Archive for the ‘Education’ Category

Critics of the President’s State of the Union address noted it did little to promote bipartisanship. Yet, it has already stimulated bipartisan agreement on one of the President’s education proposals.

In the State of the Union, President Obama proposed free community college:

“I am sending this Congress a bold new plan to lower the cost of community college—to zero.

…Whoever you are, this plan is your chance to graduate ready for the new economy, without a load of debt. Understand, you’ve got to earn it—you’ve got to keep your grades up and graduate on time. Tennessee, a state with Republican leadership, and Chicago, a city with Democratic leadership, are showing that free community college is possible. I want to spread that idea all across America, so that two years of college becomes as free and universal in America as high school is today.”

One detail that failed to make it into the State of the Union address: The funding for the program would come by effectively killing the 529 college savings accounts, that exempt earnings from taxation if used for educational expenses.

This fact stimulated bipartisanship, albeit not the kind the President anticipated. As Jonathan Weisman (New York Times) explains:

President Obama, facing angry reprisals from parents and from lawmakers of both parties, will drop his proposal to effectively end the popular college savings accounts known as 529s, but will keep an expanded tuition tax credit at the center of his college access plan, White House officials said Tuesday.

The decision came just hours after Speaker John A. Boehner of Ohio demanded that the proposal be withdrawn from the president’s budget, due out Monday, “for the sake of middle-class families.” But the call for the White House to relent also came from top Democrats, including Representatives Nancy Pelosi of California, the minority leader, and Chris Van Hollen of Maryland, the ranking member of the Budget Committee.

Although this means of funding the community college proposal seemed particularly tone deaf, it does illustrate that bipartisanship is possible when protecting tax expenditures. Imagine if reformers focused on even larger tax expenditures (e.g. the $212 billion exclusion of employer-provided health insurance, the $176 billion expenditures for pensions and 401(k)s, or the $101 billion deduction of mortgage interest)? A new era of bipartisanship might bloom.

Related: See Josh Kraushaar in National Journal for an interesting piece on the SOTU and the implications for Hillary Clinton 2016.

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Graduation is upon us. Many of my students are graduating with higher student loan debt than they would have imagined and limited job prospects. A few weeks back when I discussed future plans with several graduating seniors, there was a sense of dismay and a sense that the odds were against them given the poor economy and, more importantly, the trends in inequality.

The good news (which I guess could also be bad news, depending on the depth of your commitment to equality) is that the degrees they are earning may well contribute to inequality. A new paper by MIT’s David H. Autor turns attention to inequality among “the other 99 percent.” We have heard quite a bit about the growing concentration of wealth in the top 1 percent. As Autor notes:

Between 1979 and 2012, the share of all household income accruing to the top percentile of U.S. households rose from 10.0% to 22.5% To get a sense of how much money that is, consider the conceptual experiment of redistributing the gains of the top 1% between 1979 and 2012 to the bottom 99% of households. How much would this redistribution raise household incomes of the bottom 99%? The answer is $7107 per household—a substantial gain, equal to 14% of the income of the median U.S. household in 2012.

But what if we look at the “other 99 percent?” Here we have a story of the wage premium associated with higher education. And these gains simply dwarf the above-mentioned figures.

consider the earnings gap between a college-educated two-earner husband-wife family and a high school–educated two-earner husband-wife family, which rose by $27,951 between 1979 and 2012 (from $30,298 to $58,249). This increase in the earnings gap between the typical college-educated and high school–educated household earnings levels is four times as large as the redistribution that has notionally occurred from the bottom 99% to the top 1% of households. What this simple calculation suggests is that the growth of skill differentials among the “other 99 percent” is arguably even more consequential than the rise of the 1% for the welfare of most citizens.

Obviously there is a difference between cognitive ability and credentialing. My students who have majored in the “department of fashionable studies” will likely not make as great a contribution to inequality as might have been the case with a different major.

Bottom line: the paper is interesting throughout, engaging some important issues such as intergenerational mobility and the policy implications.

For additional coverage of the paper, see Jim Tankersley, Wonkblog. An interview with Autor can be found here.

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Is Graduate School for Me?

Jason Brennan has a nice talk on this question over at BHL. My crankier piece, “Don’t Go to Grad School,” is here.

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The Problem of Education

The OECD has released the latest results from PISA (Program for International Student Assessment).  The key findings regarding US educational performance are not encouraging. Of the 34 OECD countries, the US ranks 26th in mathematics, 17th in reading, and 21st in science. The results in mathematics are of particular concern. As the OECD notes:

Just over one-quarter (26%) of 15-year-olds in the United States do not reach the PISA baseline Level 2 of mathematics proficiency, at which level students begin to demonstrate the skills that will enable them to participate effectively and productively in life. This percentage is higher than the OECD average of 23% and has remained unchanged since 2003. By contrast, in Hong Kong- China, Korea, Shanghai-China and Singapore, 10% of students or fewer are poor performers in mathematics.

At the other end of the performance scale, the United States also has a below-average share of top performers in mathematics. These students can develop and work with models for complex situations, and work strategically using broad, well-developed thinking and reasoning skills. Only 2% of students in the United States reach the highest level (Level 6) of performance in mathematics, compared with an OECD average of 3% and 31% of students in Shanghai-China. The proportions of top performers in reading and science in the United States are both around the OECD average.

