Arby’s Plays Along, Sees Jon Stewart Off Into The Meat-Hued Sunset

For some reason that has never fully been explained, Arby’s has long been the favorite punching brisket of The Daily Show with Jon Stewart, appearing as the fake sponsor of many segments. They didn’t pay for these on-air segments, and some brands might have tried to pay the network not to mention their name on-air. Arby’s, however, has learned the publicity value of playing along.

Their Meat Mountain sandwich, for example, was never supposed to be an actual item served to customers, because Arby’s presumably cares about its customers’ health and well-being. However, customers asked, and Arby’s obliged, turning the sandwich into an off-menu item and a viral Internet phenomenon.

The company was also on its social media game when musician Pharrell williams showed up at the Grammy awards wearing a tall brown hat similar to the one in its logo. They played along all the way to eBay, where the hat sold for $44,000 in a fundraiser for Williams’ education nonprofit.

.@Pharrell You're welcome. We're HAPPY to support a great cause & get our hat back. Good luck at the #Oscars tonight! http://pic.twitter.com/2oA7qDPX9z

— Arby's (@Arbys) March 3, 2014

Arby’s has played along with the “Daily Show” gag, finally buying ad time during Stewart’s last week as host to thank him for… well, they weren’t quite sure, but they paid Viacom cash money to show clips of Jon Stewart claiming that their products cause untold digestive distress. Thanks for playing along, Arby’s.

Arby’s to Jon Stewart: Thank You for Being a Friend [YouTube]

by Laura Northrup via Consumerist

For-Profit College Industry Continues To Bemoan Recently Enacted Gainful Employment Regulations

(D. Michelson)

A month after the implementation of long-awaited regulations aimed at reining in for-profit colleges went into effect, opponents of the new rules aren’t simply backing away nicely. Instead, they continue push repeal of the new law, saying it unfairly targets the proprietary schools.

Following the failure of two lawsuits to prevent the Gainful Employment Rules, which require that schools demonstrate that its students are making livable wages after they graduate, from being implemented on July 1, for-profit college industry groups and members of Congress have turned to the legislative process to dial back the regulations, claiming the rules are unauthorized, the Charlotte Observer reports.

Appropriations bills in both the House and Senate include provisions to prohibit the Dept. of Education from enforcing the rules, that penalize for-profit colleges if too many of their graduates failed to succeed.

Lawmakers in support of the repeal contend that oversight of the for-profit education industry should be left to Congress and that the new regulations are too expensive to implement.

“It’s better handled in the higher education reauthorization than it would be in some other way,” Missouri Senator Roy Blunt, chairman of the Subcommittee on the Departments of Labor, Health and Human Services, Education, and Related Agencies, tells the Observer.

It’s worth noting that, at nearly $130,000 donated, Goldman Sachs was the second-largest contributor to Sen. Blunt’s campaign in 2014. Goldman owns around 40% of the for-profit Education Management Corporation, operator of schools like The Art Institutes, and Argosy University.

For-profit colleges, which receive about 90% of their funding from student aid, have continually come under scrutiny for failing to demonstrate that students could find gainful employment in the fields in which they had been trained.

Under the gainful employment rules [PDF], for-profit colleges will be at risk of losing their federal aid should a typical graduate’s annual loan repayments exceed 20% of their discretionary income, or 8% of their total earnings.

Discretionary income is defined as earnings above 150% of the poverty line and applies to what can be put towards non-necessities.

So for example, say the typical recent graduate of a career education program earns $25,000. That student would need to average annual student loan payments less than $2,000, or the school would be at risk for losing federal financial aid.

According to the government, about 1,400 programs serving more than 840,000 students would not pass the new accountability standards set forth in the finalized rules.

Still, opponents of the rules continue to argue that they put an unfair target on for-profit colleges’ backs.

Noah Black, vice president of public affairs for the trade group Association of Private Sector Colleges and Universities, tells the Observer that for-profit colleges must now contend with higher scrutiny while private nonprofit universities increase tuition and leave students in significant debt.

He argues that the rules should apply to all universities not just those in the for-profit realm, claiming that if the rules were enforced on every institution some well-known schools wouldn’t meeting gainful-employment standards.

Additionally, the industry says that because it’s students are often non-tradition – older, work full-time or have family to support – their success can’t be measured in a traditional sense.

