December 23, 2020

As Predatory College Stumbles, Founder Melts Down Over Ayn Rand Dispute

As Predatory College Stumbles, Founder Melts Down Over Ayn Rand Dispute

At the end of a year in which the Center for Excellence in Higher Education’s career training schools have fallen into deeper and deeper trouble with regulators and accreditors because of their predatory abuses against students, the schools’ founder, Carl Barney, has been engaged in an embarrassing public spat with a philosophy organization to which, he says, he has provided “massive financial contributions.”

Meanwhile, Barney’s top aide, CEHE CEO Eric Juhlin, sent his employees a video attacking a blistering decision issued in August by a Colorado judge — after a civil trial prosecuted by Colorado’s attorney general — holding liable CEHE, Barney, and Juhlin and ordering a $3 million penalty for deceptive practices at some of the company’s campuses. 

Carl Barney Attacks Other Objectivists

Barney has derided critics of for-profit colleges, whom he claims have engaged in “disgraceful, unethical, and criminal activities,” as Marxists, and he presents himself as a free-market champion. Yet the hundreds of millions of dollars in personal wealth he has amassed came after decades overseeing predatory schools — including Independence University, Stevens-Henager College, and CollegeAmerica — whose revenues have come largely from government-funded student grants and loans.

So what is Barney doing with all that taxpayer money, besides skiing and maintaining a self-aggrandizing website? Apparently, squabbling with fellow acolytes of author Ayn Rand. 

Barney published on his website in early October an attack on the Ayn Rand Institute (ARI), a California-based think tank whose mission is to promote Objectivism, the philosophy developed by Ms. Rand. Barney charges that top officials at ARI have defamed and attacked Craig Biddle, the executive director of the Prometheus Foundation, another Rand devotee operation, this one founded and funded by Barney. According to Barney, these ARI officials “claim that ‘Craig doesn’t understand Objectivism’ and have even said that he is ‘immoral.’” 

Barney, who notes in the post that he was previously on ARI’s board of directors, goes deep on the details, writing about a couple associated with ARI named Onkar and Debi Ghate and about the Biddle-edited The Objective Standard magazine (TOS):

Onkar’s animosity toward Craig started with TOS in 2006. Onkar was outraged that Craig heavily edited ARI writers’ articles that Onkar had already edited himself. He was especially upset when Craig said that an article written by his wife, Debi, would require not merely heavy editing, but a complete rewrite. This infuriated Debi and Onkar. And Onkar’s animosity toward Craig increased with every ARI article that Craig edited.

Barney’s account gets more convoluted from there. Sample paragraph: “I know that McCaskey was the main culprit: he should never have published Leonard’s private email, which he did deliberately to harm Leonard (I know from personal conversations with McCaskey that this was his intention). ARI’s Board of Directors should never have agreed to McCaskey’s demand to publish Leonard’s email in exchange for his resignation.”

Got that? 

Barney says he tried to mend fences between Biddle and ARI, but ultimately there was a blow-up when ARI wouldn’t let Biddle’s magazine have a merch table at AynRandCon. Seriously.

Barney goes on and on, and then promises, “There are hundreds of documents—texts, emails, memos, and agreements—that evidence this story.”

To which I say, Lord have mercy. Or, similarly what someone else said, faced with an itemized list of thirty years of disagreements. 

But there was soon even more from Barney.

Four days after Barney’s post, ARI published “A Message from ARI’s Board of Directors.” It was, mercifully, much shorter. It declared, “We regard Mr. Barney’s blog post as riddled with errors and distortions. But it would be a fruitless expenditure of resources if we spent the time that would be necessary to rebut publicly and objectively all the allegations made in that post.”

The board, which includes the aforementioned Onkar Ghate, then dropped a bomb, disclosing that on March 11, 2019, “Mr. Barney was removed from ARI’s board of directors by a vote of 11–0.”

On October 31, Barney struck back, claiming he was removed from the board only after ARI broke agreements with Barney, including an agreement to cooperate with Craig Biddle, of whom Barney clearly thinks highly. Barney says that ARI “promised me that if I continued contributing money, they would (among other things) develop and implement a conflict resolution process for dealing objectively with disputes and differences. They never did what they promised. I was cheated.”

So, Barney says, he withdrew his financial support, which he says once totaled some $4 million per year. According to Barney, that led ARI’s then-director, Yaron Brook, to demand that the board kick off Barney, or else Brook would resign. Barney continues, “When he was done complaining about me to the Board, I invited the Board to vote me off. The vote was on Zoom, and it was a ‘kinda-sorta’ vote in that many did not speak or physically indicate their vote (it was recorded).”

