I've caught up on reading Bearing's series on post-secondary education, and having done so I'm eager to start formulating some thoughts on the topic in general and on Mark's guest post "Why College Is a Bad Deal for America" in particular. I feel the need to sidle up to the topic and lay some groundwork, not just because I'm too short on time (trying to finish the novel, as I should be doing right now) to write a single exhaustive post, but also because I'm aware that this is a topic on which I have strong feelings influenced by my own history and the limited data set that personal experience provides.
Let me start by outlining my own personal background on the topic. I've written in the past about my own progress from a Classics degree to working in Marketing (and now, Finance -- pricing is one of those disciplines that can end up on either side of the divide.) What may or may not come through from that is the extent to which my personal pride ended up becoming wrapped up in proving that I could "make it" as a provider despite having a humanities rather than a technical degree. Many of the guys I hung out with socially in college were in business or computer science, and so I got a lot of "now you'll know how to say 'would you like fries with that?' in Latin!" ribbing. It was good natured enough, but I had (and have) more than my fair share of pride, and it tended to make me angry. Thus in addition to the need to provide for a family right out of college (MrsD and I married at 22, had our first child at 23 and our second at 24) I had a strong personal determination to prove that in the long run I could make as much or more than people who'd gone into fields like business, engineering and computer science.
So when I hear someone arguing that getting a college degree in general, or a non-career-oriented college degree in particular, is a bad investment, my first reaction is an entirely emotional competitive urge to respond, "Oh yeah? Can you match this?"
Secondly, my personal experience is very much formed around corporate office environments (in marketing and finance) where college degrees are almost a must. Yeah, sure, there are the famous college drop outs like Michael Dell and Bill Gates, but the companies those men founded employ almost exclusively college graduates when it comes to well paid salaried jobs. (If anything, I'm on the anti-credential side of the corporate spectrum, since I'm one of those who considers MBAs mostly useless degrees.) So when I look around me at the type of success that I'm most familiar with, purposely not going to college seems like a bad idea, because it mostly locks you out. (There are exceptions, but it's tough.)
Alright, so with those preliminaries out of the way, so that people will understand where I'm coming from and be able to contextualize what I'm saying accordingly, the approach I'd like to take is to lay out some thoughts in broad outline, and then delve into those points individually in further posts. Since these points are necessarily brief, I'll number them for easy reference in discussion. The ordering means nothing in particular.
1) I think that people are right to be concerned with the rapidly escalating cost of college education (undergraduate and graduate) and with the extent of student debt that people are getting into in order to finance their educations.
2) A great many people go to college believing that college guarantees them a job, or even a "good job". In our current economy, this is clearly not the case. Even people with degrees that are very job focused are having more difficulty getting jobs right now, and for those with less job focused degrees, things are even harder. That said, if things are hard for college graduates, they are even harder for people without college degrees and hardest of all for those without even high school degrees.
3) While one can argue that this maybe shouldn't be the case, a four year college degree is generally considered to be the minimum threshold for being a "well educated person" in our society at this time. As such, if you don't have a college degree, you're going to end up having to answer the question "why not?" to one extent or another (clearly, this will vary depending on your professional field and social milieu) and you will have to deal with people's unspoken assumptions based on your lack of degree.
3) All of that said: College is not a good deal for everyone. People who go to college but don't finish end up with debt and lost time, but don't have appreciably higher income or lower unemployment than those with only high school degrees. (Whether they learned and grew a lot is, of course, another matter, but I'd assume that dropping out isn't a great sign in that regard.) Further, some of the data out of the Academically Adrift studies suggests that among those who finish to college, unemployment is three times higher (and pretty similar to the rate for those with just a high school diploma) for those in the bottom 20% of academic ability as compared to those in the top 20% of academic ability.
4) On the other hand, we have a strong tendency to take a finding about society in general "college is a bad deal for some people" and apply it to each individual person regardless of circumstances. I'd argue that someone who has a lot of academic ability, and a strong desire to pursue a four year degree in some field, should not be dissuaded with the general observation, "College is a bad deal for some people." It's people who excel at and appreciate academic study who will get the most out of college both personally and professionally. Further, given that your children are more likely than the average member of the population to be like you (both as a matter of nature and nurture) while you shouldn't unduly pressure your children to follow your path, you probably also shouldn't assume that they should look like the general population. So if you and your spouse are both college graduates who did well in college and have gone on to successful careers, don't look at the overall population and say, "Well, 40% of people are graduating from college now, and many of them aren't doing so well, so probably most of my kids shouldn't go to college." If your kids are like you in ability and inclination, urging them to skip the college degree they want and get a certification in some skill like plumbing or welding instead is probably not a good a idea. (If they want to pursue one of those fields rather than college, that's a whole other situation.)
