because they are “equivalent to incapacitating key, statutorily-mandated functions of the Department.” The AGs say that although McMahon has authority from Congress to restructure the Department, she is “not permitted to eliminate or disrupt functions required by statute, nor can she transfer the department’s responsibilities to another agency outside of its statutory authorization.”

Among the federal statutes that the state AGs contend will be undermined by this week’s staff cuts are those covering higher education, including the Department’s obligations to ensure that federal student grants and loans may be used only at colleges and universities that provide quality educations and comply with the law. The complaint notes that the Department is charged with ensuring that colleges receiving federal aid are financially responsible, that they submit to financial audits, and that they provide adequate counseling to students concerning debt management.

The AGs also note that the Department is required to review and approve private college accrediting agencies, because under the law only schools approved by Department-recognized accreditors are eligible for federal student aid. Without that process, the AGs warn, “institutions of higher education may engage in profit-seeking behaviors without relating any educational benefits to students.”

The AGs might have added that the cuts will undermine the capacity of the Department to directly investigate colleges that engage in predatory and deceptive behavior. Data released by the Department shows the largest number of layoffs — 326 people — were at the Office of Federal Student Aid (FSA), which oversees student lending and school compliance with legal obligations not to mislead and abuse students.

The Department of Education’s higher education accountability efforts over decades have often been half-hearted and ineffectual; despite the scores of staff assigned to overseeing colleges, many students, and hundreds of billions in taxpayer dollars, have been directed to deceptive, poor-quality schools that have left many students worse off than when they started. But gutting these efforts to the degree suggested by this week’s staff reductions would make matters much worse. And the first-term higher education record of President Trump, guided by Secretary of Education Betsy DeVos and her aide Diane Auer Jones, was heavily skewed in favor of slashing accountability rules and enforcement, providing no reason to be optimistic that an aim of slashing the staff this year is to improve accountability.

The cuts would also undermine core Department responsibilities in K-12 education, civil rights, disability rights, privacy rights, campus safety, and the student loan portfolio.

Secretary McMahon is publicly insisting that everything will be fine and more efficient with the reduced and reorganized staff. But, as the new lawsuit from the attorneys general notes, McMahon said on Tuesday that the firing are the “first step” on the road to a “total shutdown” of the Department.

The attorneys general who filed the complaint are from Arizona, California, Colorado, Connecticut, Delaware, Hawaii, Illinois, Maine, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, Oregon, Rhode Island, Washington, Wisconsin, Vermont and the District of Columbia.

Former Department officials and education advocates plan to rally Friday morning at 8 am outside Department of Education headquarters in Washington to protest the mass firings and plans to shut down the agency.

[Editor's note: This article originally appeared on Republic Report.]  

The Dark Legacy of Elite University Medical Centers

 

(Image: Mass General is Harvard University Medical School's teaching hospital.)  

 

For decades, America’s elite university medical centers have been the epitome of healthcare research and innovation, providing world-class treatment, education, and cutting-edge medical advancements. Yet, beneath this polished surface lies a troubling legacy of medical exploitation, systemic inequality, and profound injustice—one that disproportionately impacts marginalized communities. While the focus has often been on racial disparities, this issue is not solely about race; it is also deeply entangled with class. In recent years, books like Medical Apartheid by Harriet Washington have illuminated the history of medical abuse, but they also serve as a reminder that inequality in healthcare goes far beyond race and touches upon the economic and social circumstances of individuals.

The term Medical Apartheid, as coined by Harriet Washington, refers to the systemic and institutionalized exploitation of Black Americans in medical research and healthcare. Washington’s work examines the history of Black Americans as both victims of medical experimentation and subjects of discriminatory practices that have left deep scars within the healthcare system. Yet, the complex interplay between race and class means that many poor or economically disadvantaged individuals, regardless of race, have also faced neglect and exploitation within these prestigious medical institutions. The legacy of inequality within elite university medical centers, therefore, is not limited to race but is also an issue of class disparity, where wealthier individuals are more likely to receive proper care and access to cutting-edge treatments while the poor are relegated to substandard care.

Historical examples of exploitation and abuse in medical centers are well-documented in Washington's work, and contemporary lawsuits and investigations reveal that these systemic problems still persist. Poor patients, especially those from marginalized racial backgrounds, are often viewed as expendable research subjects. The lawsuit underscores the intersectionality of race and class, arguing that these patients’ socio-economic status exacerbates their vulnerability to medical exploitation, making it easier for institutions to treat them as less than human, especially when they lack the resources or power to contest medical practices.

