An interesting new college model - Minerva

Excellent article about a new innovative college – Minerva (named after the Roman goddess of wisdom). 

Minerva does not see itself competing with the Massive Open Online Courses (MOOCs) like Coursera and the Khan Academy. Instead they view the content and lectures in these new entrants as complementary to what they offer and believe that fee online content will get even better and more extensive over time.

I hope that we see many new entrants in the post-secondary world of education.  We need massive trial and error to break down many of the conventions that are restricting us from delivering more learning and more job creation for the dollar spent. Maybe it is time to focus less on football, climbing walls, park-like campuses and more on education. I think that fewer high school grads should immediately head off to college, and maybe they only need two or three years before they can be ready to start or join a business or move onto the next phase of life.

One vestige that Minerva retained is “on-campus” residence halls. But the classes are not in person with a professor (who might be working from anywhere in the world) via an interactive on-line discussion and testing process of discussion, debate, and quizzes.

After the first year in San Francisco, each student changes locations each semester, allowing the student to experience different societies.  Today the other campuses are in Hong Kong, Buenos Aires, Berlin, London, Cape Town, Mumbai, New York and Sydney.

It is great to see some experimentation in higher education.

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Another angle on the collateral damage of college finance

We recently posted an article about how college debt is an inhibitor to graduates starting businesses.  

College grads with big debt payments have fewer options as a result of the minimum college loan payments they make every month.

This study at RealEstateConsulting.com tells the tale of another unintended consequence of college debt – they also can’t afford to buy a home.

Here is the gist of the report:

“Student debt has ballooned from $241 billion to $1.1 trillion in just 11 years.

29 million of the 86 million people aged 20–39 have some student debt.

Those 29 million individuals translate to 16.8 million households.

Of the 16.8 million households, 5.9 million (or 35%) pay more than $250 per month in student loans, which inhibits at least $44,000 per year in mortgage capability for each of them.”

Reminds me of that Toby Keith song: “I wish I didn’t know now what I didn’t know then.”

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Common sense about college from Robert Reich

Robert Reich, former U.S. Secretary of  Labor, has some common sense about our investment in four year liberal arts educations versus two year technical programs in this editorial.

Here are some of Reich's main points:

"For one thing, a four-year liberal arts degree is hugely expensive. Too many young people graduate laden with debts that take years if not decades to pay off."

"And too many of them can’t find good jobs when they graduate, in any event. So they have to settle for jobs that don’t require four years of college. They end up overqualified for the work they do, and underwhelmed by it."

"Consider, for example, technician jobs. They don’t require a four-year degree. But they do require mastery over a domain of technical knowledge, which can usually be obtained in two years."

"Yet America isn’t educating the technicians we need. As our aspirations increasingly focus on four-year college degrees, we’ve allowed vocational and technical education to be downgraded and denigrated."

Well said Mr. Reich!

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A College Degree and the Law of Supply and Demand

I don’t know how many times I have seen the statistic that a college education results in career earnings of more than $one million over the individual’s lifetime.  Well I call BS on this number every chance I get.  The figures do not factor in the IQ, family wealth and the socio-economic background of individuals that graduate from college versus those that do not.

But most importantly these amateur statisticians forgot one major economic factor – the Law of Supply and Demand.

The rarer the asset (in this case a college diploma), the more valuable it is.  The more common the asset, the less valuable it is. In 1960 about 8 percent of Americans 25 years old and older had college degrees.  By 2009 the percentage had reached 30 percent.

And here is where it really gets nuts.  Despite the fact that so many recent college graduates are back working as waiters where they toiled during college, some suggest that the answer to our economic challenges is for far more high school grads to attend traditional college.

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David Letterman says "Send your kid to college."

"If you can, send your kid to college. So they get a degree, and at least then, they will know what kind of work they're out of." David Letterman on his monologue August 22, 2014

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College debt can interfere with being an entrepeneur!

Any prospective or active entrepreneur should be reading Kevin Johnson's book: The Entrepreneurial Mind 

Here is a reminder from Kevin Johnson about the dangers of debt.  If you have any desire to start your own business, don't get stuck with $200,000 of college student debt.  Here is how Kevin puts it:

""Research indicates that the great majority of entrepreneurs will never receive money from a venture capitalist or an angel investor. Instead, they will fund their businesses with their own money and via credit cards. According to a report by the National Federation of Independent Business, in 2009, 83 percent of businesses with fifty employees or fewer used credit cards. This point is important, because how you manage your personal finances determines how much money you can borrow for your business and at what interest rate."