5) I think it's important to come to a broader understanding of the "liberal arts" as those arts and sciences appropriate to a free person. This means encouraging "liberal arts types" to study a bit of more hard-edged topics, and also making sure not to relegate more technical subjects strictly to training as opposed to education.
6) While I'm sympathetic to the search for "third ways", part of what made college such a valuable experience for me was living for four years with other people who where also studying academic subjects in depth, and the "community of scholars" feeling that creates. Goodness knows, it was imperfect, but I had a fairly intensive liberal arts education in high school and I've tried to do a fair amount of self teaching since, and I don't think either one is remotely comparable to the college experience.
7) While I'm a very big advocate of people getting an undergraduate college degree if they have the ability and inclination, I think people should very carefully weigh whether going to grad school is something really ought to do. It's often very expensive. If your hope is to get into academia professionally, it's an incredible career longshot. If you are doing it for more general professional advancement or benefit, I think you need to think hard whether the time and cost is going to have a sufficient return on investment. And if you're doing it because you don't know what else to do (or because it's just fun) I think you need to be very hesitant unless you can pull it off without incurring debt. Borrowing tens of thousands of dollars is a bad way to avoid making decisions.
LETTER TO THE EDITOR.
7 hours ago
8 comments:
Darwin: I am having fun playing Devil's advocate on this topic. I do have a true fondness for my college days, but I think it is time for fiscal curmudgeons such as myself to start throwing metaphorical stones at windows of the ivory towers. I hope to have a follow up to my "college is a bad deal post" that explores the wasted resources that go into science and engineering education too. I do not want my critique of higher education to end up as a high-end vocational training (engineering comp. sci. etc.) vs. liberal arts rant. Instead, I would like everyone to make sure that they are getting good value for the money they (and the taxpayers) are paying. Once we consider the taxpayer contribution ($60k per degree on top of what the students pay according to NEXUS), the total return on investment for universities is negative relative to whatever else students would do instead of going to college. I wish this were not true, but the data is what it is. Yes, college is a great deal for some, but once we tabulate the total costs, our country comes out behind. Universities desperately perpetuate the myth that the college degree is the primary factor in determining one's future financial status. The real data shows that your family's economic status is a better predictor of future earnings that your own education. In general, the best thing you can do for your children's future earnings is to earn more yourself. Some of the current college students (about a third if I take a guess) ought to be at 4-year colleges. The rest would do better at 2-year colleges and trade schools.
Everyone has to make their own decision about what is best. For me, I spent $92k (inflation adjusted) in taxpayer money at Ohio State and ended up with a great job, so college was perfect for me. I also know someone who got $200k in free education (with great grades at it too) who would be in much better financial shape if he had never gone to college at all. College is not magic, despite what our political leaders and college presidents would have us believe.
Mark,
I likewise am looking forward to having time to dig into this more and hashing things out.
An initial thought. You say:
Everyone has to make their own decision about what is best. For me, I spent $92k (inflation adjusted) in taxpayer money at Ohio State and ended up with a great job, so college was perfect for me. I also know someone who got $200k in free education (with great grades at it too) who would be in much better financial shape if he had never gone to college at all. College is not magic, despite what our political leaders and college presidents would have us believe.
Certainly, I would agree that everyone must do his best to evaluate the situation and decide what is best, and also that college is not magic: it does not create good jobs or magically form one into a higher earner.
That said, I think you're glossing over a bit of a knowledge problem here. People chronically think that they are better at things, more able, etc. than they actually are. This may be bad in the sense that it causes them to waste resources on attempting things that don't work out. On the other hand, since people don't know before hand what will and will not work out, this lack of realism also encourages people to do things that do work out.
Ideally, one would only encourage those people to go to college who would benefit from it. However, in reality, it's doubtless the case that many people who would benefit from college don't end up going. And many who can not benefit from college go anyway.
Also, keep in mind that people react primarily to situations they can affect. So while it may be that someone's earnings are, statistically, determined more by their parents earnings than their level of education, a given person can't change his parent's earnings, but he can change his level of education. So it's natural that he's going to seek to pull the lever he does have and ignore the one he doesn't.
