BOOK REVIEW: ‘Is College Worth It?’

[dcarrigg]

Re: BOOK REVIEW: ‘Is College Worth It?’

Every societal institution is under attack, and academia is not excluded. Hence, this article should be of no surprise. When societal control can be effected without an institutional framework, why would one provide their adversary (in this case, the public) with centers of prospective power from which to organize? This is a logical and highly strategic trajectory that we're proceeding down.

We're in a networked war now. Unfortunately, the one who controls the networked wins network wars. Only way for the public to escape this one is to pull the plug on the network and let the parasite collapse (insert Hudson's FIRE host parasite analogy here)

Reggie, I've been meaning to ask you, do you think the internet was set up explicitly as a complex systems experiment in social control? Sometimes I think I can follow you. Other times, I'm lost. I'm not an expert in the field, although I am familiar with the basic concepts and cast of characters.

[mooncliff]

Re: BOOK REVIEW: ‘Is College Worth It?’

But more basically, I am not very interested in taking the accounting approach to education. Trying to estimate whether it makes financial sense to go to college by looking at the cost, potential debt, and potential pay, and whether it is all a part of plots by the evil banksters and big government I would say is about 5% of the problem. The rest of it is you are much more literate and skilled after completing college, assuming you exerted some effort. IQ increases about 1 point for every year of formal education. The more years of education, the longer life expectancy and the later dementia is likely to appear. You can better manage your health if you can understand all the issues with medication (which are so complicated it makes your head spin). You can't teach children what you yourself do not know. You learn in college how to handle doubt and how what was true is now outdated. My cousin was getting rooked by IBM because he didnt go to college and didnt know how to use computers... I fixed everything for him in an hour, and boy were the IBM people mad... so that useless computer science course I took, which I never worked at, actually paid for itself in that one hour.

Students alive now have a good chance of living to see the dawn of the 22nd century. We are not educating them for the here and now, we are educating them for 2020 to 2080. I cannot imagine what the demands will be. I am not saying that there will be jobs or that people cannot get into huge debt trouble. I am saying that I do not regret a single cent I have spent on education.

Our extended family went from my dad being the first one to go to college to 3/4 of my cousins having college degrees. The few who were really qualified, in the top 5%, who chose not to go to college because it was just too boring, now tell me they regret that they didnt go.

Why pursue education? To reduce the confusion you will have for the rest of your life. And you wait until you see just how complex everything becomes just by 2020.

[wayiwalk]

Re: BOOK REVIEW: ‘Is College Worth It?’

A Saturn Ion may have been the least reliable car to drive in the last decade, and the Honda Accord the most reliable, but that didn't affect car loan rates.

You may be right in one respect. If you went full bore free market, one could expect anthropology degrees to be far cheaper than an electrical engineering degree or something. But I suspect that probably most people here are happy that the liberal arts and social sciences subsidize stem fields. If you think of it that way, the price of the anthro degree is built into the principle instead of the interest. What does it cost to get a kid an anthro degree? No new buildings for anthro. No labs. Just a room, some books, and a teacher - probably the teacher making among the least in the school. But the kid pays the same as the stem or business kid with the brand new building, twice as expensive teacher, and the labs. I'm not sure charging 20% on top of that is reasonable.

But all of this is absolutely beside the point. The point of interest in private business is to make a profit off lending money. The federal government is doing that. Should the federal government be making profit off students? That might be a better question.

I think that there are many people around who feel that if federal student loans and pell grants were ended, that college would somehow drop drastically in price. I don't think so. I think that the marginal schools, high price low yield not-for-profits, and all the for profits would go under. That would leave increasing demand for the better schools who survive. I don't think their tuition would go down a bit.

Do you know why I think demand would stay the same, even though all the loans and subsidies are gone? Because we have been on a thirty year mission to destroy the manufacturing base and vocational education in this country. There are comparatively few places left for a kid just out of high school to find employment better than minimum wage. And so the demand will stay. Plunging supply of schools, fewer seats, steady demand = increased price. And with the no bankruptcy rule, the same bully boys on Wall Street that bundle Student Loan Asset Backed Securities, appropriately called SLABS, will be happy to rush into the credit market and fill in the gap at double or triple the interest rate.

