The Economic Geography of Higher Education

The Diane Rehm Show aired a broadcast this morning about the cost of Higher Education (HE). I struggled to listen as the guests seemed woefully inadequate to address the complete picture of the costs of Higher Education. The editor of the Chronicle of Higher Education (Jeffrey Selingo), Claudia Dreifus, an author and instructor from Columbia University, and three other guests, aired their perspectives. One would think that these educated people would have a better grasp of the problems associated with obtaining a Higher Education. After listening to them, I can make no other conclusion other than their knowledge of HE costs is incomplete and short-sighted.

I have to agree with some of the comments. Higher education costs have increased pretty dramatically over the last decade or so. Also, I must agree that students are taking on considerable debt, too.

Placing all of the blame on colleges and universities is fallacious and disingenuous. Blaming costs uniquely upon colleges and universities creates a dangerous atmosphere of contempt for HE, displacing blame onto institutions that are the recipients of students who appear to have left their brains at home before traveling to college. One might as well blame farmers because Twinkies taste wierd.

Here is what I mean.

At the National Level, the USA lacks a true employment policy. The Bureau of the Census gathers statistics, as does the Department of the Commerce. We gather knowledge about education and income, occupations and trades. These federal agencies then publish reports about employment outlooks, what jobs are going to be necessary, how much they pay, responsibilities, a wealth of knowledge. Reports are published and made available via the media. These notices usually come in the form of this WKMS article, outlining the lack of technology workers. The Federal Government tells people what they should study. The Federal Government does not make people study what is needed, though. With the Employment Outlook Handbook, people have the ability to inform themselves. The Government essentially says, every year, "Hey, this is what we need people to do; if you want a job, and want to make money, check out these fields." And, a few Americans will listen, but most will just wander around willy-nilly doing whatever they want. Which is fine; that is the society we have built for ourselves. We cannot complain later that we studied the wrong field, though. And, no American can claim ignorance of any job field. The information is there; all one has to do is obtain and read.

Without a National Structure of Education, for lack of a better term, students are left to their own counsel to decide how to educate themselves. Our educational system does a poor job of placing students into "tracks." In Germany, at the onset of Secondary Education, students are given choices based on aptitudes. Students then proceed into an educational track throughout high school.Having designated tracks satisfies the job market and the student. The tracks are pretty regimented, meaning a student cannot leap from track to track, racking up debt, and then wander off to the unemployment office.

At the State Level, every state has at least one system of state universities. Yes, they may vary by quality. Programs many vary with quality. State universities are nearly obligated to accept all residents. Funding for state schools is based on Full-time Enrollment (FTE.) The higher the FTE the more funding a school receives. If FTE drops, then funding drops, and universities never want to lose funding. Admission standards are lowered, and yes, students that are functionally illiterate are admitted. The state government pretty much says a school receiving state funding cannot turn away a resident without a good reason. Education funding is dependent on state and national economies. During down times, tuition goes up to account for the lack of state funding. During good economies, tuition remains flat.

Tuition rarely goes down. Universities are constantly pushed by accreditation organizations to stay modern. Universities are pushed by public and private sector to stay current with technology, methods, and building people who can be trained and taught. Universities are pushed by students looking for modern buildings, equipment, faculty, accreditation, and research. Universities are then compelled to update, spend money, hire faculty, provide raises and benefits in order to stay competitive. Most universities try to engage public and private sector entities to help share costs, to keep minimize increases while showing former, current, and potential students that the university is current and evolving.

State colleges and universities provide the best value for the expense. Beginning at a community college, perhaps working a part-time job, living at home, is a good way to begin. Leverage good grades in high school for tuition waivers later. Work summers to pay for fall tuition. Then, if needed, engage a student loan to cover expenses not covered by working.

Students use their student loans for purchasing motorcycles, big-screen televisions, going on cruises, throwing huge parties, and generally throwing the money away. Little time is engaged in budgeting. Often I hear, "I don’t care, I’ll pay it all back when I get a job." And, then, they can’t find a job.

Which brings me to high school. At the Local Level, the high school level, guidance counselors exist for helping students select occupations based on interest and aptitude. Hypothetically, anyway. In reality, I honestly have no idea what these people do. I run across so many people who never knew their high guidance counselor, or who used notes from their guidance counselor to get of school. The guidance students should be getting in high school appears to be non-existent, in the aggregate. Parents are little better at providing guidance.

The population of the USA seems to be suffering the mass hallucination that we can do whatever we want, without having to think anything through, fly by the seat of our pants, and never plan for future’s eventual arrival.

A Potential College Student (PCS) thinks about what would be fun to have as a job. The PCS decides he likes art, and decides to pursue a degree in Art History. After spending 4 years in college, the time arrives to find a job. Wow, guess what? The job market for Art Historians with a Bachelor’s Degree is a desert; nothing. He then begins a highly critical assessment of the college, his department, his faculty, for leading him down a path where everyone around him is to blame. Totally wrong. All he had to do was ask a faculty person, or Google, “what am I going to do with this degree?”

The student has a responsibility to himself/herself to engage in research to uncover the likelihood of finding employment 4 years down the road. Don’t blame others for your own lack of research. While there is nothing wrong with the pursuit of an Art History degree, per se, knowing what to do with it is far more important. That takes foresight and planning. Foresight and planning should take place in Year 1, not Year 4. Taking out $50,000 worth of student loans without a plan again is not smart. Planning on how to pay back $50,000 post-Year 4 is not a good idea. In fact, if I ran my own university I would revoke your degree for having learned nothing in 4 years.

High schools, parents, and potential college students should use the documents provided by the Bureau of the Census and the Department of Commerce to help select occupations that the student finds interesting, and also have been identified as being "in need" or have a positive growth outlook. Then, an academic and financial plan is established to finance education. Local conditions should also apply, as well, as some occupations might be highly in demand in one geographic region, while low in demand somewhere else.

In conclusion, a few comments to distill these thoughts. Blaming colleges and universities for forces out of their control is foolish. Blaming colleges and universities for the peccadilloes of young, naive, immature teenagers is inherently flawed. The National Education Policy of the USA needs to be scrutinized. High schools need to provide better occupation counseling to all students and families. Potential college students need to take responsibility for their chosen degree path, their own success in that path, and their own financial expenses while engaged in pursuing their education.

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