Peter Thiel the cofounder of PayPal, angel investor and venture capitalist adds this: "Learning is good. Credentialing and debt is very bad. College gives people learning and also takes away future opportunities by loading the next generation down with debt." 

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Self-education

"Formal education will make you a living; self-education will make you a fortune." - Jim Rohn, entrepreneur, author, motivational speaker

What you study matters in the job market.

Here is some data concerning Bachelor's Degrees conferred in the U.S. in 2012.* The interesting part of the data is that it is divided by sex. 

The majority of degrees awarded were in business, about 360,000 of which 52% were to men and 48% to women. In the social sciences there were about 175,000 degrees awarded, 51% to men and 49% to women. Now the next highest number of degrees awarded, about 160,000, was in health of which 15% were men and 85% were women followed by Psychology and Education, both with a bit over 100,000 degrees awarded. The former had 23% men and 77% women while the later had 21% men and 79% women.

Of interest is that of the 100,000 degrees awarded in Engineering, 82% were to men and 18% were to women, and of the about 90,000 degrees awarded in Visual/Performing Arts 39% were to men and 61% were to women.

Last were those degrees awarded in English. Just a few over the 50,000 mark and of those 32% were to men and 68% were to women.

Once again is the time to ask: “Do the career choices that women make have anything to do with the difference in income between men and women?”

Jerry White

* From the Digest of Educational Statistics, Table 318.3.

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Study Finds that College is Still More Fun that Spending Four Years Chained to a Radiator!

Great fun at the Onion and this startling discovery!



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Nothing is too good for your daughter in college?

Did these college basketball stars only attend classes in their first semester?

"In the latest example of his longstanding distaste for Kentucky basketball, Hall of Fame coach Bob Knight said last weekend that UK's five starters in the 2010 NCAA Tournament did not attend class that spring semester."

This whole notion of the "student athlete" is claptrap.  It does nothing for the ultimate goal of providing a better education at a lower cost. Why not separate education from the business of minor-league sports?  

These future NBA players are not interested in their non-basketball education at the University of Kentucky.  It is a required rite of passage since the NCAA conspired with the NBA to force these basketball players to "invest" at least a year in college basketball before being eligible for the NBA draft.  Actually they don’t have to play college basketball; they can sit out a year or play beach volleyball but obviously that won’t help them land a lucrative contract when they are eligible. 

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How do we measure how well our colleges are doing?

This writer misses a critical point.  The education factories (aka colleges and universities) take in a student and then produce a graduate (with the exception of those that drop out or flunk out).  So measuring only the average SAT scores of the incoming freshman tells you nothing about how an institution of higher learning has done at the job of education. Likewise, measuring only the GMAT test scores of the graduating seniors tells one only how the graduating seniors did-not how much the students learned.  And yet both of these factors are heavily weighted in the formulas that rank our colleges and universities.   

How do we measure a typical factory? The measure of economic value created is output divided by input.  One takes something of less value and efficiently creates a product of greater value. If one takes something worth a dollar and adds a dollar of time and materials then you have $2 invested. If someone then buys that product for $4 you have produced $4 of value for $2 of input–well done. On the other hand if you spend $10 producing something and can only sell the finished product for $5 then you have destroyed $5 of economic value. You will be out of business soon (unless you are the government or have big government subsidies).

Back to how we measure college. My theory is that if I have a college or university that is lucky enough to accept only the brightest 2% of graduating American high school students (say Harvard) that four years later this same college should produce graduates that are in the top 2% of IQs (even if their "education" has been absolute BS).

But what if a college accepted students that had average incoming SAT scores in the 50th percentile and yet it produced graduates with GMAT scores in the 70th percentile? Now we’re talking. I would have to say that this college has made a real difference. Unfortunately I have yet to find this mythical institution. 

Measuring how bright the incoming freshmen are is a horrible way to measure how good a college is.  Likewise tracking how well the graduates "do from the U" without regard to the IQ of the incoming freshmen also tells me little.

What matters is how much improvement in thinking, questioning, writing, and preparedness for the job market that an institution of higher learning produces for the time and dollar spent.

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The Definition of College According to the Urban Dictionary

The Urban Dictionary is one of my favorite "research" tools these days.  If you want the real meaning of a word or the story behind the story, this is a great place to start.

Here are a few of my favorite definitions from this institution of higher learning:

"A magical place where it is rumored that learning takes place, although to those who enter it is often described differently afterward, as a beatiful land in which beer flows in amber currents next to a golden pasture, where virgins lie naked with gentle smiles upon their calm, inviting faces; but more precisely, a Shangri-La rite of passage into adulthood which involves rampant consumption of alcoholic beverages, flagrant and promiscuous sexual behavior, and a general and fundamental disregard for any form of responsibility by its habitants.