Despite the industry group’s claims that the rules discriminate against for-profit colleges, those who pushed for the regulations says there’s a reason for that: the schools collect a significant chunk of government dollars through federal student aid, tend to target more vulnerable students and often leave them strapped with debt and few job prospects.

“It’s a big issue,” Connecticut Representative Rosa DeLauro tells the Observer. “They wind up in serious economic difficulty. With high debt, they default. They don’t come out with a meaningful education or degree or certificate that allows them to be gainfully employed.”

Some say the for-profit schools are simply looking at the rules in the wrong light.

Michelle Cooper, president of the Institute for Higher Education Policy, tells the Observer she sees a counterpoint to the industry’s argument, “if you make your programs so good that students who enroll do well, then that’s the biggest selling point.”

Under siege, for-profit colleges cry foul over new federal rules [The Charlotte Observer]

by Ashlee Kieler via Consumerist

Why Do I Keep Seeing Commercials For Everest University?

Commercials for Everest University continue to appear on TV, because the schools are now operated by Zenith Education Corp.

If you’re sitting at home watching television on any given afternoon, you’re likely to see a few commercials touting the supposed convenience and benefits of attending a for-profit college. But with the recent, very public collapse of now-bankrupt Corinthian Colleges Inc — and the closure of many of its schools — you might be wondering why your Jerry Springer show is being interrupted with ads for Everest University.

That’s because, if you remember, another company – Education Credit Management Corporation – swooped in to purchased 56 Everest and WyoTech campuses in various parts of the country, just two months before CCI’s remaining Everest, Heald College and Wyotech campuses were closed.

When ECMC revealed its plans to purchase the beleaguered for-profit brands, it announced it would run the schools under its new Zenith Education Group division and transition them from for-profit to nonprofit status.

Additionally, the company said it would create a program to eliminates some of the schools’ worst performing programs and removing binding, mandatory arbitration from enrollment agreements.

Despite these changes, the commercials for the new Everest are remarkably similar and give the impression that things are business as usual, as one reader tells Consumerist.

On a recent afternoon at his home in the Northwest U.S. our reader saw a “familiar Everest ad, the one with the young, nervous appearing, woman.”

While our reader was right to think that it was odd for a company that had closed to continue advertising, it turns out the Everest schools in his area are actually continuing to operate under the Zenith Education Group.

That only brings up the question: If your company spent $24 million to buy schools with a brand name synonymous with inflated graduation rates, federal investigations and unfair business practices, wouldn’t you maybe change the moniker and branding?

One might think that would be the logical step for a corporation, but it’s not always economically feasible. And that’s apparently the case with ECMC/Zenith and the Everest and WyoTech schools it purchased.

Dave Hawn, President and CEO of ECMC Group and Interim President and CEO of Zenith Education Group, tells Consumerist in a statement that the company understands consumers’ confusion about what schools have closed and which remain open under Zenith leadership.

To be clear, there are currently 46 Everest University campuses and three WyoTech campuses still operating, while another seven Everest schools are on a teach-out program, meaning they are no longer enrolling new students.

“Although we considered rebranding, it would be a lengthy and expensive process for more than 45 schools, and we would rather invest those funds in programs that directly support student success,” Hawn says.

But it wasn’t all about the money, he says. In fact, he contends that keeping the name has made it easier for students.

“Keeping the Everest name helped minimize disruption for existing students when we assumed ownership of the schools,” he says. “Ultimately, we believe that Zenith’s system-wide focus on student completion and graduate placement, as well as our tuition reductions and grant programs for students in financial need, will help create positive awareness of our schools.”

So it doesn’t appear that Zenith is worried about any kind of negative connotation that might be attached to the Everest or WyoTech names – familiar commercials or not.

by Ashlee Kieler via Consumerist

SCOTUS: You Can Sue Over Housing Discrimination Even If That Discrimination Wasn’t Intended

(Jeff Kubina)

Housing rights groups and civil advocates were granted a win this morning by the Supreme Court of the United States, which ruled in a 5-4 vote that people can pursue lawsuits under the Fair Housing Act of 1968, that prohibits housing discrimination because of race, even when a housing law or policy isn’t motivated by an intent to discriminate.

In the case of Texas Department of Housing and Community Affairs v. Inclusive Communities Project Inc., the issue at hand was whether you could pursue a lawsuit under the FHA by claiming that a policy has a “disparate impact”: in other words, that it has a discriminatory effect even if it wasn’t intended as such.

