Debating Higher Education Policy | Policy

0:00 vailable to college graduates many college graduates are what we might call underemployed taking jobs as baristas or working in a fast-food places or a discount stores for there are too many

0:20 restrictions and too many schools on free expression ability of people to express their ideas without fear of intimidation from others maybe I should say a little bit more about some of the some of those points a fairly self-explanatory but let me say a little

0:41 bit more about a couple of them and then I will add a few other things and before we go into some sort of discussion and interaction between me and you in the audience as far as too costly goes if

1:01 you go back about a generation or so unless I go back about 1970 in 1970 the tuition average tuition at American universities absorbed about 8% the family income for a year of a typical family actually a household income of a

1:25 typical household 8% by 2010 2012 that figure had risen to 22% the tuition at American colleges has risen not only risen but it’s risen faster than people’s income so there in lies a

1:49 big problem if that number continues to grow at some point College becomes financially unsustainable for many Americans and it becomes unsustainable for the nation as well the so that’s a problem and the question is why did this

2:10 why does this problem exist and it’s some would argue that colleges have always had this problem it’s a labor-intensive industry we teach pretty much the same way many of us do as Socrates did 2,400 years ago and it’s inherently expensive very difficult to get productivity advanced in a labor

2:32 intensive in this industry like there’s some would argue that and there’s a little bit of truth to that but the rate of inflation tuition price inflation has about tripled since the mid to late 1970s and the reason I think is largely related to federal student financial aid programs

2:53 which have turned out to be sort of an open invitation for universities to raise their fees the University say hey we can raise our piece the kids will find some way to pay for it because the federal government will lend them the money and rather than with students benefiting from those programs in many cases it’s been members of the

3:13 university community that is led to high tuition fees and led to universities having bloated administrations it’s led to excessive spending in many areas of universities including an extravagant elect recreational facilities low

3:34 teaching loads for faculty and so on so these are some of the problems that we face as far as to learning goes a little learning goes on here’s a little factoid for you in 1960 roughly the average grade point average of an American University student was about 2.5 and the

3:57 average student spent about 40 hours a week in classroom or studying or otherwise doing academic thing forty hours a week the day the figure the average grade point error is about three point one the number of hours spent on academic things on average has fallen

4:17 dramatically to about twenty seven hours a week so kids are doing less or more and almost certainly are learning since we’re spending the less time working on academic affairs there’s surprisingly little information about how much kids actually learn in college but what little there is suggests that

4:40 the best learning is stagnant and more likely that shown actual declines in some areas with regards to the jobs picture things have changed and that we have credential inflation and higher ed and now because there are so many graduates with college degrees employers

5:02 are now imposing college degree requirements for all kinds of jobs where they previously didn’t have them so the so this is a problem we have for example in 1970 one out of every 150 taxi

5:28 drivers with a college graduate today out of every 150 taxi drivers at least 25 are graduates so we had a 25 fold increase in that so these are a few things that are going on let me just say

5:49 a few more things and then we’ll go into some questions see let me just mention three other sort of little scandals and higher ed that we just don’t have time to get into but at least let me mention what they are intercollegiate athletics is a scandal it’s too costly at many schools the universities are being

6:12 subsidized subsidizing sports sometimes costing $1,000 or more per student it’s too exploitive of the athletes in it in many cases it’s too corrupt there’s all sorts of corruption going on offshoot contracts and so for sexual misconduct and so on is so it is turning out to be

6:36 a real problem of for society well as I mentioned we have underutilized resources in universities the faculty teach too little I teach if I were teaching full-time now a third lesson I did when I started teaching same University same kinds of

6:56 students one-third less teaching that’s very typical students I mentioned are studying too little buildings are underutilized they lie empty months of the year and these are very expensive buildings because when outputting atriums and ordinary classrooms and all sorts of things like this so and one last problem is the governments of

7:17 universities is murky it you know everyone thinks they own the university the faculty think they own the university the students think they own the university the trustees really own the university most cases but as they are you’d be relatively clueless as to what’s going on because the administration doesn’t want them to know about things that are difficult or

