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Sunday, October 16, 2011

Higher education: is it a worthy investment?

This week I get to argue in the Las Vegas Sun that higher education is seeing diminishing rates of return. In my op-ed "Our curent model isn't working" I point to several statistics that show the value of the degree is declining, costs are on the rise, and universities are becoming bloated. That is they are doing everything but their primary mission of education and research.

I'm also humbled to have my opinion included along with Governor Brian Sandoval and the Nevada System of Higher Education Chancellor Dan Klaich.

Governor Sandoval correctly points out that Nevada's labor force needs to be educated and trained for a new, more integrated and high tech global economy. That said, producing more criminal justice, philosophy, women's studies, and political science graduates isn't likely to help. (Full disclosure I'm a Political Science and History grad and I fully admit they are stimulating but mostly useless degrees). In fact, continuing with our current system (even if we increase funding) will most likely only create graduates who end up in jobs they could have got out of high school. Some type of education and training is needed, but it is NOT our CURRENT higher education system.

We need a fundamental overhaul in higher education. Unfortunately, many leaders within the system don't want an overhaul, they want an expansion.

Chancellor Klaich argues that higher education is not only a great investment but that the investment needs to continue to expand well beyond its current mission in Nevada. He points to seemingly successful examples of mission creep in Boston, North Carolina and Salt Lake City Utah. But for every example of what appears to be a successful business incubator, business park, high tech research center, or biotech center there are examples of utter failure. Arizona State built a multi-million dollar business park in Scottsdale Arizona. The project has been a massive flop.

 "Anything you can do, I can do better!"
- higher education is now bloated enough to be that delusional

Klaich argues that for every dollar invested in higher education there is $4 of economy activity generated in the community. However, the studies cited are hopelessly flawed. Basically they generally assume that $4 is the value created in that local economy and do not take into account that the chairs, pencils, paper, computers, desks, light bulbs, wires (etc) are most likely manufactured elsewhere.  Thus the actual impact on the economy is really much less. They also don't take into account the economic impact of doing something else. It could be the case that an alternative use for those higher education dollars produces $5 of economic activity - in which case higher education would make us worse off.

All that aside, Klaich's opinion is part of the problem. He believes higher education can do anything and can do it better than the private sector professionals. This is why universities have grossly expanded their missions well beyond education and research. Besides, why on earth does anyone think business incubators and higher education venture capitalists will succeed in Nevada when they can't even excel at their core mission - actually educating and graduating students...