For-profit Education and Payday Lending

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OpenSecrets.org is rolling out two brand new profiles of industries that are also relatively new to the Washington power structure: for-profit education and payday lending.

For-profit colleges ramped up their lobbying efforts in 2010, after the Obama administration indicated it would crack down on abuses by some institutions. In 2009, the industry spent just under $2.7 million on lobbying, but the next year that figure jumped to $7.4 million and again to $12.5 million in 2011. For-profit education's heavy lobbying of the White House and Education Department weakened some planned regulations, as reported by the New York Times last year. But the Obama administration did succeed in barring for-profit colleges from providing bonuses to recruiters based on the number of students they enrolled, a law that was upheld by an appeals court last week.

The industry's campaign giving has expanded in recent years as well. In the 2010 cycle, for-profit college PACs and individual employees set a new record for their giving: $2.4 million. In the 2012 cycle, the industry has already contributed over $2.1 million. For the most part the industry doesn't consistently favor one party over the other, but donates to lawmakers in positions of power. In both 2010 and 2012, top recipients of for-profit college money include both Republicans and Democrats on the House education committee, most notably Rep. John Kline (R-MN) and Rep. Robert Andrews (D-NJ). President Obama and Mitt Romney have also both received donations from for-profit colleges, but the industry has favored Romney by a 3:1 margin.

Controversy has also dogged the other new industry we're profiling on our website -- payday lending. Payday lenders are companies which offer short-term advances on paychecks, typically at very high interest rates. Industry groups defend the practice as a necessary service for people who may not have access to other forms of credit, while critics maintain that payday lending traps borrowers in a cycle of debt. In 2009, Rep. Luis Gutierrez (D-IL) introduced the Payday Loan Reform Act, which sought to set standards for payday lenders prior to dying in committee.

Read more: http://www.opensecrets.org/news/2012/06/two-new-industries-profiled-on-open.html