7:39 embarrassing so we have a lot of problems in American higher ed the solution dollars three key words look sever the letter I one word is information another word is incentives and the third word is innovation if we

8:01 provide student more at their more information on what’s going on in universities we can get better outcomes if we incentivize professors and and staff and students and everyone to perform better we can get better academic outcomes at probably a lower price if we use innovations and technology more intelligently we can

8:22 also lower cost so this is these are some of the issues that we’re facing I think the single biggest problem if I had to pick one problem that is causing the most single most most problem relates to government financing it’s relating to student loan programs and

8:45 cetera but there there are there are others as well so that sort of you to an overview of what is going on right now now I’ve only talked for twelve or thirteen or fourteen minutes I can

9:07 elaborate a little bit more on this I I think as I say the single biggest problem is the federal student loan programs and aid programs have allowed universities to raise their prices a lot and the universities are dunfin and the question is well what do they do with the money they get from the higher tuition fees that they’re collecting

9:29 well we have a lower teaching bugs and we did 25 years ago we have higher salaries and we did on average twenty twenty-five years ago ah so the faculty you’re doing pretty well the administration has exploded at most universities where the number of administrators even those students

9:51 enrollments I have roughly doubled since the mid 1970s about twice as many administrators around for any given number of students as there were forty years ago so we have a massive University bureaucracies buildup which in my humble opinion has not improved universities generally indeed it made them a less efficient and

10:14 less good in many ways some universities impose technology P so when I want to put in this computer labs and all they charge the students to pay for them if General Motors did that or if Apple Computer tried to do that they say well we’re putting some new machinery in to make our products more a more cheaply

10:37 everyone things and so we gotta raise our prices in order to pay for these machines everyone would say they’re crazy so there are a lot of problems in higher ed today that are as a consequence I think at least in part of more intresting is probably optimal in

11:03 the private sector we have what Joseph Schumpeter once called creative destruction every now and then businesses are fail and when business and sales there’s some people lose their jobs there some people lose a lot of income and well but but it also is a

11:24 signal to society as society is in effect through the market sending a signal that we want to we need a reality or resources in a more efficient way and other businesses growth and replace those that doesn’t happen in higher ed the top ten schools in the US News & World Report rankings in 1994 haven’t

11:47 changed a bit a much either in terms of their rankings there’s minor changes but or in terms of the organization if we took the Fortune 500 from 1994 and we took the top ten companies coming like General Motors seven ILO’s top ten have fundamentally changed names have changed

12:09 they’ve been merged one of them is gone bankrupt and then resurrected but it went through bankruptcy big changes so we don’t have the impetus in the non market non proper higher ed sector to do the kinds of things that need to be done well I’ve talked now for

12:30 whatever over 20 almost 20 minutes and maybe the time has come for me to start asking answering some question for example I always weigh there Arianna Richardson asked me a question what is your position on for-profit

12:52 colleges and the problems they typically have how should they be fixed that’s a that’s a good question the for-profit industry in higher ed if you go back to say the year 2000 was about 1% of all students where that for-profit school is pretty small but then it got up to about

13:13 10% eight or nine years later and now it has fallen again because that sector has undergone a lot of regulatory scrutiny and attack some would say particularly during the Obama years that’s an industry that I think has a lot of promise I think it can be useful I have

13:36 visited for-profit schools and so forth there are some incentives at for-profit schools that do tend to promote efficiency then tend to provoke believe it or not interest in students and and student learning outcomes because if you don’t have good student learning outcomes ultimately you don’t have this

13:56 you don’t have students so there’s some aspects of the for-profit model that I think are very good and and whatnot there are been there have been bad actors in that field there been people that have run a fly-by-night outfit just in order to grab federal student loan

14:18 money that the students are able to get and the mycologist grab it from them in a form of tuition fees and so that although it’s considered a private industry it’s very dependent on federal fund if we fix the federal student loan program makes federal student loans a little bit more ressort of a commercial

14:42 model a model that we be following say in the banking sector we probably would have some cut down in that for-profit industry but I am I have seen some good one for doing university just bought one of the big for-profit outfits Kaplan University is in the process of trying to buy it I consider that a very