The Supremes ruled [PDF] that disparate impact claims are cognizable under the Fair Housing Act, with Justice Anthony Kennedy writing the opinion for the majority. He was joined by Justices Ruth Bader Ginsberg, Stephen Breyer, Sonia Sotomayor and Elena Kagan, with Justices Clarence Thomas, Samuel Alito, Antonin Scalia and Chief Justice John Roberts dissenting.

“Recognition of disparate impact liability under the FHA also plays a role in uncovering discriminatory intent: It permits plaintiffs to counteract unconscious prejudices and disguised animus that escape easy classification as disparate treatment,” Kennedy wrote.

The court held that illegal disparate impact arises only if the policy is “arbitrary, artificial, and unnecessary.”

The case started in Texas, where the Department of Housing and Community Affairs distributes the federal government’s low-income housing tax credits to developers by designated state agencies. The Inclusive Communities Project, Inc., a Texas-based nonprofit corporation that assists low-income families in obtaining affordable housing, brought a disparate-impact lawsuit under FHA, alleging that the Department and its officers had caused segregated housing patterns to continue in Texas, by allocating too many tax credits to housing in predominantly black, inner-city areas and not enough in predominantly white suburban neighborhoods.

ICP sued on the grounds that the outcome of this policy was racially discriminatory, even if the Texas housing agency didn’t intend it to be.

Supporters of disparate impact lawsuits say they’re necessary because it’s not like a landlord or housing group is going to come right out and say, “Hey, we’re doing this for racial discrimination reasons.” That would make it hard for someone to prove that they were intentionally instituting policies that would be discriminatory.

But those opposed to it had argued that disparate impact suits would hit the private sector hard with costly lawsuits where defendants are given a significant burden of proof.

The press secretary for the White House issued a statement on behalf of the administration, commending SCOTUS on the decision.

“The Court’s decision affirms that the Fair Housing Act enables Americans to challenge not only laws, policies, and practices that are intentionally discriminatory, but also those that have an unjustified discriminatory effect,” the statement reads.

“Too many Americans are victims of more subtle forms of discrimination, such as predatory lending, exclusionary zoning, and development policies that limit affordable housing. This decision reflects the reality that discrimination often operates not just out in the open, but in more hidden forms. And, it preserves a longstanding and important method for challenging and eliminating those practices and continuing the work to end discrimination in housing.”

by Mary Beth Quirk via Consumerist

HBO Will Get 9-Month Exclusive Window On New Sesame Street Episodes

(Scott Lynch)

In an attempt to make its cable and streaming services more appealing to families, HBO has struck a five-year deal with the folks at Sesame Workshop that will give the premium cable channel a 9-month exclusive window on new Sesame Street episodes.

Sesame Workshop says the partnership will allow the company to double its content output, but at the expense of having to hold back its new programming from PBS for nine months after it first appears on HBO.

Meanwhile, HBO can now market to parents as the exclusive home of new Sesame Street content. This could help the network sell subscriptions to its pay-TV service and its standalone HBO Now online streaming service, which has primarily been marketed as a means of getting more mature content like Game of Thrones and True Detective (or at least the first season of that show).

Now, in addition to the new content, which is expected to launch later this year, HBO will gain access to a library of 150 older Sesame Street episodes, and around 50 total archive episodes of two other shows, Pinky Dinky Doo and The Electric Company.

The deal will last for five seasons of the long-running educational show for kids. It will also include a currently unnamed “Sesame Street Muppet” spinoff series, along with a new original educational series for children.

“Our new partnership with HBO represents a true winning public-private partnership model,” said Jeffrey D. Dunn, Sesame Workshop’s CEO. “It provides Sesame Workshop with the critical funding it needs to be able to continue production of Sesame Street and secure its nonprofit mission of helping kids grow smarter, stronger and kinder; it gives HBO exclusive pay cable and SVOD access to the nation’s most important and historic educational programming; and it allows Sesame Street to continue to air on PBS and reach all children, as it has for the past 45 years.”

by Chris Morran via Consumerist

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Passenger Rights Group Says Delta Is Shaming Travelers Into Buying Ticket Upgrades

An example of the pop-up warning in question.

You might be familiar with the feeling: you go into a purchase with a plan of exactly what you want to buy. No frills, no fuss, no muss. But then, suddenly, you find you’re shelling out more money than you’d planned, perhaps after encountering some persuasive sales tactics. A passenger rights group says Delta Air Lines is employing shame as a method to get travelers to buy ticket upgrades they might not have wanted initially.

