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Wasn't James Garner the Original Maverick?

jsullum@reason.com (Jacob Sullum) — Thu, 21 Aug 2008 11:15:00 EDT

A McCain ad touts the Arizona senator as "the original maverick":

Washington's broken. John McCain knows it. We're worse off than we were four years ago. Only McCain has taken on Big Tobacco, drug companies, fought corruption in both parties. He'll reform Wall Street, battle Big Oil, make America prosper again. He's the original maverick.

By promising to fix Big Government while fighting Big Corporations, McCain clearly is trying to one-up, or at least match, Barack Obama's economic populism. But I fear this is the real McCain, a less squeaky version of Ross Perot. And what's up with "four years ago"? It's hard to believe that the crucial mistake, in McCain's view, was electing George W. Bush instead of John Kerry in 2004, as opposed to picking Bush instead of McCain as the Republican nominee in 2000.

Addendum: ABC's Jake Tapper notes that it's hard to argue the economy is worse now than it was four years ago, at the end of Bush's first term, yet not worse than it was eight years ago, at the end of Bill Clinton's second term:

Our unemployment rate is currently 5.7%. That's higher, worse, than it was four years ago—5.4%. But it's also worse than it was eight years ago: 4.1%.
Our inflation rate was 5.02% in June of this year.
That's worse than it was four years ago—in August 2004, the rate was 2.65%. But it's also worse than it was eight years ago. In August 2000, the inflation rate was 3.41%.

One thing that was "better" (depending on your perspective) in 2004 than it was in 2000: housing prices. Maybe that's what McCain has in mind.

[Thanks to Doug Riblet for the link.]

First Amendment Lite

info@reason.com (Greg Beato) — Tue, 22 Jul 2008 07:00:00 EDT

If you’re a perfume manufacturer and you’d like to name your latest fragrance Opium, no government agent will stop you. The world’s flagship soda is called Coke. A company called Chronic Candy has been selling lollipops flavored with cannabis flower essential oil for eight years. Energy drink connoisseurs routinely enjoy products with names like Fixx, Bong Water, Buzzed, and Speed Freak. Even the controversial energy drink Cocaine is for sale again, after revising its label to comply with Food and Drug Administration guidelines.

If you produce alcoholic beverages, however, puns, drug slang, and ghoulishly percussive monkeys may land you in trouble. Take, for example, the case of the Mt. Shasta Brewing Company. Located in tiny Weed, California, the microbrewery sells bottled versions of its five ales and lagers in retail stores in California, Oregon, and Washington. Since 2004 the bottle caps on all five Mt. Shasta beers have been emblazoned with a slogan that plays on the town’s name: “Try legal Weed.”

Anytime a producer or importer of alcoholic beverages wants to market a new product, it must submit a proposed label to the federal Alcohol and Tobacco Tax and Trade Bureau (TTB) for approval. Earlier this year, when Mt. Shasta proprietor Vaune Dillman turned in his application for a new beer he planned to start bottling, he included the design of the bottle caps. Shortly thereafter, the TTB advised him by fax that the slogan “Try legal Weed” was an impermissible “drug reference,” adding, “We do not believe that responsible industry members should want or would want to portray their products in any socially unacceptable manner.”

To put it another way, the TTB believed the 61-year-old businessman and civic booster was guilty of a thought crime. Although no law on the books explicitly prohibits “drug references” on alcoholic beverage product labels, the bureau told him he had to stop using his socially unacceptable bottle caps.

Every year, the TTB reviews more than 100,000 proposed labels, and because the statutes and regulations it has at its disposal are both extremely specific and extremely vague, its agents often end up behaving more like cultural critics than government bureaucrats—parsing puns, interpreting illustrations, determining the artistic value of the occasional female breast. In theory, the agency is supposed to protect consumers by ensuring that product labels accurately convey a product’s identity and quality. In practice, it often disallows labels (and thus, at least temporarily, products) that it deems bad for the image of the alcoholic beverage industry, short-pouring the First Amendment in the process.

“What would you do if somebody handed you, I don’t know, Hannah Montana beer, and said, ‘Please approve this’?” asks Robert Lehrman, an attorney who specializes in beverage law and has been dealing with the TTB and its predecessor, the Bureau of Alcohol, Tobacco, and Firearms, for more than 20 years. “I don’t think they like making all these immensely subjective decisions on every cotton-picking label that comes down the pike. But that’s how the legislature set it up. The government decided that liquor’s taboo and therefore needs restrictions beyond those for food generally. ”

Thus, if Disney decided to market a Hannah Montana energy drink laced with enough caffeine to power the entire touring cast of High School Musical for a week’s worth of shows, it would not have to submit a proposed label to the FDA—and consequently, the FDA would not be faced with the embarrassing prospect of having to officially “approve” a product that might be considered objectionable.

If Disney decided to create a Hannah Montana pale ale, however, the TTB would either have to give an explicit endorsement or figure out some grounds on which to reject it. In such situations, the TTB resorts to nitpicking. Take the prohibition against “drug references.” While Congress grants agencies like the TTB the authority to create rules and regulations that more thoroughly interpret general statutes, the TTB’s “no drug references” edict isn’t even that official. It’s just a policy that someone decided the bureau should implement for some reason or other. In 1994 the agency published a brief notice in a newsletter outlining the new guidelines for socially acceptable labeling. “I don’t know the particular incident that brought that about,” says Art Resnick, the TTB’s director of public and media affairs, when asked about the origins of the policy. “I could look and see if anybody remembers.”

Being fuzzy on the rule’s history doesn’t prevent the TTB from enforcing it with gusto. In 2003 a Texas liquor importer named Dan Dotson began efforts to import absinthe from Kubler, a Swiss distillery that had been producing the fabled spirit since 1863. Because Kubler’s version contained less than 10 parts per million of thujone, the chemical in wormwood that had kept absinthe off the market in the U.S. since 1912, Dotson believed it was legal to sell here. After several years of discussion, the TTB agreed. But in a 2006 letter to Lehrman, whom Dotson had retained to facilitate the TTB label approval process, the agency insisted that while the beverage Kubler had produced was legal, the word absinthe (along with the variations absynthe, absente, and absinth) was an “illicit drug term” that could not be used on the labels.

