What Thiel doesn't get is that the reason why it's a bubble is also what keeps it afloat. It's exclusionary, and something inherent in humans is a desire to categorize and compartmentalize -- credentials.
Sure, if you're starting a web startup or a basketball team, no one cares where you went to school (although an offensive lineman in football benefits from going to a top tier school -- despite football being a meritocracy its surprisingly difficult to measure how effective linemen are). But the top lawyers, doctors, professors, and even business managers will be recruited from where people think the best people are.
The ironic thing is that the only reason people listen to Peter Thiel is because of his credentials as PayPal co-founder and VC investor. There are a million people have an opinion on education and tecnology. There's too much noise -- the ideas that are listened to are those that come from people who have done soemthing in the past -- a credential. At a massive scale college is still THE credential.
And surprisingly the internet has actually made elite schools more important, not less. Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.
Frankly, Thiel's rhetorical "Why aren't there 100 Harvard franchises?" question is a reasonable one to ask. By its own admission, Harvard turns down hundreds -- maybe even thousands -- of students each year who are qualified to attend Harvard. There simply isn't enough space, and at the highest tiers, it becomes a crapshoot. Kid A and Kid B could be equally qualified, and both could have made it through the gauntlet and down to the wire, but Kid B wins out in the end through a process verging on picking straws. For the rest of his life, Kid B is "Harvard-educated," while Kid A is deemed by many folks in society to be Kid B's intellectual inferior.
But what if Harvard had enough capacity to admit everyone who met its admissions standards? It's a question worth asking. Would Harvard cease to be "Harvard" if that were the case? Thiel's point is that it would -- which is indicative of a problem with our valuation of Harvard.
Be that as it may, your overall point is sound. Harvard may have some mystique baked into its valuation, but most of us still hold the valuation -- mystique and all -- in high esteem. We accept it at face value. So long as we continue to do so, the bubble stays afloat.
In order to test Thiel's thesis, we'd have to go a step further and ask ourselves: what would, in theory, cause the bubble to pop? What would it take? Given that this bubble (for lack of a better word) has been propped up for hundreds of years, and is still going strong, what straw would break the camel's back?
I'd argue that it's Stanford. Or, rather, everything the proverbial Stanford represents: Silicon Valley, something approaching new-money meritocracy, and so forth. If enough Stanfords emerge across the world, suddenly the time-honored value of the Harvard degree seems less shiny than it once was.
[Interestingly enough, Harvard does a pretty darned good job at being a Stanford, too. But, for the set of Harvard attendees who are there to collect the credential and not to start up a company, the value of that credential-qua-credential would decrease in a bubble-deflating scenario].
"Proverbial Stanford" coincides a great deal with "Proverbial Harvard" - both are wealthy private schools that admit the very best students and have society's bias towards the well-to-do sons of well-to-do fathers. If you're looking for a school to contrast with Harvard, Stanford is a poor choice.
Furthermore, actual Stanford isn't doing any damage to actual Harvard. The data I've found suggest that 70+ or 80+% of undergrads admitted to both Harvard and Stanford pick Harvard.
All analogies are imperfect, but I chose Stanford for the specific reason that it's been at the forefront of perhaps the greatest semi-meritocratic* drive in modern American history: the high-tech industry. I very much meant the "proverbial" Stanford when I used Stanford in this example. I meant the Stanford of the movement Stanford has helped to shepherd -- the Stanford that exists in popular consciousness, regardless of how removed that perception may be from the reality of the school.
*I must use the "semi-" qualifier here because, as we all seem to agree, there's no such thing as a true meritocracy. The wealthy have advantages throughout life that maximize the chances of generating a meritorious CV.
Interestingly, I would argue that we've got two oppositional forces at play in today's admissions game:
1) Seldom before in recent American history has it been easier for a well-qualified, but SES-disadvantaged student to gain admission to Harvard.
2) Seldom before in recent American history has it been harder for an SES-disadvantated student to become well-qualified to gain admission to Harvard.
Once you've reached the admissions gates, so to speak, your merit is a better calling card today than it ever has been. But getting there is becoming tougher and tougher, thanks to a chronically deteriorating public education system and increasingly costly college-preparatory mechanisms.
It is commonly assumed that the rich receive advantages at the gate. Rather, they've been receiving advantages throughout their lives that increase their likelihood of getting to the gate in the first place. It's a subtle, but important distinction.
"Why aren't there 100 Harvard franchises?" is reasonable to ask, but is also largely a red herring, irrelevant as an indicator of a bubble. The total market impact of the tuition paid by Harvard College students might number in the tens of millions, while student loan debt in the US is measured in billions.
The answer to the question is that what makes Harvard Harvard cannot be franchised. You can't franchise the interpersonal interaction with dozens of the highest quality professors and postdocs in the world. You can't franchise Cambridge and Harvard Square. You can't franchise the interaction with the other students.
To the extent that the education and experience can be imitated, they already are, at hundreds of Universities in the US and around the world.
But again, the whole question is a diversion. The core question is whether the higher education purchased by millions of students every year is worth the investment, not whether Harvard or any of a select few Ivy League schools is worth it.
I don't see this bubble popping any time soon (the next 10 years) but I do think the availability of knowledge will have a lifting-of-all-boats effect. While the latter may happen, I believe the level of increased knowledge will happen at the entry/lower levels and not have an immediate effect on the top-end.
> But what if Harvard had enough capacity to admit everyone who met its admissions standards?
What if the admission criteria is top n candidates? (not top n % of the candidates, mind you), which is very likely (and valid criteria for Top Schools, with legacy/brand to defend, limited/finite resources/talent pool, which would not scale lineary, IMO)
Such a system would actually work out to be more exclusionary if the size of the application pool increases year over year (which, in praxis, it has been). At least a percentage-based system scales up with the size of the application group. A fixed class size does not.
For what it's worth, as well, I'm pretty sure that your system is the one actually being used. I would imagine -- but do not know for certain -- that schools like Harvard try to keep class sizes relatively fixed. It's not that their policy is to admit n% of all applicants, but rather, that their policy is to admit n students, and the size of the pool feeding into n keeps going up. Indices, rankings, and people commonly report only the percentage. But the percentage is an output of the system and not an input.
Harvard's minimal admissions standards are very low compared to the actual difficulty of getting in. Harvard invented the SAT with the idea in mind that 550 meant "probably sufficient to be admitted to Harvard" and 600 meant "conclusively good enough". Re-centering changed the numbers a bit: it's a difference of about 80 points on the verbal (i.e. a 700 now would have been 620 then). So, 1280 (or 1920 on the 2400 scale) is conclusively smart enough to attend Harvard. And the average student with a 1280, while he's not going to be an academic star, is good enough to pass through Harvard with acceptable grades.