Barney concludes that ARI failed to apply Objectivist reason to the dispute. If only they had.  

In November Barney published at least four more posts of varying lengths about his dispute with the Ayn Rand Institute, the last entitled, “ARI is Failing: Follow-Up.” There, Barney suggests that this fight, like many fights in America these days, is connected to differences of opinion over our divisive U.S. president: Barney attacks “Yaron Brook’s dogmatic and strident pronouncement that if you support President Trump, you should not call yourself an Objectivist.” 

Eric Juhlin Attacks Critics of His Schools

While Carl Barney has worked to settle the score with ARI, his underling Eric Juhlin in late November sent CEHE employees an email linked to a video that attacks the schools’ critics, as well as the Colorado judge who ruled against him and Barney. The video begins with stirring music, a stroll into what may be CEHE’s executive suite, and the title words “TOWN HALL WITH YOUR HOST ERIC JUHLIN.” (Juhlin instructed employees in the email, “You may not share, download, distribute, or in any way disseminate this video, or access to this video.”)

As Predatory College Stumbles, Founder Melts Down Over Ayn Rand Dispute

Juhlin in the video proceeds to criticize Colorado judge Ross Buchanan’s $3 million verdict, which Juhlin admits found responsibility “across the board against” CollegeAmerica, CEHE, and its operators. But, Juhlin says  “everything that judge decided… was completely wrong.” He insists that every finding of guilt the judge reached had to do only with the multi-campus CEHE school CollegeAmerica Denver, “which tragically has now been closed.” 

Juhlin says he was “shocked” by the verdict. As he had previously done in an email to staff, Juhlin in the video vows to overturn the decision: “We are going to pursue an aggressive appeal.”

Juhlin tells the staff that the judge’s decision produced “some minor amount of press, and negative press.” He chalks up that coverage to “individuals out there who are violently opposed to career education, to private enterprises operating colleges and universities,” individuals seeking to “advance their ideological agenda.” 

“We have,” Juhlin then says, “taken a very strong response to those kinds of articles.” (As far as I know, all the articles about this matter have been published on this website, with the exception of one short item published in October on Inside Higher Ed, plus a commentary posted that same week by my colleague Yan Cao of the Century Foundation.)

Juhlin praises the quality of his schools, a position heavily disputed by CEHE employees with whom I’ve spoken, and also repeatedly questioned by the school’s accreditors.

To paraphrase a source I cited earlier: Are these the men with which we are to educate America? Seriously, are the disputatious, fact-challenged Barney and Juhlin, with their court-documented, accreditor-worrying record of deceiving and abusing students (did you know their schools have also been under investigation by the federal Consumer Financial Protection Bureau?), the right people for the federal government to entrust with our tax dollars and with the educations of veterans, single mothers, and others struggling to build a better future?

Nineteen pro-student organizations, and I, wrote a letter to Secretary of Education Betsy DeVos in October arguing that, because of the Colorado court decision finding CEHE, Barney, and Juhlin liable for fraudulent behavior, federal law requires that all company’s schools be cut off from federal aid.

Juhlin assures his staff that CEHE has since provided “a large packet of material” to DeVos with two legal analyses by two outside law firms that “contradict” what we argued in our letter. He says he’s “confident” that DeVos will see that we are wrong.

Juhlin might be right about that last point. DeVos, who is guided by her top higher education aide Diane Auer Jones, a former for-profit college executive, has coddled and protected the Barney schools. DeVos reversed an Obama-era decision that denied the schools preferential non-profit status after they had formally converted from for-profit to non-profit on questionable terms that kept big money flowing to Barney. She’s allowed the schools to grab perhaps hundreds of millions more in taxpayer dollars to recruit new students, many who will be left worse off than when they enrolled.

Guess what? Before joining DeVos in the Trump administration, Diane Jones was a paid consultant to CEHE, serving as an “expert witness” for Juhlin in the very Colorado lawsuit about which he is now complaining.

But Juhlin may be wrong about the ultimate fate of his schools. Notwithstanding Donald Trump’s inept coup plotting, Betsy DeVos will no longer be secretary of education come January 20. The incoming Biden-Harris administration has pledged to protect students and taxpayers against deceptive, abusive, predatory colleges. Carl Barney’s schools, despite Eric Juhlin’s protestations, fit the bill.