Tag Archives: college value

Why College for All Is A Big Mistake

More and more Americans are going on to post–high school education, encouraged to do so by both governments and nonprofit organizations. According to the U.S. Department of Education, for example, “In today’s world, college is not a luxury that only some Americans can afford to enjoy; it is an economic, civic, and personal necessity for all Americans.”

One of many nonprofit organizations that convey the same message is the Lumina Foundation. Its mission is to expand post-secondary educational attainment, with a goal of having 60 percent of Americans hold a college degree, certificate, or other “high-quality postsecondary credential” by the year 2025. Its “Stronger Nation” initiative, as the foundation declares on its website, “is all about the evidence of that learning—quantifying it, tracking it, pinpointing the places where it is and isn’t happening. . .  Lumina is also working with state policy leaders across the nation to set attainment goals and develop and implement strong state plans to reach them. So far, 26 states have set rigorous and challenging attainment goals—15 in the last year alone. Most of these states are taking concrete steps—such as implementing outcomes-based funding, improving developmental education, and making higher education more affordable—to increase attainment and reach their goals.”

The Lumina Foundation is steeped in metrics and proselytizes on its behalf: its website proclaims, “As an organization focused on results, Lumina Foundation uses a set of national metrics to guide our work, measure our impact and monitor the nation’s progress toward Goal 2025.”

The Lumina Foundation’s mission comports with a widely shared conviction about the role of higher education in American society: the belief that ever more people should go on to college, and that doing so increases not only their own lifetime earnings but also creates national economic growth.

More Winners Mean Less Value in Winning

That article of faith, and the performance targets to which it gives rise, may simply be mistaken. As Alison Wolf, an educational economist at the University of London, has pointed out, it is true that those who have a B.A. tend to earn more on average than those without one. Thus, on the individual level, the quest for a B.A. degree may make economic sense. But on the national level, the idea that more university graduates means higher productivity is a fallacy.

One reason for that is that to a large extent education is a positional good—at least when it comes to the job market. For potential employers, degrees act as signals: they serve as a shorthand that allows employers to rank initial applicants for a job. Having completed high school signals a certain, modest level of intellectual competence as well as personality traits such as persistence. Finishing college is a signal of a somewhat higher level of each of these.

Once It Signaled Superiority

In a society where a small minority successfully completes college, having a B.A. signals a certain measure of superiority. But the higher the percentage of people with a B.A., the lower its value as a sorting device. What happens is that jobs that once required only a high school diploma now require a B.A.

That is not because the jobs have become more cognitively demanding or require a higher level of skill, but because employers can afford to choose from among the many applicants who hold a B.A. while excluding the rest. The result is both to depress the wages of those who lack a college degree, and to place many college graduates in jobs that don’t actually make use of the substance of their college education.4 That leads to a positional arms race: as word spreads that a college diploma is the entry ticket to even modest jobs, more and more people seek degrees.

Thus, there are private incentives for increasing numbers of people to try to obtain a college degree. Meanwhile, governments and private organizations set performance measures aimed at raising college attendance and graduation.

Higher Metrics Through Lower Standards

But the fact that more Americans are entering college does not mean that they are prepared to do so, or that all Americans are capable of actually earning a meaningful college degree.

In fact, there is no indication that more students are leaving high school prepared for college-level work.  One measure of college preparedness is the performance of students on achievement tests, such as the SAT and the ACT, which are used to predict likely success in college (they are, in part, aptitude tests).

For the most part, these tests are taken only by high school students who have some hope of going on to higher education, though in an effort to boost student achievement, some states have taken to mandating that ever more students take such tests. (Probably a case of misplaced causation. Students who took the tests tended to have higher levels of achievement. So, it was mistakenly reasoned, by getting more students to take the test, levels of achievement would be raised. The flaw is that better-performing students were more likely to take the test in the first place. That is, policymakers mistook cause for effect.)

