FT Piece on student loan bubble

[boilermaker75]

Every state wants, and has, a public research university--typically their land-grant institution. Most states have several public research universities. It probably depends on the department, but in departments of engineering, science, management, health sciences, etc. faculty spend 80% of their time doing research and 20% of their time teaching. Up to half that teaching is at the graduate level. Probably at very few schools do faculty provide more than 10% of their salaries from outside grants and contracts yet spend 80% of their time on these grants and contracts. 30 years ago outside salary support was much, much higher because your teaching load was based on how much outside salary support you provided. If a school lowered this requirement, they attracted better faculty.

 

Most graduate students are not paying tuition as they are on research or teaching assistantships that cover tuition.

 

Undergraduate tuition is subsidizing 90% of the cost of the faculty doing research and teaching graduate classes.

 

Rankings are mainly based on research, so top research universities attract the top undergraduates.

 

[SharperDingaan]

Universities typically differentiate themselves as either research or teaching.

Research is the marquee draw; glamorous, prestigious, possibility of a noble prize, etc. It's also at the apex of the public funding triangle; that gives you an army of free graduate level labor, and quite the ego boost. Teaching got the sh1te, & systemic feedback loop(s), to keep it sh1te. Not a bad gig to be a researcher, a*** ****'s excepted; but dangerously disconnected from the people actually paying the freight.

 

Look at a university today, & most of the growth in teaching is split between on-line and 'continuing studies'.

It's adults coming back to school in their late 40's/early 50's, & again in their 60's in preparation for retirement; continuing studies (test if you can still do it), to on-line, to Masters, to Doctorate. The Masters isn't two years either, it's one year (or slightly more) net of credits for designations & work experience - which the university WILL give you, upon forced & blunt negotiation.

 

Increasingly many of those continuing studies and on-line professors, are also professionals holding professional designations and 20+ years of industry experience in the field. It's a nice gig, a 'part-time' job that pays very well, it hedges your 'day job', gives ongoing access to a pool of 'known' graduates that you may need to hire from, & you can often do it in the evenings or on weekends - from home (on-line works both ways). Which is likely to be the better experience? a Bill Gates teaching an advanced tech course to adults (with lots of industry experience) in an on-line DBA/MBA course on Saturday morning - or that research professor teaching on a chalk board, 'in class', during the work day; who would rather be elsewhere?

 

To date research PhD's have been protected, but it's ending.

Those returning adults are also increasingly doing the more practically orientated DBA on-line; with tuition being paid for by guaranteed teaching gigs, & their employers giving them days off to both attend class (when required) & teach the guaranteed classes. I understand that culture clash is common, & its the theoretical faculty that usually loses. Black swans can be a bitch.

 

Everybody eventually retires, even the opposition.

But hit the tipping point, & those retirements are going to rapidly accelerate.

 

SD

 

 

 

 

 

 

 

 

 

 

 

[Spekulatius]

If the market will not pay, the education has zero value.

 

Others suggest that education should be free, & in many places - it is. But to make something free is to devalue it, because  now everyone has it.

 

Not sure I agree with either of these statements. An unemployed surgeon is more valuable than an unemployed ditch digger. Price does not equal value.

 

Free education does not devalue the education. The price is just a transaction price. Look at the Chinese cities built upon free IP, they are in fact more valuable because they have removed the transaction cost.

 

Most education and information is already out there to learn freely. Heck, I can download a med school's worth of textbooks and watch all the lectures online. That is not the reason we don't have a civilization filled with doctors, engineers, etc.

 

I grew up in Germany where education is free. You can go to an university and basically study what you want, if you pass the Abitur (except some restricted subjects like Medicine). However starting at a University does not mean you will be able to get a degree. There is not that much guidance, it is sink or swim. Half the students were gone after 2 semesters because they figure they wouldn't make it. I like meritocracy based in skill and hard work.

[rolling]

I grew up in Germany where education is free. You can go to an university and basically study what you want, if you pass the Abitur (except some restricted subjects like Medicine). However starting at a University does not mean you will be able to get a degree. There is not that much guidance, it is sink or swim. Half the students were gone after 2 semesters because they figure they wouldn't make it. I like meritocracy based in skill and hard work.

In Portugal meritocracy comes upon admittance. Basically you take years 10 to 12 school year grades (which average with a national examination in each subject) and then the national examination of the specific disciplines important for the degree (like biology and chemistry for medicine or math and physics for engineering) average with that (usually 50-50). Then it happens by national contest: there are X slots in each university for Y degree (chosen in theory taking into account country needs and employment rates) and people choose the degree and university they wish to go to (the most wanted are filled quickly the least wanted sometimes stay empty). Slots are filled by grade. If you didn’t study enough (or if you couldn’t get an high enough grade even while studying) you don’t go to the pretend place (and can either try it or entry the contest one year later). After that people still have to finish their degrees.

Government pays most of it, but there is still an yearly fee. Poor people can apply to scholarships (that might pay only the yearly fee or be a bit higher to help cover other expenses).