Eventually, the TTB softened its stance. Now absinthe can appear on the packaging, but only as a “fanciful term” modifying some other word. One can sell “absinthe verte” or “absinthe superieure”—but not plain old “absinthe.” And probably not “absinthe weed” either. Because of absinthe’s reputation as an illegal, mind-altering substance, the TTB continues to make marketing difficult for anyone interested in selling it.

When Lance Winters, master distiller for St. George Spirits, submitted a label for his version of the spirit in 2007, it took him seven tries before he gained TTB approval. First, he says, the TTB told him the word absinthe appeared in too large a font. Then it told him his label looked too much like a British pound note. Then it said the label’s depiction of a monkey beating a human skull with a pair of femurs implied that the product had hallucinogenic properties—impermissible, since the Code of Federal Regulations does not allow labels that “create a misleading impression.”

This, alas, is government by Rorschach test. Who’s to say exactly what a cartoon monkey indicates about the properties of absinthe? Winters says he simply wanted to create a fun, light-hearted package. “Our distillery has been trying to steer people away from the idea that absinthe has hallucinogenic properties,” he explains. “I don’t want to sell a product based on promises that I can’t deliver. I want to sell this product based on the fact that it’s complex, it’s delicious, it’s something that poets and artists loved to drink because it was inspirational.”

According to Resnick, a basic tenet of the TTB’s approach is voluntary compliance. “We don’t want to take somebody’s permit,” he says. “We don’t want to put anybody out of business. So we work very hard with the businesses that we regulate to achieve voluntary compliance on their part.”

Unfortunately, the voluntary compliance the agency achieves doesn’t always feel so voluntary to those doing the complying. While Winters is happy with how his label turned out—the monkey now bangs, in unambiguously nonhallucinogenic fashion, on a cymbal, not a human skull—all that wrangling left him frustrated. “The product in the bottle had been approved,” he says. “They weren’t protecting anyone from absinthe. They were protecting people from how the absinthe had been presented. It’s wonderful that they offered solutions to help me get the label approved, but what their solutions amounted to was a dumbing down of the labels and a loss of a certain amount of freedom.”

By censoring small businessmen like Winters and Vaune Dillman over purported “drug references,” the government is enforcing the idea that it’s not just illegal to manufacture, sell, or possess certain drugs in America. It’s illegal even to possibly allude to them. Even when confined to the limited scope of alcoholic beverage labels, that’s enough to drive a man to drink.

Contributing Editor Greg Beato is a writer in San Francisco.

When the Government Does It, It's Not Fraud

jsullum@reason.com (Jacob Sullum) — Thu, 17 Jul 2008 18:39:00 EDT

The Federal Trade Commission has proposed (PDF) withdrawing its blessing from the tar and nicotine yields included in cigarette advertisements because these machine-generated numbers are not good indicators of what smokers actually absorb:

The current yields tend to be relatively poor predictors of tar and nicotine exposure. This is primarily due to smoker compensation, i.e., the tendency of smokers of lower-rated cigarettes to take bigger, deeper, or more frequent puffs, or to otherwise alter their smoking behavior [e.g., by subconsciously covering ventilation holes] in order to obtain the dosage of nicotine they need.

The differences between the way a machine smokes in a laboratory and the way people smoke in real life have been acknowledged since the FTC first approved the "FTC method" for measuring tar and nicotine yields in 1966. But the issue has received increasing attention during the last couple of decades. After studies confirmed that the official yields are unreliable indicators of individual exposure, anti-smoking activists and trial lawyers began to argue that the numbers are inherently fraudulent, part of a scam in which tobacco companies trick consumers into believing that "light" cigarettes are less dangerous than full-strength brands. Since the research indicates that "light" cigarette smokers only partially compensate for lower yields, they should still take in less tar than they otherwise would, but any health advantage is smaller than initially hoped. A better approach would have been to increase the nicotine-to-tar ratio, rather than reducing both yields.

In response to these concerns, the FTC now wants to "withdraw its guidance...indicating that factual statements of tar and nicotine yields based on the Cambridge Filter Method generally will not violate the FTC Act." Under its proposed rule, cigarette makers could not assert or imply FTC approval of the yields, and they probably would stop using them entirely, fearing that the commission would deem them misleading. This shift in policy is overdue, but the FTC is less than forthright about its own complicity in making tar and nicotine yields ubiquitous in cigarette ads. The commission says its "1966 guidance does not require companies to state the tar and nicotine yields of their cigarettes in their advertisements or on product labels." But as epidemiologist Ronald Davis and his colleagues noted in a 1990 American Journal of Public Health article (PDF), the story is a little more complicated:

Since 1971, all major cigarette manufacturers have voluntarily disclosed the tar and nicotine yields of cigarette brands in advertisements. The cigarette industry agreed to "voluntary" disclosure after the US Federal Trade Commission (FTC) had proposed a regulation that would have required such disclosure. This agreement does not apply to cigarette packages.

So if advertising tar and nicotine yields amounts to fraud, it's a fraud that was not only endorsed but in effect required by the federal government. That did not stop the federal government from suing the tobacco companies over their "light" cigarette marketing. Nor did concerns about compensatory smoker behavior stop activists and legislators from trying to authorize the Food and Drug Administration to order reductions in nicotine content, a policy that would make cigarettes more hazardous by increasing the amount of toxins and carcinogens absorbed for a given dose of nicotine.

