Thursday, May 08, 2008

Popping the Higher Education Bubble?

I've written in the past that because for decades the cost of higher education continues to sky rocket twice as fast as inflation, that we may be reaching a point where it doesn't make cents to go to college. Last year I predicted that there would be a revolution in higher education.

Batman at Yeah Right sees similar fundamental changes, but for different reasons. In Popping the Higher Ed Bubble:

"Yesterday, Instapundit linked to an interesting article here about "the next market bubble" being higher education, where government subsidies (obstensibly, to improve access to higher education) have had the unintended (but certainly foreseeable) consequence of inflating the costs of college: "Over the last 10 years, after adjusting for inflation, tuition is up 48% at public schools and 24% at private schools."
There are several important parallels with the recent housing bubble; policy goals of extending participation (in higher education, in home ownership) led to people with serious credit risks borrowing a lot to pay a lot for something that, it turns out, isn't worth what they paid. (Instapundit also linked to a
comment by Dean Esmay explaining his regret about ever bothering to pursue a college degree.)
This bubble, like all bubbles, will have its tragic stories, so I don't want to cheer this on. But if there's a silver lining, it's that it may make people rethink the value of those four years that polite society assumes you need.

It may happen sooner, or it may happen in a decade or two, but at some point higher education will have to adjust dramatically, or cease to exist as we know it.

I wonder if there will be a higher education homeschooling movement?

(Hat tip: Instapundit)

Technorati tags: homeschooling, homeschool, home school, home education, parenting, children, public school, public education, education


Idaho Dad said...

I still say that the experience of a residential college campus was worth every penny to me. The education was secondary.

Going to college and being on my own really helped me to make the transition from youth to adult.

Henry Cate said...

Going off to college can be a great stage for the transistion from childhood to adulthood.

With the trends of higher education costs rising, do you plan to send your children to college?

Currently my wife and I expect our daughters will go to an inexpensive private college, or a state university. I don't see the value of spending hundreds of thousands of dollars to a "prestigious" college. I wonder if maybe my grandchildren might experience the transistion to adulthood in a different setting.

I do think that if the costs keep going up that better options may develop. Frederic Bastiat in his account of The Broken Window points out that often in economics people focus on what happened and don't recognize that other actions could have happened.