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Higher Education Watch
NYT Catching on to Higher Ed Bubble?

On Sunday, The New York Times ran a refreshingly sharp editorial on a topic we’ve been watching closely for some time—spiraling law school costs and the need to cut back on federal student loans for JD programs. The Times rightly points out that overly generous loan programs share a large part of the blame for the ongoing crisis in legal education:

The consequences of this free flow of federal loans have been entirely predictable: Law schools jacked up tuition and accepted more students, even after the legal job market stalled and shrank in the wake of the recession. […]

How can this death spiral be stopped? For starters, the government must require accountability from the law schools that live off student loans… Another good idea would be to cap the amount of federal loans available to individual schools or to students. This could drive down tuition costs, and reduce the debt loads students carry when they leave school.

This is all very reasonable—so it would be nice if the Times were more consistent on this question.

When it comes to undergraduate degree programs—many of which are also charging exorbitant prices, sucking up federal money, and failing to equip their graduates with the skills needed to pay back their loans—the Grey Lady has had no objection to expanding federal subsidies. In August, for example, the editorial board heaped praise on Hillary Clinton’s budget-busting college plan, which it said “aims to reduce college costs for students by giving federal grants to states and colleges and by allowing borrowers to refinance their student loans at lower interest rates.” In 2013, it condemned Republicans who wanted to scale back subsidized loans.

The problem, as our friend Instapundit said, is that “when you subsidize something, the price goes up. This is true for all of higher education, not just law schools.” Loosening the flow of federal money is not the solution to the four-year college bubble any more than it is the solution to the law school bubble.

That’s not to say that federal loans policies for JD and BA programs need to be identical. But it would be nice to see the Times critically evaluate the idea of federal subsidies in more of its higher education commentary. The current editorial line—that loans are the root of all evil when it comes to law school and the answer to all problems when it comes to undergrad—doesn’t make all that much sense.

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  • Andrew Allison

    At last count, 87% of those enrolled in ACA were receiving subsidies . . . . What was that about lowering the cost of healthcare?

  • wigwag

    The secret to dramatically reducing higher education costs is the same as the trick that made recorded music free, books much cheaper than ever before and is in the process of destroying the taxi cab industry. It’s called disintermediation.

    Colleges and universities are no different than music companies, book publishers and cab companies; they’re useless intermediaries standing between producers and consumers while adding little of value and jacking up costs. They need to be killed.

    We will see a revolution in higher education, which means far higher quality at far lower cost, when a nimble, efficient and entrepreneurial start-up figures out how to connect professors who want to teach with students who want to learn without the fat, belching, smelly and smug intervention of college and university bureaucracies.

    That day is coming. When it arrives, the costs of higher education will plunge and government’s role will be much less necessary.

    • Anthony

      WigWag, tangentially related: of the 17 candidates seen and heard thus far, Bernie Sanders (I find) stands most impressive! But given our soap opera/entertainment media, general public may never know.

      • wigwag

        It’s hard not to like old Bernie, but he would be awful. He’s too invested in doing things the old way. We don’t need single payer medicine, which is what he advocates. That just substitutes one grossly incompetent middleman (the government) for another grossly incompetent middleman (the insurance companies).

        Bernie’s higher education plan is even worse than Hillary’s. They both want to feed the beast (which is what colleges and universities are); instead we need to starve the beast. Government subsidies of higher education are almost singlehandedly responsible for the bloat, inefficiency and ultra high tuitions that colleges and universities foist on their students.

        I’ll bet you anything that Bernie never takes Uber and that he thinks that the independent contractors who drive for Uber should be considered employees. That idea is horrible.

        What do I think of Bernie? He reminds me of my favorite avuncular uncle. It’s charming that he means what he says and he says what he means. But he’s a nice guy who’s time has past. Returning to the 1930s or the 1960s to search for solutions to America’s problems, which is what Bernie and the Democrats want to do, is just as misguided as the Republica’s pining for the gold standard or austerity or a big fat dose of that old time religion. Contrary to what many Republicans may think, the solution to America’s problems are not to be found in the 1950s or the 1850s.

        And as long as you brought up Coates, not only is he a charlatan, but he’s a mirror image of the old time segregationists. He thinks when it comes to race in America nothing ever will change; the segregationists just differ because they fear when it comes to race, things are changing and they wish they weren’t.

        Anyone curious about the dialog that Anthony and I are having about Ta-Nehisi Coates should go here,

        • Anthony

          You know WigWag, you and Bernie share home town beginnings – New York, New York. Seriously though, I don’t get sense he wants return to New Deal democratic policies but I hesitate to hazard a guess (as I don’t know enough about him or policy record in Vermont – though I found him extremely impressive on Charlie Rose yesterday).

          On the other hand, we are in agreement about establishment (Rep/Dem) retreads not conducive to 21st century requirements/expectations (by the way, I find your Keynes’ sofa joke hilarious).

          Finally, I think you judge Ta-Nehisi both prematurely and harshly; you identified two find charlatan models previously and I don’t see him in that mold (I could be terribly off though but as I said we have to wait and see). The kid just made 40 WigWag (I think) so there’s room for development – I saw some interviewer force an admission of change from him (though it appeared begrudging but I may be conditioning response by on age bias).

