As is the case with any other government subsidized industry, costs rise faster than inflation and there never seems to be an end to the increases. For too long higher education has been on the government dole affording them a seemingly endless supply of students enrolled with government backed funds. Well now the bloom seems to be coming off the rose and these institutes of higher learning are finding themselves faced with economic woes.
It is my guess however that at least under the current administration, these institutions will be deemed TOO BIG TO FAIL and will get another influx of government money to keep their bloated institutions in tact. Let us not forget that the Federal government has taken over all student loans so it will be simple to dole out more money to these failing institutions.
I have contended for a long time that the present educational system has failed. They are overpriced dinosaurs that need to become extinct. But that is only my view from the nest. What say you?
Imagine that you have a product whose price tag for decades rises faster than inflation. But people keep buying it because they’re told that it will make them wealthier in the long run. Then, suddenly, they find it doesn’t. Prices fall sharply, bankruptcies ensue, great institutions disappear.
Sound like the housing market? Yes, but it also sounds like what Glenn Reynolds, creator of instapundit.com, writing in The Washington Examiner, has called “the higher education bubble.”
Government-subsidized loans have injected money into higher education, as they did into housing, causing prices to balloon. But at some point people figure out they’re not getting their money’s worth, and the bubble bursts.Some think this would be a good thing. My American Enterprise Institute colleague Charles Murray has called for the abolition of college for almost all students. Save it for genuine scholars, he says, and let others qualify for jobs by standardized national tests, as accountants already do.
“Is our students learning?” George W. Bush once asked, and the evidence for colleges points to no. The National Center for Education Statistics found that most college graduates are below proficiency in verbal and quantitative literacy. University of California scholars Philip Babcock and Mindy Marks report that students these days study an average of 14 hours a week, down from 24 hours in 1961.
People are beginning to note that administrative bloat, so common in government, seems especially egregious in colleges and universities. Somehow previous generations got by and even prospered without these legions of counselors, liaison officers and facilitators. Perhaps we can do so again.
Presidents and politicians of both parties have promised for years to provide college opportunities for everyone and measure progress by the percentage of students enrolled. But it’s becoming increasingly clear that college doesn’t make sense for everyone. Some simply lack the necessary verbal and math capacity. Others are interested in worthy non-college careers like carpentry.
Higher education expanded when the G.I. Bill financed veterans’ education after World War II and then expanded further with postwar growth. Government’s student loan subsidies have enabled institutions to grow faster over the last three decades than the economy on whose productivity they ultimately depend.
As often happens, success leads to excess. America leads the world in higher education, yet there is much in our colleges and universities that is amiss and, more to the point, suddenly not sustainable. The people running America’s colleges and universities have long thought they were exempt from the laws of supply and demand and unaffected by the business cycle. Turns out that’s wrong.
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