Tag Archive for education

$6 Million Bucks of Nothing

Photo courtesy of dawgsports.com

I wish I raked in a $6 million annual salary.  (That’s almost $3,000 an hour if you work 40 hour work weeks!)

The only people that make that kind of dough are successful inventors, high level execs at prestigious firms, or… college football coaches.

You read that correctly.  College coaching is paying more than ever before, and I’ve got a problem with it.   In a previous blog post, I wrote that the costs of higher education are unsustainable, and this article is a follow-up piece.

 

I took over 200 credits during my undergraduate years (and still managed to graduate without student debt), and almost 30 credits for my master’s program (still no debt!).  I attended, at most, maybe ten football games and a handful of other athletic events.

Funny, because I paid around $80 per semester in student fees, which adds to over $1,100.  With a little digging, I found that the actual definition for this athletic category reads as follows: “The revenue from this fee enables free access to sporting events by all students at the U. Money also supports non-revenue sports and marching band.”

You see why I’m mad?  Even my on-campus gym and intramural sports weren’t covered in this fee (those fees are filed in the ‘recreation’ student fee).

If you’ve read my previous article, you’re probably wondering why I’m continuing to beat this dead horse.  It’s because I just finished watching a video that got me all riled up again!

The National Inflation Association produced a documentary called College Conspiracy, and it’s actually quite good.

One fact that I never realized in this education bubble is that when it pops, the market will contract.  The NIA predicts that 30% of colleges and universities will close as the population recognizes that a college degree does not equate to a high-paying job.  College prices will come down and brick-and-mortar schools are going to be stuck with their crazy glass buildings (here, here, and here) they seem to enjoy.

I encourage you to watch the video for yourself and leave your comments.  Here’s mine: I want my $1,100 bucks back.


~Nick, the Self-Taught Economist

 

PS:  For those of you following my journey away from W-2 salary into self-employment, I may have news for you soon.  I can’t really discuss at this point, but I’m hoping I can announce in a week or two!

 

Epic. Fail.

I remember the first day of my master’s program (with an emphasis on higher education) quite well.

The professor passed around a big bag of colorful candies and told everyone to take a handful.  After the bag had been passed around, she instructed us that for every red candy we took we had to tell the class one of our favorite books, for every blue candy we had to say a place we had visited, and so on and so forth.

Note:  While this activity was probably designed for 4th graders, it seemed to work well for graduate students, too.

I was shocked to hear more than one student profess to not reading books!  After a laugh from the class (Personally, I was laughing out of shock, but maybe others were laughing out of relief), these students discussed magazines or video games they enjoyed.   Don’t get me wrong, I’m not anti-periodical nor am I anti-technology.  It’s just…this is an education program.  In order to serve your students well (let alone do well in the graduate program), you absolutely have to read!

I guess my point is that everyone knows the U.S. education system is failing. Now, that may sound like a hypocritical statement coming from a person with two bachelor’s degrees and a master’s degree (at least I didn’t take on debt to pay for these, but there was an opportunity cost…sigh).  But hear me out:

  • There are huge inequalities and achievement gaps within the educational pipeline.  If you aren’t white and well-behaved, the odds are your teacher is going to “track” you into easier classes.[1]
  • High school students are dropping out at unprecedented levels.  Some states are only graduating 47% of students.[2]
  • The students that are graduating aren’t prepared for college.  If they do decide to apply, often picking up $15-25k a year in student debt in the process, they have to take remedial courses to catch them up and get them ready for the rigors of college.
  • Even if you make it through college with a degree or two, you’re not likely to find a job.  Thanks to the timing of the market, most of the students in the millennial generation are facing unemployment levels worse than the great depression.

Okay, it’s pretty bad.  What can we do to improve the situation and help the U.S. get back on top?  Here are my recommendations (and add your own if you’ve got ‘em):

1.  Raise the salaries of teachers and make the school year a full calendar year, with a full 9-4:30 day, which includes sports or physical education.  It’s too hard on students to remember concepts after three months off, and too hard on parents to cover the cost of childcare.

2.  Pay teachers based on their improvement of their students.  With better technology and evaluation procedures, it should be easier to see improvement from year to year.  Standardized testing in its current state is a failure, so this would rely on something better.  More effective teachers deserve better pay.

3.  Do away with tenure and with teacher’s unions.  Bad teachers should be fired.  Period.

4.  Raise the expectation of parents.  Provide classes to educate parents on how much they should read with their students, how to ask students about their day, etc.  Parents should be involved throughout their kid’s education.

5.  Raise the expectation of students.  Get rid of No Child Left Behind.  Abolish the idea that students should always be segregated by their age level.  Work to improve a model where students mentor other students and get mentored themselves.

6.  Improve the physical education programs in schools, and provide healthy, fresh, breakfast and lunch to every student.  You can’t learn if you’re hungry or sick.

7.  Cut class sizes down to 15-20 tops.  Teachers should get an extra $2,000 for any additional students beyond the cap of 20.

8.  Change the tax code of the United States so that the more children you have, the more you pay, not the opposite (current) structure.

9.  Allow teachers to invite guest lecturers to teach about important topics like personal finance, specialized science projects, music, foreign language, and the arts.  Teachers should be allowed to focus on being excellent at teaching the core concepts in exciting, unique ways.

10.  Encourage young entrepreneurs to find new ways to teach from outside the classroom.  Examples include the Khan Academy that wants to flip education upside down:  The students watch the lectures (on YouTube) at home, and then they come to school to do their homework with individualized attention from the teacher and working collaboratively with their fellow students.

