Going Broke For The Degree

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Graphic by Emily Metcalf

BY CANNON BROOKE – It seems universities are making a considerable amount of the headlines today, however, this publicity is conspicuously disparaging. Some topics covered by the media examine the problem on campuses with binge and underage drinking, athletic scandals and the occasional student riot. But there is one topic that stands out – the burgeoning cost of a post-secondary education.

We all have heard the promises of holding a college degree, a life of intellectual fulfillment, and a substantially much higher income than non-degree holders. Going to college is viewed as a stepping-stone into adulthood, “a small price to pay” argue universities, for a quality education. Even politicians weigh in on this topic, some going as far as to say “on average you will earn a million dollars more with a bachelors degree than just having a high school diploma” (Hillary Clinton) over a life time.

However, with a tumultuous economy and student debt out-pacing credit card debt, the college experience is having many concluding that it just might be a scam.

A fundamental reason for the explosive tuition hike in recent years is the lack of productivity in universities. The efficiency of university personnel has been stagnating in recent years. So the question arises: how come the rest of the economy can become more proficient, utilize the latest technology to lower costs, while the universities on the other hand, need more administrators and professors to educate a given number of students?

And that is just the problem. Universities are NOT subject to the same market-based principles and are subject to the inefficiencies of the current non-profit and vague ownership model. Deans, presidents and other faculty have no incentives to lower the costs of attending a university since it is mostly taxpayer and donor funded. There is absolutely no accountability in academia. Also, all of the subsidies that the schools receive abate competition and reduce the market-imposed discipline to economize and innovate, leading to higher tuition costs.

The post-secondary education, particularly at the larger universities, is notoriously resistant to any kind of reform – and this is not a just few recalcitrant professors. Tenured faculty inordinately resists any change to the status quo and will veto proposals affecting their workload or opulence. This policy is further perpetuated by presidents placating constituencies [donors] and faulty unions by continuing lumbering decision procedures and other impediments to change – consequently, stifling innovation.


Universities often lure professors into their institutions by promising reduced workloads and extended sabbaticals so instructors can “research” and work on publication. This is typical in research universities. A focus on publishing and not instructing leads to undergraduate students feeling neglected, since emphasis is put on having their faculty publish in some obscure scholarly journal that nobody reads. As a consequence of this focus on “research,” a decline in teaching loads has occurred and the number of academic journals has multiplied.[1] Focusing on research and publishing in academic journals does not promote enhanced student learning, instead, subsequently drives up the cost of tuition and lowers the actual classroom time.


Low retention rates, declining analytical competency and years of debt are making some question the real worth of a college degree. With the cost of obtaining a four-year degree more than doubling since 1975 in inflation-adjusted dollars, there is no question as to why some are looking towards alternatives to this latest bubble that is certainly going to pop.[2]


I have written a working paper on the alternatives to college available on the Grassroot Institute’s website. The paper goes deeper into the problem with higher education and calls for a more pragmatic approach to post-secondary education. Please check it out and let me know what you think.


The link can be found here.





[1] Vedder, R. K. (2004). Going broke by degree : why college costs too much. Washington, D.C., AEI Press.


[2] Digest of Educational Statistics. 2009a. Table 26. Expenditures of educational institutions related to the gross domestic product, by level of institution: Selected years, 1929-30 through 2008-09. National Center for Education Statistics.