Education for Profit

kmw@reason.com (Katherine Mangu-Ward) — Thu, 03 Jul 2008 12:00:00 EDT

By many measures, the University of Phoenix is the most successful institution for higher education in American history. With more than 325,000 students currently enrolled—22 times the number at the University of Chicago—Phoenix is vast, and contains multitudes. On campuses scattered across 39 states, and online as well, it offers everything from associate's degrees in sports management to Spanish-language MBAs. And unlike most universities, Phoenix makes a hefty profit. Its parent company, the Apollo Group, produced margins of 11.7 percent last year on revenue of $2.9 billion. What began in 1976 as a small night school where firemen and policemen between shifts completed unfinished bachelor's degrees is now an educational and commercial powerhouse listed on NASDAQ, with a market capitalization of $7.4 billion.

But in recent years, the University of Phoenix has become the poster child for everything the mainstream academic establishment thinks is wrong about for-profit higher education. The school's aggressive recruiting practices and high dropout rates have drawn fire from The Chronicle of Higher Education, where a college admissions specialist in 2004 called Phoenix's approach "an affront to the principles that have been developing in college admissions over the last three decades." The head of the major accreditation body for business schools, the Association to Advance Collegiate Schools of Business, last year accused Phoenix of using "a lot of come-and-go faculty." The U.S. Department of Education has punished the school for insufficient hours spent in the classroom and illegal recruiting practices, exacting two settlements during the last decade totaling $15.8 million. "Their business degree," Henry M. Levin, a professor at Columbia University's Teachers College, told The New York Times last year, "is an MBA Lite."

Many of the criticisms are technically accurate. The school does have aggressive recruiters and skimpy class hours. The faculty is nearly all part time. Graduation rates are low, and the level of instruction can be too.

But much of what academic traditionalists see as problems, Phoenix advertises proudly as solutions. The university aims to meet underserved demand for post-secondary education, tailor-made to fit the individual circumstances of harried adults. Like other for-profit schools such as DeVry and ITT, Phoenix offers the educational equivalent of a subprime mortgage: not the best product the industry has to offer, but a potentially valuable option for people who might not otherwise get into a desired market.

As with subprimes, a nonnegligible portion of consumers won't be able to stay afloat, exiting school moderately poorer and perhaps not much wiser. But the students who do graduate—like the millions who use subprime deals to gain a firmer foothold in the housing market—have a much different story to tell. Their tales are not about sunshine on the quad, Saturday night football games, or ivy-covered walls. They're about a kind of practical, bare-bones education that you never see in coming-of-age films but that is usually superior to no education at all.

At the same time, the size of the Phoenix student body—like the number of homeowners during the recent bubble-has been artificially inflated by policies set in Washington. There are legitimate criticisms of the university. But the education establishment's hostility to the institution often lies elsewhere, in an attitude toward for-profit higher ed that is essentially an aversion to change and commerce, the same snobbish disdain directed at payday lenders, providers of adjustable rate mortgages, and inner-city fast-food vendors. Few sins are less forgivable in polite society than offering poor people products they actively seek.

From ‘Plague Spot' to Juggernaut
For-profit higher education is nothing new in America. Up through the 19th century, most doctors, lawyers, and accountants picked up their basic skills at schools that were out to make a buck. The army of typists and stenographers that midwifed the information age at the turn of the last century came pouring out of commercial institutions all over the country. One hundred years ago, most medical schools were still small trade operations run by practicing local or retired doctors as a way to supplement their income.

But in 1910, amid newspaper horror stories about quack doctors ("The Doctor Who Killed His Patients With Germs") and fears that the U.S. was falling behind the rest of the world ("Germany to Stop Quackery"), the Carnegie Foundation sent the prominent educator Abraham Flexner to survey the state of medical education in North America. The influential Flexner Report, which singled out Chicago's 14 mostly for-profit medical schools as "the plague spot of the nation," called for standardizing curriculum and dramatically reducing the overall number of diplomas issued. As a result, the 160 institutions that educated more than 28,000 med students in 1904 became 85 schools educating half that many in 1920. (Among the effects: a decrease in medical competition and an increase in doctors' fees.)

The Progressive Era also saw the creation of the modern research university. Schools such as Princeton, with its Institute for Advanced Study (founded by Flexner himself), hit on the magic formula of combining under one roof undergraduate education, graduate and professional training, and academic research. Universities expanded and began to swallow smaller medical schools. By 1935 there were only 66 medical schools left in the country, 57 of which were affiliated with universities, according to a study by the University of Virginia radiologist Mark Hiatt and the D.C.-based consultant Christopher Stockton.

After World War II, the baby boom and the GI Bill helped usher in the "golden age of higher education," a three-decade stretch in which America went from a country where two-thirds of adults hadn't even managed to complete high school to one in which more than 17 percent earned a college degree. Not coincidentally, this era was also the golden age of public funding for universities. Federal and state research grants and student aid became major sources of revenue for public schools and nonprofits. In 1972 Congress allowed for-profit colleges to sidle up to the government trough as well. Now students were allowed to carry what would eventually be called Pell grants with them from school to school; as with vouchers, the money adhered to the student, not the institution.

John Sperling was a middle-aged professor of humanities at San Jose State University in the mid-1970s when he decided to take advantage of what he saw as a gap in the market by risking his life savings, a whopping $26,000, to start a private school. According to Phoenix's official history, Sperling hatched the idea after realizing that "working adult students were invisible on the traditional campus and were treated as second-class citizens."

Initially, there was little more than a facility in San Jose called the Institute for Professional Development, dedicated exclusively to adult education—that is, education for students past their early 20s. At the time, Sperling found, it was taking adult students in the U.S. about eight years to finish a typical four-year degree, in part because nearly all university business happened during work hours. Even if classes were offered at night, the rest of the campus was typically closed, forcing full-time workers to take time off just to register for class, meet with a professor, or buy a book. By offering extended hours and a host of other individualized tweaks, Sperling made it possible for older students with jobs to satisfy all the requirements for a college degree in about four years.