15:03 interesting and maybe promising model a good experiment at least to let a public university that’s not for-profit makeover a company that has had a lot of experience running of online education programs and see at what they do with it

15:24 we am agrees asked me what is my opinion on Accreditation I think accreditation is a scandal in America first of all the first problem with a credit is the credit people do the accreditation have a monumental conflict of interest the boards of the

15:47 accrediting organizations are controlled by universities that are in fact accredited by those accrediting organizations yeah they’re there they’re they have conflicts of interest oh there’s a fundamental problem that accreditation is almost like pregnancy

16:09 you either are accredited or you’re not accredited there’s no attempt to provide the quality variations in rankings of accreditation reports are usually made privately to the universities not publicly to the to the broader community

16:31 of university communities which i think is questionable there’s just a whole variety of problems with accreditation accreditation restricts entry into higher ed it makes it harder to start new University the old universities controlling the accreditation organization are skeptical of new models

16:53 new approaches to learning and thus I think it tends to stifle innovation I can go on and on so I would like to just totally abolish accreditation as of some sort of requirement but we do have to as

17:14 long as we have some federal financial aid programs we do have to have some way of starting those I’m not allowing those colleges that are truly fraudulent to operate so we need something but I think we need to move away from the system accreditation as it is was asked what do

17:37 you think is less harmful federal grants or federal loans and that’s asking me a question like who who is worse Stalin or Hitler and that’s a little unfair I suspect I

17:57 actually the idea of federal grants it’s not a bad idea conceptually and could be a minister than in the rather good way sort of like a voucher or where we give qualified students who are have reasonable academic process of promise

18:18 and financially we need we could give them vouchers and let them go wherever they want to school it could be done in a way that would foster greater competition get students a greater sort of empower them more in the process of dealing with universities and so forth the loan programs are just dysfunctional

18:40 the main problem with the whole federal system is are too many programs there are more than 15 different programs and you know we have programs on top of programs and we have Perkins walls we have stafford loans and we have subsidized and unsubsidized loans we have federal work-study we have federal

19:01 tuition tax credits do we mean all those why don’t we just go to one long program in one grant program and try to put pays out the loan program oh why don’t we try to privatize them by moving towards towards something like income share agreements where private companies provide funds for kids to go to college

19:23 but then take a chair of the income of a student for a given number of years afterwards and so that the burden of financing the student falls on the investor they’re taking the risk much more than the student and which i think

19:43 is good and it can be done in a way that I think could get the federal government out of the student loan business or reduce of it really ask me a question about safe speech zones on a campus and what do you think of those who were punished speaking contrary

20:04 opinions outside of the Fed speak zone well I just think safe zones are a horrible idea now I will admit that there are some places on campus where there should be not an opportunity for

20:26 anyone to walk in the room and just say what they want when I’m teaching a class by the way I was season class a couple hours ago in American economic history if some student had walked into my classroom and started expounding on whatever their the topic of the moment is whether they’re interested in I think that’s inappropriate because

20:46 they’re disrupting other speakers so but I think as a general rule on campuses that people should be able to speak pretty much anywhere they want at any time on any copy as long as they’re not disrupting the ordinary business of the university the other business in university generally speaking that means

21:08 they should be allowed to speak almost anywhere outside inside buildings are a little more problematic because inside building there’s activities going on that we’re a large gatherings of people could be highly disruptive in protecting university from doing business and it needs to do so that’s a generalization I

21:32 think one of the great affronts one of the great problems of the modern era is that we sight of the fact that this force between people then goes on and a further somewhat civilized fashion on violence between people this sort of

21:56 argument and discussion mean even though hairbrained crazy ideas it’s part of what makes universities interesting part of what leads to new ideas a better it’s part of what a university is about the exploration of different ways of doing

22:17 things and and and I think face speech zones is sort of an oxymoron the notion that we because of their galaxies and can’t take speech which might be somehow offensive to it is an idea that bothers me I think

22:37 students should be somewhat offended by some of the things they hear on campus they should disagree with them they should but that should get them to think it should listen to think of why they are offended and wanting talk back

