Friday, February 06, 2009

Is College a Scam?

Kathy Kristof recently wrote in Forbes (H/T) that a college education, for many people, does not pay off its cost. I can certainly understand: I went to a rather pricey liberal arts college and it is only now starting to pay off with a salary really commensurate with the tuition cost and lost income for four years there.

But Kristof went a step further and argued that college education is a scam perpetrated by the education industry to encourage young people to incur huge debts that will not be paid off by subsequent income:

The two disillusioned attorneys were victims of an unfolding education hoax on the middle class that's just as insidious, and nearly as sweeping, as the housing debacle. The ingredients are strikingly similar, too: Misguided easy-money policies that are encouraging the masses to go into debt; a self-serving establishment trading in half-truths that exaggerate the value of its product; plus a Wall Street money machine dabbling in outright fraud as it foists unaffordable debt on the most vulnerable marks.

I'm inclined to accept Hanlon's Razor on this one, especially as I've seen how groupthink can operate within an organization, wherein salespeople can start to really believe that their product is essential for the prospective customer. As for my own case, I knew, going into my history major, that job prospects would be challenging, but did it anyway. I blame no one for my decision but myself, although I would now choose a career based upon financial return, rather than personal interest.

But I'm glad that even in college I had some connection with market realities, as well as lacked the money necessary to attempt something really foolish. Namely, go to graduate school and become a medieval historian. That was my dream, back in the day. English professor Thomas Benton wrote in The Chronicle of Higher Education (H/T) that it is exceedingly risky, if not foolish, to acquire doctoral degrees in the humanities:

Most undergraduates don't realize that there is a shrinking percentage of positions in the humanities that offer job security, benefits, and a livable salary (though it is generally much lower than salaries in other fields requiring as many years of training). They don't know that you probably will have to accept living almost anywhere, and that you must also go through a six-year probationary period at the end of which you may be fired for any number of reasons and find yourself exiled from the profession. They seem to think becoming a humanities professor is a reliable prospect — a more responsible and secure choice than, say, attempting to make it as a freelance writer, or an actor, or a professional athlete — and, as a result, they don't make any fallback plans until it is too late.

Some people make it into academia. Good for them. But the risks are so very, very high, that anyone studying the humanities -- at the graduate or undergraduate levels -- should be fully aware of the real hazards of choosing personal interests over marketability.


Larry B said...

A four year engineering or computer science degree is one of the best paybacks for the cost in my opinion.

The average salary among engineers with my degree is around 95K, the average salary for professors with my degree is 78K. The profs went to school for 10+years, they fight for their very existence every year by needing to bring in grants to the school, and they teach very little. You would have to be a glutton for punishment to want to do that, or very idealistic.

Keith Taylor said...

I agree with Larry on the payback of a technical degree.

I have a four year engineering degree and I added 1 1/2 years of graduate school to that to earn a Master of Science.

When I hired in, the company treated my masters as if I had been working 4 years so I hired in making about 12 percent more money than the folks sitting in the chair next to me with a B.S. That compounded rather quickly in the furture as my raises leveraged that 12 percent considerably.

I was asked by the college to stay and work on my PhD, but I turned that down for the same reason as Larry mentioned.

Here is the biggest problem I have with colleges. They act like they are entitled to your money. There is no payor/payee relationship with them. Students pay them 10s of 1000s of dollars and they in no form or fashion consider the payor to be their customer. In fact they treat you like crap. I have always wished I could find a way to free market the educational system and force colleges and universities to have to grove and work for the money they are paid. I had to treaten to sue my stepson's college in order to get a refund for a dorm room after they reneged on their commitment to him. They had a wait list for rooms and it was a month prior to the semester start, but they were bound and determined not to give him his money back even though they were clearly in breach of contract. Only after I told them they'd see me in court did they seem to care. In fact, I had to threaten them 2 or 3 times before they finally realized that I wasn't kidding, they were fixing to get hauled in to court.

Kenny said...

It depends. It seems to me that it is worth an awful lot of money to be doing something you actually care about. On the other hand, it is well-known that you ought not to go to grad school in humanities (or, really, pure science or mathematics) unless it's really a sort of hobby for you. If you see yourself as getting paid to work full-time at something that you would be doing in your spare time anyway, then you are not likely to complain about getting a stipend that is often less than $20,000/year. It will probably be about 10 years before I get back to what I made as an engineer in my first year out of college, so if you think of it as a JOB that you do for money, the situation is positively ludicrous.

To what degree does the same apply to undergrad? I'm not sure. It is expensive, but the federally backed loans are much less predatory in nature than these mortgages - the terms are actually pretty amenable. It also is true that a great many jobs want you to have some sort of BA degree, and they don't necessarily care what your major was. For most people, I think an undergraduate degree makes sense, but probably not any kind of graduate degree.

Anonymous said...

I know too many people with Bachelors (and Masters)who can't get a job and/or are accepting jobs that pay peanuts. There are those who had their parents support (parents who have now taken on more debt) so the pressure to pay back the full amount was lessened and others who floated loans and are now up to their eyeballs in huge debt, most of which will take 15 years or longer to pay back.

The impression I got from Kathy Kristof's observation of a perpetrated scam; that Academia is an industry in the money making business that colludes with the interests of the banking industry. All of it promising the "American dream" if you will.

To a finer point; all one has to do is look at the entry level sector. Home Health (Aide)workers for e.g., use to simply require a desire to work with elderly and or disabled populations and all that was needed were basic courses to complete. The pay since hasn't changed much, if at all. 3 years ago before Community colleges and Vocational schools got in on the program these workers made roughly between 8 - 10 dollars an hour. What do they earn now? On average about the same. And yet they have to complete nearly 2 years of a program!!

[We] are creating more debt, frustration and delaying income for people that have chosen professions that doesn't or shouldn't require anymore than 6 mos or less of education. Not only are we leaving people out in the cold who don't want to go the college route (for whatever reason) we are sidelining them from entry level positions by demanding college degrees.

What was once considered an entry level sector with no college degrees required - is now being taken over by unseen (TPTB) forces for dispicable reasons alone: to control and diminish the choices people have and to keep people believing going into debt (and years of college) MUST BE THE ONLY WAY TO a decent paying job. All the while banks and those at the top of Higher Learning institutions benefit.

It is breaking the backs of a huge segment of society. One generation already in debt with all the responsibilities of their own career (and ensuing retirement)homeownership and that of their young offspring. We are making promises to the younger generation that simply can't be sustained in any way or shape of the truth. Unfortunately most parents have bought into this myth themselves.

For those who are the lucky few, whose career path has brought about opportunity or is well defined - well done. For those finding themselves in a sea of competition and heavy debt, don't give up, don't lose hope. Get creative, get defiant and think outside of the box; 80 percent of this is ATTITUDE of which you MUST stay on the positive side with. 10 percent is who you talk to (do a lot of talking!)and who you know and the rest is luck. Best wishes to all.