The sucker’s game

Ironically, those who constantly preach the value of a college education clearly missed economics 101:

Like many middle-class families, Cortney Munna and her mother began the college selection process with a grim determination. They would do whatever they could to get Cortney into the best possible college, and they maintained a blind faith that the investment would be worth it.

Today, however, Ms. Munna, a 26-year-old graduate of New York University, has nearly $100,000 in student loan debt from her four years in college, and affording the full monthly payments would be a struggle. For much of the time since her 2005 graduation, she’s been enrolled in night school, which allows her to defer loan payments. This is not a long-term solution, because the interest on the loans continues to pile up.

Going 100k into debt in order to obtain a job that pays $22 as a photographer’s assistant is not an intelligent action. The correct answer to the question about attending college is “it depends”. What college, what degree, and what job prospects? Remember, since the median debt for attending private, nonprofit colleges is $22,380, that means that you have to keep in mind the average cost of 5 years without wages, the cost of the degree, and the debt.

The statistics on the monetary advantages of a college degree are misleading because the number of college graduates has risen dramatically as have the number of women obtaining college degrees. The equation has changed, which is why it is necessary to sit down and crunch the numbers before you automatically assume that a college degree from the best university that will accept you makes any sense. I thought it was particularly interesting that the article mentioned the way in which a debt burden that can repel potential life partners… one assumes this is generally aimed at women with degrees.

Like most things, it comes down to supply and demand. Because full-time college enrollment has increased 44 percent since I graduated in 1990. The US population has increased 20 percent, thus rendering a generic college degree approximately 24 percent less valuable while the cost has risen 63 percent in constant dollars. Even if you assume that you graduate successfully, your education dollar is worth about 28 percent of one spent in 1990. And since only 53% of college undergraduates manage to graduate in six years – a statistic recently increased from the five-year measure in order to keep it above 50% – the chances are nearly one in two that you’re literally buying nothing, not even a piece of paper.

Basically, if you have to borrow money or if you are at all prone to not finishing what you start, you shouldn’t even think about going to college. And if you do go, get a degree in something meaningful, not outdated liberal arts degrees in English, Art History, or Business. You’ll learn more about business running a fast food franchise for a summer than you will in six years of college. Throw in a little reading of Peter Drucker, Sun Tzu, Malcolm Gladwell, Dilbert, and whoever the business author du jour happens to be and you’ll know more management-speak too.

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