One of the most critical components of this issue is the stark contrast in healthcare access between the wealthy and the poor. While elite university medical centers boast state-of-the-art facilities, cutting-edge treatments, and renowned researchers, these resources are often not equally accessible to all. Wealthier patients are more likely to have the financial means to receive the best care, not just because of their ability to pay but because they are more likely to be referred to these prestigious centers. Conversely, low-income patients, especially those without insurance or with inadequate insurance, are often forced into overcrowded public hospitals or community clinics that are underfunded, understaffed, and unable to provide the level of care available at elite institutions.

The issue of class inequality within medical care is evident in several key areas. For instance, studies have shown that low-income patients, regardless of race, are less likely to receive timely and appropriate medical care. A 2019 report from the National Academy of Medicine found that low-income patients are often dismissed by healthcare professionals who underestimate the severity of their symptoms or assume they are less knowledgeable about their own health. In addition, patients from lower socio-economic backgrounds are more likely to experience medical debt, which can lead to long-term financial struggles and prevent them from seeking care in the future.

Moreover, class plays a significant role in the underrepresentation of poor individuals in medical research, which is often conducted at elite university medical centers. Historically, clinical trials have excluded low-income participants, leaving them without access to potentially life-saving treatments or advancements. Wealthier individuals, on the other hand, are more likely to be invited to participate in research studies, ensuring they benefit from the very innovations and breakthroughs that these institutions claim to provide.

Class-based disparities are also reflected in the inequities in medical professions. The road to becoming a physician or researcher in these elite institutions is often paved with significant economic barriers. Medical students from low-income backgrounds face steep financial challenges, which can hinder their ability to gain acceptance into prestigious medical schools or pursue advanced research opportunities. Even when low-income students do manage to enter these programs, they often face biases and discrimination in clinical settings, where their abilities are unfairly questioned, and their economic status may prevent them from fully participating in research or other educational opportunities.

Yet, the inequities within these institutions don’t stop at the patients. Behind the scenes, workers at elite university medical centers, particularly those from working-class and marginalized backgrounds, face their own form of exploitation. These medical centers are not only spaces of high medical achievement but also sites of labor stratification, where workers in lower-paying roles are largely people of color and often immigrants. Support staff—such as janitors, food service workers, custodians, and administrative assistants—are often invisible but essential to the functioning of these hospitals and research institutions. These workers face long hours, poor working conditions, and low wages, all while contributing to the daily operations of elite medical centers. Many of these workers, employed through third-party contractors, lack benefits, job security, or protections, leaving them vulnerable to exploitation.

Custodial workers, who are often exposed to hazardous chemicals and physically demanding work, may struggle to make ends meet, despite playing a crucial role in maintaining the hospital environment. Similarly, food service workers—many of whom are Black, Latinx, or immigrant—also work in demanding conditions for low wages. These workers frequently face job insecurity and are not given the same recognition or compensation as the high-ranking physicians, researchers, or administrators in these centers.

At the same time, the stratification in these institutions extends beyond support staff. Medical researchers, residents, and postdoctoral fellows—often young, early-career individuals, many from working-class backgrounds or communities of color—are similarly subjected to precarious working conditions. These individuals perform much of the vital research that drives innovation at these centers, yet they often face exploitative working hours, low pay, and job insecurity. They are the backbone of the institution’s research output but frequently face barriers to advancement and recognition.

The higher ranks of these institutions—senior doctors, professors, and researchers—enjoy financial rewards, job security, and prestige, while those at the lower rungs continue to experience instability and exploitation. This division, which mirrors the economic and racial hierarchies of broader society, reinforces the very class-based inequalities these medical centers are meant to address.

In recent years, some progress has been made in addressing these inequalities. Many elite universities have implemented diversity and inclusion programs aimed at increasing access for underrepresented minority and low-income students in medical schools. Some institutions have also begun to emphasize the importance of cultural competence in training medical professionals, acknowledging the need to recognize and understand both racial and economic disparities in healthcare.

However, critics argue that these efforts, while important, are often superficial and fail to address the root causes of inequality. The institutional focus on "diversity" and "inclusion" often overlooks the more significant structural issues, such as the affordability of education, the class-based access to healthcare, and the economic barriers that continue to undermine the ability of disadvantaged individuals to receive quality care.