22:58 someone asked a question about we got twenty three billion dollars in debt right now and I the question has passed by and I can’t see the rest of it but I think in general the question was something the effect in effect why are the University why are we subsidizing University so much in this day and then

23:22 we afford to do so with all this federal debt that we have run up I give out money that we don’t have since we’re 23 trillion in debt good question what’s happening now is the federal student loan programs are being financed by the federal government so what the federal government is doing to

23:42 some extent and last year we ran a government deficit of 668 billion I believe that through about 2/3 of a trillion dollars last year for one year it’s almost 2 billion dollars a day and debt and so what the you know what the government does is it goes out and borrows money and then it from say the

24:04 Chinese Chinese investors and lend it to the American students ah then this is an unsustainable model in the long run I think and it is true are the ratio of debt to to output or capacity to pay in the United States is extremely high for

24:25 a period that’s relatively peaceful we’re not in major Wars now and the period where we’ve had 8 years of expansion the last recession I’ve sensibly ended in mid 2009 – were in our ninth year of expansion this is it’s almost unprecedented for us to be running a deficit equal to three point

24:47 four percent of GDP which is what we’re doing so I think we are acting fiscally irresponsible right now and it is contributing to some of the problems in university so that’s to me another reason why we probably should be dialing down some of these programs in my

25:09 judgment it someone else would it help to make universe colleges more or less expensive will be very prices for each major what our problems with this idea I think in general it’s a pretty good idea to consider all varying prices in the

25:29 university it first of all I thought is it the cost and they became students variation discipline – discipline within university there’s no question about that there I think you can justify on some sort of cost-benefit ground charging students more in some areas

25:50 than in others and so on the whole I think it’s a good idea there are some practical problems with what if you change majors when you go for one tuition model to another students at any one time you know they may be majoring in one subject of taking half of their work maybe a general education

26:11 requirement in a broader liberal arts context and the very tuition by courses actually Adam Smith two hundred and forty-one years ago in the wealth of nation had an interesting idea he said why don’t each professor charge tuition for their own classes and then maybe kick some of that money back to the

26:32 university to help pay overhead and let the professor’s get paid and depending on how many students they can bring in and the man I supposing that my whole professors could decide the fees beside you know professors or what try to maximize their own income and might try to charge a high fee but if they try first UI students will take another

26:54 professor will be cheaper do I want the low price professor to the high price because no one is talking about doing that Smith claims that when that happened back then before 1776 before the wealth of nation was written colleges ran much better than when they went to the model where the universe in charge subpoenaed everyone blankets

27:16 either everyone he said the quality of instruction went down the professor’s got paid no more if they get a good job of teaching as a full good fellow still bad guy maybe we should move towards that kind of model what can we Sara asked what can we do to lower the cost of tuition well I think

27:37 if we reduce the demand for higher education that is being sort of artificially created by some of these student financial aid programs I think in time that would lead to reach certainly a stop in the tuition inflation and maybe some rollback in peace it’s interesting enrollments have

27:59 fallen for the last six years in higher ed and the reason seems to be kids are starting to say hey the benefits of going to college are not rising faller you hear about all these kids end up working at Starbucks when they graduate which you could do with a high school

28:21 diploma the benefit sort of stagnant the profit rising so some people are saying just say no to college and so a few colleges now are actually starting to cut tuition fees for next year believe it or not and and some fairly prominent

28:42 schools are talking about 20 30 percent reduction in fees ah and do less discounting the tuition to charge different houses different suit I think it’s an idea that time is some Olivia asked me do you think tea tenures and quite an important issue in

29:04 higher ad and I I think tenure is an issue but how important of an issue is debatable I think as a whole it tends to get a little bit overstated as a problem because there are benefits to tenure

29:26 their cross to tenure the typical University about a third to 40% of the budget goes for instruction directly and involves any on tenured professor sixty or seventy percent of the money goes for other things so I would appreciate so

29:50 you know this is an isn’t issue if I had my druthers I think I would offer professors when they’re hired or choice you want to be on a tenure track or do you want to be on a non tenure track what would say of course I want tenure well then you tell them well that’s a fringe benefit at your bind you’re

