Overselling the College Degree

May 5, 2011 by  
Filed under Money and Behavior

I distrust the student loan industry and the higher-ed bureaucrats who exploit it relentlessly. Motivated by economic self-interest, student lenders and college officials have persuaded misguided politicians that “college for all” is a noble goal. It absolutely is not.

The most significant outcome from the “everyone goes to college” battle cry is an enormous increase in our collective student loan debt. It is approaching a trillion dollars and now exceeds our national credit card debt.

Here is an interesting statistic: Fifty years ago only 48% of high school graduates went to college. In 2009, that percentage reached an all time high of 70%.  This does not mean that they are graduating. It just means that they are attending for a while, having some fun, and borrowing in the process.  A smaller percentage actually finish.

A recent article from the New York Magazine covers the issue very nicely. If you still have pre-college age kids, you must read it and think about it. I like this quote as a teaser:

American colleges have transformed from rigorous scholarly communities into corporate-minded youth resorts, where some presidents command salaries of more than $1 million and competition centers on outdoing one another in acquiring high-end amenities (duplex-apartment dormitories, $70 million gyms).

The article and the resources it cites makes the case that U.S. colleges are under-performing and overcharging. A double Amen from Mr. ToughMoneyLove.

Yes I know about the statistics demonstrating the different lifetime earnings between those who have a college degree and those who do not. But those statistics are only correlations. I submit that the earnings differences in most cases can be attributed to the motivational and energy levels of the students, not to the degrees conferred.

When I tell you that our youngest son last week graduated from college, you may call me a hypocrite. Here is my defense: (1) He graduated with no student loan debt ;and (2) He used his college experience to focus on a career path. I will add that one of our older sons started but has not finished college. It will not bother me if he never goes back. When he first left, I felt differently. However, he has since developed unique skills that cannot be acquired in any college. He is now marketing those skills in his own small business. That’s what I want for him and for each of our sons: Skills that are valued and ownership of their own business based on those skills.

Here is a link to the must-read article: How the Notion That a College Degree Is Essentially Worthless Has Become One of the Year’s Most Fashionable Ideas

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12 Responses to “Overselling the College Degree”
  1. thomas patterson says:

    Hi Mark,

    I find it interesting that on your page citing college expenses, there is an ad for the University of Phoenix.

  2. Yes, yes, yes. I hear you on this post, Mr. TML. For about 15 years I taught composition and linguistics at a local state university (and at local community colleges)as part-time faculty. There was a time when there were plenty of us part-timers, as there was plenty of teaching work to go around, if you were a part-timer. There were lots of people coming into the system.

    I also worked at a private university where I couldn’t get paid until the students got their grant and financial aid checks. I left that school. I have to wonder how many of those students had their own social security cards to sign up for student aid.

    And I remember being really surprised at the skills level in language that came into the developmental English courses where I taught. Many were non-native English speakers, but not all, by any means.

    I remember very clearly the yearly reports that oh, 50% or better of the incoming freshman class needed remediation in English and math. Of course, we needed all sorts of grad students to teach those remedial courses, so we got tuition from both the incoming freshmen and the grad students. I should know; I was one of the grad students for a while, before going on to work on not one but two doctoral degrees that I didn’t not finish. The cycle continued!

    What I also remember is the girls on financial aid who came to school in the $200 sunglasses, or the woman who had been in a psychiatric facility but was released and then pursuing a degree in sociology, using financial aid. I was her tutor, and when I asked her for her books so we could study with them, she said she didn’t buy them because her financial aid didn’t cover them, only her rent, food, etc.

    I knew back then that something was up with higher education, for some of the recruits, anyway. Now we’re seeing the back end of that, with people who have obtained their degrees with borrowed money.

    Now it’s not just the people who were academically prepared who have financed degrees and can’t find a job, these days; it’s also the people who were sold an education for which they weren’t prepared. And I have to wonder whether their educations, which I helped sell them, prepared them any better for anything.

    I guess the good thing is that those financial aid packages will follow them into their Social Security collecting days; that’s one debt that can’t be discharged in bankruptcy. But then, there’s a whole other level of poverty when Social Security checks at 62 are garnished for debts incurred at 22.

    Who has the solution?

  3. Jack Clark says:

    Wow TML I just read this post and you are off base here in a major way.

    While you are 100% correct that a large portion of the collegiate industry, let’s be honest and call it what it really is, are under-performing and overcharging at the same time good luck getting a job that pays anything over 30K a year without a degree.

    The flip side that you’re forgetting about is that most companies big and small have set a college degree, in any discipline even if unrelated to the position being applied for, as a litmus test to even be considered for any position that is non-entry level.

    Without that degree one almost never has a chance to go past an entry level position experience or not because of not passing that sheepskin litmus test.

    While your son has made out nice that is by far the exception and not even close to the rule.

  4. ross says:

    I feel like college can definitely be overrated as far as the skill you learn from it (Unless you are attending a technical school and learning a trade). The whole experience of living in a dorm with a bunch of kids your age, is great. But as far as skills that you need to succeed in business or a full time job, i don’t feel like it did me much good.

    But i think kids could succeed just as well if they got an internship in a field they were interested in. Plus internships are free, and probably are much more likely to guarantee you a job.

