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The Black Hole of Higher Education


ONE OF THE GREAT growth industries in America in the second half of the 20th century was higher education. Prior to World War II, there were only 1.5 million students enrolled in some 1,700 colleges and universities. Spending per student was about $450. By the late 1990s, the student population had grown to 14.4 million students, enrolled in 3,700 colleges and universities. Spending had grown to roughly $15,000 per student.

Federal and state governments lavish subsidies on higher education. The Feds provide billions in college loans and grants; the states do their part with low tuition that covers only a fraction of the cost of providing the educational services. (Vermont is the least profligate, with tuition covering 78 percent of the cost. California is the most profligate, with tuition covering only 16 percent of the cost.) The explosive growth of higher education has occurred not because millions of students and their families decided that their lives would be better if they went to college but because government subsidies so lowered the cost of attendance.

But isn’t it a good thing that we now have so many young people (and some who aren’t so young) pursuing college (and advanced) degrees? If education is good, isn’t more education better? Don’t we need to have a more educated workforce for the more demanding jobs that will dominate our economy in the future? Hasn’t our economic progress been catalyzed by the increasing educational level of our work-force?

A great many people believe those ideas and follow the conventional wisdom that we need to do still more to get the greatest possible number of students into college.

President Clinton, for example, said in his 1997 State of the Union Address that we should make 14 years of school the national standard and proceeded to announce new federal programs to increase “access” to higher education.

The conventional wisdom about higher education, however, is wrong. We don’t need more governmental subsidies to get more students into college; we need to end the subsidies so that college costs will be borne only by willing parties. We don’t need to try to make college attendance universal; we need to allow people to choose for themselves the type and extent of education that best suits them. We don’t have prosperity because so many more people are going to college; so many more people are going to college because we have prosperity. We won’t get a better educated populace merely by throwing money into the education machine; throwing money into the machine undermines academic standards. In short, the right government policy toward higher education is to keep out of it.

Too many students

In the movie Amadeus, the emperor of Austria complains to Mozart that a piece of his has “too many notes — just too many notes.” Mozart knew how to write music, and he certainly did not have too many notes. Government in the United States, however, has put too many students in college. The government’s egalitarian policy of trying to give everyone “access” to higher education through low tuition and financial aid has opened the doors to throngs of students — far more than would probably have attended if they had had to bear the cost without subsidization. At the same time, it has weakened standards.

Many college professors privately lament the problems caused by the presence of large numbers of “students” who are that in name only. Some have even had the nerve to speak out. A book well worth reading is Generation X Goes to College by Peter Sacks, in which the author explains how he was driven to make his courses intellectually vapid, easy, and entertaining in order to improve his student evaluations and keep his job. On many campuses, the indifferent student who wants only to get a degree with the least possible effort is the norm, and the pressure to appease students has led to a decline in academic standards that adversely affects the serious students.

Professor Paul Trout of Montana State University calls those indifferent students “disengaged students,” and describes them as follows:

They do not read the assigned books; they expect high grades for mediocre work; they complain about course workloads; they regard intellectual pursuits as boring; they resent the intrusion of course requirements on their time; they are apathetic or defeatist in the face of challenge; and they are largely indifferent to anything resembling an intellectual life.

Our government education system has always produced a large number of people who have neither the interest nor the ability to do college-level work, and its imploding standards are increasing those numbers each year. In the days before nearly universal access to higher education, poorly educated high schoolers simply got jobs, or if they tried college, they probably flunked out. But things have changed. Driven by the belief that everyone should go to college, politicians and university officials have lowered both costs and standards to the point where virtually everyone who has the slightest desire to attend college can.

There are still islands of excellence in higher education, but they are surrounded by and eroding into an ocean of mediocrity. As Ernest van den Haag wrote in his essay “Gresham’s Law in Education” more than 25 years ago,

In the process of trying to educate the inept, the education of those who might benefit will necessarily be impaired while very little is gained by those supposed to be helped.

Higher education and prosperity

In one of the great non sequiturs of all time, many people argue that our current high level of prosperity is due to the fact that so many Americans have pursued college educations. Here’s a typical statement: “The rising education level of the workforce has contributed importantly to the growth of productivity and real incomes in the United States.” The writer is Marvin Kosters, resident scholar at the American Enterprise Institute and editor of Financing College Tuition, from which the quotation is taken. You encounter this sort of thinking all the time – Y follows X, therefore X caused Y. (Logicians call it the post hoc ergo propter hoc fallacy.)

Is there a connection between economic prosperity and the extent of formal education — and if so does it run the way Kosters assumes? Is the American economy as productive as it is because of the large numbers of students enrolled in courses ranging from Economics 101 to History of Witchcraft and Magic (a course at Rutgers) or Social Construction of Femininities and Masculinities (a course at the University of Colorado)?

Let’s put the question this way: How much of what you studied in college has been essential to your success in life?

In honesty, the answer is probably, “Almost nothing.” Most of what people learn about business they learn on the job. Our vaunted productivity is due in the main to technological breakthroughs that would have occurred whether or not the person or persons responsible had gone to college. (Bill Gates dropped out. Thomas Edison hardly went to school at all, much less college.) This is not to say that college studies are worthless or never do any good, but that we ought not to make the unwarranted claim that they are essential to our prosperity.