Thank you sir, may I have another?"

by Phlagellum September 23, 2003

"The place where you enter inexorbitant amounts of debt to "learn" things you will never apply once to your actual occupation. Basically, an expensive 4-year waiting period for a paper called 'degree'.

I will owe Wells Fargo my first born so I can pay off my college."

by Drenam February 02, 2003

"An alternative to buying a Ferrari (they cost about the same).

Damn, that Ferrari costs almost as much as college."

by Duesey December 01, 2003

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When it comes to college, why don’t we separate granting credentials from learning?

Today college serves at least four different purposes:

      Purpose #1) It provides some information to a prospective employer about the minimum IQ of a possible hire (it tells you little about their actual IQ);  

      

      #2) General learning and experience;
   

d    #3) Preparation for the job market; 
      

      #4) Demonstrate credentials to the job market that allows a potential employer to determine if the graduate has learned certain material. 

      

Demonstrating Your Smarts

One does not get accepted into Harvard with an IQ of 90. Therefore if I hire a Harvard grad, I have some information about the IQ of the candidate. But some graduates from Florida State have higher IQs than some Stanford grads. This function (demonstrating smarts) could be met more simply and accurately by allowing and encouraging prospects to include their test scores (SAT, ACT or GMAT) on their resumes and job applications. This is not done today because: 1) it is considered bad form and 2) it might be viewed as discriminatory because the employer cannot demonstrate that this measure is required to meet the minimal requirements of the job (in the crazy world of Equal Opportunity Law).  Seems nuts to me, but if a large corporation started asking for SAT scores they would quickly have the US Equal Employment Opportunity Commission breathing down their necks and threatening major fines.

Here is an alternative (although limited) method to demonstrate your smarts. We could allow and encourage job applicants to list the colleges to which they were accepted but chose not to attend. Unfortunately with today’s norms this would be viewed as egotistical as the bumper sticker that brags: “My other car is a Porsche”. There is a time and a method where the student sells herself in a time-honored fashion (trying to get into a college and trying to get a job or into graduate school upon graduation) but this is currently not one of them. One could establish that she was accepted at Harvard but chose San Jose State instead (perhaps with a bumper sticker). The hardest part about graduating from Harvard is getting accepted in the first place. Very few students that start at Harvard (provided they show up, do not drop out like Bill Gates and Mark Zuckerberg did, and do not get hooked on drugs) end up not graduating. 

Learning and Experience

The learning is what you should be paying for (time, money and effort) - learning how to learn, how to think, how to persuade, how to question, how to analyze as well as mastering a few basics like logic, statistics, writing, and the discipline to meet deadlines and complete projects.  And of course it might also help one determine what the individual might be interested in pursuing as a career starter.

   

But today there are plenty of alternatives to achieve the learning without the traditional college experience. The Khan Academy, free online MBA classes from Wharton, Coursera.org  and TED conferences are just a few of the wonderful free online resources available.  There are also a growing number of for-pay sites that provide education at a reasonable price like Lynda.com ($25/month), Skillshare.com ($9.95/month) and Grovo.com ($15.95/month).  On this dimension, shouldn't we care about the education achieved for the dollar spent? 

Two potential college experiences are living away from home for the first time and sharing a dorm room with someone from a different background. And of course there is the chance to participate in campus clubs, games, debates, and politics. My favorite of course is getting a job or internship while in college.

There is plenty of discussion of life-long friendships that are made and the experience of attending the Saturday morning football games. But much of this is possible without spending an additional $200,000. For example, if one chose not to attend college, you could join a local entrepreneurs group, attend local seminars, watch online pitches, volunteer at a non-profit or an angel investing group, or volunteer to assist a college professor on her research.  Please consider that smart volunteers are almost always in demand.  College is not the only way to gain non-paid experience.

Preparation for the Job Market

If you hope to be accepted to Medical or Veterinarian school you probably have to find a way to get through Organic Chemistry. If you want to work for a consulting engineering company then you better take a broad range of math, science and engineering classes. If you intend to get a finance job then college is the chance to learn the basics of accounting, finance and project finance.

If all your classes in the general curriculum make you a better critical thinker (a stated goal of virtually every university) and more knowledgeable about world history these are interesting but generally do less in increasing your odds of getting several great job offers upon graduation.

