Recently, there’s been a lot of buzz in tech circles about college being a waste of time. It started with investor Peter Thiel’s creation of the Thiel Fellowship, which awards potential students technology & entrepreneurship mentorship and $100,000 of incubation money to work on their own projects. In an interview with the National Review, he remarked:
You know, we’ve looked at the math on this, and I estimate that 70 to 80 percent of the colleges in the U.S. are not generating a positive return on investment.
Over on TechCrunch, Sarah Lacy mused:
[...] For Thiel, the bubble that has taken the place of housing is the higher education bubble. “A true bubble is when something is overvalued and intensely believed,” he says. “Education may be the only thing people still believe in in the United States. To question education is really dangerous. It is the absolute taboo. It’s like telling the world there’s no Santa Claus.”
Like the housing bubble, the education bubble is about security and insurance against the future. Both whisper a seductive promise into the ears of worried Americans: Do this and you will be safe.
The touchpaper was lit, and the meme began to spread. The Washington Post discussed the relative merits of different degree majors:
Over a lifetime, the earnings of workers who have majored in engineering, computer science or business are as much as 50 percent higher than the earnings of those who major in the humanities, the arts, education and psychology, according to an analysis by researchers at Georgetown University’s Center on Education and the Workforce.
[...] “Education is so off-the-charts expensive now,” said poet and Florida International University professor Campbell McGrath. who noted that his son is considering an anthropology degree. “You are making a really weird decision if you decide to send your kids off to study philosophy. It would be a better world if we all studied the humanities. But it’s not a good dollars-and-cents decision.”
A couple of days ago, Mahalo’s outspoken CEO Jason Calacanis chipped in:
The education bubble feels a lot like the housing bubble: it’s based on credit, it keeps growing and a lot of the folks participating don’t have the ability to pay back the money they are borrowing.
Anyway, back to the point. Preschool and primary education in this bubble is three to four times what I paid for college ($9K for Fordham University at Lincoln Center in the late 1980s-early 1990s). A year in school from ages 4 to 18 inside this insanity costs $30K to $40K a year.
People are spending $500K on their kid’s education — before college! Insane!
This is why we have something called “public education”, which is a hugely important resource that none of us should take for granted. I was publicly educated, and my children, when I eventually have some, will be too. But I digress. He continued:
What would a parent pay to have their 19-year-old sit next to one of the brilliant Twitter triumvirate: Evan Williams, Biz Stone or Jack Dorsey?
What if you could pay $25K a year for three years and have them spend one year shadowing each of these individuals? Would you pay $50K a year?
[...] After three years of sitting next to folks at $35K a year for $100K, you give your child $50K to start a company and you’re in for $150K. That’s probably $100K less than you would spend on a private school all in.
[...] It would be better than spending money on college, right?
Cue Dale Stephens, one of the recipients of the Thiel Fellowship, who made his feelings known over on CNN:
College is expensive. The College Board Policy Center found that the cost of public university tuition is about 3.6 times higher today than it was 30 years ago, adjusted for inflation. In the book “Academically Adrift,” sociology professors Richard Arum and Josipa Roksa say that 36% of college graduates showed no improvement in critical thinking, complex reasoning or writing after four years of college. Student loan debt in the United States, unforgivable in the case of bankruptcy, outpaced credit card debt in 2010 and will top $1 trillion in 2011.
Fortunately there are productive alternatives to college. Becoming the next Mark Zuckerberg or mastering the phrase “Would you like fries with that?” are not the only options.
Enough was enough. The New Yorker attempted to justify a college education, but came across just a little bit elitist:
Society needs a mechanism for sorting out its more intelligent members from its less intelligent ones, just as a track team needs a mechanism (such as a stopwatch) for sorting out the faster athletes from the slower ones. Society wants to identify intelligent people early on so that it can funnel them into careers that maximize their talents. It wants to get the most out of its human resources. College is a process that is sufficiently multifaceted and fine-grained to do this.
College is, essentially, a four-year intelligence test. Students have to demonstrate intellectual ability over time and across a range of subjects. If they’re sloppy or inflexible or obnoxious—no matter how smart they might be in the I.Q. sense—those negatives will get picked up in their grades. As an added service, college also sorts people according to aptitude. It separates the math types from the poetry types. At the end of the process, graduates get a score, the G.P.A., that professional schools and employers can trust as a measure of intellectual capacity and productive potential.
Nonetheless, they nailed how education is used in today’s employment marketplace. Assuming that all we care about is a graduate’s work prospects, let’s return to that Washington Post article:
In general, the study found that a college degree is a good investment. It showed that a worker with a bachelor’s degree can expect to make 84 percent more in a lifetime than a colleague who has only a high school diploma.
Combined with Peter Thiel’s napkin figure that 70% of college programs are not providing a return on investment, and the Washington Post’s report that engineering, computer science and business students end up making 50% more, the numbers seem to suggest that the people Thiel is paying to not attend college are some of the people who would get the most out of college.
The New Yorker article is elitist, but that’s one of the true purposes of universities: to create an elite. They’re gatekeepers: a way for people to hold up a piece of paper and prove – at least in the minds of the general population – what they’re capable of. Standardized qualifications make hiring more efficient (or at least, that’s the assumption), and ensure that an individual’s claimed skills and achievements have some oversight.
This is the essence of a gatekeeper. I’ve written and spoken extensively about gatekeepers, and there’s a real chance that just as other gatekeepers have fallen or been dramatically reconfigured in the wake of Internet models, the fabric of how we think about qualifications will be radically changed. In fact, I hope it will be. A college degree isn’t just an intelligence test; it’s a test of one’s ability to follow instructions within a set framework, and a test of one’s access to resources.
This leads to a simple but important question: if we are to lose faith in college degrees, how can we best represent what an individual is capable of? Could LinkedIn-style social portfolios, with testimonials ranked according to built-in trust metrics, fill the gap? Or will we be left having to take peoples’ word for their own achievements?
I’m inclined to think that we’ll figure out a strong, decentralized, less-elitist way of going about this. But there’s a bigger question in all of this, too. If you take salaries away and look only at the overall education of a person, and the overall knowledge of our global society at large, don’t universities have some inherent value?
I would argue that they do. I also think that looking at direct salaries as the sole measure of ROI in an institution is a short-term, short-sighted way to look at the world. Sure, some degrees yield less well-paying jobs than others. However, the contribution to our overall well-being, and to our economy, shouldn’t be overlooked. The world is a complex system, and just because a degree has a lower financial benefit in the first instance to its graduates, doesn’t mean it has no benefit, either to them or the people connected to them. Think about teachers, or nurses: both are poorly rewarded, but we need them for our society to work. Historians, literary theorists and philosophers are all important, and make our lives better. This is where – or at least, one of the places where – I strongly depart from libertarians like Thiel. Simply put, I think their “enlightened self interest” is near-sighted; perhaps fatally so.
I agree that we should encourage students to delay entering college, but I think that we need to focus on fixing our educational system rather than abandoning it. [...] For some reason, most of the people I knew who delayed college by one year seemed better adjusted than the people who went straight to college.
[...] I think that we should encourage kids to delay college by one year. During that year, they should be able to pursue something they are passionate about, or if they aren’t self-motivated enough to come up with something, they should be provided with service opportunities that allow them to have a more structured experience. After one year, a lot of them will run (not walk) to college. Some will realize that they can make do on their own, but I honestly think that will be fewer people than you would expect. Hopefully the kids who do go to college at 19 or 20 will be far better customers of higher education than the naive ones who now come in at 17 or 18.
Rather than abandoning a system that doesn’t completely work, let’s understand the value of what we have, and try to make it better.
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