The unsustainable cost of education

The quote I have always loved is: “If you hate the cost of education wait until you see the cost of ignorance.” I love the logic. It is only when you take it to the extremes that it no longer works.

Mish Shedlock has a unique perspective in his post: PhD's In Distress and the Unsustainable Cost of Education

We are in an era when basic classes like Algebra and History can be taught at a far lower cost – and yet the costs are going up not down. We need to question the models, question the assumptions and teach that which will lead to jobs rather than academic enlightenment. Let’s get real – education like everything else needs to be cost competitive.

California sells it university system?

http://www.sacbee.com/opinion/story/2227503.html

Excellent article suggesting that California might actually sell their university system to a private entity. Great idea but unless your leader is Maggie Thatcher it ain’t going to happen.

It is time to consider alternatives to the government running our colleges and universities. And the University of Phoenix is as good a choice as any to manage this change.

The problem with government and non-profits running things is they are impervious to change and believe their noble mission should exempt them from providing a practical education at a reasonable cost.

Disruption of the college model

http://techdirt.com/articles/20090910/0408256152.shtml

Excellent article: Disruption of the college model.

The US college experience continues to receive big subsidies - a sacred cow. An overwhelming assumption that one can never lose with a college education - no matter what it costs - no matter what one studies.

If this sacred cow was not protected with so many subsidies it would be a whole new story.

Questioning the Return on Educational Investment

http://thechoice.blogs.nytimes.com/2009/09/03/questioning-the-return-on-educational-investment/

Excellent article from the New York times sent to me from my friend Jay Fitzgerald.

Let's be clear - I am not against college. What I am against is kids going deep into debt to earn a dubious degree over six plus years and then strugling to ever pay off their loans. All the while these kids never consider many of the great alternatives to college like getting a job, starting a small business or learning a trade.

Saddest moments as a career counselor

One of the most insightful articles we have seen about college is written by Marty Nemko, a career counselor. It is too bad that other “career counselors” are so narrowly focused on getting poor students in college.

Nemko says: “Among my saddest moments as a career counselor is when I hear a story like this: 'I wasn't a good student in high school, but I wanted to prove that I can get a college diploma. I'd be the first one in my family to do it. But it's been five years and $80,000, and I still have 45 credits to go.'"

Article "It's time to study the value of college"

Excellent piece by David Frum. Here are two paragraphs from his commentary:

"Over the past decade the cost of college tuition has approximately doubled, faster at private colleges. This rapidly inflating investment is yielding a declining return. The earnings of bachelor-degree holders have been dropping this decade. After inflation, B.A. holders earned more than $54,000 in 2000. That dropped 5 percent over the next four years.

What happened? Some point to international trade. It used to be only blue-collar workers who faced international job competition. Today, so do bookkeepers, software engineers and certain health care technologists."

WSJ article “Weighing Price and Value When Picking a College”

http://online.wsj.com/article/SB10001424052970203739404574288301760990542.html
Excellent July 16, 2009 WSJ article “Weighing Price and Value When Picking a College”

“In a May 2008 survey of 720 parents of college students by Gallup and Sallie Mae, a student-loan company, 46% said they had never, at any point, ruled out any colleges for their kids based on costs.” Is there any wonder that the cost of college has inflated so much faster than other costs? What would have happened to the cost of autos in the US if car buyers had had the same attitude? When few care about the price it is sure to increase to a point where someone finally does care.

This notion that you always get what you pay for is simply a fallacy. But one benefit of the recession is that families are looking at the cost of college much more pragmatically.

“The engines that have enabled college costs to soar—easy credit, home-equity loans and growth in savings—have stalled.” Not to mention the wealthier the society the higher average “sense of entitlement”. The shakier the economy the more obvious it is how challenging it is to n get a good paying job.

But what is even more important than how expensive your college is what do you study. Does anyone debate that an electrical engineering degree from San Jose State will offer more job prospects than a History degree from Stanford?

Financial Problems at San Francisco City College

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/08/29/BAA119F7LO.DTL&tsp=1

This article in the San Francisco Chronicle today speaks to the financial problems some of California’s junior colleges are experiencing. These schools have been a very cheap way to get the first two years of one’s college because they have been heavily subsidized.