The eminent economist Fritz Machlup once commented on the notion that the increasing technological sophistication of the economy calls for measures to increase the educational level of the work force: “Most of the required [computer] skills can best be acquired on the job and high-school graduates are not one whit less educable in these skills than college graduates.” If employers find that they need to raise the skill level of their workers, they can and will do so directly. There is no need for government subsidies for higher education in order to have well-trained workers.

Contrary to Kosters’s perspective, I think that the causality runs the opposite way: Because we have a high degree of prosperity, we can afford to lavish resources on universities that teach less and less and to keep millions of young people out of the work force for four years or more. Colleges and universities are very good at playing the game of politics to wheedle resources out of government and as our prosperity has grown, they have succeeded in getting politicians to divert billions of dollars to them. Of course, if consumers perceive value in our higher education system, then it will stand on its own feet without government assistance.

A free market in higher education?

The United States has wandered so far away from a free market in education, both at the K-12 level and at the college level, that it takes some effort just to imagine what it might be like. In his engaging book, How Professors Play the Cat Guarding the Cream, Richard Huber gives us some ideas:

In the Middle Ages, at Bologna University in northern Italy, students engaged professors in something like a contractual relationship. If the professor fulfilled the specifications agreed upon, he got paid. Otherwise, he paid. At Bologna, if a professor was absent from class for a day, he had to request and receive permission from the students. Should he wish to leave town, he was required to deposit a sum of money as security for his return.

We never know the results of liberty ahead of time, but if we had a free market in higher education, we might find that the Bologna model would be very appealing. Just imagine the changes that would occur if students contracted with and paid professors for the knowledge they desired, rather than accumulating credits toward a degree by taking courses paid for mainly by other people. For starters, most of the “disengaged students” would quit wasting their time and other people’s money on courses they have no real interest in. That, in turn, would lead to a tremendous shakeout in the ranks of the professorate.

I doubt that the professors who teach History of Magic and Witchcraft or Social Construction of Femininities and Masculinities would survive very long with such courses. If students wanted to pay for such courses, fine, but taxpayers wouldn’t be compelled to subsidize them any longer.

It would also mean the end of the inane worries over “diversity.” Even if a professor had a preference for men or women or whites or blacks or left-handed Aleutian Islanders or whatever, it is most unlikely that he would turn away paying customers on that basis. University speech codes would also be a thing of the past.

And of course it would mean a dramatic reduction in the cost of government borne by taxpayers. No more government loans at low-interest rates — loans that often go unrepaid. No more grants and financial aid. No more subsidized construction of football stadiums or convocation centers. No more $100,000-per-year Marxist professors. The savings would be stupendous if no one was forced to subsidize the college education of others.

While a full-fledged free market in higher education in the United States is perhaps a long way off, there is movement toward it. For-profit higher education is a rapidly growing phenomenon. The University of Phoenix, for example, is a for-profit, no-frills operation that sells courses in fields where individuals desire knowledge and will pay for it. It has more than 70,000 student-customers at more than 100 campuses and learning centers in the United States.

In a brilliant paper entitled “Whither the Nonprofits?” the late Emory University professor Peter Aranson speculated that for-profit education could blow the doors off nonprofit education. His paper is worth quoting at some length:

Students in public and private nonproprietary colleges and universities are subsidized. Those who pay for the education — parents, taxpayers, and donors — remain rationally ignorant about what their money buys. Most students, by contrast, have a very clear idea of what to expect…. This includes their use of all the wonderful programs and facilities under the control of the Office of Campus Life, and their instruction by professors who, when they do teach, demand increasingly less of them while helping them to break loose from their parents’ “narrow mindedness.”
Now comes the University of Phoenix, most of whose students, being working adults, are paying the full cost of their education. What will they choose to buy? Certainly not the counseling centers, the fancy cafeterias and dormitories, the clubs and political action committees, the rock concerts, and the rest.
What courses will they choose to buy? Certainly a course in writing skills, mathematics, computers, and perhaps a well-designed course in the classics of political thought. And because they are paying full fare, these students will not tolerate faculty who miss classes, lecture from yellowed notes, meet students “y appointment only,” and spend most of their class hours talking about the latest social issues.
Nor, when employers foot the bill, do we expect them to tolerate the characteristic sloth of the nonprofit world. How long will it be until financially strapped parents of high school graduates come to the same answers?

The government-subsidized realm of higher education is a great black hole, sucking up resources without end. But if proprietary institutions are allowed to continue to grow — and count on defenders of the subsidized status quo to fight back with accreditation and licensure demands — perhaps its end will be accelerated.

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    George C. Leef is the research director of the George C. Leef is the research director of the Martin Center for Academic Renewal in Raleigh, North Carolina. in Raleigh, North Carolina. He was previously the president of Patrick Henry Associates, East Lansing, Michigan, an adjunct professor of law and economics, Northwood University, and a scholar with the Mackinac Center for Public Policy.