For-profit institutions are making a lot of headlines. In a time where it seems to many that higher education needs to rapidly transform, they have that capacity and are doing it. Kevin Carey writes about his time spent with one for-profit entrepreneur, Michael Clifford. Clifford specializes in purchasing dying traditional institutions and making them over into for-profits, such as he did in 2004 with Grand Canyon University.

The reputable parts of the industry are at the forefront of much technological and organizational innovation. For-profits exist in large part to fix educational market failures left by traditional institutions, and they profit by serving students that public and private nonprofit institutions too often ignore. While old-line research universities were gilding their walled-off academic city-states, the University of Phoenix was building no-frills campuses near freeway exits so working students could take classes in the evening. Who was more focused on the public interest? Some of the colleges Clifford bought have legacies that stretch back decades. Who else was willing to save them? Not the government, or the church, or the more fortunate colleges with their wealthy alumni and endowments that reach the sky.

But . . . 

[H]e rejects the Obama administration's proposal to cut off federal aid to for-profits at which student-debt payments after graduation exceed a certain percentage of the graduates' income. In fact, he denies that colleges have any responsibility whatsoever for how much students borrow and whether they can pay it back. He won't even acknowledge that student borrowing is related to how much colleges charge.

That refusal is the industry line, and it is crazy nonsense. As a rule, for-profits charge much more than public colleges and universities. Many of their students come from moderate- and low-income backgrounds. You don't need a college degree to know that large debt plus small income equals high risk of default. The for-profit Corinthian Colleges (as of mid-July, market cap: $923-million) estimated in official documents filed with the Securities and Exchange Commission that more than half the loans it makes to its own students will go bad. Corinthian still makes a profit, because it gets most of its money from loans guaranteed by Uncle Sam.