But when things get subsidized to this degree you have distortions. For one they have been offering high school math classes like elementary algebra and offering college credit. Maybe folks should get their high school math in high school.

And because it was so inexpensive, the demand for the classes has been higher than it would otherwise be. It points out that Mary Allen, 76, has taken classes at the City College for the last quarter century. Nice for Mary but how about the taxpayers that are footing the bill for her classes in Psychology, Sociology and Art Appreciation (I really don’t know what classes she took).

College board drivel about cost of college

http://www.collegeboard.com/student/pay/add-it-up/4494.html

This is the kind of drivel that keeps getting printed about college. Granted certain colleges and majors provide good value – but this is far from universal. Try and show me the data that demonstrates the payback for a “Sociology degree” that costs a student and her family $200,000.

And keep in mind that most of the $143 billion in student aid discussed is simply debt that sticks with the individual for life or until they find a way to pay it off.

If one gets a practical degree (like engineering or accounting) from the State college at a reasonable cost, lives at home and gets the degree completed in 4 years or less, college can pay substantial dividends. But borrowing $100,000 to get a degree in “Sexual and Gender Issues” is unlikely to pay off.

Let’s get real! Here is what they have to say.....

“2008-09 College Prices
Keep Increases in Perspective
There's no escaping the fact that college prices are rising. According to recently released reports from the College Board, most students and their families can expect to pay, on average, from $108 to $1,398 more than last year for this year's tuition and fees, depending on the type of college.

But there is good news. There is more than $143 billion in financial aid available. And, despite all of these college price increases, a college education remains an affordable choice for most families.”

Alumna sues college because she hasn’t found a job

Read this CNN article.

http://www.cnn.com/2009/US/08/03/new.york.jobless.graduate/index.html

Today if you want a job in IT getting a Business Administration Degree in Information Technology is probably not the way to go. But parents, the media and conventional wisdom keep sending kids to college when there are frequently better ways to go.

She probably would have been far better off getting a Cisco, Microsoft or Oracle certification at a far lower cost and a much shorter investment in time. Then she could get out in the work world and start learning on the job.

I wonder how much student debt this woman racked up in the process? And by the way student debt is not dischargeable in bankruptcy.

Why the Chinese kick our butts in Mathematics

Class Pictures from University of Colorado vs Shanghai University.

State colleges hiring expensive lobbyists

A classic case of the government using our money to lobby other parts of government to get
more money. Read this story about California State Univeristy system
hiring expensive lobbyists in order to protect their subsidies. A great example
of why we need to get the government out of the college business and let them
stand alone on their own financially.

http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/07/05/MNGL18HBC9.DTL

Stars of the NBA semi-finals

The four stars of the recent NBA semi-finals Koby Bryant, LeBron James, Dwight Howard & Carmelo Anthony have a combined one year of college (Anthony at University of Syracuse). High School draft choices were so dominant that in 2005 the NBA decided to protect its minor league (college basketball) by requiring at least one year “removal” from high school play.

So did the lack of classes in history, badminton, psychology and yoga really set these four players behind the eight ball? Not quite.

There are certain careers that almost require a college education: engineering, pre-med, and accounting for example. But general studies, sociology, and geography are more leisure activities than a way to earn a living. Like basketball for most of us. College is not the way to get into router administration (go get a Cisco certification) or acting (actually start producing your own series), or journalism (start your own blog) or video production (start producing on YouTube – don’t study it).

College can pay off but it is clearly not for everyone.

Staff Jobs on Campus Outpace Enrollment

By Tamar Lewin The New York Times 4/20/09

http://www.nytimes.com/2009/04/21/education/21college.html?_r=1&sq=tamar%20lewin%20staff%20jobs&st=cse&adxnnl=1&scp=1&adxnnlx=1241965291-asCS28YUs/naqEben3c4gQ

This article points out some of the causes of rising college tuition. The author points out:

“Over the last two decades, colleges and universities doubled their full-time support staff while enrollment increased only 40 percent, according to a new analysis of government data by the Center for College Affordability and Productivity, a nonprofit research center.”