11.  Make education a process of “lifelong learning”.  Your education shouldn’t stop at the end of the school year, the end of high school, the end of college, or…ever.  Folks in their forties, fifties, and eighties should be able to teach and learn.  If you feel like you still have a little bit more to learn, check out these 12 dozen online education sites:  http://www.marcandangel.com/2010/11/15/12-dozen-places-to-self-educate-yourself-online/

 

Ultimately, just like my friend Tyson pointed out, our education system will determine whether or not the U.S. retains a middle class.  I personally think that the U.S. would not be half the nation it is today if we didn’t offer a free, top-notch education to all students.  If we lose this, our whole country loses.

What would YOU change about our current education system?

~Nick, the Self-Taught Economist

 

The Economics of Higher (Cost) Education

The cost of a college education is outlandish. It wasn’t always this way.  A quick internet search will show that from the about 1900 until the mid-1970s, college tuition increased between 2 and 3 percent per year (adjusted for inflation).

But starting around 1975, college tuition began increasing 5 to 6 percent per year, and by 1985 was far outpacing the overall Consumer Price Index (CPI), which is what Figure 1 represents.  The Bureau of Labor Statistics defines the CPI as, “a measure of the average change over time in the prices paid by urban consumers for a market basket of consumer goods and services.”

Figure 1

The skyrocketing rise in college student loan debt is one result of the increasing cost of college.   For the first time in history, student loan debt surpassed credit card debt and is on track to hit $1 trillion by the end of 2011.

Average debt levels for graduating seniors with student loans rose to $23,200 in 2008 — a 24% increase from $18,650 in 2004.

While healthcare has also seen drastic increases, improvements in both the technology and healthcare outcomes somewhat justify this price increase.  Colleges and universities, however, can’t claim similar improvements in student learning outcomes.

To read more about this topic, visit the Project on Student Loan Debt.

 

Why is the cost of college increasing so fast? “Think of the question in terms of incentives,” Richard Vedder, an economist at Ohio State University expounds. “There’s no incentive to save money and keep costs down. All the incentives run the other way. Look at the way a school operates. They call it ‘shared governance.’ What that means is, everyone thinks they run the place. The trustees think they run it, the alumni think they run it, the state legislature thinks they run it, if it’s a public university. At some schools they have student trustees and various boards filled with students — and they think they run it.

“And then there’s the poor president. His job actually is to run it. To do this he has to buy off all these various groups and make them reasonably happy. You buy off the alums by having a good football team. A good football team costs money. You buy off the faculty by giving them good salaries. You let them teach whatever they want, keep their course loads low. You buy off the students by not making them work too hard. I’m serious about that: there’s grade inflation, there’s not too much course work, the reading assignments given to students are much less than they were forty years ago. You make sure the food is good and the facilities are nice. And you buy off the legislators and trustees in various ways: tickets to the big football games, admit their kids if they apply, get a good ranking from U.S. News. All this costs huge amounts of money. No wonder universities are expensive!”

The rest of this article can be read here, but for the sake of my argument regarding the cost of higher education, just keep scrolling down…

 

Higher education must adapt to survive. Since the G.I. Bill after World War II, it has been standard advice that you should “go to college so that you can get a good job”.  Sorry parents, but this advice is no longer a guarantee to a better life.

Now that the cost of college means accumulating tens of thousands of dollars of debt with no guarantee of a job after graduation, students are starting to wonder if college is worth the cost.

Run the numbers yourself.  Let’s look at the University of Utah (my Alma mater) as an example:

  • As of January, 2010, the University of Utah was working on nine major projects on campus.  In total, over 730,000 square feet of new indoor space will be created.
  • I’m not an energy consultant, but I just found a few statistics online that estimate every square foot of indoor space at a college or university costs $1.10 per square foot of electricity and 18 cents per square foot in natural gas (in 2005).
  • That means the University of Utah will see an increase of $934,400 per year in energy costs alone for this new space.  As energy rates are going to increase drastically in the future, this number will double, triple, or quadruple.

The future of higher ed. Don’t get me wrong – higher education will always be valued in the U.S.  But colleges and universities are doing more harm than good at their current price levels.

So what suggestions would I make after my ten years of serving as an administrator and student?  Here are a few:

  • Improve the quality of online courses.  Lectures from top instructors should be filmed and used repeatedly (scaleability improves).
  • Train instructors to become moderators and facilitators for in-class discussion.  Let students read the material and watch the lecture online, but true learning comes from the knowledge construction that takes place during peer interaction sessions.
  • Stop building new buildings!  Schools should seek to build one large, central building that students can pay tuition, get lunch, take courses, and get involved.
  • Minimize the administrative bureaucracy and allow students to “help themselves” using online resources.
  • Take away tenure. Tenure is an antiquated beast that has no role in the 21st century.  Do away with it and perform constant performance checks on instructors.
  • Set the expectation higher for students.  Enough grade inflation.  Make college cheaper, but require true work to graduate.  If a student fails out, give them opportunities to “earn” their way back into the classroom.
  • Change the incentives so that schools operate more efficiently.  Change the governance. Pay extra for cost-saving techniques.

I don’t have all the answers, and I know it’s next-to-impossible to change huge institutions. But things have to change.  I hope I’m part of the process.

~Nick, the Self Taught Economist

What woud you change about the education system here in the US?