However, if Harvard dropped its admissions criteria to that level, it'd be forced to take in several times as many students as it does. Consequently, you're not getting in with a 1250-1400 unless your parents are very well-established.
I don't think it's worth it for people to get bent out of shape about the difficulty of getting into elite colleges. It's just supply and demand. There's nothing personal about it, and the idea that bleary-eyed admissions officers making quick judgments at 7:45 pm after a string of 14-hour days can make meaningfully "holisitic" assessments of a person's character and future prospects for success, well... that's just laughable. Besides, an elite degree may have made a person set for life at one time, but that era ended a long time ago.
What Thiel doesn't get is that the reason why it's a bubble is also what keeps it afloat. It's exclusionary, and something inherent in humans is a desire to categorize and compartmentalize -- credentials.
A rule of thumbs for bubbles is each one must have a "why this time it's different" elevator pitch ("Dow 40,000', "there's only local housing markets").
Exclusivity likely is a large part of what gives an elite education its value, normally - a Harvard education has indeed generally been highly prized. But what keeps a bubble afloat is bubble dynamics. Even a valuable item can be over-valued. The self-validating quality of increasing prices and valuations really does works well for a while - like it did for all the other bubbles - and can then can be expected to stop working - like it did for all the other bubbles.
Prices for the highest quality houses rose and that tide also lifted housing prices in poor areas. But when the market crashed everything went down.
For profit colleges are selling garbage degrees to poor people in urban areas. Degree inflation has already begun and soon it will also effect people at some of the highest levels. Look at PhDs and JDs. Soon this paper inflation will suck real value away from the areas we haven't even thought of.
This particular focus on for-profits is simply the work of a media campaign against them (by short sellers and non-profits afraid of cheaper competition).
I think a lot of people work with an assumption that the non-profit colleges at least have pure motives, so they may fall short on execution but they're trying.
For profit, on the other hand, I have no problem with capitalism but the incentives in the low-income-education market point pretty clearly to "crank out as many degrees as possible with more emphasis on marketing the degree than making it good". Butts in chairs and all that, if you want to make money.
EDIT: Although, I'd love to be proven wrong. Cheap vocational training where the school turns a profit would really be a great system. I'm just concerned that the priorities will have to be 1) attract lots of students, 2) cut costs per student, 3) deliver education, in that order, if your organization's goal is profit rather than education.
I think a lot of people work with an assumption that the non-profit colleges at least have pure motives, so they may fall short on execution but they're trying.
This fallacy (what I sometimes call the "non-profit fallacy") is certainly being exploited by the people looking to harm for-profits.
But make no mistake - it is a fallacy. Non-profits want money just as much as for-profits - the only difference is that the money is distributed as salaries to employees (particularly the bloated administrations) rather than as profits to shareholders.
Institutional incentives matter far more than the explicit corporate charter.
Eh, I'd say that it affects decisions at the topline more. Empire building happens everywhere, but if the attitude at the top is "we're here to make it rain" vs "we're here with a holy mission to educate", then that permeates everything.
This fallacy (what I sometimes call the "non-profit fallacy") is certainly being exploited by the people looking to harm for-profits.
In another part of this thread, you essentially admit the point that for-profits are engaging in a massively fraud against the Federal government as selling garbage degrees.
So the problem with "harming" these shysters is what? That you don't want this to be specific to for-profit education institutions. Fair enough but any effort to "harm" this group would essentially involve reigning any college's ability to print federal government dollars. Is there a problem that rather pressing concern?
I didn't essentially admit the point, I strongly agree with it. I'm just trying to put the idea out there that we shouldn't limit our attention to for-profits. I'm sure some for-profits do a good job, and I'm sure many non-profits don't.
I suspect the majority of crappy schools are non-profits, simply because most colleges are non-profits. I strongly favor reigning in all crappy schools, I merely oppose limiting our efforts to for-profits.
> if your organization's goal is profit rather than education.
The organization's goal isn't all that relevant compared to the results produced by the folks actually doing the work. Heck, their goals matter more than the organization's goals.
For example, a non-profit can easily be staffed by folks looking to just slide by. Remember - they're being paid just like the folks at the for-profit down the street.
Non-profit is merely a tax and investor-return status. That tells you nothing about what the organization actually does.
I disagree, profit vs non-profit is your raison d'etre and it affects all of your decision making, particularly the topline variety.
Say you're writing the FY2012 budget right now for your moderately successful for-profit degree program. You have an extra 10k. Do you spend it on better lab equipment or on subway ads? Subway ads would seem to be the more profitable choice a lot of the time. Actually, while we're at it, if we have a choice between an excellent and a mediocre professor, why don't we take the mediocre guy for less money and spend the difference on marketing? That's a sound business decision, because it will lead to more profit.
Now, maybe your consumer market will be so discerning as to punish schools who make decisions like this in the long run, but I'm not convinced they will.. good marketing can beat a good product in many industries and especially in something as hazily defined as education. Doubly so when you have customers who just want "a degree", take a look at Western New England University sometime if you want to see the definition of a paper mill. Their entire degree program is cops getting their masters for the contracted pay bump.. the emphasis is very much not on learning.
Again, I'd love to be wrong.. but can you really not see these incentives at work here?
Why do you feel non-profits don't make the same choices? Instead of spending an extra $100k on better lab equipment, they might spend it on empire building. If an administrator has 12 people under him rather than 10, it gives him a better case for a pay raise and makes him feel more important. Spending the money on marketing increases enrollment, and reduces the chance of layoffs/pay cuts.
(This phenomenon also occurs at for-profit companies, but the profit motive of shareholders can sometimes reign it in, e.g. the Gordon Gekko investor. Sometimes it can't, as in the case of GM or MS.)
> Actually, while we're at it, if we have a choice between an excellent and a mediocre professor, why don't we take the mediocre guy for less money and spend the difference on marketing? That's a sound business decision, because it will lead to more profit.
Profit is at most 10% of revenues. Why do you assume that that 10% has more effect than the 90% that goes to expenses?
In fact, non-profits are notoriously lax wrt expenses. They often cost more to deliver the same services.
Which reminds me, why are you assuming that it's better to spend 2x as much on an "excellent" professor? Sure, it's great for the folks in her class, but what about the folks who don't get to take a class because you spent all your money on excellence?
Or, if you like, what about the folks who can't afford that class because you spent so much on the professor.
No, what some for-profit colleges are doing is despicable and amounts to defrauding the federal government. These behaviors include heavy-handed marketing to potential students who are unlikely to see a benefit from the education and who are unlikely to be able to pay back their loans. For more on this, see the excellent PBS documentary College, Inc and/or the various federal lawsuits that have been filed in the past year.
It's entirely possible that low-end non profit colleges participate in similar bad behavior. But that in no way excuses it for the for-profit colleges.