“A lot of it is definitely trying to keep up with the Joneses,” said Daniel Bennett, a labor economist and the author of the center’s report. “Universities and colleges are catering more to students, trying to make college a lifestyle, not just people getting an education. There’s more social programs, more athletics, more trainers, more sustainable environmental programs.”

Our response:
She points out some of the reasons that college costs keep going up but the fundamental reason is that there is so little push back. The widely-held assumption is that any dollar spent on college is a dollar well spent. And since many students and their parents are borrowing to foot the bill they have less concern about the costs and more about the hours of the gym. It is only when they start paying the bill years later that they wish they had shopped a little harder.

I love college!

http://www.youtube.com/watch?v=43pkqeamXe8

This video is fairly representative of kids perspective on college. Why go
to work or start a new business when you can enjoy college parties like this?

Jamie Lee Curtis interview on the Tonight Show May 8, 2009

Jamie – “My daughter is away at college – she has just finished her last day of college. My daughter Anne is graduating in a week. Thank you.”

Jay - “What will she have a degree in?”

Jamie – “She will have a degree in American Studies and a degree in Dance – she double majored Jay.”

Jay – “So she’s going to live with you when she gets done.”

Jay – “There’s so many job openings”

Jay – “What was it – American Studies?”

Jamie – “American Studies”

Jay – “What is that? What is that? What is American Studies?”

Jamie – “Don’t you ridicule my daughter on national television?”

Jay – “Have you helped her with her homework?”

Jamie – “Have I helped her with her homework? Stop this! Now! Stop! I am proud of her. I am not going to let you ridicule her on this television. She’s a fabulous woman.”

Jay – “A fabulous girl.”

Jamie – “She’s a woman.”

Jay – “A Woman. She’s a woman now. ”

Jamie – “A fabulous woman – a woman.”

Jay – “A woman now. This girl is a woman now. Who studies America and can dance. ”

Jame – “Let me ask you. Can I ask you about the dance?”

Jamie – “No!”

Jay – “Is it lap or pole?”

UC chief touts progress

To: Jim Doyle jdoyle@chronicle.com

Thanks for your article “UC chief touts progress, outlines marketing plan” about the UC financial struggles http://www.sfgate.com/cgi-bin/article.cgi?f=/c/a/2009/05/06/MNJQ17CKF9.DTL&hw=jim+doyle&sn=002&sc=838.

Our colleges and universities have been built around a premise that society would always need more colleges, more college students and that any dollar spent on college was a dollar well spent. This led to a predictable inflexibility in ability to downsize and reduce costs when such circumstances require it. Staff (both professors and support staff) were given well above average benefits packages (especially health care, vacation time and pension programs). And since their customers (students) were given lucrative loans with which to pay for this education combined with substantial state and federal subsidies for the universities there was little if any push back for lower prices. In fact the normal premise is that the higher the tuition the better the education.

The typical government approach for lower costs is to give all employees a few days off without pay. But their fixed benefits continue to accrue and therefore little actual savings are realized.

Our public colleges and universities should turn to the mavericks like the University of Phoenix that have created a far more flexible cost structure. They rely far less on the traditional professor lectures and are making money despite far fewer subsidies from government.


Blog http://valueofcollege.blogspot.com

Not all college education is created equal

Our politicians keep pouring more money into college education via grants, subsidized loans, and tax deduction subsidies for donations to colleges.

But look no further than Saudia Arabia to demonstrate the fallacy of “any college education is money well spent.”

According to Wikipedia:

“Today, Saudi Arabia's nationwide public educational system comprises twenty universities, more than 24,000 schools, and a large number of colleges and other educational and training institutions. The system provides students with free education, books and health services and is open to every Saudi. Over 25 percent of the annual State budget is for education including vocational training.“

“The study of Islam remains at the core of the Saudi educational system. The Islamic aspect of the Saudi national curriculum is examined in a 2006 report by Freedom House. The report found that in religious education classes (in any religious school), children are taught to deprecate other religions, in addition to other branches of Islam.”