The ACT tests four subject areas: English, math, reading, and science. The company that develops the ACT has developed benchmarks of scores that indicate that the test taker has a “strong readiness for college course work.” Of those who took the ACT test most recently, a third did not meet the benchmark in any of the four categories, and only 38 percent met the benchmarks in at least three of the four areas. In short, most of those who aspire to go on to college do not have the demonstrated ability to do so.

The results are predictable—though few want to acknowledge them. Since more students enter community colleges and four-year colleges inadequately prepared, a large portion require remedial courses. These are courses (now euphemistically rechristened “developmental” courses) that cover what the student ought to have learned in high school. A third of students who enter community colleges are placed in developmental reading classes, and more than 59 percent are placed in developmental mathematics courses. Students who are inadequately prepared for college also make additional demands on the institutions they attend, thus raising the costs of a college education: the growth on campuses of centers of “educational excellence” is a euphemistic response to the need for more extracurricular help in writing and other skills for students inadequately prepared for university-level work.

Graduation Rates Count

Colleges, both public and private, are measured and rewarded based in part on their graduation rates, which are one of the criteria by which colleges are ranked, and in some cases, remunerated. (Recall the Lumina Foundation’s encouragement of state governments to engage in “outcomes-based funding.”) What then happens is that outcomes follow funding. By allowing more students to pass, a college transparently demonstrates its accountability through its excellent metric of performance. What is not so transparent is the lowered standards demanded for graduation.

More courses are offered with requirements that are easily fulfilled. There is pressure on professors—sometimes overt, sometimes tacit—to be generous in awarding grades. An ever-larger portion of the teaching faculty comprises adjunct instructors—and an adjunct who fails a substantial portion of her class (even if their performance merits it) is less likely to have her contract renewed.

Thus, more students are entering colleges and universities. A consequence of students entering college without the ability to do college-level work is the ever-larger number of students who enroll but do not complete their degrees—a widespread and growing phenomenon that has substantial costs for the students who do so, in tuition, living expenses, and earnings foregone. High dropout rates seem to indicate that too many students are attempting college, not too few. And those who do obtain degrees find that a generic B.A. is of diminishing economic value because it signals less and less to potential employers about real ability and achievement.

Recognizing this, prospective college students and their parents seek admission not just to any college, but to a highly ranked one. And that, in turn, has led to the arms race of college rankings, a topic to which we will return.

An Air of Unreality

Lowering the standards for obtaining a B.A. means that using the percentage of those who attain a college degree as an indicator of “human capital” becomes a deceptive unit of measurement for public policy analysis. Economists can evaluate only what they can measure, and what they can measure needs to be standardized. Thus, economists who work on “human capital” and its contribution to economic growth (and who almost always conclude that what the economy needs is more college graduates) often use college graduation rates as their measure of “human capital” attainment, ignoring the fact that not all B.A.’s are the same, and that some may not reflect much ability or achievement.

This lends a certain air of unreality to the explorations of what one might call the unworldly economists, who combine hard measures of statistical validity with weak interest in the validity of the units of measurement.

One assumption that lies behind the effort to boost levels of college enrollment and completion is that increases in average educational attainment somehow translate into higher levels of national economic growth. But some distinguished economists on both sides of the Atlantic—Alison Wolf in England, and Daron Acemoglu and David Autor in the United States—have concluded that that is no longer the case, if it ever was.

In an age in which technology is replacing many tasks previously performed by those with low to moderate levels of human capital, national economic growth based on innovation and technological progress depends not so much on the average level of educational attainment as on the attainment of those at the top of the distribution of knowledge, ability, and skill. In recent decades, the percentage of the population with a college degree has gone up, while the rate of economic growth has declined. And though the gap between the earnings of those with and those without a college diploma remains substantial, the falling rate of earnings for college graduates seems to indicate that the economy already has an oversupply of graduates.

By contrast, there is a shortage of workers in the skilled trades, such as plumbers, carpenters, and electricians— occupations in which training occurs through apprenticeship rather than through college education—who often earn more than those with four-year degrees.

To be sure, public policy ought to aim at more than economic growth, and there is more to a college education than its effect on earning capacity. But for now, it is worth underscoring that the metric goal of ever more college graduates is dubious even by the economistic criteria by which higher education is often measured.

