We Must Embrace Higher Ed Reform

History Channel’s
popular series “The Men Who Built America”
portrays an incredibly wealthy – yet worried – John D. Rockefeller. Rockefeller,
who earned much of his vast fortune by producing and refining kerosene, was
facing competition not from rival magnates – the Carnegies or Vanderbilts – but
from the likes of Thomas Edison and Nikolas Tesla, who sought to harness electric
light to affordably power the homes of millions of Americans. 

Rockefeller quickly realized he had to find another
market for his kerosene, or risk losing his wealth, standing, and influence. Rather
than trying to stop it, Rockefeller had the entrepreneurial skill to recognize
that his industry had to change when confronted with a fundamentally new and
transformative form of competition.  It’s evident that many of today’s
colleges are trying to block inevitable change, through barriers such as accreditation,
while others realize they have to redefine their industry.

America’s colleges and universities stand on the same precipice.
A disruption of the higher education market through online learning and more
specifically, through Massively Open Online Courses or MOOCs, is underway,
precipitated by untenable college costs. And unless Traditional U rethinks its business model, and for that matter, its
raison d’être, it will face an uphill
battle to stay competitive in a rapidly changing higher ed market. As Stuart
Butler and I write in a recent paper we published:

“Traditional higher
education, however, may no longer be able to ignore the revolution at its
doorstep. Dramatic changes are on the horizon as entrepreneurial educators
experiment with radically different business models and approaches to

Students, parents, and taxpayers will be the
beneficiaries of those dramatic changes. Innovative start-ups such as Coursera, edX, and Straighterline offer courses for a fraction of what they cost at
traditional universities, or, offer courses that are altogether free. Given
this new environment of open access to high quality content, one can imagine a
day when students pursue a menu approach to higher education, piecing together
their degree from a variety of sources instead of spending four years and
thousands of dollars obtaining a bachelor’s degree at a single institution.

Such a menu approach would allow students to home in on
the courses they need to be marketable and to succeed in the workplace. Their
course selection could be guided by independent third parties- businesses or
non-profits for example – who lend their “seal of approval” to a given course.
Such an approach could radically reduce costs, improve access, and provide
valuable information to employers.

But there is a significant barrier to the much-needed
transformation of higher education: accreditation. Accreditation has become a
poor gauge of college quality. Schools rarely lose accreditation once it is
granted, despite widespread recognition that the quality of higher education
has been on the decline for decades.

At the same time, colleges and universities must toil
through the bureaucratic and time-consuming accreditation process in order for
students to be eligible for federal loans. Such a system hinders innovation,
creates an inflexible college experience for students, and results in accredited
courses of questionable academic value.

The first step toward reforming higher education is
reconfiguring accreditation and unleashing a new higher education business
model. To do that, federal policymakers should end government sanctioning of
accrediting agencies, making accreditation voluntary; reputations dependant on
market forces, not government approval. At the same time, federal financing
should be unbundled from accreditation.

Traditional universities face a dilemma: Americans are
coming to the realization that too often a bachelor’s degree just isn’t worth
the average $25,000 in student loan debt it costs. Employers realize that that
pricey piece of paper is a poor indication of the skills and knowledge of a
prospective employee.

Rockefeller ultimately lost the battle to light America’s
homes, but he remained a powerful player in American industry. He shifted his
focus to oil, using what was once a byproduct – gasoline – to fuel the
“horseless carriages” mass produced by Henry Ford. Colleges need to likewise
shift their focus and recognize that in a time when the acquisition of basic
knowledge is cheaper than ever, degrees cannot remain historically expensive.

By embracing the budding online revolution, they can do
just that. Federal policymakers can aid that transformation by removing
barriers such as the current government-driven accreditation system, and
allowing the market to determine quality.


M. Burke is the Will Skillman Fellow in Education at The Heritage Foundation


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