The original post about this new service generated a lively debate about whether it’s ethical to “plagiarize” your own essays, or recycle them for multiple applications. I think the consensus was that that it was, and the folks at Turnitin say there are safeguards in their system to eliminate “self-matches” and not flag them as possible plagiarism. There were also questions about whether schools would tell applicants they’ll be running their application essays through the Turnitin service before they’re submitted, or if this would be done on a stealth basis. I think the consensus on that one was that schools should flag their use of Turnitin to applicants.
As to re-cycling things, CBS does it all the time. One can look up past stories and compare them to present ones.
However, the Wendler matter at SIU shows that self-plagiarism is not always harmless.
As to application essays, recall the "burning pajamas" matter.
***UPDATE. USAToday adds some interesting detail to Penn State problem:
One of the topics for [the Penn State B-school] application essays referenced the business school's idea of "principled leadership." Some applicants apparently Googled the term and came up with an article about the concept in a publication of a business school association. Thirty applicants submitted essays that either lifted many passages straight from the article or substantially paraphrased the article without appropriate attribution.
IPBiz notes this IS the "burning pajamas" matter!