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Jerry Falwell Jr.’s Liberty University makes millions of dollars from low-quality online courses

A ProPublica/New York Times Magazine investigation reveals shady practices at the university’s distance learning program. But its status as a nonprofit means federal crackdown is unlikely.

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Liberty University, the evangelical Christian college founded by the now-late Moral Majority leader Jerry Falwell, made headlines over the past few years because of its vocal institutional support for Donald Trump. But a recent ProPublica/New York Times Magazine investigative piece by Alec MacGillis has brought Liberty into the spotlight for a different reason.

According to MacGillis, Liberty’s luxurious campus — including a $7 million year-round ski resort and a $3 million shooting range — is essentially funded by the revenue stream brought in by Liberty University Online: an online learning system that, the students profiled by MacGillis uniformly say, falls significantly short of American academic standards.

But unlike other online universities such as DeVry or the University of Phoenix, Liberty has secured a nonprofit status, making it far more difficult for federal regulators to crack down.

Liberty has about 11,000 on-campus students — and approximately 95,000 students enrolled in the distance-learning program. According to MacGillis’s reporting, the online university features exam questions chosen at random, required textbooks failing to arrive, and a teaching faculty incapable of spelling words like “cite” or “exceptions.”

Remote students are charged $455 per credit. (Assuming that 120 credits are necessary for a bachelor’s degree, that’s a total degree cost of about $54,600.) Meanwhile, Liberty spends on average $2,609 per full-time student per year (on campus and off campus combined) — about a tenth of what, for example, a private university like Notre Dame spends.

MacGillis reports extensively on Liberty’s aggressive sales tactics, using a 300-strong team of recruiters and a $16.8 million Google advertising budget to target potential students before their for-profit competitors do:

At the front lines are the “admissions representatives,” some 300 phone recruiters working two shifts from 8 a.m. to 8 p.m., deploying call lists that Liberty gets from websites where people register and search for information about online higher education, like BestCollegesOnline.com. There is such a race to get to customers before University of Phoenix and other rivals that the prospective students sometimes marvel at how little time has elapsed — just a handful of minutes — between their providing their information on a website and the call coming from Liberty. Liberty’s tax filings show that in 2016, the university paid Google $16.8 million for “admissions leads generation.” ...

They get no more than 45 seconds between calls, and sometimes managers override even that short break. There are no formal quotas — a federal regulation that went into effect in 2011 forbids them. But as one former employee put it, the “highly motivated goal” is for each recruiter to sign up eight new students a day. Multiplied across 300 cubicles, that is 2,400 per day.

But students who have been convinced to sign up for Liberty, MacGillis reports, have little recourse when things go wrong. The Obama-era crackdown on for-profit degree mills — including requirements that graduates be able to attain “gainful employment” — only served to help Liberty’s enrollment numbers by putting many of its competitors out of business. And new Trump-era policies under Education Secretary Betsy DeVos have only made things easier for Liberty; DeVos is expected to roll back Obama-era regulations establishing higher standards for online-only learning.

Liberty isn’t the only evangelical institution whose nonprofit status allows it to operate with less financial transparency than it would otherwise. Just this year, the conservative lobbying group Focus on the Family — which heavily advocates for anti-LGBTQ and anti–sex education policies, among others — filed its 2017 taxes as a church, allowing it to avoid laws about financial disclosure and to, for example, claim property tax exemption for its “clergy.”

Whether the federal government intends to crack down on this intersection of religion and finance remains to be seen. But Trump’s repeated invocation of his desire to repeal the Johnson Amendment — a provision prohibiting 501(c)(3) nonprofits, including churches, from explicitly endorsing political candidates — suggests that as far as the Trump administration is concerned, religious institutions should be granted as much tax-related leeway as possible.

Read MacGillis’s full article here.