I was responding to this: "For profit colleges are selling garbage degrees to poor people in urban areas."
As you say, non-profits engage in similar bad behavior. So why single out for-profits specifically? Why not just say "colleges are selling garbage degrees..."?
I wasn't trying to excuse anything. I just think prepending the word "for profit" in front of any criticism of low end colleges ignores half the problem and plays into a media narrative created by various vested interests (non-profits trying to eliminate the competition).
I pointed out for profit colleges because that's who I see advertising the most heavily (ever watch day time TV). Ads during Maury Povich show, multiple judge shows, etc... Those ads aren't for state schools. How many non-profit schools do you see advertising?
I'm a capitalist, but some of the practices of these schools are not defensible. High cost, high dropout rate, low placement.
I don't watch TV. But I do see plenty of ads for CUNY (public, non-profit) and other non-profits on the subway. Ramapo college and Montclair State both advertise on the radio in NJ. Devry might be big enough to have commercials, but that doesn't make them the only game in town for worthless degrees.
I could argue subway ads are blanket ads that target huge numbers of diverse people in NY. While daytime television ads during low-brow tv shows target a certain socioeconomic area of society (specifically low income, poorly educated and with few options available).
You're so right. A bubble accepts exceptions. Google and Amazon survived the tech bubble, Paulson made lots of money with the 2008 crash, etc. Harvard will probably stay Harvard even with the bubble explodes. But the other 99% overprised colleges will be hurt badly.
yeah, the government is after for-profit schools with shoddy predictions about what a good investment those student loans are. But the recent legal efforts give a pass to not-for-profit schools, as usual.
Seems its evil for the non-unionized to make money in education. The unions and the overpaid civil servants that manage them can rake in as much as possible without federal resistance, even if the product is marginal. I wonder if that came up when the unionized PBS did their expose.
Money that flows from DC has a way of wrecking things.
>Seems its evil for the non-unionized to make money in education
College professors are tenured, not unionized. And considering that most schools hire adjunct professors and slash benefits to the bone, it's hard to argue that teachers are bleeding the system dry.
On the other hand, the school where I just got my Master's from just built a brand new 177,000 square foot rec center, complete with 3 story climbing wall. And we've proudly paid good money to bring the guy/girl who invented Zumba to teach a few Zumba sessions. On top of this, programs that bring recognition to "joe consumer" (college football, basketball, etc) want for not.
Also, much of PBS is not unionized. It's kind of hard to unionize organizations that rely on member donations to keep afloat.
Sort of OT but I remember getting letters from AAUP when they were involved in negotiations for certain benefits for Lecturers, Part time Lecturers (TAs were considered to be part time lecturers because of some statute IIRC) when I TAed at Rutgers..
Many college professors are unionized - see the California Faculty Association for an example. The parent probably went to a school where they were.
At least in America they rarely go on strike. My undergrad institution in suburban Toronto was infamous for strike-related class cancellations.
I'm in complete agreement with your point about non-academic expenditures, though. There's a large 'four-year party' market out there, and the fight for those students' tuition dollars has led to an arms race in campus luxury spending.
From the article: "But Thiel’s issues with education run even deeper. He thinks it’s fundamentally wrong for a society to pin people’s best hope for a better life on something that is by definition exclusionary. “If Harvard were really the best education, if it makes that much of a difference, why not franchise it so more people can attend? Why not create 100 Harvard affiliates?” he says. “It’s something about the scarcity and the status[...]”"
You're probably right on Harvard-as-a-filter, but Thiel has seen this.
Let me start by saying that the standard of living has increased for everyone, but yet being poor still sucks. And it will continue to suck. Increasing you standard of living is no fun if everyone else's increases faster.
The reason you do things like college, YC, or even start a company, is generally to differentiate yourself with respect to standard of living (some people do this to make the world a better place, but those people are few enough that wlog we can ignore them).
You can't look at a system that is meant to create differentiations and then complain because it creates them. For better or worse, its doing what its meant to do. Even if you were to get rid of college altogether, you'd still have the issue persist. But now it would just shift to making into Thiel's Talented 20, or the Moritz 5, or YC, or TechStars -- each with a different level of repute (because at the end of the day, there is going to be differentiation between who is given nothing to start a company and those people that everyone wants to shove a million dollars in their pocket).
Unless we go to a socialist system, people will value metrics that differentiate people -- and ideally the differentiation should happen on someone else's dime. Today that dime is the student/parent/government. Maybe in the future it will be VCs, but trust me it will still happen as a VC as bright as Theil knows its not prudent to fund everyone at equal levels.
Let me start by saying that the standard of living has increased for everyone, but yet being poor still sucks. And it will continue to suck. Increasing you standard of living is no fun if everyone else's increases faster.
Spoken like a person who's never seen real deprivation. In the 70's, many poor people didn't have a flush toilet. Pooping without walking into the backyard is fun, even if everyone else gets to do it too.
If your only concern with the poverty is that the bottom 5% is jealous of other people, you need to stop and simply accept mathematical reality. You can't eliminate the bottom 5%. But eliminating the class envy rhetoric might at least reduce feelings of jealousy among the poor.
> Increasing you standard of living is no fun if everyone else's increases faster.
When you've reached the point where this is the case, you're not really poor any more. For someone who is actually poor, increasing standard of living is good without regard to whether other people's increases more.
>"Let me start by saying that the standard of living has increased for everyone, but yet being poor still sucks."<
I'd argue people are going to school to get higher wages. Wages have stagnated for the last 20+ years. High cost university educations are offering little or no bargaining power to individuals. Just like buying an overpriced house you can't sell. It's a bubble.
Any time you make it cheap to increase the supply of a thing, the supply of it increases. But that also decreases the price one can get for it
Eventually people's awareness catches up with reality. And that's usually when the government tries to lower the cost of increasing the supply even more. But for some reason, people don't seem to fall for it twice.
Perhaps, but YC costs nothing to apply and nothing if you are accepted, and a four year private college costs around 200k. That four year college often gives you largely impractical skills when it comes to employment. Why should we, as a society, try to choose differentiators that cost a ton of money for our students, instead of ones that are free?
The vast majority of people don't have what it takes to get into YC, nor to do anything with the chance if they did get in. But many people have the ability to go to a state school, and it will definitely make them more employable if they major in something practical.
Just based on the earning and unemployment rates of college grads vs. high school grads, a college degree still makes a dramatic difference in your chances of employment.
It isn't being poor that sucks. Its not having any pathway out of being poor that sucks. Socialism, consistently followed, makes the pathway equal for everyone. Which is why it fails when consistently followed. No one's going to struggle to create if there is no reward.
I worked two jobs, spent very little, saved money, went back to school for electrical engineering technology, graduated and became a programmer
I was one of six kids. We were always taught learning was important. We went to Catholic schools. We had nothing but always lived in a neighborhood where everybody worked. I think that is very important. Seeing cause and effect is very important.