          • wigwag

            Anthony, you’ve insulted me terribly! Bernie Sanders and I do not share hometown beginnings. He was born in Brooklyn and I was born in Queens. It’s like meeting an Irishman and asking him if he’s English.

          • Anthony

            Yea, I knew he was from flatbush; my apologies as I would never want to insult such a distinguish contributor (born in Borough now resided in by WRM). And I know so well the United Kingdom’s history vis-a-vis Ireland.

          • wigwag

            Watch this short video from Woody Allen’s “Annie Hall.” Do you suppose it was Bernie Sanders he waking about at the the 1 minute 6 second moment in the monologue?

          • Anthony

            Ha, ha, ha, close WigWag very close. But, you know Woody he loves Manhattan and self effacement.

  • Jim__L

    Ah, but there is nothing so clearly a giveaway program to the clerisy than subsidizing the university education they all have in common.

    Expect this idea to get squashed, in favor of Free College. (To go along with Free Dope, I suppose.)

  • PennsylvaniaPry

    I would argue that, historically, a university education is
    rather different from a nice collection of tunes on your iPhone. Simply put,
    universities, in addition to their role in offering advanced education in
    divinity, medicine and law, and more recently, business, served as gateways to
    the elite. We today tend to think of the Ivy League and near-Ivies in this
    regard, although almost every county in America has had some local college that
    produced at least a local elite. The experience of a residential college has
    ideally comprised much more than mere booklearning. In such an environment,
    often one of undergraduate pretension and posing, young men and women learn, or
    learned, the habits of elite behavior and attitudes. Formerly, the American
    WASP was just such a product. (Nowadays, it appears that we are creating an
    elite concerned primarily with signaling the proper social justice virtues. But
    that is matter for another comment on another article.)

    This model began to break down with the GI Bill after World
    War II. Faced with the nightmare of 12 million servicemen coming home to an
    uncertain American economy, just five years after the last doldrums of the
    Great Depression, FDR prudently decided to direct them into the colleges, in
    the Hail Mary hope that the education they might acquire would spark economic
    growth beyond what had been possible under the New Deal. Turns out he was right
    about that. Millions of young men, many of them possessing natural intellectual
    ability, could now afford a college education. Many of these men formed the
    ranks of the Organization Men of the 1950s and early 1960s. It should also be
    noted that women also entered college in larger numbers in the 1950s and early
    1960s. These were the women who ended up discontented as housewives in the
    mid-1960s and who returned to the workforce around 1970.

    The end result of all this expansion in the national student
    population was an expansion of the colleges themselves. Initially, the
    expansion was funded by the GI Bill, but as the number of veterans began to
    stabilize and later dwindle, the colleges needed a new source of funding for
    new students of non-elite background. Enter the subsidized Student Loan.

    Up until this point, it was conceivable that a poor student
    could work his way through college. While it took some time to become
    impossible, the trend, starting in the 1970s, was for college costs to begin
    rising at least as much, if not much more than, inflation. At the same time, as
    business firms began to shy away from administering their own employment exams—for
    fear of being sued as racists—those firms came to rely on the mere possession
    of a B.A. as the equivalent. No longer could a self-taught genius land a good
    job on brains alone (many such people became entreprenuers like Bill Gates, who
    lacks a college degree). For the rest of us, though, credentials suddenly
    loomed much larger than direct displays of natural talent or aptitude. And by
    the late 1980s and early 1990s, as the Baby Boomers, who are essentially
    paranoid, began sending their kids off to college, the notion that you had to
    get into a good school to have a middle class life began to take hold. This
    message was let loose on American society in general. In the 1990s, the
    private, for-profit trade schools began marketing themselves as “colleges” in
    the hopes of drawing in a student population not traditionally college-bound—minorities
    with no family history of higher education or middle class employment. At some
    point in this period, politicians began pushing the myth that college should be
    open to all. No mention was made of anyone’s ability, or lack thereof, to
    complete true college-level work.

    And that is the problem.

    The sad truth is that a majority of the population is incapable
    of, or unwilling to engage in, true college level work. Such work would involve
    the ability to learn first year calculus, to learn enough Latin to read a
    passage from Caesar, to have a reading knowledge of at least one modern foreign
    language, to have a general ability to grasp Shakespeare, Milton, and the
    greatest of English novelists and poets. to understand and recognize the basic
    principles of microeconomics, to have a solid but general familiarity with U.S.
    and world history and geography, to be familiar with the general tenets of the
    world’s major religions, and so on. Very little of this can be assumed on the
    part of most “college” graduates these days, even discounting the trade

    College has become a scam, a racket, a fraud. And the good
    are being damaged by the bad in all this. By all means, let us return to employer
    exams and a due regard for the auto-didact. But let us also restore the
    function of college as a social marker, as well. I know this idea violently
    contravenes the spirit of the age, which is morbidly democratic, but all
    healthy societies recognize their parts and their ranks. Our Founders certainly
    did and crafted a government with such an understanding in mind. We move from
    that reality at our grave cost.

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