Sperling's fledgling school left San Jose in 1976 and struck out for Arizona after being denied accreditation (not for the last time), in this case by the Western Association of Schools and Colleges. (Nonprofit regional accreditation bodies certify most schools in the U.S. based on site visits and other measures of quality, though schools do not need any accreditation to operate.) The Institute for Professional Development was reassembled as the University of Phoenix, winning accreditation from North Central Association of Colleges and Schools the following year.

The school grew quickly, graduating its first full class in 1981 and gaining accreditation for a nursing school in 1987. In 1989 it inaugurated an online campus. A few years later it launched an online library, one of the first of its kind, offering course materials and reference books that might otherwise require students to dig through the stacks of an academic library—a time-consuming luxury many Phoenix students can't afford.

Although the university is now best known for its online programs, in which students log on for lessons and group projects and deal with their professors via email, it has more than 200 physical campuses across the country, many of which are little more than leased rooms in buildings near a convenient highway off-ramp.

‘Every Academic Decision Has to Be a Business Decision'
Phoenix first attracted widespread attention when Sperling took his company public in 1994. Since then, the press notices haven't been especially flattering. When the school tried to expand into New Jersey in the late 1990s, New Jersey Education Association Executive Director Robert Bonazzi complained to the Newark Star-Ledger that "pre-packaged programs such as these are the antithesis of any known definition of [academic] freedom."

The criticism has intensified during the last few years. In a series of breathless stories culminating in a comprehensive takedown last year, The New York Times aired accusations by prominent educators, former students, and current and former staff members that at Phoenix "the relentless pressure for higher profits...has eroded academic quality." The story highlighted the school's low graduation rates, numerous sanctions from regulators, and a mounting concern that Phoenix was taking taxpayer education dollars without providing promised services in return. David W. Breneman, dean of the University of Virginia's Curry School of Education, told the Times that "Wall Street has put them under inordinate pressure to keep up the profits, and my take on it is that they succumbed to that." Or as James Samels, president of the Education Alliance consulting firm, put it to the Dallas Morning News in 2004: "One cannot serve two masters. They've got investors, and they have a different mission."

University of Phoenix President Bill Pepicello readily agrees that Phoenix has a different orientation than a traditional school. "A successful for-profit higher education enterprise has to survive on the tension between the academic side and the business side of the house," he says. Students want low tuition and easy classes, so there is always commercial pressure to ease academic rigor. Part-time instructors are cheaper, and a standardized curriculum handed down from on high produces lower transaction costs. "Every academic decision has to be a business decision" Pepicello says, "and, conversely, every business decision is an academic decision." Pepicello, whose previous role at Phoenix was as a dean of academics, thinks for-profit education's reputation is "tainted by earlier endeavors," such as cash-for-paper diploma mills. "Bad business decisions and bad academic decisions left a bad taste," he says.

Phoenix offers a much more substantial education than fly-by-nights like degrees-r-us.com. But there's another aspect of its business decisions that does leave a bad taste.

Asses in Classes
Phoenix's business model relies on federal tax dollars. In 2004-05, its 300,000-plus students received a total of $1.8 billion in federally supported student loans, making it the biggest single recipient of student aid in the country. Because the school, unlike elite universities, receives zero government research grants, every one of those greenbacks from Uncle Sam comes attached to a student, usually in the form of a Pell grant. This leads to a very simple equation: More students equals more money. The school helps students apply for the maximum amount of aid they're eligible to receive and speeds the processing of the government money into their coffers. Phoenix has every incentive to be aggressive in its recruiting practices.

Too aggressive, says the federal government, which in return for ladling out Pell grants attaches several strings to the money. The tension between gobbling up federal aid and satisfying the conditions that come with it is at the heart of Phoenix's legal and reputational troubles. In 2004 a Department of Education report alleged that the university had violated the Higher Education Act by offering financial incentives and free trips to its most successful recruiters, those who, in the recruiters' slang, put the most "asses in classes." Phoenix has paid $9.8 million to the Department of Education for recruitment violations, and in January 2008 the Apollo Group was found liable for fraud because it failed to disclose the report to investors. That decision came with a price tag of about $280 million paid to investors.

I ask President Pepicello about accusations that the university pays commissions based on how many students recruiters enroll, regardless of academic qualifications. "We don't apologize for that," he replies. "Recruiters, as much as anyone else, should have responsibility for what their job description is." Pepicello points out, accurately, that what the law prohibits is paying recruiters "solely" on the basis of enrollment numbers, and he "vigorously" denies that the university does so.

As the University of Virginia's Breneman writes in his 2006 book on for-profit education, Earnings From Learning, "Such practices...are one of the key reasons why economists and others have doubted the wisdom of providing education through the mechanism of for-profit production." According to Breneman and other critics, overly aggressive recruitment leads to Phoenix's high dropout rates.

Using the federal government's standard measure of completing a degree within six years, Phoenix's graduation rate is just 16 percent, compared with nearly 50 percent at traditional schools. That measurement captures only 7 percent of Phoenix's total enrollment, since students who come into the institution with some prior college are not counted, but the school declines to release detailed figures for the remaining 93 percent. Methodologies aside, if 84 percent of any significant segment of your student body is dropping out, that's still pretty bad, a fact Pepicello acknowledges. It is also a less-than-ideal expenditure of federal tax dollars.

Just as there are high default rates on loans given to people with bad credit, Phoenix has high dropout rates (though compared to federally protected mortgage defaulters, Phoenix dropouts carry a modest amount of low-interest loan debt). By keeping admissions standards low, the university is opening up higher education not just to those who can't hack it but to others who can, and who might not have gotten in anywhere else. Phoenix takes the federal money, offers the courses, and considers the high failure rate a cost of doing business.

For-profit schools are not the only ones vulnerable to the distortions of federal education dollars. Nonprofits and state schools wallow in the stuff, too, including research grants and direct subsidies unavailable to Phoenix. What's more, many public schools make up their budget shortfalls not through charging their customers or synching up with employers (from whom Phoenix derives significant revenue) but from extra-academic fund raising, which can invite a whole world of curriculum-bending and attention-sapping distortions of its own. Breneman, a Phoenix critic, writes that he was nonetheless impressed with the comparative amount of time the school's deans spent on actual academic development: "As a dean in a public university, a substantial portion of my time is necessarily devoted to fund-raising and grant procurement. The ironies abound!"