Try to convince me that this college education is any less relevant than “Sexual Studies” or “Medieval German” at US institutions. At least our universities tend to discount classes centered around hate.

College can be of value but it makes a difference what is studied and society really only benefits when the education leads to job creation and economic growth.

New York times article on graduate programs

http://www.nytimes.com/2009/04/27/opinion/27taylor.html

This article has some excellent points about graduate education. Some of the same
points apply to the concept of undergraduate education.

"Financial Aid" is code for student debt

Let’s call a spade a spade. The term “financial aid” as used by colleges and universities is way too benign. In most cases this term is code for “student debt”. And these educational loans come along with bad debt collectors that make the neighborhood loan shark look gentle.

This debt can never be discharged in bankruptcy and the US government is relentless in collecting on it. The government and its agents can use techniques like garnishing your wages even in states where others (banks) are not allowed this trick. How about a more descriptive term like “Education loans and grants”? A loan is more like a weight on your shoulders than “aid” – it may help in the short-term but it will kick you in the butt when you are struggling financially in later years.

How long do you think the banks would get away with calling their credit cards “Financial Aid Cards”?

Success of "High School Thoughts About College" YouTube Video

In the first day the YouTube video "High School Thoughts About College" had over 15,000 views and over 350 comments. Here are some of the comments about the video.....


I'd love to go to college in America, it seems like so much more fun.

Wow, that was amazingly funny...I wish I had thought about that before going to college.

"No I'll be in school for the next ten years.. DON'T RUSH ME."

Awesome vid....maybe u cud have posted it 2 years ago so i cud make a more informed decision about college.

When my dad finally understood why I'd been complaining about it all these years, he pretty much flipped out and told me I was wasting his money. That's love.

I graduated last year and I've been at home ever since...lets just say "I'm delaying"...I mean community college yeah, I'm going...no jobs but i know its going to cost my parents butt loads of cash...oh, well and you know whats even better? I don't know what to do?

High School Thoughts About College

This new song at http://www.youtube.com/user/tobuscus?blend=1&ob=4 is about a high school student considering college that is quite funny. I think this kid Toby Turner is a future star. Let me know what you think about it here.

You may also want to check out the comments on the song because the listeners are saying things like “”I graduated last year and I have been home ever since.”

Toby originally caught my attention with his song “I go to college for the financial aid” which you can also see at on YouTube at http://www.youtube.com/watch?v=eGNIfrwcmzY.

Playboy's list of the top Party Schools

Playboy’s list of the top Party Schools (Colleges and Universities) is out and these are the best places to rack up student debt, live off your parents, postpone working for a few years and eat up those government subsidies.

The full list is in the magazine’s May issue and on the Internet at www.playboy.com/partyschools09.

The top 10 party schools are as follows:
1) University of Miami
2) University of Texas (Austin)
3) San Diego State University
4) University of Florida
5) University of Arizona
6) University of Wisconsin (Madison)
7) University of Georgia
8) Louisiana State University
9) University of Iowa
10) West Virginia University

The five factors that were used to rank these institutions of higher learning are:
1) Bikini ( a combination of great weather, favorable guy-girl ratio from the guys perspective, and the cheerleader ranking)
2) Sex
3) Campus Life
4) Sports
5) Brains

CNN Video on "Does College Pay"?

http://money.cnn.com/video/moneymag/2009/02/13/money.kids.education.pay.moneymag

A nice little piece on CNN about job salaries with and without a college degree.

Top 10 colleges for surfing

http://www.surfline.com/surfnews/article_bamp_400_v03.cfm?id=25098

This article lists the top campuses relative to surfing. If you don't really care about gaining financial independence via a college education then why not select your school based on the best surfing locales. No worse than how pretty the campus is, how good the football team is or do they have co-ed dorms.

The Great College Hoax

http://www.forbes.com/forbes/2009/0202/060.html%22
"The Great College Hoax" This article in Forbes highlights the falacy that every college education is worth the money and the time. "Higher education can be a financial disaster". It is time for parents to stop forcing kids into college and suggesting great alternatives (like starting a business, going to work,going into the service, learn a trade). A bunch more history majors from Harvard are not going to lift this economy out of the big hole we are in.