But this is not unusual. Many people in the US have parents or grandparents who started with nothing.
Poverty is a cultural and political creation. Most people that desire to save and invest and are allowed to keep the results will work their way out of it. Those who are taught to consume and borrow or have the results of their efforts taken cannot.
I remember before the internet, and a degree from Harvard, Yale or Oxford still would've made you Jesus-with-a-keyboard. It's about branding, i.e., transitive trust - I trust Harvard, Harvard trusts you, therefore I trust you.
As joe-the-user points out, this gives it value, and has nothing to do with whether it is currently over- or under-valued.
There's a subtle but big difference between what he said (at least how I read it) and what you said he said.
You're implying he said credentials are worthless or meaningless.
He actually was saying that there's a bubble in education. That is, the cost of education is overvalued vs the return one typically gets. Yes, he talks about the exclusionary nature of institutions but I don't think his point is that credentialing is pointless. His point is that the system has built a bubble (overvalued not worthless)
The problem with credentials you get from some universities (even elite ones) is that they are of much less value than you paid for it. It like buying house in San Francisco Sunset district ("elite" town) for 2M and saying it is a great deal. No. It is great deal for 500K but not for 2M since max rent was is 4K.
New credential systems are created all the time. One we hear people talk about nowadays on HN is a GitHub repository. Another one is acceptance into YC.
All a credential is is something you've done in the past which implies your ability to do something in the future.
Graduating with a degree in Econ from Harvard implies that you might be a good consultant for McKinsey. Founding Facebook implies you might be a good founder for a future effort. Having a great GitHub project implies you might be a good programmer for some simliar tasks.
YC is a better example of a credential than a Github account. The function of credentials is to outsource decision making about quality: you have to actually read code to extract signal about a candidate from Github, a task which is expensive and beyond the capabilities of most investors and people with hiring authority. "YC alum", by comparison, tells you a lot about somebody in a sentence and doesn't require any work to understand - pg et al already did the vetting for you.
There probably exists a spectrum of opinions on whether the credential is useful because of the vetting or the experience of the actual program. Candidly, I think that YC probably has a value add in attendance. Higher education? Not generally, no. I have a $140,000 degree (two, technically) which basically certifies that at 18 years old I was smart enough to get into my university and then, for the next four years, I did not die or fail to sign my loan docs. I know I learned some things of value in those four years, but I could just as easily have written myself a course of study with zero commercial potential, and my degree would say the same thing in a language 99.998% of Americans can't even read anyway. (East Asian Studies degree written in... Latin?!
There probably exists a spectrum of opinions on whether the credential is useful because of the vetting or the experience of the actual program. Candidly, I think that YC probably has a value add in attendance. Higher education? Not generally, no.
The problem with higher ed is that if there is value add they make it impossible to know. Try to get outgoing metrics, besides grad rates, of outgoing undergrads and its near impossible. Professional schools do a better job of this.
Facebook and LinkedIn definitely have good data about college education and employment outcomes. I really wish they would just compete head on with USNews for college rankings.
For example, I'd love to see income distributions by university/major. The universities themselves cannot be trusted to provide it in any accurate fashion[1], but mining it from a large sample of graduates would be much better and less biased.
I don't disagree but it's tough to scale YC. Same with Thiel fellowship. However, it isn't unreasonable to see a situation in which follower counts on sites like Github, Dribbble, Quora, etc. do become scalable ways of signaling. They aren't perfect indicators of ability or knowledge but then again, neither are college degrees (as anyone who has ever hired a dud college grad can attest to).
YC, TechStars, Thiel, etc. are awesome signals for those who achieve them just as Harvard, Stanford and MIT are but I think the real juice is in the alternatives for those who don't fall into the top 1% of 1% who simply wish to prove their knowledge and abilities without having to drop six figures in the process.
> However, it isn't unreasonable to see a situation in
> which follower counts on sites like Github, Dribbble,
> Quora, etc. do become scalable ways of signaling. They
> aren't perfect indicators of ability or knowledge but
> then again, neither are college degrees
"Karma"-based mechanisms favor a very specific personality profile. One that doesn't necessarily correlate with aptitude.
Just have a look at the SO superstars -- none of them are auto-hires for all situations. You'd need to evaluate them individually and carefully. Presumably to a degree that makes their community rating superfluous.
I've talked to a whole lot of people who are dealing with the problem of college -- for CS, the solution is generally obvious to us: open source work is not merely useful on a resume, but so valuable that past a point nobody even asks you about college.
The problem seems to be that "a Github account" only exists for software development. For almost every other field that college covers, there's no equivalent. And the vast majority of college students aren't CS majors.
That point is pretty high tho'. The thing is, that people who don't hire people usually don't understand, is that programming experience that organizations are interested in is only experience of programming to external requirements under external constraints, because that is what working programmers do, e.g. "write a program to do X on system Y by time Z", where none of those things are what you would have chosen yourself. Which is why it's a really bad idea to put on your CV that you've had 10 years experience when you're 21, the guy interviewing you has 10 years actual experience and he'll not be impressed.
>Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.
If regional schools received such a blow, why did their tuitions radically increase right in line with the Ivies' increases?
Also in response to, "the reason why it's a bubble is also what keeps it afloat;" there is no quantification there--what would the tuition numbers have to be before this statement didn't apply? Will it key applying no matter what, even if there was an increase that put tuitions, say, beyond the lifetime earning capacity of the average college graduate?
I don't think it's going to be one system but rather many systems. I think there are a host of online communities that have arisen in the last few years that are actually doing this. A good example is Stack Overflow/Careers 2.0. The fact that companies are hiring people on the basis of their Stack Overflow reputation graph should strike fear into the hearts of college administrators everywhere (but likely won't of course). The change won't happen overnight but we've come a long way in just the last few years in terms of mechanisms that could ultimately rival the university when it comes to signaling and I think this shift is only getting started.
Even the founders of SO acknowledged that their (up-to-date) reputation does not reflect "smartness" :) So this is just another example of corruption as I see it.
But I agree with you that future online community reputations can improve the situation.
> the only reason people listen to Peter Thiel is because of his credentials as PayPal co-founder and VC investor. There are a million people have an opinion on education and tecnology.
That million people haven't founded such significant ventures as PayPal is. That's why you call'em "a million", not by names.
You're assuming that the schools don't in themselves add value beyond signalling.
Even after adjusting for academic achievement students from top-tier university do better post-university, as this broadly tends to hold true across subjects. Of course this could be purely be down to signalling effect, but if so it would imply signalling has as strong impact across all industries not just a handful of professional ones.
And surprisingly the internet has actually made elite schools more important, not less. Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.