I have some thoughts inspired by your comment here.
+JMJ+
These days, all conversations about higher education remind me of Woodrow Wilson's answer when someone asked him how many students were at Princeton when he was President there: "Ten percent." =P
When I was in high school, I read a novel in which a character described English Literature as a "rich girl's major"--something for a rich man's daughter who knows she doesn't have to get a job after graduation. Being a rich man's granddaughter, I had to chuckle. There is a sense in which my degree is no more than a status symbol: my family could afford to support me for four years while I had some academic fun that everyone knew would have no financial return on investment. But I was 100% Student!
On the other extreme were some South Asian friends I made at my New Zealand uni. They admitted their parents were willing to pay for an exorbitant foreign degree in the hopes that their children could apply for Permanent Residency after graduation and eventually petition the NZ government to allow their whole family over. They did the work, yes, but they weren't in uni to be "students."
Just hoping to clarify Mark's claim:
Once we consider the taxpayer contribution ($60k per degree on top of what the students pay according to NEXUS), the total return on investment for universities is negative relative to whatever else students would do instead of going to college.
The superficial sense of these words seems implausible, so I must be confused; is the claim being made that a lifetime of work following a successful college degree does not pay-off a 60k$ investment? Or is the claim that the advantaged lifetime of work following a successful four-year degree does not pay-off that 60k$-plus return from relatively disadvantaged work for those four years? Or is it simply the trivial observation that a worker paying taxes for four years is an apparent positive while a student paying subsidized tuition is, at it seems, being paid by the state and his family to do nothing?
Belfry: I am claiming that, on average, a lifetime of work after college does not pay off the costs when we consider both the cost of tuition and the subsidies paid by the governments. We have fallen for the myth that college delivers a large earnings boost. This is mostly perpetuated by the figures that college grads earn some large percent more than non-college grads. This is a phony comparison because so many of the non-college grads come from poor families. The children of the poor earn less than the children of the wealthy and family income has far more to do with a child's future income than going to college. The question to ask is how much would a specific individual make if they went to college vs. not going to college. The best data to answer this question comes from sibling pair data. It shows that the real earning boost is less than 20% for going to college. (This is because the children of wealthy people still make lots of money even if they don't get college degrees.) I link to the research that shows this in my post at Bearing Blog. Since the total cost (tuition plus subsidy) is $92,000 at a public school and higher at a private school, the 20% earnings boost is not enough to make the societal return on investment (ROI) positive when the opportunity costs of not working for 4 years are factored in.
Since government subsidy is involved, there are many cases where a student is better off in college even when the societal ROI is negative. This means wasted taxpayer dollars, but I don't blame students for taking advantage of silly subsidies. Also, for a minority of students college is a great deal. These include students who get their education mostly free via scholarships and students who graduate with highly compensated degrees. Students who pay full price for college and have degrees with low demand generally are worst off than if they had simply gone to work right out of high school. Even the unemployment figures show what a bad deal college is for the bottom 25% of students. They are paying all this tuition money, generally getting low value degrees, and their unemployment rates are close to those for people who didn't go to college. The latest figures from the department of labor show that the majority of the unemployed have college degrees.
If I met a top high school student who wants to major in business or engineering I would have no trouble advising them to go to college even if they had to borrow some (not all) of the money. Really good students can also make a career of a liberal arts degree but taking on debt looks far riskier for them. For students graduating in the bottom half of their class who are undecided on a major I think four year college is a poor choice. Two year degrees and vocational training will pay out better for these students.
We can make college a net positive ROI for society by reducing the number of students who attend and ensuring that those who do go are the ones who will make the most of their time there. We can also improve the ROI but slashing administrative costs at universities. The vast increase in the price of attending has mostly gone to college management, not to teachers. Capital spending at colleges is also over the top. When I was at Iowa last year, the university president cared more about hiring famous architects than getting a good deal on the money that was being spent.
I think Mark is probably wrong on this analysis, but I want to finish reading the paper he's referencing before I go into the question in detail.
I hope I am wrong and that our country's spending on higher education is in fact creating real wealth. If you find more data showing causality for higher earnings I would like to see it. The more I cast about on topics related to education the less value I see in our current system. It just costs too much for what most students get. Plus the students are only studying half as many hours as they did in 1960, so it looks more and more like a super expensive party than a career preparation.
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