Thursday, July 7, 2011

College is a Smart Investment

[Note: I am back from vacation but had to have some surgery this week so intermittent blogging will continue as I convalesce.  Sorry.]

So for today I simply direct you to an excellent article by David Leonhardt in The New York Times which makes the case for a college degree even in a down economy and skyrocketing public university tuition.

Here is a taste:

ALMOST a century ago, the United States decided to make high school nearly universal. Around the same time, much of Europe decided that universal high school was a waste. Not everybody, European intellectuals argued, should go to high school.

It’s clear who made the right decision. The educated American masses helped create the American century, as the economists Claudia Goldin and Lawrence Katz have written. The new ranks of high school graduates made factories more efficient and new industries possible.

Today, we are having an updated version of the same debate. Television, newspapers and blogs are filled with the case against college for the masses: It saddles students with debt; it does not guarantee a good job; it isn’t necessary for many jobs. Not everybody, the skeptics say, should go to college.

The argument has the lure of counterintuition and does have grains of truth. Too many teenagers aren’t ready to do college-level work. Ultimately, though, the case against mass education is no better than it was a century ago.

The evidence is overwhelming that college is a better investment for most graduates than in the past. A new study even shows that a bachelor’s degree pays off for jobs that don’t require one: secretaries, plumbers and cashiers. And, beyond money, education seems to make people happier and healthier.

“Sending more young Americans to college is not a panacea,” says David Autor, an M.I.T. economist who studies the labor market. “Not sending them to college would be a disaster.”

Go and read the reat at the Times.


Anonymous said...

I have a son who is looking to start college next year.

Me? I went to college. And I recommend it for everyone. But, I'm gonna blow holes in this article, for your benefit and that of your readers.

I look at everything with a critical eye. I was taught that in college. They called it "Critical Thinking.” They have classes for it.

As for Leonhardt’s direct claims...
"Many colleges are not very expensive, once financial aid is taken into account. Average net tuition and fees at public four-year colleges this past year, were only about $2,000.00."

1) What is 'net' tuition? What are the fees? 2) How many colleges were surveyed to calculate this figure, and, which colleges in particular? (My old Alma Mater, runs over $6,000 for tuition alone for 'residents' and well over $11,000 for non-residents.) 3) Figuring in financial aid brought this down to about $4k and $7k respectively, and, that doesn't even cover books and "fees", housing, transportation and personal expenses - all in all, the cost to attend my old college is over $21,000 a year for residents, and, financial aid only helps to lower that by a few grand with an EFC (estimated family contribution) of over $7000.00 "Many colleges are not very expensive....." So very untrue!

The Hamilton Group: "College tuition has delivered an inflation-adjusted annual return of more than 15%." What would the real numbers look like once we added in ALL of the cost of going to college, not just that "$2,000" tuition? What kind of ROI would we be looking at then?

Finally, the Georgetown folk and the real world...

The graphic is at first 'glance' impressive. Wow! You mean I could be a dishwasher and get a four-year degree and have the SAME JOB and suddenly my boss is gonna give me another $15,000 a year? Hahahahahahaha.

Or, what about this one? A plumber goes to college and comes back with a degree and makes another $14,000 a year. I'll bet that my childhood friend who became a Master Plumber before he was 25 would tell you to take your graphics/charts and your studies and flush 'em down the toilet. I know a few building contractors who are millionaires and they would tell you the same thing.

And then there's the fact that all of these job descriptions are generic in nature so as to allow the statisticians the most latitude in shaping the information to fit the intentions.....a common device used in all fictional literature to lead the reader to a spot where the author wants them to be.

I've worked as a dishwasher in Country Clubs, posh restaurants, chain restaurants, and mom & pops, and I can tell you - a four year degree would not have netted me another $15k a year UNLESS I was first living and working in Mississippi and then moved to New York City where the wages are customarily two to four times as high. We'd have to adjust the real "value" of that degree in terms of the cost of living in Mississippi versus NYC. The rent alone in NYC is over $5,000 (1br) versus $485 (1br) in Mississippi. Suddenly that extra $15k has evaporated.