Credentials

There are different types of credentials that one can earn via college.  The typical one is a "degree."  But in the IT field, the myriad of certifications (from Microsoft, Oracle and Cisco) frequently count for more than a Bachelor’s Degree in Computer Science.

The degree from an Ivy League college frequently just signals that you were smart enough to get accepted in the first place (OK, I have covered this but it is important ). If you get accepted to Harvard and stick it out, you will earn a degree. The hard part is being smart enough to get accepted and sometimes brash enough to borrow boatloads of money to finance the gig.

The second element of the degree that matters is the major in which you graduated. Did you graduate in a discipline that is perceived as difficult and in demand (electrical engineering or chemical engineering) or did you take a course load that is perceived as easier (Gender Studies, Sociology, Physical Education). Many more students can get accepted to San Jose State or Stanford than can complete the Electrical Engineering programs at these schools. Being smart enough and disciplined enough to complete one of these degrees provides more bragging rights (and probably more job offers) than an easier program at the same school. The general media hypes the value of a generic college education far more frequently that the value of a degree in Electrical Engineering compared to Sociology.  

The credential process has some value. Do you want a brain surgeon operating on you for his first ever surgery? When you are on trial for murder do you want an attorney that has not graduated from law school, or never tried a capital case?  Back as to demonstrating your smarts, in these latter two cases wouldn't you want someone you knew is very smart as well? Although a college degree can demonstrate smarts, shouldn't there be a more direct and cheaper vehicle for determining this?  

The Challenge

Here is my thesis: when we combine these four distinct functions, we muddle the objectives of each of them and waste a lot of time and money trying to achieve some nebulous combination. When a college is failing in one dimension they say: “but we are doing so well on this other one.”  On the learning element, shouldn't we track the amount of learning achieved in some quantifiable way? For example, a simple measure would be to require GMAT scores for every college graduate. Then compare the SAT scores of the entering classes with the ranking of the graduating classes (on a percentile basis).  My guess is that we might not see much difference. 

When we combine the credential process with the learning process, there is a clear conflict of interest.  Should it matter which professor is the most demanding and generates the most learning or one that is the kindest, gentlest and easiest grader?  Professors and colleges frequently get evaluated based on how many pass the class or graduate from the college – a sure conflict of interest. Rarely does the instructor or college get greater kudos for being extremely demanding. If one institution delivers the education and another does the testing and grading, the conflict of interest is removed. The current system has resulted in such grade inflation that today about 42% of all college grades are A’s. 

I doubt if many colleges will be inclined to set goals and measure results based on my four purposes – this might actually force them to reevaluate how they are organized and how they compete. I also doubt that they will remove themselves from the credentialing process (Purpose #4). Once these institutions lose their ability to grade themselves (by grading and graduating their own students), we might see radical change (and improvement).

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Being lucky enough to be born smart might be more important than if you attend college

This is about the 1000th article I have seen that mixes up correlation with cause and effect as it relates to the value of college.

They never try to compare comparable subsets (with IQs that are similar) when they make the fallacious argument that college grads make more money than high school dropouts and therefore it is a good investment.

They always forget to account for the average difference in IQs for college grads compared to non college grads.  I can tell you that one factor that always seems to pay off is to be lucky enough to be born smart.  A degree in Sociology is not going to cure this challenge if you weren't so lucky.

But alas, if this writer did attend the local U, he must have been sleeping during his Logic class.

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Which Class Do I Take?

How about this for a college decision process?  Study the harder subject. 

You can take a class in Gender Studies where the prof awards 90% A’s or a class in Advanced Engineering Mathematics where only 20% of the students earn an A. In which class should you enroll?

You can take a class in Organic Chemistry where few students receive an A and many do not even complete the class. Or you can take a late afternoon class in Volleyball.  Nobody flunks Volleyball.  So in which class do you enroll? 

I will say it now; always take the harder class. Set aside the grade and focus on what you are going to learn.

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Using equity to fund college instead of loans.

Interesting article about the antiquated system we have for funding college today.

At least with the federal home loan programs, the system attempts to qualify their borrowers, such that a borrower has a chance of not defaulting.

But this kind of evaluation is not even a consideration in the college student loan programs. It doesn't matter if you study petroleum engineering or sociology - you can borrow the same amount. And yet the job and income prospect for the two majors are obviously quite different.

This article suggests an equity-like program where an investor funds college in exchange for a part of the future income stream of the student. Conceptually it might work well, but if it is just another government program you can be assured that it will bring in a whole new set of subsidies. The college establishment hates the idea that the petroleum engineering student might get a better deal than the sociology major.

