Michael Clifford Refutes Eisman

Education entrepreneur Michael Clifford offered a rebuttal to the recent criticisms of short seller Steve Eisman, in an article for Earth Times.

Eisman is one of the legendary Wall Streeters, who has a strong proclivity for making ‘easy money.’ He doesn’t create jobs or help people live better lives. Instead, he makes money for himself and investors in his $1.1 billion long/short equity fund by creating doom and gloom scenarios, then shorting stocks.

the industry, as a whole, can be improved. He humbly suggests the following to Secretary Arne Duncan:

“Get rid of 90/10 rule, or the requirement that schools receive no more than 90 percent of their tuition revenues from the government. Watch prices fall at institutions. The primary way today for schools to solve the 90/10 dilemma is to increase tuition.

“Jobs: If under your watch, Secretary Duncan, the Department of Education decides to cut the for-profit sector’s participation in helping these students, the sector will be forced to lay off hundreds of thousands of faculty and support staff resulting in increased unemployment numbers. And hundreds of thousands of current students will be denied access to school and much needed retraining.

“Make sure the Department of Education differentiates between publicly traded for-profits and privately held for-profits. The pressure Wall Street demands for increased profits with growth to avoid players like Eisman every single quarter contributes to the abuses. Private for-profits don’t have this pressure.

“Increase transparency with ALL regionally accredited institutions for-profit and non-profit. The best contribution the Department of Education could provide would be to give the accrediting commissions the same technology in order to create real time reporting for the entire world to review. Level the playing field for all institutions receiving Title IV funding.

“Invest in technology and encourage innovation. The Internet is continuously and radically disrupting every business model it touches, so get some super smart Internet leadership riding shotgun with you, Secretary Duncan, as nobody can stop the power of the Cloud.

“Allow the opening of more post-secondary institutions with affordable price points. Encourage the regulators to support Public-Private Partnerships – get rid of the divisive ‘them or us’ mentality.”

Clifford summed up his position as follows: “If you make it prohibitive for all market-funded institutions to come into the higher education sector, then you will be smothering the dreams of millions of Americans, who want a better life. Are there bad actors in our industry? Sure. Just like there are in other industries. But the vast majority of schools and school owners are working to change lives through the power of education while fulfilling their corporate mission at the same time.