What changed in the second half of the 20th century is that academia became (for students and professors) a national, rather than a regional, market. Now every top high school student vies for an Ivy League slot, and there just aren't enough of them to accommodate all the great students, especially when there's an implicit contract between the Ivy League and the WASP old-board that about half of the slots are going to go to entitled aristocrats based on privilege rather than merit.
The national market actually makes the process a lot noisier, not a more efficient informational market.
The internet didn't create the national market. That began in the 1960s (air travel, television) if not earlier. The Internet just sped the process along by making it a lot easier for people to send out 20+ applications and clog up the system. The job market has the same problem. It's not flow of information that's the problem. It's, for lack of a better word, spam: content without information.
You know how selective tech companies brag about their 1:250 acceptance rates? For an even moderately qualified applicant, odds are closer to 1:15 to 1:4. Companies get a ridiculous number of spam CVs-- often in duplicate or triplicate, because many of the worst recruiters are prolific spammers, and because the least-qualified applicants send out so many CVs. On this note, be very careful about using recruiters and make sure they won't send out your CV without your consent; the worst recruiters not only throw CVs around promiscuously, but often "upgrade" details, meaning that a later (honest) CV submission may contradict one on file, make you seem a liar, and flush you out on that alone.
It's not fluidity of information that is the problem. In an efficient market for information, no one would give a shit about college prestige in the first place because the (smarter and harder-working) 85th-percentile state-school graduate would beat the 65th-percentile Ivy graduate, hands down. College prestige only matters because people are often typecast to the average quality of a student from their school, at least as the starting assumption about a young person with a blank CV. The problem isn't "fluidity" of information but that personnel markets (job market, academic admissions) are clogged up with so much useless spam information that separating the signal from noise is nearly impossible.
Posted this as a TechCrunch comment but wanted to cross-post here:
The challenge higher education is going to face is that the signaling mechanism that higher education provide (i.e. you were good enough to get into Harvard so you're good enough to work for Goldman Sachs) is going to become de-coupled from the institution's ability to impart knowledge on people. A few decades ago, most of what you needed to learn to be productive in society was best learned at a university. Today, most of the what you need to learn to be productive in society is best learned on your own, online, for free. There are exceptions but 99% of human knowledge is no longer locked up within a university.
Contrast that with the cost of higher education.To go to UCLA as an out-of-state student it now costs $50K/year (http://www.admissions.ucla.edu/prospect/budget.htm). And that's a public school. And it's rising 8% a year. So the cost of learning has plummeted to almost nothing and yet 18-22 year old kids are taking out six figure loans to "learn". This makes no sense and feels very unsustainable.
And here's what I think will change the game: alternative signaling and credentialing mechanisms. When universities no longer have a monopoly (or near-monopoly) on signaling/credentialing we'll witness a sea change. I'd offer that this is already starting to happen in certain parts of industry. Would you rather hire an engineer with a lot of GitHub followers, a great reputation on Stack Overflow and/or someone who is a Y Combinator alum or would you rather higher a Stanford or MIT grad? It's a bit of a toss-up for many people to answer that and given that the comparison is Stanford/MIT and not the 4,000 "lesser" schools, that says something.
This change won't happen overnight but Thiel is on the money here. Higher ed is a $500 billion industry in the U.S. alone and I think its value proposition has never been more questionable than it is today.
A few decades ago, most of what you needed to learn to be productive in society was best learned at a university. Today, most of the what you need to learn to be productive in society is best learned on your own, online, for free. There are exceptions but 99% of human knowledge is no longer locked up within a university.
This knowledge hasn't been locked up for decades, though. It's been possible since at least the mid-20th-century to self-teach yourself the standard material in any major field, at least at an undergraduate level, by going to a library and reading, from the introductory textbooks up through the advanced ones. There are some things that might be hard to replicate (e.g. getting hands-on chemistry lab experience), but you could certainly self-teach the equivalent of a 4-year program in mathematics or history or theoretical physics.
A few people even did. In mathematics it's not that uncommon to find self-taught people, though it still isn't the norm. But overall not many people do it. Why will people do so now? Just because the material can be accessed without going to a library? Given that it takes some effort to work your way through a 4-year physics program, was the effort of going to the library to pick up Griffiths/Feynman/Landau really the main bottleneck?
I can definitely buy some change on the margins and in poorer countries (people who had no access to a library), but I'm confused why the internet will mean that people who for decades have not been teaching themselves physics, despite the books being available, will now do so.
Yes, Christensen in The Innovator's Solution talks about people buying products to get the jobs done that they want to do - we can consider a library and the internet as products, to get the job done of education.
He notes (p.94) that many companies tried to use the Internet to reshape the textbook industry, by supplying more content. But, he says, the job most students are really trying to get done "is pass their courses without having to read the textbook at all". These companies were trying to help students do something that they were trying not to do. He imagines a hypothetical "cram.com" would be more successful.
Most people (not all) find self-study extraordinarily hard - how many things have you, dear reader, set out to study but not completed? I think the only ones I have managed are when I'm using a textbook to help me achieve something specific - write some code, build a business, solve some problem. I wonder, is this really "study" or just "use of references"? e.g. Looking a word up in a dictionary is not really "study", to comprehensively master a topic.
It would be incredibly disruptive if someone found a way to make study - giving useful skills - enjoyable and easy. Gameplay seems the most favourable. I don't just mean things like SO-style badges, but like physical sports (games) teach motor-skills, eye-hand coordination, teamplay and strategy. It's like the "purpose" of play is learning. Note that even animals play (e.g. dogs and wolves have a "play bow", that indicates what follows in not a genuine attack).
I don't disagree but I think the quality of free education has dramatically increased with the rise of the Web. You can now consume the audio and video from the top professors around the country for free. You can work through amazing screencasts from anyone ranging from Sal Khan to some of the best Rails engineers in the world. The examples are endless.
So I definitely think the ability to self-educate has been there for a long time (you could make the case that dates all the way back to the advent of the printing press) but I think it's only in the last decade or so that we've had an explosion in the amount of high-quality, free and widely accesible educational material that is available.
BTW, if my math is correct, the entire amount spent on the Thiel fellowships ($2 million) is the equivalent to what Americans spent on higher education every two minutes. Interesting perspective eh?
Here's what Piaw Na, a Xoogler, said about this piece-- it's worth quoting:
"When the Thiel Foundation came to a local startup incubator to pitch, it came under heavy fire. For one, a lot of their recruiting heavily targeted existing Ivy League/MIT/Caltech students. These were students who were going to do great regardless of whether or not they pursued traditional college paths.
In other words, if this is an attack on the traditional college path, Thiel's definitely sided with their filtering mechanisms.
One guy who was present said the following: "You guys denied admission to the program from the one candidate who was actually making money as an entrepreneur!"