The thing that drives the cost of school down is dropping demand. And the way to do that is to increase vocational ed, increase apprenticeship programs, and fix the trade deficits that bleed on like a sieve year after year sucking low-mid range lobs overseas. At least that's the way I see it. Many anthro majors aren't suddenly going to become savants at differential equations. Neither are they going to find $12/hr work right out of high school halfway through this decade of 7%+ unemployment, 20% for youth. So they go into anthro. They learn a bit. They take on debt. And they try to figure things out.

But I think the mistake in total utopian free market thinking is that it has never existed and will never exist. Every single trade agreement sets all sorts of specific tarif rates and import and export restrictions on specific goods. Every single tax policy differs and drives change. Even non-tax laws that provide for trains, roads, and buildings that don't collapse into nothing the way they might in China or Bangladesh add cost. Wherever human life is cheap, labor will be cheap. And so there's never a level playing field in the neoliberal global economy. And all the cheap goods that are pumped into first world economies skew conceptions of price. This is why John Williams has shadowstats up showing CPI far higher than the current CPI that increasingly only takes into account manufactured goods imported from the third world, removing housing and commodities and education and healthcare. They all go up so fast because they're the only things that can't be easily tied to the cheap labor, cheap life, third world economy. And for the third world, I'm not sure things are any better, since the money only flows as long as you make sure not to improve wealth, health and safety. To grow, you must be a cheap place to do business.

Taking that entire construct, the loss of 7 million manufacturing jobs etc. etc, and simply removing subsidies to give kids something to do would just cost money on the other side. Instead of taking out loans, lots of them would probably end up on some kind of welfare. There's no desire to really create jobs for them. And there's a constant desire to cut back on old age benefits in both the public and private sector. So people who might otherwise retire work longer. Just ripping away all subsidies isn't going to make these kids magically have successful careers without college, or give them productive things to do from 18 to 22. At least that's the way I see it. The system isn't right now. But when your choice isn't between a wrong and a right, but rather between a wrong and a wrong, what do you choose?

You say two wrongs don't make a right. But I've lost count of how many wrongs there are here. The question is where the original wrong lies.

Great, insightful post.

Another aspect to keeping demand up - the universities' outreach efforts overseas to bring in quality students to fill their halls. They're ahead of the curve!

I totally agree - there are so many wrongs in so many areas that it is hard to poitn to any one cause or solutions, and a problem like this that developed over several decades doesn't go away overnight.

[vinoveri]

Re: BOOK REVIEW: ‘Is College Worth It?’

http://www.bloomberg.com/news/2013-0...ee-threat.html

[Thailandnotes]

Re: BOOK REVIEW: ‘Is College Worth It?’

i have no clear idea where higher education is going, but william j bennett is a corporate shill, nothing else.

[mooncliff]

Re: BOOK REVIEW: ‘Is College Worth It?’

Shill? I just always thought he was strange and incoherent.

[Thailandnotes]

Re: BOOK REVIEW: ‘Is College Worth It?’

Elizabeth Warren does great email. One payoff of my pittance of a contribution to her grass-roots funded campaign—I regret not contributing more—is that I am regularly alerted by the new Massachusetts senator to the favoritism of our Congress toward Wall Street.

That’s how I was reminded this week that Congress is about to let the interest rate charged for new student loans double to 6.8 percent at a time when the too-big-to-fail banks that caused the Great Recession continue to be bailed out at the rate of 0.75 percent. Yes, the banks pay less than 1 percent for money that we the taxpayers lend them. I know that such statistics are thought to be boring, but as Warren explained, the rate that students will have to pay “is nine times higher than the rate at which the government loans money to the big banks.”

The student loan interest rate that had been temporarily cut in half back in 2007 was once again set to double, but instead of pushing for the status quo as Congress did last year, Warren has upped the ante with legislation that would cut the student loan rate way down to the near zero that the big banks enjoy. As Warren put it in her characteristically no bull style:

“The federal government is profiting off loans to our young people while giving a far better deal to the same Wall Street banks that crashed our economy and destroyed millions of jobs. That’s why I’ve introduced the Bank on Students Loan Fairness Act as my first bill in the Senate: To allow students to borrow money at the same rate as the biggest banks.

http://www.truthdig.com/report/item/...ment_20130514/

[RebbePete]

Re: BOOK REVIEW: ‘Is College Worth It?’

Some good charts in this recent article.





