FTC Endorses Education Department Proposal to Expand Higher Education Accreditation Options

The Federal Trade Commission has backed the Department of Education's proposal to broaden higher education accreditation options, promoting competition among accreditation agencies. This move could lead to reduced costs and enhanced quality for millions of American students. President Donald J. Trump encouraged the Department to invite public comment on a proposed rule aiming to "reenvision America's postsecondary quality assurance system" by making it easier to recognize new accreditors.

The Office of Policy Planning and Bureau of Competition directors commended the Department's initiative, highlighting the negative impacts of accreditation monopolies on tuition costs, consumer choice, and innovation. Currently, many accreditation authorities have a vested interest in maintaining rigid requirements and resisting new, innovative standards.

For example, at the Middle States Commission on Higher Education, 21 out of 27 commissioners are university administrators or faculty, who have a strong incentive to uphold policies that prevent the emergence of low-cost education alternatives. Accreditation standards that perpetuate the expensive status quo contribute to their job security and high wages, while simultaneously inflating tuition.

The situation for accreditors of specific professional programs is often more severe, as many programmatic accreditors are influenced by higher education interests and incumbent members of the profession with incentives to raise educational costs and erect barriers for alternative competitors. The American Bar Association exemplifies the competitive harms that can arise when incumbent professionals and higher education interests dictate accreditation requirements.

Commission staff have praised state efforts to reduce reliance on the American Bar Association's law school accreditation monopoly. The FTC's vote in support of the Department's proposal was 2-0.