Credentialing Mania
It's not just the people who own the campuses who spend time thinking about how to get their hands on more dough. Many students are in education for the money too. "University of Phoenix is, in some ways, exploiting this credentialing mania in our country," says the Ohio University economist Richard Vedder, who has written extensively about the economics of education. "People want to have a jump on their colleagues—an MBA, an MPH. University of Phoenix is exploiting that desire to make a profit."

Many student customers just want a piece of paper with a credential that their employers will accept. Employers, especially those footing the students' bills, want that piece of paper to be legitimate, backed by a certain amount of achievement. Both want the service to be affordable. Shareholders of the Apollo Group want the whole transaction to produce profits.

Vedder is ultimately enthusiastic about the role that Phoenix and for-profit institutions play: "I think it's great that we have the University of Phoenix. I wish we had more [schools like it]. It's providing a great education service to a large number of Americans at no direct costs to the taxpayers, though I might add that indirectly it depends on government loan money."

Students who stick it out can earn their credentials from Phoenix with a maximum of flexibility and a minimum of fuss; that's why they enroll. This aspect may have attracted such disparate graduates as Secretary of Transportation Mary Peters and basketball star Shaquille O'Neal.

But the typical student is considerably less flashy. Take 29-year-old Samantha Emrick, a lab tech at a hospital in Columbia, South Carolina, who liked her job but didn't see a future in it. Emrick had tried community college back in 2002 but found it was a scheduling nightmare. Evening offerings were so limited that she found herself skipping entire semesters because none of the classes she needed for her requirements were available at convenient times. "Just sitting out like that is really wasting time," she says. Unable to afford going back to school full time, Emrick saw a TV ad for the University of Phoenix's Axia College and decided to enroll.

Axia, a relatively new offering, is designed to speed people with little or no higher education through an associate's degree and prep them for a bachelor's. It's cheap: $7,084 a year, compared with an average tuition of $9,630 in other Phoenix programs and $23,712 at traditional private colleges (public universities average $6,185). "I support myself," Emrick says. She pays for her classes with the help of loans while continuing to work full time. Emrick is about six months into her associate's degree, with a focus in health care administration. She hopes to complete it in November 2008, then go directly into Phoenix's bachelor program. "It's helping me to prepare for being over people, management skills, writing memos, resumés, how to critique yourself," she says. "What I'm learning goes toward everyday life, too, not just professional life."

Faculty Fraud?
One of the thorniest issues that regulators and critics raise regarding the University of Phoenix is its reliance on part-time faculty. A full 95 percent of Phoenix instructors teach part time, compared to an average of 47 percent nationwide.

Phoenix's instructors describe themselves as "delivering" course material, since most of the classes are centrally crafted and standardized across teachers. Half of the class sessions are spent in "learning teams," where students work together without an instructor present. This makes Phoenix cheaper to run, since the school only pays an instructor for half of the course hours. President Pepicello calls the learning teams "integral" to the university's education model, but as Breneman notes, "A cynic might suggest that students have been known to shirk efforts that are not monitored."

In 2000 the university paid the federal government $6 million to settle a complaint from the Department of Education, which ruled that the school's class hours fell short of the minimum 12 hours per week of instructional time required for federal student aid eligibility. Phoenix upped its hours a little, and the 1992 amendment to the Higher Education Act that had instituted the 12-hour rule was allowed to expire in 2001, partly in recognition that standards for what counted as a "week" of classes were changing in the era of online education, work-study semesters, and other education innovations.

Mandating a class-hours percentage is a decidedly 20th-century approach in the age of the Internet. As the single biggest education-industry enthusiast for technological change, Phoenix is bearing the brunt of outdated expectations. Many students, says Phoenix writing and English teacher Carol Rzadkiewicz, switch from courses in person to courses online, sometimes mid-semester. "If you have that option, if you have that convenience," she says, "you don't have to drop out, like so many women in my situation did."

Rzadkiewicz is exactly the kind of nontraditional university participant that Phoenix was designed to attract. At age 16, she was a married and pregnant high school dropout who still maintained some vague literary ambitions. "I was young," she says. "I was in a hopeless situation, with no education, no training." Eventually she obtained a GED, took some classes at a community college, enrolled in the State University of West Georgia at age 44, got a divorce, and earned her master's degree online through a state school. Now she's a published short story writer who has been teaching at Phoenix since 2003, often telling her story to incoming students as an example of what's possible in the modern world. "Had there been something like University of Phoenix, especially the online aspect, that would have made a big difference in my decisions," she says. "I might have done what I did a lot sooner."

Phoenix's reliance on part-time faculty such as Rzadkiewicz prevents the university from winning accreditation from the top credentialing institutions. Though many of the components of the school are regionally accredited, the university's business school is ineligible for the gold standard of business schools, accreditation from the Association to Advance Collegiate Schools of Business, largely because of the part-time faculty issue.

But the truth is, Phoenix made the tradeoff between efficiency and accreditation a long time ago. The school has never applied for accreditation for its MBA program, because it's not eligible. It doesn't provide the same education as Kellogg or Wharton, and it doesn't even have some of the basic facilities of community colleges.

Pepicello is more concerned about the university's relationships with "more than 1,000 employers across the country," most of whom pay student tuition. "That's an indicator that employers see the value of what we're doing," he says. When employers withdraw a tuition benefit—as Intel did in 2006, citing lack of top-level accreditation—"we take that very seriously, because they are our customers too."