For me, there are two key quotes:

"Stephanie Owen’s and Isabel Sawhill’s Brookings report, 'Should Everyone Go to College?' is getting a great deal of well-deserved attention. ... [The report] is framed by its authors as casting doubt on the assumption that everyone should go to college[, but] the report is more of a testament to the poor quality of some colleges and universities than to the inappropriateness of college for a large number of students."

and

"And a caveat is in order that ROI as used above doesn’t adjust for graduation rates. These are the returns for those who go and graduate, not the (many) who drop out midway through."

I think it can simultaneously be true that completing college is a better choice on average than no college, while still being a much worse value proposition than it would be without a lot of accumulated bloat and inefficiency. Also, there are clearly specific colleges and specific majors for which the ROI is low or negative. (And the usual caveats about population averages versus individual circumstances apply.)

Aha! I had to click through a bunch of links to find "the rub." The ROI quoted is apparently calculated as the difference over 30 years of the income the student could receive as a college graduate in that field versus a high-school graduate. However, it doesn't seem to account for the unemployment rate of graduates nor those who are working in a job that doesn't require a college degree (currently over 50%!). The ROI for those graduates is, what, -100%?

It also takes the college expenditures as net, not the total outlays over time, including loan payments, which can be considerably more. For example, Duke is quoted in the article with an ROI of 6.4%, but when college loan rates go up to 6.8%, you lose! I also don't think it accounts for lost or diminished wages for the high school graduate during the 4 years he/she would have been in college.

Bear in mind, I have two masters' degrees, one in engineering and one in ministry, so I'm not totally down on education, just believe that it has to depend on the child, what he or she wants to do, and his or her abilities.

[radon]

Re: BOOK REVIEW: ‘Is College Worth It?’

“The federal government is profiting off loans to our young people while giving a far better deal to the same Wall Street banks that crashed our economy and destroyed millions of jobs. That’s why I’ve introduced the Bank on Students Loan Fairness Act as my first bill in the Senate: To allow students to borrow money at the same rate as the biggest banks.

So colleges can charge even more? How is that fair to "young people"?

What they should do is make the loans easily dischargeable like any other unsecured debt so that people don't have to sign suicide loans in order to attend.

[ASH]

Re: BOOK REVIEW: ‘Is College Worth It?’

Aha! I had to click through a bunch of links to find "the rub." The ROI quoted is apparently calculated as the difference over 30 years of the income the student could receive as a college graduate in that field versus a high-school graduate. However, it doesn't seem to account for the unemployment rate of graduates nor those who are working in a job that doesn't require a college degree (currently over 50%!). The ROI for those graduates is, what, -100%?

It also takes the college expenditures as net, not the total outlays over time, including loan payments, which can be considerably more. For example, Duke is quoted in the article with an ROI of 6.4%, but when college loan rates go up to 6.8%, you lose! I also don't think it accounts for lost or diminished wages for the high school graduate during the 4 years he/she would have been in college.

Bear in mind, I have two masters' degrees, one in engineering and one in ministry, so I'm not totally down on education, just believe that it has to depend on the child, what he or she wants to do, and his or her abilities.

Good sleuthing! Thanks!

[c1ue]

Re: BOOK REVIEW: ‘Is College Worth It?’

It is also useful to apply a little math: according to the chart above, lifetime earnings for an engineering major is around $3.5 million. For arts, about $2 million.

Besides the not inconsiderable niggles concerning present vs. future value of dollars, also the impact of inflation, assuming a 30 year career yields over $116.7K/year for the engineering major and $66.7K for the arts student.

I don't know about you, but this seems implausibly high.

I'd also note that if we're talking ROI - a high school graduate attains infinite ROI because his investment in college was zero.

Other likely issues: is an investment banker with an engineering degree 'using his education'? What about a barista arts major? What is the average vs. the median? the median/average game has been played extensively by the real estate industry.

[bpwoods]

Re: BOOK REVIEW: ‘Is College Worth It?’

Is college (ie higher education) 'worth' it? Now worth is a value claim term, so I'll skip it. If you insist on the pecuniary aspect it boils down to the tuition (and board + lodgings) costs. Here in Direland there are no tuition fees for undergrads for your first level 8 qualifications; eg: BA, BS, BEng, BMed, etc. Undergrads have to pay a Reg Fee (currently approx 2,000 euro). If you wished you could attend an Institute of Technology and get a 3-year Diploma (level 7) then go on to university, and all without any tuition fees.

