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I agree with most of your points, but there are some things about the post-WWII college system that required ever-greater numbers of people attending. In particular, professors want doctoral students, but in most majors the only reason to get a Ph.D. is if you intend to be a professor. Which worked kind of ok for several decades, as more and more state schools opened up, and a higher and higher percentage of the population went to college.

But, like any system designed for growth that persists for generations, it isn't designed well for leveling off, much less shrinking even a small amount. It's not clear how well many universities can even function without a lot of graduate students to teach many of the classes, but without more and more college professor positions for those graduate students to take once they get their doctorate, the current number of graduate students seems unsupportable.

I frequently hear this claim, but it is not what I observed during my PhD studies. All students, from the moment they got in, and most faculty under 50 years old were aware that more than half of the graduating class will not continue working in academia (rather they would do industry RnD or consultancy or something else). And plenty of efforts existed within my program itself, and in the university as a whole, to prepare students both for academic and non-academic jobs.

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