Here's a new article for your blog: Employment rates for recent four-year graduates with a chart showing how many got jobs in their respective fields; how many in other fields (full-time); how many in other fields (part-time); how many at temporary pools; and finally, how many without jobs for an extended period. All listed with their salaries/incomes versus their cost of attending college, and, their geographic locations so we can accurately value their degrees.

Let's have a dose of reality. Not propaganda.

BTW - Many of the seniors I encountered could not write an effective essay if their life depended on it. What then, is the 'intellectual' value of going to college? Does it make for a more educated populace? Can they discern propaganda from journalistic integrity? Can our college grads compete with those of Europe or do we suffer lack there as well?

Sam said...

Let's see who actual study that collected real data on the earnings of college grads (the majority of whom aren't the drunk rejects the media portrays them to be) in non-degree requiring jobs...or Eric G who presents only anecdotal references, interprets the article to mean that a degree magically adds $15k to anyone's paycheck, and writes an essay just like the college seniors he knows.

See you on the next "I'm bitter" show.

Anonymous said...

Thank you Patrick, for posting my comment. I understand that it was controversial both in tone and content, but you being a fair individual allowed free speech to thrive.

Thank you.

Patrick Emerson said...

Eric G,

Of course, I enjoy all kinds of debate as long as it is civil and on topic. The only reason I moderate comments is to keep the commercial trolls out. Unfortunately, unmoderated comments quickly become a marketplace for viagra and other products.

Patrick Emerson said...

Besides the the question of why would I want to go to college to be a better paid short-order cook is a good one. To my mind it is less about the monetary rewards as the fulfilling nature of the jobs one does. In fact, I think the monetary rewards for a college degree wold be higher if we accounted for the compensating wage differential (people will accept less to do a job they enjoy).

Anonymous said...

Well, Sam, you took me to task and I appreciate that. We should never rest on our laurels. You showed an adroit use of criticism and insulted me all in the same breath. Kudos to you. But, I'm
certain that you weren't merely wanting to insult me, otherwise you wouldn't have refuted my
argument and it's supposed lack of credibility. Therefore, I shall respond....

First, let me point out that I was refuting the "real data" as presented and was explaining that the statistics could be massaged to support a stated position. That's all I was doing. Granted, the language I used was cold and "bitter," and I could have let the paper rest a day or two and rewritten it so that it wasn't offensive to anyone. But instead, I followed a knee-jerk reaction and was perhaps rude. My mistake. Please accept my apology.

As for the article and the studies. They are all used to support a position. That position being, - get lower-income people into college. "Even for Cashiers, College pays off."

I'm not against people going to college. In fact, I am wholly convinced that almost everyone would benefit from attending for two or more years. What I am not happy about, is using
fallacious arguments and data to steer people into the college pen. Especially when the claims mislead
people into thinking college is very affordable - the ends do not justify the means. Consider
this recent article from CNN Money/Fortune Mag:

Let's revisit my main objection....

"...there are two main reasons college costs aren’t usually a problem for those who graduate.

First, many colleges are not very expensive, once financial aid is taken into account. Average net tuition and fees at public four-year colleges this past year were only about $2,000 "

This is an adaptation of the weak analogy fallacy - claiming that college is "not very expensive" because net tuition and fees are only $2,000.00 - as if there are no more expenses to attending college. Vital information has been left out - books, room & board, housing, parking fees, medical insurance, and any other fees that the student might have to pay have not been included in the "expense" of going to college - therefore the claim that college is "not very expensive" is a fallacy. I'm "bitter" because I believe the statement was made
purposefully to deceive and/or mislead the reader. Sure, let's get everybody into college. It's good for the country. But, again, the ends don't justify the means.