30:11 buying dog security and so you’re going to take a $10,000 smaller salary or $15,000 smaller salary in other words we ought to recognize that tenure confers benefits on professors and we should make that an explicit but make that more explicit in the cost structure of the university ah to me it isn’t a top issue one of the

30:36 top three or four what should government do about the hazing issues favoring higher education Kelly F I’m not sure exactly what is meant by that I assume this is referring to issues such as the Trinity’s like the recent by Delta Theta

30:57 episode of LSU where a student literally was died from excessive alcohol relating the hazing I think that those kinds of activities should appropriately be handled by legal authorities but I think not only the kids should be punished in terms of

31:18 being thrown out of school or similarly put on some sort of disciplinary probation but I think that they should go to jail I mean this is killing a murder is murder and by the way I feel the same thing about campus sexual assault issues I think as a rule the official small issues it should be

31:40 handled by the courts if you if there’s a rate that goes on by two men involving two individuals who are not involved with universities 19 non student and the person being raped wants to file charges against the other individual that goes to court has handled by the by the

32:02 prosecutors the police and the judiciary and I think by and large that should be the way we handle campus sexual assault cases as well and all I will tell you I was very strongly applauded a secretary divorce and her recent actions to sort

32:25 of try to write the balance in terms of fair play and due process in matters of this matters like this I’m probably getting necessary getting a little far afield Shelley Oberlander asked me multiple questions

32:46 they’re all interesting but one I’m I just happened to be reading right now please address affirmative action has it’s necessary time see well I think so we’re in a nation where I think most people the overwhelming majority of

33:07 people of goodwill aw all believes that people should be allowed to advance in life regardless of brute characteristics such as the color of their skin or their religion or their other attributes their gender other attributes about them and I think

33:30 that this is in a revolution in American thinking over the last half century fifty years ago we didn’t have that revolution maybe at that time affirmative action serves a useful function I think you could argue that point make that point Oh today I think it is a very dubious point I think that

33:55 if we removed all of her live-action rules at universities I don’t think that we would see massive increases in overt discrimination in favor of one race versus the other I think we would probably have a reduction in some racial tensions on campus ultimately there’s a

34:16 lot of resentment on some people’s part because of it what they view as the unpaired a use of affirmative action and I have become convinced that the affirmative action program is not working as it should and who knows I you know I think this is in

34:39 fact is a radical idea I think University should be prohibited on student admission forms application student application for asking race of a southern individual I think that that is racist in nature to ask him what is your

35:01 race ah and I am fundamentally opposed to it and I was asked by Emma’s similar kind of question with regards to title 9 I don’t 9 has many dimensions to it

35:21 I do think you know we should have open opportunities for people regardless of their gender on campus I generally feel that there’s too much government regulation in it I think we’re in a time of goodwill after all this was directed towards sharing a

35:43 greater opportunities for women on campus my gosh 57 58 for some of us kids going to college today are women and these you can make a pretty decent case that if there’s a good that’s being sort of browbeaten and discriminated on campus it’s white males ah for every three males are on campus

36:06 right now there are four female and so again I wonder whether title nine is is necessary anymore or whether at least we ought to rethink some of the dimensions of it generally speaking I wonder why the federal government should be making intruding on local campuses one of the

36:31 great strengths of American education is every university is their own boss by and large that’s not entirely true there are state university systems are imposed rules on their schools but we have 50 different states so we have at least 50

36:53 different ways of doing things University wise and since we don’t literally over thousands of private schools and we also have state schools with a fair amount of autonomy I think that provides strength students have more choice they can go to schools that are very traditional very say faith

37:13 based in nature or they can go to schools we quite a different tradition ah they can go to school where students are allowed to drink and do all sorts of activities and no doubt smoke pot and everything else whereas we have other universities and colleges which have

37:35 very strict rules against that I think this is it’s great vive la vie for office the French would say and yet when the federal government imposes more and more rules and regulations via title 9 be it student financial aid and whatever it being special assault I

37:57 think we are taking away from that and so I I do have some problems without Daniel Watson no and why student graduates are being underemployed and working in Starbucks well here’s the basic math Daniel