In addition to acknowledging racial inequality, it is crucial to tackle the broader issue of class within the healthcare system. The disproportionate number of Black and low-income individuals suffering from poor healthcare outcomes is a direct result of a system that privileges wealth and status over human dignity. To begin addressing these issues, we need to move beyond token diversity initiatives and work toward policy reforms that focus on economic access, insurance coverage, and the equitable distribution of medical resources.

Scholars like Harriet Washington, whose work documents the intersection of race, class, and healthcare inequality, continue to play a pivotal role in bringing attention to these systemic injustices. Washington’s book Medical Apartheid serves as a historical record but also as a call to action for creating a healthcare system that genuinely serves all people, regardless of race or socio-economic status. The fight for healthcare equity must, therefore, be a dual one—against both racial and class-based disparities that have long plagued our medical institutions.

The story of Henrietta Lacks, as told in The Immortal Life of Henrietta Lacks by Rebecca Skloot, exemplifies the longstanding exploitation of marginalized individuals in elite university medical centers. The case of Lacks, whose cells were taken without consent by researchers at Johns Hopkins University, brings to light both the historical abuse of Black bodies and the profit-driven nature of academic medical research. Johns Hopkins, one of the most prestigious medical centers in the world, has been complicit in the kind of exploitation and neglect that these institutions are often criticized for—issues that disproportionately affect not only Black Americans but also economically disadvantaged individuals.

The Black Panther Party’s healthcare activism, as chronicled by Alondra Nelson in Body and Soul, also directly challenges elite medical institutions’ failure to provide adequate care for Black and low-income communities. Nelson’s work reflects how, even today, these institutions are often slow to address the systemic issues of health disparities that activists like the Panthers fought against.

Recent lawsuits against elite medical centers further underscore the importance of holding these institutions accountable for their role in perpetuating medical exploitation and inequality. In An American Sickness by Elisabeth Rosenthal, the commercialization of healthcare is explored, highlighting how university hospitals and medical centers often prioritize profits over patient care, leaving low-income and marginalized groups with limited access to treatment. Rosenthal’s work highlights the role these institutions play in a larger system that disproportionately benefits wealthier patients while neglecting the most vulnerable.

A Global Comparison: Countries with Better Health Outcomes

While the United States struggles with systemic healthcare disparities, other nations have shown that equitable healthcare outcomes are possible when class and race are not barriers to care. Nations with universal healthcare systems, such as those in Canada, the United Kingdom, and many Scandinavian countries, consistently rank higher in overall health outcomes compared to the U.S.

For instance, Canada’s single-payer system ensures that all citizens have access to healthcare, regardless of their income. This system reduces the financial burdens that often lead to delays in care or avoidance of treatment due to costs. According to the World Health Organization, Canada has better health outcomes on a variety of metrics, including life expectancy and infant mortality, compared to the U.S., where medical costs often lead to unequal access to care.

Similarly, the United Kingdom’s National Health Service (NHS) provides healthcare free at the point of use for all citizens. Despite challenges such as funding constraints and wait times, the NHS has been successful in ensuring that healthcare is a right, not a privilege. The U.K. consistently ranks higher than the U.S. in terms of access to care, health outcomes, and overall public health.

Nordic countries, such as Norway and Sweden, also exemplify how universal healthcare can lead to better outcomes. These countries invest heavily in public health and preventative care, ensuring that even their most marginalized citizens receive the necessary medical services. The result is a population with some of the highest life expectancies and lowest rates of chronic diseases in the world.

These nations show that, while access to healthcare is a critical issue in the U.S., the challenge is not a lack of innovation or capability. Instead, it is the systemic barriers—both racial and economic—that persist in elite medical centers, undermining the potential for universal health equity. The U.S. could learn from these nations by adopting policies that reduce economic inequality in healthcare access and focusing on preventative care and public health strategies that serve all people equally.

Ultimately, the dark legacy of elite university medical centers is not something that can be erased, but it is something that must be acknowledged. Only by confronting this painful history, alongside addressing class-based disparities, can we begin to build a more just and equitable healthcare system—one that serves everyone, regardless of race, background, or socio-economic status. Until this happens, the distrust and skepticism that many marginalized communities feel toward these institutions will continue to shape the landscape of American healthcare. The path forward requires a concerted effort to address both racial and class-based inequities that have defined these institutions for far too long. The U.S. can, and must, strive for healthcare outcomes akin to those seen in nations that have built systems prioritizing equity and fairness—systems that put human dignity over profit.