The Price of Education

The current controversies over lender’s affiliations with colleges and universities have drawn national attention to what exactly the relationship should be between companies that give student loans and educational institutions. Stanford, Notre Dame, and Morehouse College have all had high ranking administration on the boards of companies that give student loans. This creates a conflict of interest, especially because these universities pass out lists of preferred lenders to all of their students.

While Margaret Spellings, the head of the Department of Education, is in the process of establishing a task force to create federal regulations, federalism has allowed state governments to immediately create codes of conduct to be enforced upon lending companies and universities.

The attorney generals of various states have already conducted investigation over the past few years, and it is largely due to their efforts that the states are able to take action so quickly against individual companies.

Attorney General Lisa Madigan of Illinois recently reached an agreement with DeVry University, where DeVry agreed to follow a code of conduct. DeVry will also return $88,122 to students, and remove Citibank from its preferred lenders list.