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We are not against college

Here is what we have been saying for years: “We are not against college but question many of the long held assumptions about it. We think too many attend, too much is spent on it and that students are under the mistaken belief that all college degrees bestow the same benefits. And when students, parents and governments borrow recklessly to finance it, we have a huge problem.”

This article from the Economist GETS IT! YES!!

College can be valuable – at the right price and if one studies subjects that the market place demands and needs.

The market demands few college graduates with degrees in Gender Studies, Sociology, Psychology, English and History. But the market is demanding grads in Electrical Engineering, Petroleum Engineering, and Network Security.

This author is one of the few that makes three great points:

       1) Not all college education bestows the same benefits.

       2)  If one graduates with substantial student debt, the individual is frequently reducing her  opportunities rather than expanding them.

       3)  College grads on average have higher IQs than high school drop outs. So the figures that  compare the relative financial performance of the two groups should adjust for relative potential  and not attribute all the extra earnings to college. But the stats never do.

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Why have we combined minor league football with a college education?

With all the talk about unionizing college athletes last week, I question why we ever combined sports and education in college.  I am not talking about intramural sports nor club sports where the participants generally pay their own way.  I am talking about how we have combined minor league NFL and NBA programs with college. For most of us that is the way it has always been.

Granted, a few student athletes get a great education.  But this seems to be the exception.  Instead the institutions work at perpetuating the myth of the “student athlete” and the only goal is to find a way for the star player to get the minimum passing grade in his classes (which frequently are on a par with high school) and then coddle the athlete so he can retain his athletic eligibility. 

College Football and Basketball are big money – a $16 billion a year business.  And every time you have big money, the temptation is to cheat for a bigger share of the pie.

Why not move college sports into separate minor league teams that are loosely affiliated with colleges?  The business  would receive no financial support and receive none of the revenues of the minor league franchises. That way colleges could concentrate on delivering a great education at a competitive price (I know – you never hear about this second criterion.)

This story about a college football player’s A- final term paper might cause you to question the system we have created.

What is she trying to achieve?

On Charlie Rose Show March 28, 2014 at Bloomberg:

As Charlie Rose introduced Drew Faust, President of Harvard, he said “In her installation address, she said: ‘A university is not about results in the next quarter, it is not even about what the student has become by graduation. It is about learning that molds a lifetime, learning that transmits the heritage of millennia, learning that shapes the future.’”

Here is my question:  How in the heck do we know if the President is achieving her goals?  How would we know if she is an utter failure or a grand success with her stated mission?  Do we have to wait until the President and we are all dead?

It is a noble sounding mission statement.  But is it possible that it is all puff? Pure BS?

Maybe we should state the goals and the mission of the university in more down to earth terms. Perhaps we should express it in simple language such that when the President of Harvard is failing we will know it and we can replace her. Maybe we should be able to measure the results rather than rely on her "gut feeling" or the President's gut feeling as proof of success.

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Drunken Party at UMass Results in Injuries

"Police arrested 73 people at a University of Massachusetts at Amherst Pre-St Patrick's Day party in which unruly students threw beer cans, bottles and snowballs at authorities, leaving four officers with minor injuries."

As we debate the pros and cons of college, it is important to remember that substantial use of alcohol is frequently at the core of the experience.  

I am not a teetotaler, but can we go back to the basics?  What is the purpose of college?  In my mind, it is to prepare young adults to find jobs that will allow them to contribute to the economy.  And prepare these students at a reasonable cost.  

A party here and there is no big deal, but when regular drunkenness becomes established as the norm, then one must question how well we are achieving our primary goal.  

I don't think that enough colleges today are providing the important lessons and when you compound that problem with skyrocketing tuition fees, the whole institution needs to be rethought.

If you are lucky!

Beware of Propaganda about College like this Pew Study

These social “scientists’ spread this propaganda and consistently mix up causation with correlation.

Here would be a way to actually test the Pew’s hypothesis that college education results in substantially better incomes and life styles: Take 1,000 high school students and send them to college.  Take another 1,000 students and direct them to non-college alternatives.  Each of the groups would have the same distribution of SAT scores.

Then look at the results 10-15 years later.

The reason the Pew’s results are so skewed is that on average high school grads with higher IQs go on to graduate from college in greater proportion than those with lower IQs.  This factor alone probably accounts for most of the differential in salaries 15 years later.

I am not saying that college cannot be valuable.  But based on the Pew propaganda we have allowed the cost of college to get out of hand and college students are going ever deeper into debt to finance it.

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