This is an excerpt from Jerry Z. Muller’s new book, The Tyranny of Metrics, published by Princeton University Press. Jerry Z.  Muller is a professor of history at the Catholic University of America in Washington and the author of many books, including The Mind and the Market: Capitalism in Modern European Thought.

Is Half of College Education Wasted?

Trigger Warning: If you fancy yourself smart enough to understand complex social science, Bryan Caplan’s book, The Case Against Education: Why the Education System is a Waste of Time and Money, may lower your self-esteem. This is a serious, “academic” effort, six-years-in-the-making, and while Caplan, an economist at George Mason University and the Cato Institute, can be witty, this is not the breezy rant so common among today’s alarmist books on education.

The gist of Professor Caplan’s case is that there is way too much education, students waste hundreds of hours and millions of government-supplied dollars learning material that adds nothing of productive value or personal enrichment. Yes, high schools and colleges may occasionally produce a genius who invents Microsoft Word, but such accomplishments are exceedingly rare and cannot justify society’s massive investment in schooling. Learning history, for example, is only valuable for future history teachers, and how many history courses enrollees will pursue that vocation? Nor does the college experience broaden student cultural horizons. Most students, Caplan claims, are bored by “high culture” and even those who ace English Literature quickly forget everything.

Is It Just ‘Signaling?

Wastefulness understood, why do millions embrace the “more education” and “college-for-all” mantras? Is everybody delusional regarding the alleged financial payoff of a high school diploma or a college BA? Caplan explains this oddity with the concept of “signaling.” That is, a student’s educational record tells a potential employer a great deal about a person’s intelligence, conscientiousness, and conformity, so students will invest prodigious (or minimal) effort to demonstrate worthiness largely independent of what is substantively acquired in the classroom.

Thus, a young man who completes a four-year degree at MIT in three years signals a potential employer that he is a great catch even if the acquired learning is, for the most part, vocationally irrelevant. Conversely, an equally talented youngster unable to graduate from a community college will not even be invited to a job interview. Who wants to hire somebody—no matter how smart–who lacks industry and perseverance? Employers cannot determine exactly what you learned, but they will happily pay a premium for those surviving the ordeal necessary to get the degree.

Caplan hardly argues that schooling is generally wasteful; only some of it, undoubtedly at least a third, he says, maybe even 50% or higher. Even the low side estimate of a third signifies an enormous squandering of personal time and government money.

Might this troubling calculation counsel that students should shun college, learn marketable skills elsewhere and invest saved tuition in the stock market? Hardly. The inherent nature of signaling dictates following the mob—not attending college only works if millions likewise share this disinclination to get a BA given that employers will judge your lack of a sheepskin as proof of unworthiness, regardless of your smarts and industry. The parallel is the futility of standing during a concert to see better; a strategy instantly defeated when everybody else stands.

Fluff Courses Make Sense

Going one step further, since employers only look at the credential as proof of worthiness, it is rational for an MIT student to enroll in as many fluff courses as possible from easy grading professors since employers cannot tell the difference and, to some extent, don’t care. The MIT degree itself suffices.

To make his case scientifically, Caplan marshals massive quantities of evidence and is totally unafraid of offering personal judgments. For example, he personally classifies both high school and college courses into three categories: high usefulness, medium usefulness, and low usefulness. High school subjects deemed highly useful are English and mathematics (further sub-divided so Algebra I is highly useful” while Geometry is of low usefulness”); low usefulness includes foreign languages and the social studies.

College courses are similarly classified—highly useful are engineering, health professionals, and agricultural majors. Wasted learning, predictably, is fine arts, psychology, journalism and the Liberal Arts more generally. All and all, judged by the distribution of college majors in 2008-9, 40.5% of college students are squandering their time and money, at least according to Professor Caplan’s judgment.