38:18 every year we graduate one 1/2 to 2 million new college graduates ah every year the American labor force is adding about 2 million new workers but some of those new workers are people that are doing things that are passing applause before my relatively unskilled

38:39 laborer people don’t need a lot of skill the workers and Starbucks and in retail trade and some people on construction jobs are and even some people I’d say the lower level skills in my health profession home health care aides and so forth we have we need a lot of those

39:01 we’re probably adding in terms of managerial professional and technical workers now maybe four or five hundred thousand of these jobs a year maybe a little bit more in some year but we’re turning out a million I have two million on new college records the math is such is that there is not enough sort of high-paying professional high-skilled

39:22 jobs available for the number of kids going to college so that’s why I say and some people think it’s provocative and they think it’s terrible for me to say but I think the evidence supports it and then once things were over invested in college what are having too many kids go to four years to get major in whatever gender

39:42 studies or social work or whatever it might be economics philosophy and all some of these people are able to get jobs some of them are not even there they get some sort of job but they’re getting jobs sort of not the traditional level I jokingly have said that by 2025 you’ll

40:04 need a master’s degree in janitorial science to get a job sweeping floors if things continue the way they are now that’s of course a bit of an exaggeration but that’s the way things are moving and so maybe we ought to be telling more and more kids why don’t you go to Welding school and learn how to weld or why don’t you go learn how to drive an

40:25 18-wheel truck or whatever learn how to fix hair ah and these jobs pay a little bit less but you also have a lot less of expense remember a good hunk of the students who go to college never graduate they end up with large debts and

40:45 relatively little educational skills that make them prepared for the labor force so we have a lot of failures in higher ed and so I think we should try I don’t want to make hire it elitist but I think we need to perhaps dial back a little bit what we’re trying to achieve and accept the notion that not four

41:08 years of college is not the solution for everyone so that that is a question do you think I’ve asked you do you think colleges should try to cut down on food rate waste well yes on that rod sunder

41:29 here’s an interesting little factoid I think price of college food is food in dormitories has risen dramatically more than the price of food in the general public whether it’s the food bought in

41:50 restaurants food bought in grocery stores and and so on so there’s a lot of money going into raising food prices and kids go to universities where they go to monopoly dormitory where they’re forced to live and they have to pay whatever the fee is I think there’s a lot of waste there and that probably means a lot of food waste as well one thing I

42:13 would do is I I would separate the food function from the education function I don’t think universities are particularly good in the in the business now amadee is telling me that we’re at the end of the recession I maybe have time for one more question

42:38 I’m asked what would you give the power to pass significant reforms in higher ed back to Congress and thus in my hands the people to be beneficial rather than apartment education or in seconds agents we have a net power I do worry too much about excessive executive power the administrative state is getting out of hand in the United States and while I’m

43:01 not entirely confident in Congress’s ability to perform well at least banning is a democratic process so we are now nearly at the time where I think we have agreed that we’re going to that I’m going to step out of this conversation and renew I will say this I enjoyed it

43:22 very much all right guys thank you so much for participating tonight I think that we all have learned a lot now for the future we are going to be posting this recording either on YouTube or we’re going to be allowing you guys to unsee

43:43 this with a Google Drive link and so so we will let you know which of those ends up being now as far as further information though I’m going to go ahead and switch to our survey page all righty so you guys can go ahead and answer this survey but also make sure that you

44:05 notice the links on the bottom of the page with more debate resources think the vote and then the website of the Center for college affordability and productivity um you guys can use that if you want to reach to have further information on the topic also to announce the winners the winners of the

44:26 free book IBM I have Anna Eckhart Davis Chandler Tiffany Hine Stone and Lily young alrighty so all of those those five students or teachers that I have named I

44:47 mean you guys can go ahead and email me at em h o w AR D at Bill of Rights Institute org that was m8o w AR D at Bill of Rights Institute dot org I’ve also opened up all of these polls so you

45:07 guys can go ahead and answer those questions like I said you can either those went five winners make sure you email me but also if you have any questions for me or any questions about the further about further webinars or anything like that please feel free to reach out I’m more than willing to talk to you guys about

45:28 this and I hope that you enjoyed tonight and we’ll see you before the next debate webinar