The Half-Truths of Academia

I just read an interesting article at Forbes.com, called The Great College Hoax. HippieHusband sent it to me.

(His mood has greatly improved and best of all he's gotten back to revising his thesis. Yeah!!)

Here is a lovely quote from the article.

...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.

It turns out education is the next housing bubble.

Most people live under this notion that getting a higher education ensures some reasonable level of income. Historically, this was true. Today the student goes into debt for a degree whose earning potential is eroding because everyone has one and because the cost of that degree is increasing.

The half-truth is based on the following: According to the US Census Bureau (Average Annual Earnings—Different Levels of Education based on population surveys from March 1998, 1999, and 2000) full time workers with a Bachelor's degree earned an average of $52 200 while those with high school degrees earned $30 400. If you assume that we work on average 40 years (age 25 to 64) over our lives then the overall earnings results in an apparent discrepancy of $872 200.

[Aside: WTF. I don't know any college grads whose salary, immediately upon graduating is $52 200. Heck, I don't even know any post-docs that make that kind of money. And we've gone to school for a lot longer. Obviously, this is an average across all disciplines. Let me tell you it doesn't reflect your salary if you graduated with, oh say, a Theatre degree. ]

Driven by the myth that one's earning power is higher than if you just got a job out of high school, many go to college. But today to cover the rising cost of tuition, fees, books, room and board , at a public school this 4-year cost is estimated at $46,700 and $99,900 at a private one lots of students are taking out loans. Where is the money coming from? Turns out more and more students are looking to sub-prime private loans to finance their four-year fantasy.

According to Forbes, borrowing has doubled over the past decade. The same US Census report showed that the number of Americans (over the age of 25) with a college degree has doubled since the year 1975. In total student debt owed is over half a trillion dollars. If you look at the graph in this post, it shows that there are more and more students attending college, hence the amount of borrowing money to attend college has gone up. A report by Project on Student Debt found that the average student loan debt for college grads rose by six percent in one year, while starting salaries rose by only three percent.

(That number sounds vaguely familiar. U.S. debt is 10.5 trillion and rising. Ahem, I see a pattern.)

So are the educational institutions who rely heavily on the income continual flow of students, misleading the masses?

Let's do a little back of the envelope math:

1. Factor in time spent at college - that's lost earnings of $121 600. Cha-ching!

2. Loan payments, if interest is 12% and amortization is 10 years that's $56 040 in interest for the public university and $119 880 for the private one. Cha-ching!

3. Plus you don't start earning right away so really you only have 31 years of earning power. Not to mention if you're stupid enough to go to grad school. Then really you only have 29 years of earning power.) Cha-ching!

That discrepancy in earning power between the high school graduate and the college graduate now drops to $60 820. So why do I care about this? Two reasons. The first, I am part of the a "self-serving establishment trading in half-truths." If people get smart and stop chosing education, what will this mean to academics like me? If there are fewer students going to university, it means that there will be a decreased need for faculty. Fewer jobs. In an already tough market, I think one could say this leaves those of us looking for faculty positions, up the river without a stick. No wait, what's that saying - up the river without a creek. Oh crap. whatever, you get my drift.

Second, it made me wonder if I were graduating from high school would I go to university to get a college degree or further would I do a PhD over again?

The answer to the first part of the question is yes, but not right away. I like the idea of gap-years where you go travelling and get a different kind of education. The reason I would still get an undergraduate degree despite the decreased earning power , is that I couldn't compete in job market where everyone else has a college education. Context is everything.


The answer to the second part is not so clear cut. I really love the discovery and creativity of science. I entered the PhD not because I thought I would immediately get an academic position, but because I was totally inspired by biology. And let's face it, I must love learning. You have to love it if you stay until Gr.25. Sheesh.

But would I do grad school all over again?

Would you??