It gets worse: this learning, however modest, evaporates with age. When adults are quizzed about reading, math, history, civics, science and foreign languages, Americans can recall almost nothing despite years of exposure When 18,000 randomly selected American adults in 2003 were quizzed about reading, math, history, civics, science and foreign languages, they recalled almost nothing despite many of these subjects having been covered multiple times. Ample data also suggest that among today’s college students less and less time is devoted to learning so what ultimately remains in the brain will drop yet further. No wonder employers frequently complain about the difficulty of hiring good help!

No Gateway to High Culture

Nor does schooling instill an appetite for high culture, a love of “the best and the brightest. The market says that this endeavor is largely pointless—only a tiny portion of adults pursue “high culture” so schools are trying to satisfy minuscule future demands. If Caplan is right, returning to a cheap, bare-bones education that largely ends at 8th grade would not be a national catastrophe.

The bulk of The Case Against Education is spent disentangling the countless factors that contribute to the economic success that, at least partially rival the signaling explanation. This can get tedious and, alas, often relies on incomplete data and the intricacies of specific analytical techniques. It is conceivable, for example, that attending Harvard may be a low-yield learning experience, but it might help you to meet fellow students and alums able to offer you prestigious, well-paying jobs. Likewise, that Harvard graduates may get rich may have less to do with classroom learning than a person’s innate intelligence. Or, as some radical egalitarians insist, rich kids have the inside track to Harvard and join the elite thanks to their family’s pre-existing fortune. Nevertheless, the signaling explanation holds up rather well against rivals.

What does Caplan counsel after all the slash and burn analysis? His advice seems sensible: more and better vocational instruction, everything from classroom training to apprenticeships. In concrete terms, America employs roughly 900,000 carpenters but only 3,800 historians, so why not teach more carpentry than history? The Professor even puts in a word or two for child labor—better than boring fifteen-year-olds with how to diagram a sentence. Alas, that the government (and some private firms) already offers dozens of under-utilized vocational training programs receives scant attention.

The Case Against Education is a tour de force of modern economic analysis, but it skips over the payoff of “wasted” educational spending for society more generally. Even academically marginal schools with half-awake students can generate genuine value, for example, invigorating rustbelt towns hanging on for dear life. Hundreds—perhaps thousands– of these third-tier schools and their party-animal enrollees exist, and this “wastefulness” might be the most effective way to deliver the socially desirable economic uplift.

All Those Unemployed Professors

Similarly, what would Caplan do with all the unemployed professors (and armies of adjuncts and administrators) who would have taught such “useless” subjects as history, psychology, foreign languages? Easy to visualize thousands of unemployed Marxist Ph.D.’s scheming to elect a Bernie Sanders who promises college “for everybody.” In the grand scheme of things, it may be preferable to having all the Ph.D.’s “gainfully employed,” albeit pointlessly, versus working part-time in Starbucks. Keep in mind how much better the planet would be if the young Karl Marx had been able to secure a professorial appointment at the University of Jena.

So, if you have the Sitzfleisch and relish complex, clever and occasionally counter-intuitive, long-winded arguments, this is a great book. Even if you cannot fathom a word, carry it around and impress your friends with your erudition. As Oscar Wilde said, only shallow people do not judge by appearances, and Professor Caplan probably agrees though he would call it signaling.

Enough of the College-for-Everyone Agenda

Every so often, someone in the higher ed establishment does a bit of cheerleading for the team –proclaim that college degrees are so beneficial that the country should try to put far more young people through college.

The most venerable such effort is a report that the College Board puts out every three years entitled College Pays. Here is the most recent in the series. The formula is the same every time: point to the fact that on average, people who have finished college earn more than people who haven’t, then call the difference between those averages the “college earnings premium” and imply that the causal factor is having gotten that degree.

Related: Gary Becker Is Wrong to Say College is Still a Good Investment

In addition to those higher average earnings, we’re also told that college education creates huge benefits for society: better health and longevity, more steady employment, higher rates of voting and civic engagement, among other social goods. In this view, college isn’t just a private benefit that confers increased earnings on graduates, but a public good that makes the whole nation better off.

