Yesterday Sen. Tom Harkin (D-IA), Chairman of the Senate Health, Education, Labor, and Pensions Committee, released his magnum opus on for-profit colleges, the culmination of two years of excoriating, browbeating, shaming, and generally demagoguing that fast-growing but relatively small sector of American higher education. His report is everything you’d expect from a crusade characterized by an almost complete unwillingness to address the central role of the federal government in creating pervasive rot not just in for-profit higher education, but the entire Ivory Tower.

The for-profit college sector is certainly raking in lots of cash and producing very little for it, with big revenues but very low completion rates. It’s probably not as bad as Harkin would have us believe—I’ve chronicled much of the exaggeration and misrepresentation that has punctuated his attack—but there’s little question that lots of students drag heaps of taxpayer dough into for-profit schools and get little of value for it.

The thing is, that happens across higher education, including the profit-taking.

As I’ve cited ad nauseum, completion rates throughout higher education are abominable. Looking at first-time, full-time students—an imperfect sample, yes, but the best we’ve got—the top completion rate is for bachelor’s students at private not-for-profit schools. But that’s only 65.4 percent completing within six years. The worst is at public two-year institutions—community colleges—which see only 20.4 percent finish their programs within 150 percent of normal time. That’s just one-in-five!

Surprisingly, Harkin’s report mentions the atrocious completion rates at community colleges. But only very briefly, and mainly to assert that “the cost of for-profit programs makes those programs more risky for students and Federal taxpayers.” That proviso is technically correct, but as misleading as much of the behavior for which Harkin condemns for-profit schools. Community colleges are cheaper to students in large part because they get direct taxpayer subsidies, and while those don’t come mainly from Washington they do come from taxpayers, just at the state and local level. In the 2009-10 school year, state and local appropriations to community colleges totaled $5,412 per pupil. Meanwhile, public four-year schools—with six-year graduation rates of just 56 percent—received almost $8,000 per student in federal, state, and local appropriations. And, of course, all “not-for-profit” schools get favored tax status, paying no taxes on most of their revenue and benefiting from tax deductible largess of donors.

But don’t think those schools aren’t profiting. Harkin’s report blows off the possibility that putatively not-for-profit schools make profits simply by stating that “by definition” such schools “do not retain any revenue as profit.” But as Vance Fried illustrated in his 2011 policy analysis, most public and not-for-profit private colleges make thousands of dollars per-undergraduate beyond the cost of educating them. They just use the money to reward the people in the school, or to pay for things that often make the school more bloated, instead of distributing the profits to investors.

Putting the for-profit sector in the context of all of higher education, it’s clear the witch hunt has been on. But there’s also been major scapegoating: by enabling students to pay for school with other people’s money, and with almost no regard for their ability to do college work, it is federal student aid that largely causes the rot in higher ed, quashing both school and student incentives to economize, and student incentives to think critically about consuming higher ed. By demonizing institutions that dare admittedly make profits, politicians like Sen. Harkin shift the blame from where it belongs—themselves—to those who do what the politicians want: ”educate” people regardless of their ability. It’s exactly like housing: the politicians demand that everyone be able to buy a home, condemn anyone who might fail to furnish the uncreditworthy with mortgages, then blame the lenders when things go horribly wrong. They seem to want the votes—their profits—but no blame when things go south.

Sen. Harkin, the fault for what ails not just for-profit higher education, but the entire Ivory Tower, sits largely with you and your colleagues. Please quit shifting blame and do what must be done: phase out student aid and make all schools earn their money.

Suddenly, student loans are nearing the top of the nation’s public policy debate. Indeed, President Obama is expected to make a big speech about them on Wednesday. Why the sudden ascendance? Probably because the burden of student loans is one of the few things OWSers are clearly angry about, and that has raised questions ranging from whether such loans should be dischargable in bankruptcy, to whether they help fuel the Saturn V rocket of college price inflation. And last Sunday GOP presidential contender Ron Paul jumped into the fray, suggesting we eliminate the federal student loan program entirely.

Paul is right about phasing out federal student loans. Unfortunately, that’s likely the last thing President Obama will propose.

The first reaction to hearing such a proposal is that it’s Grinch-level heartlessness, stealing a better future from low-income kids. That is almost certainly what the president would say, and such a reaction would likely poll well. That’s why he’s expected to propose lowering interest rates, easing repayment, and other borrower-friendly measures. But as I lay out in a Cato Policy Analysis to be released imminently, by most indications federal student aid and other taxpayer-fueled subsidies aren’t good for anyone. (Well, anyone not employed by a college or university, the ultimate receiving end of all the forced largesse). By artificially—and hugely—boosting consumption, they ultimately lead to massive tuition inflation, encourage millions of unprepared people to take on studies they never finish, and pour H2O into already watered-down degrees. In other words, student aid—including federal lending—is likely a net loss to both students and society.

But I’ve already said too much. If you want to get a lot more on this—and more on the many unintended evils of federal college policies—stand by for the release of my study. And if you’re in DC, come to Capitol Hill Thursday for a briefing on the subject with me and Rep. Virginia Foxx (R-NC). It should give OWSers, libertarians, conservatives, liberals, and anyone else lots to think about.

The College Board is out with its annual reports on college prices and student aid, and the story is pretty familiar. According to The New York Times, the reports reveal that over the last year tuition and fees rose 8 percent at public, four-year schools, and 4.5 percent at private non-profits. Meanwhile, student aid rose at a very fast clip. Indeed, over the last five years, despite lightning-quick growth in sticker prices, after-aid college costs actually dropped.

Now, don’t expect to hear this from the College Board or even mentioned in the Times, but doesn’t it seem at least plausible that giving more and more aid to students enables schools to raise prices? You know, that colleges might jack up tuition and fees knowing that government, largely, will ensure that students can cover them? It’s not only plausible, it’s almost certainly the case. But like I said, forget about ever reading that in The New York Times. Instead, we get this standard lament:

“The College Board figures are depressing and utterly predictable,” said Terry Hartle, senior vice president of the American Council on Education. “When states cut funding for higher education, tuitions go up to make up for the difference.”

Dealing with this one gets incredibly tiresome, and it should infuriate taxpayers who fund both massive student aid and subsidies to public colleges.

For one thing, of course, cuts in  state subsidies don’t explain constantly increasing private school costs. Moreover, while no doubt public schools sometimes raise tuition to make up for state funding dips, they also raise it when state funding is going up. Indeed, as this chart from the State Higher Education Executive Officers illustrates, public schools raise prices no matter what is going on with state and local subsidies:

How can schools get away with this? Because students are able to cover the incessantly rising prices. And how can students do that? By using more and more money that comes from someone else!

The data scream this reality so loudly even passed-out undergrads could hear it. So why does it get so little attention? In part, no doubt, because many in the media refuse to even consider that there could be a causal connection between ballooning aid and skyrocketing prices. Even worse, the people controlling the aid see votes, votes, votes from playing education Warbucks. And if, say, the President of the United States can buy votes with student aid, why would he ever admit that his “generosity” mainly just lets higher education bleed taxpayers dry? The unfortunate answer is, he wouldn’t.