Before I went to college, higher education received the reverence of some sort of religious institution. Not only would attending college/grad school guarantee easy middle class living, it was the Path. Universities were these Higher Grounds, noble and humble institutions pursuing the best of the human spirit.
Then they sack you with six figures of non-dischargeable debt and you're back living with your parents sending out resumes.
I don't think a "bubble" is the appropriate term, I think "exploitation" is better. The value that universities provide (either as learning environments or signalling systems) is nowhere near commensurate with their costs to young people. Young people have no idea though: they don't know the performance of the university in terms of enhancing graduates' incomes nor what a reasonable level of education debt is. And universities are completely negligent (and in some cases outright deceptive) in providing this info to incoming students.
Education debt WILL be made dischargeable in bankruptcy again, there is simply too much pressure (edu debt is larger than credit card debt). When it does, you can expect tuition rates to plummet, back in line to their real net present values. In my opinion this could not happen soon enough.
The university comes from an era that never really existed of large, stable corporations providing steady employment to "educated" worker bees. The university was the 0-cost-to-employer filtering system to ensure Big Co highers the best people. That model simply doesnt make sense anymore.
I agree with Thiel's essential point. We need to take a step back and ask ourselves what benefit is being derived from sending all these kids to college. The kids also need to look carefully at the risk vs cost vs benefit of taking on debt in return for potentially higher future earnings.
Having said that, his statement "If Harvard were really the best education, if it makes that much of a difference, why not franchise it so more people can attend" misses the point entirely. Sure, Harvard probably has above average education. However, the reason it's sought after is because of the perception that all your peers at Harvard will be extremely smart talented individuals. As a society, we're hoping that that by putting all these really smart kids together in the "Harvard environment", they'll go on create things that they wouldn't have been able to on their own.
The point I'm trying to make is that the exclusivity of Harvard isn't "an excuse to do something mean", but rather an effort to create conditions where our smartest youngsters can get together and really change the world. I do, of course, agree that there are many other ways of achieving this goal than just college education.
Sharing the "Harvard environment" with talented peers can be pleasant, horizon-expanding, and occasionally inspirational. In my experience, though, it doesn't often inspire young people to change the world. Instead, it introduces them to lucrative career options (e.g., investment banking) available mainly to Ivy League grads. Given the massive salary differential compared to virtually anything else one could choose, most go that route.
Fair enough, this is a valid point. To me, this indicates that there's an opportunity here for folks like Theil who have the ability to command the respect of the students at Harvard to get these students interested in opportunities other than those that lead to a quick financial payoffs but instead might have a bigger impact on society.
Instead, it introduces them to lucrative career options (e.g., investment banking) available mainly to Ivy League grads. Given the massive salary differential compared to virtually anything else one could choose, most go that route.
Entry-level investment banking compensation is pretty low on an hourly basis-- definitely lower than entry-level technology. IBD is about the only six-figure job available out of college, but it's awful when you consider the nature of the work and most people leave the industry within a year, not capitalizing at all on the "exit options"
Agreed that the work is not nearly as appealing as an outsider imagines. My point is merely that when I graduated (caveat: ~6 years ago, pre-collapse), a majority (literally) of graduates were going into banking or high-profile consultancies. There is no way all those folks came to Harvard with the goal to join The System four years later, so the net effect of their education was to redirect their ambitions into existing power structures.
"the exclusivity of Harvard isn't "an excuse to do something mean", but rather an effort to create conditions where our smartest youngsters can get together and really change the world."
Where by "change the world" you mean "continue to see that the Haves remain the Haves." You are correct to identity gathering a critical mass of best and brightest as a key part of the Harvard/Stanford "best of the best" puzzle, but the goal isn't to improve what they do, it's to introduce them to each other so that in 20 years they can sit on each others boards and amicably divide up the spoils of the markets they control. Quite a few students think the way you do, but the parents and especially the board members don't.
Money quote from this piece feels relevant: "Once you enable students to borrow $36,000 a year, then magically the costs of a year in college (or for-profit school offering worthless "skills" that do no more for the hapless student than a high school diploma) rise to $36,000"
I think Thiel is right - sort of. At least, if you consider the large amount of money spend on a college degree in the US. Let me compare this to Germany. In Germany, universities and therefore higher education is free. You just enroll, take classes, pay your rent and after a couple of years, you are done and usually have a degree that is very competitive around the world.
But every student knows that there are areas that lead to high-paying jobs such as engineering, while in other areas such as history, communications, philosophy, languages, you will have trouble finding a job, not even speaking of a high-paying job. Still, people are usually more or less aware of the fact that they might end up having an average-income job.
In the US, higher education is a financial investment where people expect a financial return. In Germany, higher education is mostly an investment of time and people are much more aware of the possible outcomes. We don't have a bubble here.
In Germany, the number of Abiturients, those who go to college prep schools has been going up for decades. They have also relatively recently opened pure universities up to certain relatively narrow classes of non-Abiturients.
Given that the number of people with college degrees has been increasing steadily by age group in Germany, and that someone is paying for it, i.e. the state, i.e. the taxpayer, I don't see that "bubble" is an inappropriate word.
Germany probably has less of a higher education bubble than any other Western country though, because they have the best apprenticeship and vocational training system in the world. I believe this is only stable because Germany is enormously class and status conscious, and as a result has early streaming. I don't doubt that some potential is wasted, but probably the fact that Hauptschüler are not hindering the eductaion of Realschüler and Gymnasien would justify the system by itself.
In Germany you dont even need to go to college to get a good education in your field. They have a system where Companies train new people from school (they have to take tests and stuff to get in) for the job. For 3 years you work in the company, go to school and get paid around 600 EUR a month. After successfully completing that you have a degree that enables you to work as a Software Developer or Media Designer for example.
For anyone interested in learning more about the education bubble, there is a good article in this month's Fortune magazine about the creation of a new for-profit K-12 school in NYC:
The article highlights some really interesting and shocking facts about private K-12 education (i.e. Harvard's 2010 acceptance rate was 6.9%, while acceptance to NYC's top private schools combined was 5.0%; Harvard's 2010-11 tuition was $34,976 and Horace Mann's tuition was $35,670).
What will disrupt higher education in entirety is a properly done asynchronous class-schedule structure that allows students to take the time they need to finish the course. Coupled with some or full location independence and mandatory collaboration, it could be drastically more economical.
