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Das Kaplan: Testing’s Profiteers

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The Bull Market

The Bull Market
October 15, 2008 - 11:00pm
By Dmitri Koustas
Tags: careers, economic crisis, economic meltdown, finance, financial meltdown, graduate school, kaplan, standardized testing, test prep

Ever since the first I.Q. test was administered in 1914, standardized testing has developed rapidly in the U.S. In true capitalist fashion, “prep” or “crash” courses have developed even more rapidly, and at the present time they are in full bloom of speculation and swindling.

If you are considering becoming an Atticus Finch Esq., Dr. House, Warren Buffett, or just want to be a professional student, you know you need to take the LSAT, MCAT, GMAT, or GRE respectively. Although many may coddle you — saying your score doesn’t matter — you know that the closer you get to 180/ 45T/ 800/1600, the closer you get to moving out of your parents’ basement. If that’s not enough pressure, your score often dictates the amount of scholarship funding available to you.

Back in your dad’s day, if you wanted to do well, you studied really hard, went to church every Sunday and just plain prayed to Jesus. Today, in addition to the former, many people take a “test prep” course. Perhaps the most popular “test prep” company is Kaplan, Inc., sole teachers of the recondite “Kaplan method.” This is a method so “quill-and-dagger” that Kaplan forces you to sign a legal document threatening death and/or legal repercussions for divulging their secrets.

Kaplan is not affiliated with ETS, the company that makes the GRE, or with ACT, Inc., the developers of the GMAT, or with the Law School Admissions Council, the administrators of the LSAT, or with the Association of American Medical Colleges, the administrators of the MCAT. These are all nonprofit institutions whose mission is not to make money, but to “advance quality education with valid educational testing,” “curriculum development assets”… yada yada yada.

Kaplan, Inc. on the other hand, is in it for the moolah, bringing in revenues around $2 billion last year. Ironically, the test preparation industry makes more money than the test makers. ETS, the largest educational testing organization (they make all your favorites, like the SAT, AP and GRE), operates on an annual budget that is half of Kaplan’s. Standardized testing has acquired, as Marx would say, “the occult ability to add value to itself. It brings forth living offspring, or, at the least, lays golden eggs.”

Taking a Kaplan or other test prep course is like an investment (kind of like a good college) that many students make in order to maximize their score and improve the odds of admission to a good graduate school. You receive important insight into the test, including the content, the structure, and the test-taking strategies needed to succeed — if you can afford it, that is.

You get all you need to know for the low, low price of $1199. But the best deal is the “Advanced Prep Course” — buy now and it’s only $1399. Or perhaps you can afford the next step up — private tutoring? 25 hours will cost you $2199.

Compare these costs with the average Pell Grant of $2,000, the grant the federal government offers to low-income students for college.

Maybe the reason why Kaplan makes so much money is because the “Kaplan method” really works. Well, they certainly have the market cornered here at Cornell, but I’m not sure it’s because the “Kaplan method” is really so special. With the limited exception of the TestMasters LSAT prep, Kaplan basically has a monopoly. Plus they advertise the most, they have name recognition, and they do have the most resources to make you think they are the shit.

Unsurprisingly, Kaplan was recently accused of violating federal antitrust laws, allegedly colluding with other test providers between 1997 and 2006. By limiting competition, this would make sure that prices remain high. Of course, Kaplan denied the allegations, and like all innocent victims they settled out of court for $49 million.

But what disturbs me the most is not the near monopoly provision of these courses, but how widespread their use has become. Originally designed for people who really needed help, today, some of the smartest people I know take a Kaplan course. As a result, I can’t help but think that you are put at a disadvantage if you don’t take a course. The test becomes no longer about your ability, but how many hours (and dollars) were spent in test preparation.

With no scholarships available for a test prep course and no financial aid, it‘s basically so that those who can afford it get a “leg up” over those who have earmarked their pennies to pay for pasta. Is this the modern day version of daddy pulling out his checkbook to get you into college? The bourgeoisie versus the proletariat?

Some might tell you that the Kaplan course really didn’t teach them anything mind-blowing. “I could have just studied from the book,” they say. Then why did they pay a grand? If the course was useless but they took it anyway, then they are stupid and should have scored in the bottom 10 percent. In reality, they probably scored really high, because the course helped them. They took the course because it’s not so easy to learn from a book, because going to a test prep class really does help, and because Kaplan does tell you all the details, tips and tricks you need to feel confident on test day. And if it didn’t work, then why would Kaplan promise a “higher score guaranteed or your money back.” They seem pretty confident that only buying their book doesn’t cut it.

Since the cost gives an unfair advantage to an elite group, I think Cornell and other universities should think about stepping in and providing some kind of test preparation. We offer belly-dancing, meditation, and a course on why we collect oriental rugs (HIST 427). My small-town high-school had two free pre-SAT tests, and other free SAT practice. What’s the difference? Don’t put Kaplan out of business, but offer us an alternative. Or maybe consider factoring a “test-prep” course into our financial aid.

Perhaps the best rationale for doing this is because Cornell has a stake in our futures. Oh, and it’s also true that the better grad schools we get into, the more money we make and the more we have to give back to Cornell. So there’s a good capitalist reason, as well as a good collective one.

Dmitri Koustas is a senior in the School of Industrial and Labor Relations. He can be reached at dkoustas@cornellsun.com. The Bull Market appears alternate Thursdays.

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Check your facts first

Check your facts first buddy. The majority of Kaplan's revenues come from for-profit post-secondary schools like an online law school, not from test prep. Besides, Kaplan's courses don't really work. They are getting hammered by some of the new online companies that actually work.

The field of standardized testing needs a major overhaul

I agree with your analysis, Dmitri. Not only has standardized testing become an entire industry, but all it tests is one's ability to prepare for a given test.

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