A College Degree – Meh!

We started with a little erosion of the financial cost of higher education… the ripple became a flood, until the cost of college slowly increased to triple the published federal COL escalations. Scholarships faded at most universities, minimized or eliminated, often replaced by Pell Grants for the lowest rung of the economic ladder but mostly student loans, public and private. Back in my day, where there were student loans at all, generally they would get retired with reasonable payments within a decade of graduation. Today, loans among those my Millennial son’s age and younger, have repayment rates that reach well into middle age, decades past the relevant graduation dates. With the roughly $40K in average undergraduate loans, easily escalating to serious six figures when you add graduate or professional school debt, the aggregate of outstanding student loans now exceeds the aggregate of American consumer/credit card debt.

Stories about college dropouts, like Bill Gates and Mark Zuckerberg, becoming billionaires with entrepreneurial risk-taking, has taken some of the “you need a college degree to have a well-paid future” off the glittering educational rose. There has been a serious backlash against college- educated “elites” as being the mainstay of killing upward mobility for the rest. California’s Governor Gavin Newsom has even removed the requirement of a college degree from many state jobs where that degree was once mandatory. That represents a liberal press for greater income equality.

But there is an equal and opposite vector coming from the conservative side, as MAGA Republicans have noticed that college-educated people, other than the super-monied class that seeks reregulation and lower taxes, are much more inclined to vote for a liberal candidate. So expensive tuition without affordable financial aid tends to prevent that educated class from growing. Education specialist, Paul Tough, writing for the September 5th New York Times, observes an opposite trend in other developed countries, as education values are slipping here:

“Britain and Canada are not the outliers on this point; we are. On average, countries in the Organization for Economic Cooperation and Development have increased their college-degree attainment rate among young adults by more than 20 percentage points since 2000, and 11 of those countries now have better-educated labor forces than we do, including not only economic powerhouses like Japan and South Korea and Britain but also smaller competitors like the Netherlands, Ireland and Switzerland. Americans have turned away from college at the same time that students in the rest of the world have been flocking to campus. Why? What changed in the last decade to make a college education — and higher education as an institution — so unappealing to so many Americans?

“When it comes to higher education worldwide, the United States is an outlier in more ways than one. In Canada and Japan, public-university tuition is now about $5,000 a year. In Italy, Spain and Israel, it’s about $2,000. In France, Denmark and Germany, it’s essentially zero. A few decades ago, the same thing was true in the United States; government funding covered much of the cost of public college. Now students and their families bear much of the burden, and that fact has changed what used to be a pretty straightforward calculation about the economic value of college into a complex math problem….

“In the fall of 2009, 70 percent of that year’s crop of high school graduates did in fact go straight to college. That was the highest percentage ever, and the college going rate stayed near that elevated level for the next few years. The motivation of these students was largely financial. The 2008 recession devastated many of the industries that for decades provided good jobs for less-educated workers, and a college degree had become a particularly valuable commodity in the American labor market. The typical American with a bachelor’s degree (and no further credential) was earning about two-thirds more than the typical high school grad, a financial advantage about twice as large as the one a college degree produced a generation earlier. College seemed like a reliable runway to a life of comfort and affluence.

“A decade later, Americans’ feelings about higher education have turned sharply negative. The percentage of young adults who said that a college degree is very important fell to 41 percent from 74 percent. Only about a third of Americans now say they have a lot of confidence in higher education. Among young Americans in Generation Z, 45 percent say that a high school diploma is all you need today to ‘ensure financial security.’ And in contrast to the college-focused parents of a decade ago, now almost half of American parents say they’d prefer that their children not enroll in a four-year college.

“The numbers on campus have shifted as well. In the fall of 2010, there were more than 18 million undergraduates enrolled in colleges and universities across the United States. That figure has been falling ever since, dipping below 15.5 million undergrads in 2021. As recently as 2016, 70 percent of high school graduates were still going straight to college; now the figure is 62 percent.

“Outside the United States, meanwhile, higher education is more popular than ever. Our global allies and competitors have spent the last couple of decades racing to raise their national levels of educational attainment. In Britain, the number of current undergraduates has risen since 2016 by 12 percent. (Over the same period, the American figure fell by 8 percent.) In Canada, 67 percent of adults between 25 and 34 are graduates of a two- or four-year college, about 15 percentage points higher than the current American attainment rate.”

The United States is woefully short on STEM graduates; jobs in those field go begging. Hospitals cannot find enough medical personnel, particularly doctors and nurses, to service the demand for their services. It’s getting desperate, and the political polarization and anti-immigration rhetoric has made recruiting experts from overseas increasingly difficult. Recently, Canada capitalized on that reality, offering immigrants speedy visas for themselves and their families if they had the right STEM/medical credentials.

Long gone are the post-WWII benefits that put hordes of returning GI’s into college. The educational reward for that effort was a most rapid rise in the productivity and creativity of American business that cemented our role as the world’s greatest entrepreneurial economy. We had engineers and scientists creating new economic splendor for us all. After the Soviets launched Sputnik in 1957, the American commitment to higher education redoubled, and the nation’s GDP soared accordingly.

But today, as the above Pew Research chart illustrates, education has become heavily politized for all the reasons set forth above. Our public primary and secondary schools, based on international test scores, have fallen from first place to somewhere between nineteenth and thirty-eighth, depending on subject matter. While our top “elite universities” still rule the international roost, lesser state colleges and universities are producing graduates with skills often generated overseas at a high school level. There is no way to sustain our economic strength by relying on our pass successes without investing heavily in a cadre of experts to build a solid future.

I’m Peter Dekom, and you really have to ask yourself who really benefits from increasingly unaffordable college tuition coupled with a profound decrease in state and federal funding for higher education.