Back to the pecuniary bit. In the US it appears that a college degree is simply too expensive for most undergrads. It leaves the grad with a very nasty debt overhang (except you have v-rich parents!). Skews your entire working life. You're in effect a debt skivvy. So, it's not 'worth' it. But. If a college degree is a mandatory requirement. Now you have a very big social and economic problem indeed. But maybe that's what the residents at the top of the business baboon tree actually want. "Only our type need apply" "White trash (and other undesirables) keep out" Quite!

The academic bit is a tad harder to grasp. As a former professor, I noted that the active researchers were almost all 'poor teachers'. They were trained to research, not to teach undergrads - which is a very challenging activity if you are keen and do it well. All the academic administrators I served under were utterly appalling. And the higher they clambered up that corporate baboon tree the 'worse' they got. And they then had the arrogance to 'demand' obscene salaries! Mind boggling stuff!

Just so some of you may think I am a tad biased. Think no more - I am! I retired, then returned to college and took undergrad and postgrad degrees - just to check if my biases were valid. Regrettably they were! But I had a great four years (apart from the exams!).

For those of you who are so inclined (I dislike recommending reading - its smacks of paternalism!): In no particular order of preference or recommendation (all refer to US higher education):-

Bloom, Allan. (1987). The Closing of the American Mind: How Higher Education has Failed Democracy and Impoverished the Souls of Today's Students. Penguin Books.

Sykes, Charles. (1988). Profscam: Professors and the Demise of Higher Education. Regnery Gateway.

Boyer, Ernest. (1990). Scholarship Revisited: Priorities of the Professoriate. The Carnegie Foundation for the Advancement of Teaching.

[RebbePete]

Re: BOOK REVIEW: ‘Is College Worth It?’

http://p.washingtontimes.com/news/20...lege-worth-it/

This report was just on the news tonight. Coppin State College in Baltimore, over a 10 year period, had its enrollment fall 3%, but they increased faculty 49% and administrators 92%.

[dcarrigg]

Re: BOOK REVIEW: ‘Is College Worth It?’

This report was just on the news tonight. Coppin State College in Baltimore, over a 10 year period, had its enrollment fall 3%, but they increased faculty 49% and administrators 92%.

My favorite was last year's story about Charles Polk at Mountain State University. Makes a cool $1.8 million in 2009, which was about 4% of the school's budget if I remember correctly. Then he gets fired in 2012 when the school ran into accreditation issues. Whoops.

[flintlock]

Re: BOOK REVIEW: ‘Is College Worth It?’

As with many things, the Devil is in the details. It's not just whether a college degree is worth it, but rather WHAT degree you choose. I've never put much heed into the standard statistics always thrown out in regard to college vs no college. They simply are not a realistic measure of success based on what a MOTIVATED individual can achieve. Keep in mind, the "non-college" demographic includes criminals, drug addicts, and other assorted losers in far greater proportions than the college group. And by its very nature, college attendees require at least some motivation. So while I still feel there is a payoff to going to college, and plan on sending all my kids there, the income gap may not be as large as crude statistics may make it seem. No doubt an engineering degree or medical degree can payoff. There remains some doubt however if that degree in history or cultural studies is still financially worth it.

I work along side a lot of entrepreneurs, most without college degrees, but usually with some technical training of some sort. It is quite common to see these young people, still in their 20s or early 30s earning six figure incomes. The fact is, there is becoming somewhat of a shortage of smart, motivated individuals to work in technical fields not normally associated with traditional college training. That is what it is really about. Filling economic demand. It pays to keep in mind the needs of today may not be the needs by the time you graduate from college. There is a glut of mediocre college graduates, with no specific skills, often having never learned a good work ethic. In fact often with no work experience whatsoever.

As the book mentions, there is a certain snobbery involved today in regard to jobs and job titles. Many seem more concerned with the appearance of status in a job than any actual financial gain. This is why, in my area, you can expect to spend $200+ hour for a good plumber. A good buddy of mine in the HVAC business is usually out on his boat fishing by noon, or sitting on the deck of his luxury lakeside house. And I'm talking about a two man operation, not some big outfit. My father in law, a college grad, made a fortune renting those little flashing road construction barriers. I have no doubt he would have been successful whether he went to Duke or not. Probably one of the best examples I know of is my brother's wife. HS grad. Worked her way to a high paying job with a major bank while still in her early 30s. You cannot buy yourself a work ethic or ambition with a college degree, but rather must see it as a tool to help you get where you want to go. The financialization of college today is a direct result of the mentality that college is something you can buy yourself, like a new vehicle, or a house. If only it were that simple.