Upselling, as its known, is the practice of convincing customers to buy perks or extras not included in a base price. In the airline industry, these add-ons can be anything from a wider seat or more leg room, to priority boarding and free ticket changes. But flyersrights.org, a nonprofit group that advocates for passengers, is calling Delta out on its tactics to get people to buy those extras.

On Delta’s website, choosing a basic economy fare will bring you to a final page to confirm your purchase, notes the Los Angeles Times. Listed there are several consequences of buying the cheapest ticket: You’ll be last to board, meaning the last to find overhead bin space. You don’t get a seat assignment ahead of time, there are no refunds or ticket changes and no stand-by travel changes.

The president of the passenger rights group says the practice is like when a car dealer pressures buyers into tacking on expensive upgrades to a basic car model.

“If it works, other airlines will likely try to follow,” Paul Hudson told the LAT.

Delta denies that the section of its site is meant to shame people, with a spokesman saying instead that it’s meant “to make people aware of what they are buying.”

Critics say Delta Air Lines is shaming passengers to spend more [Los Angeles Times]

by Mary Beth Quirk via Consumerist

Are Student Loan Forgiveness Programs Just A Free Pass For Grad Students With More Than $100K In Debt?

(fblumongoose)

Just two years ago, the Consumer Financial Protection Bureau estimated that nearly 33 million american workers eligible for student loan forgiveness weren’t taking advantage of the programs. Times have certainly changed, as the federal government earlier this year revealed that these program were now so popular they cost nearly $22 billion more than they anticipated. But it doesn’t appear the increase in use for such plans is by those who might benefit the most.

Instead, as a new report from the Wall Street Journal points out, they’re being utilized by those that often have the most debt and the best chance of actually earning enough money to one day repay their obligations: graduate students.

The promise of student loan forgiveness has drawn thousands of students to take out additional loans to pursue post-secondary education, a move critics say is a misuse of federal programs meant to keep the most vulnerable student borrowers from defaulting.

Student loan debt has now topped the $1.9 trillion mark, thanks in part to a surge of students taking out loans in excess of $100,000 to finance their graduate school education.

As the WSJ points out, postgraduate borrowers account for about 40% of all student debt, but represent just 14% of students in higher education. In all, nearly 1.82 million consumers have graduate student loans exceeding $100,000.

Unlike many government loan programs – such as those for undergraduates and home buyers – that put a limit on how much a borrower can obtain, programs for graduate students, like GradPLUS, don’t place a limit on the amount that can be borrowed.

These unlimited loans, coupled with federal forgiveness and income-based repayment programs, have created a “moral hazard” by allowing borrowers to amass debts they have little hope or intention of repaying, critics of income-based repayment programs such Pay As You Earn, tell the WSJ.

It’s these programs that some post-secondary graduates say propelled them to pursue higher degrees and, in turn, take out more loans, creating a cycle of borrowing.

That was the case for Bonnie, who owes almost $209,000 after earning her doctorate degree from a for-profit college.

She tells the WSJ that after borrowing for her bachelor’s degree, she decided to pursue her master’s and then doctorate as a way to postpone making student loan payments.

“There’s no way to pay it afterward. It’s a continuous cycle. I’ll be the retiree that’s getting Social Security garnished,” she says of her student loan debt.

Still, she has hopes that federal income-based repayment programs will help.

The situation is similar for Virginia, a public defender in Florida, who says the promise of forgiveness was the only reason she even considered taking out additional loans to attend law school.

She now owes $256,000 in student debt, but pays just $330 a month under a federal income-based repayment program that allows borrowers to only put 10% of their discretionary income toward their student loan balances on a monthly basis.

Virginia’s plan is to have her entire balance forgiven in seven years under a debt-forgiveness program meant to encourage students to become teachers, public defenders and other public-service employees.

Under that program, borrowers who work full-time for a government agency or a nonprofit employer – and make on time payments of their debt – will have their balances forgiven after 10 years.

While these programs have likely increased the number of individuals working in positions deemed to benefit society, the influx of graduate students covered by the program means those being benefited might actually be those that need the least amount of help.

In many cases doctors and lawyers will go one to make six-figure salaries – often enough to manage their debts without assistance from government-run programs.

According to the WSJ, the Obama administration is reportedly taking steps to ensure that these federal programs are better targeted to borrowers who need help the most.

Grad-School Loan Binge Fans Debt Worries [The Wall Street Journal]

by Ashlee Kieler via Consumerist