I don't have any evidence to back this up but my sense is that the cost of textbooks is actually falling, not rising. Companies like Chegg and Bookrenter have made it cheaper for students and digital textbooks will likely help to accelerate this trend. The major increase in costs have been due to tuition and that shows no signs of abating.
providing access to everyone for something by nature devalues it. as we try to democratize and socialize the world we try to give everything away.
college is just another victim of this. no one wants to tell a parent that their new born child is ugly and no one wants to live in a world where we can't all hope to be anything.
the housing bubble was the result of parents telling their kids to buy homes, because that's the american dream.
if education is a bubble, if housing is a bubble, then the american dream might just be a bubble too.
maybe it's time we invent a new dream.
a long while a go we dreamed of working less. i feel like in a creative economy, one where the generation of creative ideas is of principal, maybe we need more time to be creative and to share.
i think largely as a whole we are at peak capitalism. capitalism seems to best fit when resources are expansive. i feel like in the next 20 years resources will be less scarce than in the previous 20, and that is a strong signal that we no longer need to focus on exploration and expansion as much as we do living within our means.
I disagree with this "providing access to everyone for something by nature devalues it"
It's not just that everyone has access. It's also that bubbles create huge numbers of over-valued objects. If these for-profit colleges were cranking out well-trained software engineers we'd see a rise in overall real value (there'd be more technical co-founders available). Instead they're charging students 25k for online classes in degrees that society has no demand for. The same way pyramid schemes sell you junk to sell to your friends. You end up with a bunch of junk you can't sell. The degrees provide little or no real value to the workforce, and they're not even a filter anymore. That's what's really wrong with them.
1. Providing food for everbody devalues food, but frees up the labour of everybody to make cool shit.
2. ???
3. No - it was a result of poorly underwritten loans, made possible by a lengthening/abtraction of the underwriting chain through mortgage backed bonds.
4. ???
5. ???
6. Peak capitalism? Where did you get that idea from? Do you honestly think we have reached maximal productive capacity? Do you know how much more cool shit I will be able to do when quantum computing gets here? Do you know how many people still do menial jobs that could be automated, freeing up those people to build other cool shit for me to have a better time?
> college is just another victim of this. no one wants to tell a parent that their new born child is ugly and no one wants to live in a world where we can't all hope to be anything.
Yes, the three words that define the last 10 years (in this context) are: exceptional, entitled, and special. Many people are merely average.
The devaluation of vo-tech schools also contributes to the bubble. Much of the CS technical skill training (like configuring a router, network planning, etc) needs to moved to vocational technical schools. You don't need a 4-year masters degree (nor the student debt) to do basic design and troubleshooting.
providing access to everyone for something by nature devalues it
Particularly true in education. Consider a hypothetical scenario where a law is passed that all CS curriculums across the nation have to be synchronized. Could you take the curriculum from MIT or CMU and simply drop it on Podunk U unchanged? Probably not. The only way to provide access is actually to lower standards.
I find the discussion here as well as the article myopic in the scope.
Programming/Web Startups are just a small part of the world.
You still need Doctors, Lawyers, Engineers and Scientists.
Sure one can question the utility of spending four years to get a
degree in Liberal Arts, but most other subjects require close supervision that one receives in a college education.
The bubble in education is not at the Harvard and Stanford level. Membership in that club is probably worth the cost. The bubble is in the lower-ranked schools that cost almost as much but don't deliver the exclusivity of Harvard. The people who will be hurt the most when the bubble pops are those people who overpaid for the knowledge they learned in college: People who attended average state schools who have a $600/month education loan payment for 30 years who have to compete for jobs with people learned the same thing for $600 in total.
Right now, there is no company that can give you for $600 the same education that a state school provides for $100,000. But such companies are coming. Khan Academy already is as good as any school in helping people learn. All that's missing is certification: comprehensive exams given in secure environments like normal standardized tests (SAT, ACT, LSAT, GMAT, ...) Compared to teaching, certification is easy.
The real big bubble in education is at the lower levels, at the elementary, middle, and high school level where schools are even more fungible than at the college level. Kids don't attend a middle school for the prestige. They go to learn. The bubble for the teacher unions will pop when states begin to ask why the state should pay union-level salaries for teachers to lecture when students actually do better with just a laptop and an internet connection.
This may already be covered (with 88 comments), but I fear this article will go on deaf ears, not just to education, but to general readers of TC (investors, et al). In the same way that companies use higher education as an over-valued indicator of capability, so do investors use incubators, and suffer from the well-known "Group Think" mentality. The important difference is that you have to pay for higher education, whereas with an incubator you get paid. The other nice part is that you can re-apply to an incubator as many times as you want, and there's no social norm about the age you have to attend, whereas with colleges it's a 1-chance opportunity when you're 18, so if you don't get into Harvard you just don't get in (yes, you can transfer, but it's highly discouraged, and mainly in relation to the money involved).
I believe my only gripe with the article is Thiel says you should not judge Harvard-caliber students if they went to Harvard or not, because we just don't have enough Harvard affiliates. But that's very hypocritical thinking for a venture capitalist, whose community resonates the same sentiment of judging YC-caliber companies when there aren't enough YC-affiliates (cause if that was the case, TechStars and other funds would hold the same esteem).
And you can also look at it from the perspective of the students that are emerging from mid or low tier institutions with a hefty chunk of debt relative to their likely earning potential.
Peter's (or Sarah's) focus on the Harvard kids seems to be the least compelling part of a potential education bubble. These are smart kids who either leave school with no debt in the case that they are poor to lower middle class, and with parental support (of the monetary kind) if they're on the other side of the wealth spectrum. So maybe they're "wasting" four years where they could be creating a business, but they're not in dire straights upon graduation or necessarily compelled to sell their souls. Check out Harvard's financial aid policies: http://www.admissions.college.harvard.edu/financial_aid/hfai...
I do think there needs to be some different paths put before kids in general as they contemplate "college as the only option" but I don't think Thiel is quite right to target the ivy kids as they have the least reason to fear an education bubble bursting -- because of the lasting [perceived] quality of their degree, their lack of debt in a lot of cases, their campus-born connections to smart and wealthy classmates and alums, and their smarts.
Yes, because he "predicted" the dot-com bubble and "predicted" the housing bubble. He's also a super smart dude who created PayPal, is extremely rich and successful.
Yes, I'm being snarky. I'm open to his opinion but I also missing where he's qualified to make a more informed opinion.
Thank you bubbles for allowing people to either have work or study. There's all this bubble talk, but when it comes down to it, if everyone really was just doing useful non-bubble stuff most of us in the first world wouldn't have anything to do. Our economists aren't ready for that.
People in the valley have this weird notion that what is happening in the valley is happening everywhere. It's not. Most people go to mediocre state schools with a little bit of debt when they graduate, and then live in that area for the rest of their life. Most people don't go to Stanford, Harvard, Yale or Princeton and rack up $80k+ in student loans.
Brilliant and thought provoking, heretical words. Exclusionary access, prohibitive cost, insular culture, overgrown complexity concealing fundamental ideas...
“It’s something about the scarcity and the status. In education your value depends on other people failing. Whenever Darwinism is invoked it’s usually a justification for doing something mean. It’s a way to ignore that people are falling through the cracks, because you pretend that if they could just go to Harvard, they’d be fine."