Writing in The Chronicle of Higher Education, Philip Trostel, a professor at the University of Maine at Orono, has just reprised that number. He argues here that getting a college degree is “practically a windfall-profit investment for most” Americans and that the benefits of college go “way beyond the earnings premium.”

Close to ‘Fake News’

Trostel starts with the supposed lifetime earnings premium, which he calculates at $1,383,000, before adding that the premium is probably going to increase since it always has. Therefore, even if a student paid “full sticker price at an elite college,” getting that great earnings boost would still make it “a great investment.”

That claim is very close to “fake news.” Assuming it’s true that on average individuals who have college degrees earn significantly more than individuals do without them, it doesn’t follow that any person in the latter group will necessarily gain a large earnings boost just by virtue of earning a degree. After all, the types of people who are drawn to higher education are different from the types who aren’t. They tend to be more talented and ambitious.

Furthermore, the earnings data this comparison relies upon are necessarily drawn from the past. The problem is that at many schools, a college education just isn’t what it used to be. Standards have declined for both admission and academic performance. Students today don’t have to work as hard and many apparently derive little or no intellectual benefit from their years in college.

Going forward, there is no reason to assume that the “college premium” will be nearly as large as it was in the past. Financial firms know to advertise that “past performance is no guarantee of future performance” and a college economics professor ought to know to be similarly cautious.

What About Side Benefits?

Besides, there is plenty of evidence that large numbers of recent college graduates, far from earning more, are working in the same kinds of jobs as people who have only high school educations, and they are struggling to pay off their college loans.

As this paper published by the Center for College Affordability and Productivity explains, the labor market has become saturated with workers who have college credentials (but often not the skills that are in demand) and many are underemployed. And a recent study done by the Federal Reserve Bank of New York finds that for the last two decades, around one-third of college graduates have wound up working in jobs that do not call for any higher education.

If the claimed earnings gain is for many students just a mirage, what about those other social benefits? True, they correlate with college completion, but that does not mean college completion will cause them. Again, the two populations tend to have different characteristics. Those who are inclined toward post-secondary education are on the whole more inclined to have healthier lifestyles and more social attributes than those who are not.

Think of it this way – even if you could focus on a guy who barely graduated from high school and loves to drink and smoke, and lure into college and manage to get him through to a degree, is that likely to change his behavior? Probably not. (Nor will he probably have learned as much of value to himself and society in college compared with what he’d have done while working in the real world.)

Does College Improve Behavior?

Just as it’s a mistake to think that having a college degree causes higher earnings, it is also a mistake to think that having a college degree causes people to behave in more desirable ways.

Finally, as Frederic Bastiat taught, good economists look for unseen effects as well as those that are easily seen. There is a large cost to college other than the obvious financial one, namely the fact that so many students pick up terribly mistaken ideas in college. It’s primarily on college campuses that young people become imbued with such progressive notions as social justice, white privilege, sustainability, intersectionality, anti-capitalism, institutional racism, microaggressions and more.

On many campuses, intellectually weaker students can get through by taking lots of “experience learning” courses which simultaneously build up their GPA (since an A is almost guaranteed as long as you say politically correct things in your “reflection papers”) and make them believe that social problems are caused by freedom and can only be solved through government activism. (The recent report from the National Association of Scholars, Making Citizens, is extremely valuable for making that point.)

Spending our limited resources to under-educate young people so they’ll support leftist causes and candidates is doubly damaging.

An Expensive Credential

Trostel laments that “access to college education may well continue to be compromised, which makes not just the potential students who are deterred, but all of us worse off.” The trouble with his view is that the students who might be deterred – and in recent years the percentage of high school graduates who go on to college has declined somewhat – are overwhelmingly going to be the academically marginal and disengaged students for whom college is just an expensive credential.

America’s sharp students are in high demand and can easily obtain the loans, grants, and scholarships they need for college and post-graduate studies. If more students who don’t have their ability decide that some other kind of education or training after high school is better for them, that is no cause for concern.

We can’t pull ourselves up by the bootstraps by promoting the “college for everyone” agenda, but by trying we waste resources and diminish the college learning experience.