‘The Nation Is the Better for It'
In the coming decades, says economist Vedder, for-profit and nonprofit models for higher education will compete directly with each other for customers. For-profit schools have saturated the adult education market, so more and more commercial institutions will be thinking about turning their attention toward younger students. The pool of 18-to-21-year-olds has been expanding for many years, as the children of baby boomers reach college age, but that growth has begun to slow and is expected to reverse itself three or four years from now. "When the for-profits continue to grow," Vedder argues, "that is going to have some noticeable enrollment effects" on traditional colleges.

This isn't a problem for elite schools, which maintain their status by turning away as many potential customers as possible. But mid- and bottom-tier schools offering cheaper versions of the traditional four-year bachelor's degree may have something to worry about. As more and more people realize that their college degree doesn't come with a $1 million check, they're going to look for ways to minimize the huge opportunity cost of attending a traditional four-year college. One way is to work full time while attending school.

Until recently, Phoenix didn't consider applications from anyone younger than 23. That minimum age requirement was dropped to 21 in 2004, and now 18-year-olds are allowed to enroll in some programs. Other for-profit educational institutions are also getting more aggressive. A group of former Phoenix employees, organized as Bridgeport Education, recently started buying small, failing nonprofit schools and turning them into for-profit campuses on a tweaked version of the Phoenix model. This approach solves several problems at once, including accreditation, since the existing schools were already accredited when purchased.

Vedder argues that "for-profit education is part of the solution to America's higher education problems, not the problem itself." And even Phoenix critic Breneman has said, "Where UOP does compete with traditional institutions, competition will generally be beneficial to students and there is no reason to decry that outcome. On balance, the education of working adults has been strengthened and improved by the existence of UOP, and the nation is the better for it."

Phoenix students know they're not getting the best education money can buy. But they might be getting the best education their money can buy.

Katherine Mangu-Ward is an associate editor at Reason.

(This is a corrected version of a story printed in the July 2008 issue of reason. The job title of University of Phoenix President Bill Pepicello was in error, as was the terminology used to describe the university's defeat in a January 2008 civil trial.)

And If You Freeze the Frame at Just the Right Moment, You Can See a White Robe and Pointy Hood Hanging on the Back of the Door

jsullum@reason.com (Jacob Sullum) — Thu, 13 Mar 2008 11:56:00 EDT

Harvard sociologist Orlando Patterson has watched Hillary Clinton's "something is happening in the world" ad so many times that he has lost his mind. Spurred by "an uneasy feeling that something was not quite right," he found that "repeated watching of the ad on YouTube increased my unease." Eventually Patterson realized what was bothering him:

I have spent my life studying the pictures and symbols of racism and slavery, and when I saw the Clinton ad's central image—innocent sleeping children and a mother in the middle of the night at risk of mortal danger—it brought to my mind scenes from the past. I couldn't help but think of D. W. Griffith's "Birth of a Nation," the racist movie epic that helped revive the Ku Klux Klan, with its portrayal of black men lurking in the bushes around white society. The danger implicit in the phone ad—as I see it—is that the person answering the phone might be a black man, someone who could not be trusted to protect us from this threat.

Patterson concedes that the Clinton campaign might not have had a racist intent, but he's pretty sure that the candidate benefited from the support of voters spooked by the idea of a black man answering that red phone. And if that was not the plan all along, why on earth would the ad's creators have put a blond child in it? True, "two other sleeping children, presumably in another bed, are not blond, but they are dimly lighted, leaving them ambiguous. Still it is obvious that they are not black—both, in fact, seem vaguely Latino." Just like the children menaced by lurking black men in Birth of a Nation?

I hate Hillary Clinton more than the next guy, and I thought the red phone ad was moronic and demagogic. But Patterson's take on it is even stupider.

With His Ballot in His Hand

jwalker@reason.com (Jesse Walker) — Mon, 03 Mar 2008 15:00:00 EST

Like no other Democratic candidate in this presidential campaign, Barack Obama has had an affinity for fan-launched viral videos, from a cutting spoof of Apple's famous 1984 ad to a star-studded singalong to a stump speech. But the most interesting Obama clip circulating online right now might be "Viva Obama!," a musical tribute cooked up by the Chicago-based marketing company Nueva Vista Media and performed by a California mariachi band. Aimed at Latino voters in Tuesday's Texas primary, the video features a Spanish-language testimonial to the junior senator from Illinois.

Translated into English, the song begins:

To the candidate who is Barack Obama
I sing this corrido with all my soul
He was born humble without pretension
He began in the streets of Chicago
Working to achieve a vision
To protect the working people
And bring us all together in this great nation
Viva Obama! Viva Obama!

The anthropologist Margaret Dorsey has listened to lots of lyrics like these—though this is the first time she's heard someone combine a corrido, a specific kind of ballad frequently used in South Texas political campaigns, with Mexican mariachi music. "This is insane," she laughs as she hears the song over the phone. "I can't wait to listen to it at home. It sounds like a wonderful example of cultural hybridity and innovation."

Dorsey has spent a lifetime surrounded by borderlands politics and borderlands music. The daughter of a now-retired Texas judge, she attended her first rally when she was five. More recently, she spent several years researching and writing Pachangas (2006), an intriguing study of the intersection between music, marketing, and politics along the Texas-Mexico border. It focuses on the pachanga, a local institution whose forms range from family barbeques with musical entertainment to choreographed commercial spectacles sponsored by Budweiser, Ace Hardware, and other multinational firms. She did her fieldwork in and near Hidalgo County, a rapidly growing border county that contains over 700,000 people.

Dorsey, 34, is now a visiting scholar at the University of Pennsylvania. I interviewed her in late February, just a few days before the Texas presidential primary. We began by exploring the deep roots of Obama's campaign corrido.

reason: When did the corrido originate as a form?

Margaret Dorsey: The corrido of the Texas-Mexico borderland area comes out of a context of intercultural contact and conflict, specifically between Anglo and Mexicano populations. Américo Paredes [author of With His Pistol in His Hand, the classic study of the subject] points to the time period around 1900 to 1920, when you see the real emergence and innovation of this form in the region.

reason: What is the literal translation of "corrido"?