I encourage you to read another article by Mr. Leonhardt
The Real Cost of College - NY Times

If you read the Real Cost of College, you'll notice that it states it feels like it costs more to attend college because rent prices are higher, wages have been stagnant (for lower-income households), and general
expenses have risen above that of inflation. (For Mr. Leonhardt to have one article touting how inexpensive college is and another article saying that the cost has risen and is somewhat out of reach for lower-income students is perplexing.)

Now, concerning the graphic... Same job, same pay - That is a misleading heading. Obviously, there is no magic in getting more pay after earning a degree. The reality is that the college grads might go back to the same industry, but not the same job. Usually, the grads are either promoted to a different job within the same company, or, they find a higher paying job at a different company within the same field. But, still, not the same job. Therefore, it's a another fallacy, perpetuated by the gross generalizations in the chart. And another reason "I'm bitter." - - - - more....

Anonymous said...

Finally, Sam, let me directly address your remarks concerning mine.

1. An actual study versus my anecdotal evidence. You're right. My evidence alone did not carry the behemoth weight of data that the study probably accrued through their research. However, anecdotal evidence such as that supplied by the CNN Money article is quite damning to the article and study whose data is reflected in black and white and not in flesh and blood. And what do studies such as these reflect if not personal, anecdotal, experiences?

2. The issue of magic. LOL - Anyone with a brain knows that one does not graduate college and "poof!" receives more pay. That being said, not many readers can contextualize statistical data, and when the charts are using generalizations, mistakes are more readily made in comprehension of said data - and we know those seniors have a hard time comprehending because they can't even write an effective essay.

3. Ah, yes, - the insult - whoops, I mean, the essay. First of all, an essay is a formal document such as a report, a speech, a dissertation, etc. A comment is more along the lines of colloquial communications and therefore not subject to the stringent demands placed upon essays (MLA style, Chicago style, etc). Still, I invite you, Sam, to again use your skills at critique and take me to task, but this time please include your skills at proofreading and editing, as I wouldn't want you to leave our readers wanting by having you type just one small paragraph.

In your editing and taking me to task, I encourage you to check my spelling (impeccable); my sentence structures; my use of punctuation (always suspect); the use of articles and modifiers; the general flow of logic, and, the adherence to the rules of logic. And, any other thing you can think of to find failure in my communication.

A non-response from you, Sam, will leave me to believe one of two things has happened - either you have not come back to the
blog post to read updated comments (my response to your insults and critique and/or others' comments - or - you have come back and deemed it a waste of your time to respond, in which case your logic is either that you believe me to be a "bitter" blowhard and not worth the effort, or, you are not wanting to engage in a serious
debate because you are incapable of such and don't want to be embarrassed in public.

Either way, please note that I am not trying to insult you, I am merely extending the use of simple logic.

I do hope that this time, my language was acceptable and that my writing skills were up to your stringent standards. Good day.

Anonymous said...

"To my mind it is less about the monetary rewards as the fulfilling nature of the jobs one does. In fact, I think the monetary rewards for a college degree wold be higher if we accounted for the compensating wage differential (people will accept less to do a job they enjoy)."

I can't agree with you more. The reason I worked as a dishwasher more than once is because I actually enjoyed doing it. Same with truck driving. But, truck driving paid more. Had dish-washing paid the same as truck driving I would have stayed a dishwasher - Though the freedom of the open road and the independence were favorable, with dish washing I was home every night; I got to socialize with fun, energetic folk every shift; and I crossed cultural barriers learning a lot of Spanish in order to communicate with co-workers which turned out to be a lot of fun.

Anonymous said...

I really like David's articles and his focus on education in America. I think everyone should attend college. And as far as economics is concerned.....I'd have to take those classes over and over and over again for that stuff to imbed itself into my understanding.

I had great educators who used wonderful analogies for us to directly relate to, but in the end, I still couldn't get it. It's a language thing, I think, and the charts logic was just nuts. LOL