Positives: if you need 1500 engineers a year the government only pays for 2000 (or less). If you take an useless degree (which shouldn’t happen) at least you won’t be indebted for life

Negatives: there are still a lot of useless degrees (many people just want to have a degree and it would be unpopular not to allow that…)

 

[SharperDingaan]

I grew up in Germany where education is free. You can go to an university and basically study what you want, if you pass the Abitur (except some restricted subjects like Medicine). However starting at a University does not mean you will be able to get a degree. There is not that much guidance, it is sink or swim. Half the students were gone after 2 semesters because they figure they wouldn't make it. I like meritocracy based in skill and hard work.

In Portugal meritocracy comes upon admittance. Basically you take years 10 to 12 school year grades (which average with a national examination in each subject) and then the national examination of the specific disciplines important for the degree (like biology and chemistry for medicine or math and physics for engineering) average with that (usually 50-50). Then it happens by national contest: there are X slots in each university for Y degree (chosen in theory taking into account country needs and employment rates) and people choose the degree and university they wish to go to (the most wanted are filled quickly the least wanted sometimes stay empty). Slots are filled by grade. If you didn’t study enough (or if you couldn’t get an high enough grade even while studying) you don’t go to the pretend place (and can either try it or entry the contest one year later). After that people still have to finish their degrees.

Government pays most of it, but there is still an yearly fee. Poor people can apply to scholarships (that might pay only the yearly fee or be a bit higher to help cover other expenses).

Positives: if you need 1500 engineers a year the government only pays for 2000 (or less). If you take an useless degree (which shouldn’t happen) at least you won’t be indebted for life

Negatives: there are still a lot of useless degrees (many people just want to have a degree and it would be unpopular not to allow that…)

 

I grew up in Africa under a combination of the German system - high marks required for all your subjects, & Portugal's system of a very limited number of university slots. The African twist was that all results were based on a single UK exam, all exams were written within 2 weeks of each other, and if you failed you got drafted. I had all the sciences, maths, two languages, and commerce - & passed with enough academic muscle to force my way into almost all UK universities.

 

Problem was, that at that time, I would have been an 'illegal' in the UK, & almost all of Europe & NA as well - which made all those results useless. An adventurous interlude, & I ended up in a Canadian university a few years later with a competitive entry engineering scholarship - but only after having to write a separate and purely domestic test in mathematics, my best exam subjects!

 

Merit based sink or swim is undeniably a great system, but it also has a very high body count. Then add to it that it's highly disruptive, doesn't work well in most societies, & outliers aren't appreciated. Obviously, it's not for everyone.

 

SD

 

 

 

 

 

[Jurgis]

Every state wants, and has, a public research university--typically their land-grant institution. Most states have several public research universities. It probably depends on the department, but in departments of engineering, science, management, health sciences, etc. faculty spend 80% of their time doing research and 20% of their time teaching. Up to half that teaching is at the graduate level. Probably at very few schools do faculty provide more than 10% of their salaries from outside grants and contracts yet spend 80% of their time on these grants and contracts. 30 years ago outside salary support was much, much higher because your teaching load was based on how much outside salary support you provided. If a school lowered this requirement, they attracted better faculty.

 

Most graduate students are not paying tuition as they are on research or teaching assistantships that cover tuition.

 

Undergraduate tuition is subsidizing 90% of the cost of the faculty doing research and teaching graduate classes.

 

Rankings are mainly based on research, so top research universities attract the top undergraduates.

 

QFT.

 

I am very pro-US-universities, but it would be great if teaching had bigger priority. Maybe it does in non-STEM fields... not sure. I don't know how music professors are selected, for example. Politics? I think that's what my friend who was music prof said. But even there I think the selection is not really based on teaching.

 

OTOH, I don't think other countries have great teaching traditions either. I know for fact that Lithuania/Russia is way worse in teaching style/content than US. From what I heard about Western Europe (Germany, Belgium, UK), people have said that US teaching is better. The system is different in Europe, but teaching is not prioritized there either.

[boilermaker75]

Every state wants, and has, a public research university--typically their land-grant institution. Most states have several public research universities. It probably depends on the department, but in departments of engineering, science, management, health sciences, etc. faculty spend 80% of their time doing research and 20% of their time teaching. Up to half that teaching is at the graduate level. Probably at very few schools do faculty provide more than 10% of their salaries from outside grants and contracts yet spend 80% of their time on these grants and contracts. 30 years ago outside salary support was much, much higher because your teaching load was based on how much outside salary support you provided. If a school lowered this requirement, they attracted better faculty.

 

Most graduate students are not paying tuition as they are on research or teaching assistantships that cover tuition.

 

Undergraduate tuition is subsidizing 90% of the cost of the faculty doing research and teaching graduate classes.

 

Rankings are mainly based on research, so top research universities attract the top undergraduates.

 

QFT.

 

I am very pro-US-universities, but it would be great if teaching had bigger priority. Maybe it does in non-STEM fields... not sure. I don't know how music professors are selected, for example. Politics? I think that's what my friend who was music prof said. But even there I think the selection is not really based on teaching.

 

OTOH, I don't think other countries have great teaching traditions either. I know for fact that Lithuania/Russia is way worse in teaching style/content than US. From what I heard about Western Europe (Germany, Belgium, UK), people have said that US teaching is better. The system is different in Europe, but teaching is not prioritized there either.

 

I agree about the quality of teaching in the US. There are some great researchers who are also great undergraduate teachers.

 

I am just indicating why the costs have been going up and why they are so high.