Dorsey: Literally, correr means "to run"; it's about a flow. But the best translation in English is really "ballad," or "border ballad."

The quintessential corrido, the ur-text, is "El Corrido de Gregorio Cortez." Paredes found many, many iterations of this song. It's never exactly the same: People change the places a little, and they play with it. But it follows the corrido form in terms of its rhyme scheme. There is a corrido melody, and it follows that. And the text tells the story of an upright man fighting for the right cause against a system that is not upright.

This is important, too: A corrido is based in reality. It's a legend, but it's based on historical fact. It's extrapolated from this wonderful story of what happened to this fellow.

reason: And what did happen to him?

Dorsey: In a nutshell, it's the story of an upright Mexicano fighting the unjust rinches, or Texas Rangers. It's a very long story, but the short version is they come on his property and try to arrest his brother, a shooting match breaks out, people are killed, and then he flees and Rangers chase him all over the state. Once they meet up, Cortez is put in jail. He is tried in several counties in rural Texas, and finally President Lincoln's daughter intercedes to have him freed.

reason: So it's a classic outlaw ballad, then.

Dorsey: It is. You can talk about this in relation to European balladry traditions. You can talk about this in relation to the Robin Hood story. It's connected to both Mexican and U.S. folk forms. In terms of Spanish balladry traditions, Paredes argues that it builds upon the romance form.

reason: It's interesting that this form that's identified with celebrating the righteous outlaw would evolve into something celebrating the outsider politician.

Dorsey: It makes a lot of sense, right? In my book I talk about [Judge Edward] Aparicio [subject of a popular campaign corrido, "The Song of the Judge"]. He was the politician from Washington state running for office in Hidalgo County in South Texas. And who was he running against? The political machinery. So you can see how those valences work.

You can see it with Obama, too. Bill Clinton was just stumping for Hillary Clinton in Corpus. There was not a strong turnout. There weren't many people there. And -- this fits perfectly with the corrido -- who was standing on stage with Bill Clinton? All of the political establishment, all of these elected officials. Then Hillary Clinton spoke at University of Texas-Brownsville, and from what I could see, she did not have a huge turnout.

Obama had a rally around the same time at University of Texas-Pan American, in Edinburg. At that rally, people arrived six hours ahead of time so that they could be close to Obama.

reason: But is a university typical? A campus would probably be stronger territory for Obama.

Dorsey: Well, I was watching the news, and they were interviewing some young people who had come from Rio Grande City, which is an hour away. Obama's bringing in lots of young people, and when you talk to political scientists who study Latinos in the U.S., you can see it's clearly falling along the lines of young, educated, cosmopolitan Mexicanos overwhelmingly supporting Obama. For Hillary Clinton, it's middle-aged Mexicanos.

reason: There's also the idea that someone like Alonzo Cantu, who was reported to be bundling contributions for Hillary, also has the sort of turnout machine that can bus people in to vote for her -- people who might not be as politically engaged on the national scene but know who their patrons are. Do you buy that argument?

Dorsey: I think people who make that argument are discounting the ability of individuals to make their own choices.

reason: The most recent poll numbers I've seen have Obama ahead statewide but with Clinton holding the lead in the border country.

Dorsey: That's pretty much what I've been seeing, too. I haven't seen any surveys that have Obama ahead in the region. What people have told me is that in places like the Austin area his backing is much stronger, but when you get into South Texas there's a much more even split. Even families are split.

We're just going to have to see. I don't think anyone knows. I'm not a predictor.

reason: You mentioned Hillary Clinton's rally in Brownsville. I thought it was interesting that the Brownsville Herald headline called it a "presidential pachanga." Later in the article, the reporter said the rally had "the feel of a political pachanga."

First of all, how would you define a political pachanga?

Dorsey: There are different types of pachangas. You have corporate pachangas, you have family pachangas, and you have political pachangas.

When you look at the political pachangas, specifically in Hidalgo County, you see various iterations of it. You see old-style pachangas, which are still in practice, which are all men, typically out in the country on a little ranch. There's live music, the men cook the food, they're talking politics, and they're organizing people to run for office.

Another kind arose with women taking an explicit role in politics: the dance-hall style pachanga. You find that in small towns and cities. It'll be in a dance hall, usually a family-owned dance hall. It'll have food—traditional Mexican-style entrees, but also served with white bread and things like that. It involves usually a conjunto band. Conjunto bands play various genres of music, including corridos and including dance music. They always have an accordion and a bajo sexto, which is a kind of guitar, and a vocalist.

These rallies involve a pretty set format. You usually have some prayers, the showing of the colors of the flag, patriotic gestures, introduction of the candidate, then the candidate's speech. And then everyone leaves. It almost feels like going to mass, it's almost that regimented. People dance beforehand and afterwards.

The third kind is a novel combination. It's moving more toward a spectacle format, so it has a much more visual orientation, easier to broadcast on TV.

reason: What's the relationship between a political pachanga and the sort of rally Hillary had in Brownsville?

Dorsey: I can't comment on it, because I wasn't there and I didn't talk to anyone who went to her event. The images I have just aren't clear enough.

reason: I found another report about the Clintons going to pachangas back in the '90s. Those were actual pachangas that do fit the term?

Dorsey: They do. Bill Clinton is and was a strong presence in this area. You go into restaurants, and you see signs with the owner shaking Bill Clinton's hand, saying this was Bill Clinton's favorite restaurant. I remember a couple of years ago Hillary Clinton was down in the Valley raising money. So they have maintained their presence in that area for a long time. I never heard about Barack Obama going down to the Rio Grande Valley and drawing in the big money people and raising money the way Hillary has.

reason: I want to read a couple of quotes from your book. First: "Scholars have tracked the work of people, particularly upper-class conservatives in power, who use terms like 'boss,' 'patrón,' and 'machine' in conjunction with politics to describe all that is bad in U.S. politics. Usually such discourse functions to disenfranchise poor citizens (who tend to be darker and immigrant), keeping them as far removed from the political system as possible." The other one is earlier in the book: "With the final fall of bosses like [James B.] Wells, who saw Mexicanos as political capital, and with the rise of reformist candidates, politics reverted to strict racial segregation and a systematic disenfranchisement of Mexicano voters. The texture of politics in South Texas shifted from one of pistol whipping and brow beating—coercing Mexicanos to vote a certain way—to excluding them from the process altogether."