Housing bubble - people have a right to own a home, regardless of financial merit.
Education bubble - people have a right to a college education, regardless of academic or financial merit.
Housing bubble - massive federal infusion of cash that drove short-term costs artificially low, spiking sales prices while putting people in large, long-term debt for something they don't necessarily need (ownership - people do need housing).
Education bubble - massive federal infusion of cash that drives short-term costs of education artificially low (student loans), while putting people in large, long-term debt for something they don't necessarily need.
Common theme - long term infusion of federal cash into markets leads to profiteering at the expense of the average American citizen. (What should we expect for health care?) In particular, the artificial reduction of interest rates allows sellers to charge higher prices for the same services. The services provider collects more money. The purchaser pays the same (or potentially more if their interest rate is not fixed).
Also, and economics, duh, artificially low costs lead to artificially high demand, which without any sort of quality control, looks an awful lot like a bubble.
Makes a lot of sense — especially given the amount of remedial education a lot of not-particularly-cheap colleges are having to undertake. Seems plausible that a lot of the investment (both in terms of municipal and state subsidies, as well as private debt) being made now won't bear a meaningful return for a long time, if at all.
It's a superficial story about Peter Thiel and Founders Fund framed as a controversial argument about the value of higher education. It really doesn't do anything more than pose the questions and include a few quotes from Peter Thiel.
In the end a University degree is just a piece of paper. What matters is the quality of the knowledge and mentoring you receive from your lecturers and from the university as a whole.
I think this situation is a result of the financial crash; Thiel is right, people have fled to something they see as a safe investment to increase their personal worth. People are going (back) to university so they have the qualitifications they need to get a job that would have previously required very little in the way of formal education. The market is flooded with educated job-seekers, so people must now set themselves apart with something else.
Thought bubble: Companies use universities as a filtering mechanism, like recruiters. But recruiters get paid and universities do not. Conclusion: universities should get into the recruitment business.
Thiel's going to have a lot of success with this first batch - if I may say so myself, being one of the finalists. It's remarkably generous of him to offer 100k without any equity exchange whatsoever - the terms are far better than those offered by YComb and arguably quite equal in beneficial environment acquired - particularly as it's for 2 years and not a quarter-year mini-stint. We'll see what happens in two years ; )
He has a strong opinion and this will always generate a big debate. But what I like the most, is that by talking of the education bubble and creating an option for students (the 20 kids program with $100k), we're going to test his theory soon. If that works, how about some of the top education programs replicating his model?
I plan to write a blog post about this later but I'm starting to think that the term "College Drop Out" has started to become more valuable than "College Graduate." This may not be completely true right now but in 5 years when today's 25 year olds are hiring, the term may possibly be more valuable.
Something that is hinted at the end of the article but not fully addressed: the risk of creating a new elite (if elitism is the problem) is there just as much in the new system (such as Thiel is) as it was the original institution.
There will always be an elite. But society needs a humble, wiser elite, who lead by example, talent, and perseverance; leaders who provide valuable insight, rather than protect their advantage by raising walls. Ken Thompson is the best kind of elite, an elite mind who gave us the foundational tools to build a whole new industry.
In a free competitive situation the government if it wanted to give value to higher education while hobbling other competitive items would make higher education at state schools somewhat free thus reducing the competitive edge of for-profits while also reducing the debt load per student which spurs job creation because more college graduates can afford to start businesses and startups..
At least in the USA the main reason why college is not free is that the major debate in congress occurred during the
years after Vietnam Veterans returned and US congress people had a cultural bias towards giving those returning from Vietnam and those who did not fight in Vietnam a 'free college education' and like all political laws very hard to over-turn through a renewed debate..
> Thiel is wrong - education is valuable, college very much so.
Depending on your definition of "education", I agree with the first part of your statement. The second part of your statement I wholeheartedly disagree with. Education in general is a very valuable thing, but a classroom education is not the only one, and college can be valuable but is not necessarily so. I'm a high-school dropout, yet I've never regretted it for a second -- I have a good deal of education, but it comes from self-exploration and experimentation and it's shown itself to be quite valuable so far. My case is by no means the norm, but propping college up as the only path is pretty silly.
"college can be valuable but is not necessarily so"
makes no sense.
You can always claim that "X can be valuable but is not necessarily so". Where X can be anything in this universe.
Second, you are trying to turn a personal experience into a generalization. A good question to ask would be what would happen If the college enrollment dropped by 10% or 20% or 50% ? How would this affect the workforce and the industrial output?
Another extremely important question is that how do you decide who exactly should drop out??
Should people drop out on basis of financial resources or some limited test of intelligence. The problem is that it is hard to tell who should enroll and who shouldn't.
While certain subjects can be learnt online, a large number of subjects cannot be learnt. A university provides Labs, Wide range of subjects, access to a social network of like minded people, Faculty, Assessment and most importantly some guarantee of Academic Integrity. Universities are an example of the Theory of the firm.[1] You can surely separate different components of college education which I mentioned above, however there will be significant transaction costs.
The underlying theme of this discussion is not about education or elitism. It is about allocation of capital.
Peter Thiel being a Venture Capitalist is interested in allocation of capital, thus the whole 20 under 20. Dont confuse his efforts with education or elitism. If anything his program might be more elitist than Harvard.
I downvoted you because I felt that the tone of your comment is more aggressive than a discussion should be. It's just mean.
It's like saying to martian geologist, have you been to mars? If not, how do you know what rocks are there at all?
No, but that person has parsed data from probes and knows what s/he is talking about.
It's like saying that while planning a moon mission for the first time. Have you gone to the far side of the moon?
No, but we will.
------
The thing you're advocating is dogma. This person has lived through a lot of things and can offer a unique perspective based on his experiences and the data in front of him.
An English degree is of course higher education, just like an art or a philosophy degree. The ability to get a high paying job is not a suitable measurement for what constitutes "higher education" and what doesn't.
Sure, if you're starting a web startup or a basketball team, no one cares where you went to school (although an offensive lineman in football benefits from going to a top tier school -- despite football being a meritocracy its surprisingly difficult to measure how effective linemen are). But the top lawyers, doctors, professors, and even business managers will be recruited from where people think the best people are.
The ironic thing is that the only reason people listen to Peter Thiel is because of his credentials as PayPal co-founder and VC investor. There are a million people have an opinion on education and tecnology. There's too much noise -- the ideas that are listened to are those that come from people who have done soemthing in the past -- a credential. At a massive scale college is still THE credential.
And surprisingly the internet has actually made elite schools more important, not less. Pre-internet regional schools were often held in near equal esteem as Harvard/Yale. As information became more fluid (USNWR and the internet) the ranking of credentials became easier to obtain. This won't change.