That education is strongly associated with economic growth and higher income over one’s lifetime is nothing new. A bachelor’s degree is, on average, worth about $830,000 more than a high school diploma.
Education prices, which are growing faster than overall prices, also is nothing new.
Also familiar is the constant reminder that students are unable to graduate in four years.
Other anecdotal evidence points to the fact that college education is not preparing students for a “real job.”
The second Bush administration introduced “No Child Left Behind.” The goal was to raise primary and secondary education outcomes, which linger in the bottom one-third of developed countries, to be able to compete with our counterparts.
However, if a school was unable to meet certain requirements, such as passing standardized tests, money was yanked away.
Anybody could see that incentives were set up to ensure passing the test but not necessarily to require any learning. But learning is what I thought education is for – and learning can, in most circumstances, lead to higher income.
Students may be good at passing standardized tests, but at college, they are underprepared.
As it turns out, about 60 percent of American college students require some remedial classes. So, before a single college course is taken, some students may require close to one year of additional training. One more year of college and loans – and at higher prices.
What many of these same people don’t discuss, however, is that public support for education has been sliding.
Between 2002 and 2010, state funding for University of Colorado at Boulder fell more than 50 percent.
Simultaneously, the federal government has cut low-interest loans to students, requiring them to rely on private-funding sources and credit cards.
Now, a greater number of students, about 71 percent, have part- or full-time jobs in addition to loans.
This is generally not a problem for high-income families.
Recently, the Obama administration decided to rank colleges and universities based on value for money, debt and job prospects for high-paying work.
Seems to me the reason it’s hard to find work is the number of high-paying jobs is shrinking – this is a long-term structural issue.
This leads students to, essentially, vocational training. Gone would be degrees like philosophy. However, philosophy majors generally outperform every major in graduate school entry exams – one ahead of economics majors.
Into the mix comes the Pay As You Earn program that provide students a loan package that if not paid after 20 years, under certain conditions, doesn’t have to be repaid.
Really? What lender would make the loan in the first place? What student would rush to repay? Information asymmetries abound.
Not necessarily the panacea envisioned.
As we get ready for the next school year, let’s hope some plausible solution can be found.
email@example.com. Robert “Tino” Sonora, is professor of economics at Fort Lewis College and the director of the Office of Business and Economic Research at Fort Lewis College.