  5. kitty says:

    “Of course, we needed all sorts of grad students to teach those remedial courses, so we got tuition from both the incoming freshmen and the grad students. ”

    I don’t understand this. If a graduate student is teaching, the graduate student is a teaching assistant and thus gets full tuition waver as a “member of academic or graduate stuff”. So you don’t get tuition from graduate students.

    That is unless it’s some weird university that manages to get grad students to teach without giving them teaching assistantship. Not a type of school I’d go to… If I were a gtrad student, why would I teach for peanuts when I could go to another school and do the same and live a charmed life with full tuition waver and a nice fixed salary which is more than enough to cover expenses?

    • MasterPo says:

      Usually TA’s are post-grad PhD candidate students.

      Either way I sure hope they are getting something for the teaching!

      Then again, *I* as a student am paying big bucks to attend the school. I want a full prof teaching me, not a grad student. I can hire a tutor for a lot less to do that.

    • Yes, you do get tuition from grad students in some places. Grad students in the CSU and UC systems I attended did not get a full tuition waiver; we got paid to teach, at the starting end of the scale,but we still paid tuition.

      Regarding going to another school, I was tied to a geographic location and unable to apply all over the country. I went to school where I lived — and where I was admitted!

  6. kitty says:

    @MasterPo “Usually TA’s are post-grad PhD candidate students.”

    Absolutely NOT. The schools that offer assistantships normally offer them to all graduate students. In my school, professors preferred to hire PhD candidates as research assistants (RAs) as they have longer time at a university, but they didn’t wait for them to get their Master’s before they hired them, it was enough to say that you *plan* to pursue a PhD. But any grad student could be a TA – assuming a university offers assistantships. Depends on a university and fields as the demand for assistants varies.
    Science/technical fields in large universities have especially high demand for TAs and RAs, so they sometimes even higher Master’s candidates to be RAs. Also PhD candidates at least in my school weren’t considered post-graduate, they are graduate students just like Master’s candidates, also sometimes grad students were allowed to pursue a PhD directly without getting a Master’s first.

    TAs don’t give lectures except when the professor is away – in my two years as a TA I only needed to do it once, I’ve never had a TA give a lecture in any of the courses I took either. TAs teach discussion/lab/practice sessions during courses that have those e.g. freshman/sophomore math/cs courses, they have office hours during which they provide one-on-one consultations, they also do grading especially of exams, but we often had undergrad “graders” to help.

    Incidentally, my university – University of Illinois at Urbana-Champaign although it’s a state university was considered a 3rd in the US in Computer Science, so if you followed your desire to be taught by a professor you’d have to go to a worse school. I’d imagine MIT or other top private university would have TAs/RAs too. In large universities be it state or private there is a lot of pressure on professors to do research so they don’t have much time for teaching.

    I had different professors. I had professors who were really involved with teaching, and I had professors who would ask TAs to do everything but lectures, even prepare exam questions. Look at it this way – every universities has professors who are good teachers and professors who are bad teachers. Good professors would teach regardless if there are TAs, but if you have a bad professor, at least if there is a TA you can get additional info. Also, it’s unlike that professors would give you a lot of one-on-one time, but TAs have office hours specifically to answer your questions. As a TA, I had to compensate for professors’ not giving enough information e.g. to do the course project.

    @The Accidental Retiree – I see, I guess your school didn’t offer real assistantship, just jobs. In UIUC (University of Illinois at Urbana-Champaign) all grad assistants got full tuition/fee waiver. We also were on a fixed salary for 9 months, not hourly salary, I got around $500 a month but it was in 1981-1982 (if I remember correctly it was $480 a month the first year and 520 the second year, but I am not certain. It was 30-40% more than what I needed to live on, food service with the university+private room in grad dorm came up to slightly over half of my salary. TAs got paid for December and January even though large part of it was a break. RAs had to work during the break.

    Bottom line – you need to choose the right field and the right university.

  7. kitty says:

    FYI – teaching and research assistantships at MIT — notice that it’s 1) for graduate students not “post graduate” and 2) that assistants get full tuition waiver as well as salary (“Tuition and Stipend payments”) 3) they hire about 800 assistants

    I am not sure about other fields, but in science/technical fields trying to find a college which doesn’t have TAs would probably eliminate all the best programs in both private and public colleges. On the other hand from grad students it’s really a great deal.

  8. Jan says:

    How long ago was this Master Po? In the last five years I have heard of:
    Undergrad students working as TA as work study,
    Grad student TA being paid- but not enough to cover tuition,
    Research assistants being solicited in the local newspapers.
    My experience is Arizona and Kansas.
    California might not be the same—-BUT—Kansas is not broke!
    There is a glut of professors out there now.

    I have one college grad who had an amazing time at university. He is well employed- but if the government cuts back there will be another well trained Physicist out of work.

    I have one college drop out. She could not handle the social fair and classes. With no advisors and little in direction, she lasted a few years. Fortunately for the world, but unfortunately for us, we footed the bill. The taxpayers got off easy and she is not in debt.

    Our daughter is now married to a non college guy- who was just told,”If you could just get a degree, we could pay you a whole lot more.” He is making more than both of us have ever made (both have a college degree). He has a unique skill set and works very hard.

    I don’t know if college is worth it- but education is something no one can ever take away. We are saving for our grandchild’s (3yr old) college as I word process.

  9. Mike says:

    I am all for a college education and professional certifications; just against any debt to finance them. There are simply too many ways to get an education for free…you can’t justify loans or debt to get it done.

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