At the surface, grassroots democratic reform seems to be opposed to that kind of machine politics. On the other hand, there's this history of people using "reform" as a way of cutting out the lower rungs.

Dorsey: Usually that's been how people are disenfranchised. When I was doing my fieldwork down there, you still heard Republicans using that rhetoric. The Republicans would use this talk of transparency. And Barack Obama also talks about transparency in his speeches, though that doesn't necessarily mean that the valences are the same.

This is why the story of Aparicio is so important. Block-walking [visiting voters door to door] and grassroots politics are very important to this area. It's very important for people to get to know the candidates, for people to have personal contact with the candidates. The corrido, the music, can often work to facilitate that.

So you do have this very complicated relationship between personal contact and people looking at voters, especially people of color, as a "herd" to be marshaled to vote one way.

reason: How does Obama's rhetoric fit into that? The period of disenfranchisement that you're talking about was the Progressive Era, which is associated with liberal reform.

Dorsey: Right. Martha Menchaca, who's at UT-Austin, is writing a book about this period in Texas politics. And she agrees that these analyses of "machine," "boss" politics where you have people voting in herds is highly problematic. She's an anthropologist writing a historical study that's going to add a lot of complexity to our understanding of that.

With Obama, it's just hard to tell. I realize that's not really a fair answer, but I think we'll be better positioned to answer that question in the general election. Because the general election will be Republicans vs. Democrats, and that's when you tend to see that rhetoric used more clearly, because it tends to be Republicans using that kind of talk against people of color, who tend to vote Democratic. Republicans are already talking about Obama the same way: He's part of "the machine from Chicago."

reason: A lot of people wouldn't talk to you on the record about political pachangas. Do you feel that reticence was justified?

Dorsey: If one feels afraid or threatened to speak about it, certainly it's justified. It's not my place to tell them they should feel safe or unsafe. Politics is still physical in Hidalgo County. The day Barack Obama spoke in Edinburg, the local TV station reported the sheriff going out to a site where people were campaigning for a state rep race -- the campaign workers were having clashes. People were afraid it was going to turn into a fistfight.

Politics in South Texas is still very personal. It's still very family-based for a lot of people. You still hear stories about there being brawls at the polls. That's not everywhere at all times, but it still happens.

At the pachangas themselves, I write about the politiqueras, the ward-heelers, and some people affiliate their role with a type of coercion in getting people out to vote.

reason: Your book talks about the corporate pachangas converging with the political pachangas. When did that start to happen?

Dorsey: I didn't put a date on that. But companies like Budweiser putting on these huge pachangas has been around now for at least a decade. One important fact that I highlight in my book is that right at the time when you expect the candidates to be busy at their own pachangas, Budweiser hosts this huge event and all of the political players are there.

Those events aren't just people from the lower Rio Grande Valley. They bring in people from all over South Texas.

reason: You had a quote in the book about the changing meaning of the term "crossover." A marketer you interviewed, Robert Peña, flipped the word on its head—instead of talking about Tejano stars and the like crossing over to the mass market, he said that advertisers need "to cross over into the Hispanic marketplace." So instead of the outsiders crossing over to the mainstream, the people who are seeking the consumers cross over to the consumers' niche.

You seem ambivalent about that process, but I think it demonstrates a really interesting mutual influence between the local population and the transnational companies.

Dorsey: And we're seeing this today in these political campaigns. You see that in that webpage you sent me: "Viva Obama!" Hillary Clinton is doing it, too. I think Robert Peña was showing some foresight.

We have this wonderful Obama corrido, this hybrid kind of mixture. At the same time, both Obama and Clinton voted in favor of the fence—what people along the border call the wall. And that is highly unpopular in these places.

reason: How do they address that issue when they're in South Texas? It's not just immigrants who are upset—property owners are having their land taken.

Dorsey: Hillary Clinton said at the debate that when she spoke at the University of Texas-Brownsville the previous night, she learned that the president's plan would go right through the campus of the University of Texas. She said there was a "smart way" and a "dumb way" to protect the border and that this was clearly "absurd." And she said it had to be "reviewed" and that she would "listen to the people who live along the border." But then, after she says that, she talks about "smart fencing" and using technology.

So while they're stumping, people from inside the Beltway are finally hearing what people on the border have been saying forever. It doesn't matter if you're Republican or Democrat, if your skin is light or dark, if your first language is English or Spanish—almost everyone is against the wall. So people like Hillary are saying that we're going to build it in spots, but first we have to listen to the people. She's trying to do both.

Obama's not that much different. He even said, in this debate, that they "almost entirely agree." Obama has three talking points on immigration, and he does a good job in sticking to those three points. But one thing he's added—and Hillary Clinton has mentioned this too—is that we need to work with Mexico and the governments of Central America to fix their economies so that we don't have as many people coming in. Then he shifts attention to—this is his number—the "12 million undocumented workers" in the U.S.

reason: How did you get drawn into this world? Was this around you already, or did you decide as an academic that you wanted to take a closer look?

Dorsey: I was raised in Texas politics. When I went to grad school I was interested in studying the relationship between music and politics, but I didn't know where they came together. I was constantly going back and forth between studying music and studying politics, and the convergence just wasn't there. Then, in 1998, I was reading the Corpus Christi paper, and I saw this photo of Bush stumping with [Tejano star] Emilio Navaira. And he just swept the largely Mexicano counties, the first time a Republican had done that since Reconstruction. That's what brought it all together.

Jesse Walker is managing editor of reason.