The results are interesting given that the US is wealthy (ranked third in per capita GDP) and has more educated parents than most countries (ranked sixth in percentage of 35-44 year olds with tertiary education). While many might claim that the US fails to invest sufficiently in education, it spends more per student than most (ranked fifth). On this point, the OECD notes that the Slovak Republic performs at the same level as the US, but spends less than one half the amount per student.

It is clear we have a significant problem here (and a problem that dates back decades and has become more significant in a global economy). Motoko Rich (New York Times) has a piece on the PISA results and some of the competing reactions (they range from dismissing the results to calling for an expansion of the welfare state). While advocates will continue to promote their solutions, I am always reminded of As John Kingdon’s  classic Agendas, Alternatives, and Public Policies. As Kingdon observes “In contrast to a problem-solving model…solutions float around in and near government, searching for problems to which to become attached.”  Events like the release of new data on educational performance can open a window of opportunity that facilitates the coupling of solutions and problems. Unfortunately, there is little to suggest that the solutions are genuinely solutions.

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Jordan Weissmann at The Atlantic has a story on the revelations that George Washington University rejected applicants on the grounds that they would have required financial aid. Apparently the university had advertised itself as “need-blind” in its admissions policies, but in fact the admissions office ended up rejecting marginal needy applicants in favor of marginal tuition-paying applicants in order to balance the books.

I have a couple of problems with the way Weissmann editorializes on this story. First, he tries to put GWU’s practices in a better light:

Some schools have openly defended this approach by arguing that it allows them to offer fuller financial-aid packages to the lower-income students they do admit. That’s the line GW is adopting now, and it may or may not be true. At the very least, their approach is less ethically disturbing than the widespread practice of “gapping,” where schools admit students on a need blind basis, but frequently award them a financial aid package that’s too small, sometimes with the express purpose of discouraging them from attending. Kids who fail to take the hint just sink deeper into debt.

And just why is GWU’s lying about its admissions policy less “ethically disturbing” than otherGWU schools’ practices of letting needy students themselves decide whether to come or not? One practice is a fraud or very near a fraud; the other practice “discriminates against” non-paying customers in the same way that a Jaguar dealer is likely to “discriminate against” me. In Weissmann’s view, policies that refrain from engaging in paternalism toward needy applicants (“you really shouldn’t take on this much debt, and so we won’t give the choice to”) are ethically more “disturbing” than fraudulent policies.

Then there’s this:

Finally, this incident is also symptomatic of a wider sickness in higher education: the mania for prestige. Even while it’s freezing out poorer qualified applicants, the university continues using “merit aid” to recruit desirable students who might be able to pay their own way. GW isn’t alone in that practice. It just got caught covering it up.

Wait, what’s wrong with merit aid again? I’ve seen proggy types crusading against it here and there, but I haven’t seen anyone even bother to make a real case against it — to them anything that doesn’t overtly maximize the well-being of the poor is wrong, I suppose. Let’s remember that we live in a world of resource constraints. Universities operate in a competitive environment and have to at least break even in order to finance facilities, faculty, and staff. It’s wishful thinking to suppose that they will be completely blind to the ability and willingness of their customers to pay. There’s every reason to think that if a university did operate on a completely need-blind basis, unless a generous benefactor insisted on such a policy, it would enjoy fewer resources, fewer faculty, smaller facilities, and be able to admit fewer students. How do poor students benefit from that outcome?

In my own case, I was from a poor family and qualified for full financial aid: a 100% free ride, work-study, Pell grants, and all the rest. However, for the last three years of my undergraduate education, I actually got a merit scholarship that covered everything. If you’re a student from a poor – or perhaps, especially, a middle-income – family, and you want to go to a private college, you need to count on going to a college that is a little bit below your ability level. You’ll be one of the big fish in the little pond helping to drive up the college’s scores and attracting the applicants. That’s what you’re giving them in exchange for their ignoring your inability to pay. You can still get a great education and have plenty of opportunities ahead of you, if you have the right attitude about it.

If you think the poor in America don’t get a fair shake, (more…)

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An article on the plight of adjunct professors in higher education, “Labor of Love or Cheap Labor? The Plight of Adjunct Professors,” was brought to my attention by its author, Celine James. Ms. James kindly asked me for my thoughts about her article. I thought Pileus readers might be interested in what I sent her. Here it is in full:

Dear Celine,

I have had a chance to read your article. I empathize with the plight of adjunct instructors that you describe. It is, or can be, a terribly difficult life. I am afraid, however, that I cannot endorse the solution you suggest, namely unionization.

Higher education is operated like a medieval guild, with special protections for the lucky few who make it in and special benefits to them that come at the expense of all those who were not lucky enough to get in. The problem is the rigidity in the labor market that this creates: once a person is in, he or she cannot be fired, regardless of performance, for life.That is a great deal for those who get in, and it explains why so many try so desperately hard to get in, but it is a model for maintaining an unjust, and slowly dying, status quo rather than responding to changing economic realities we actually face.

The solution would be not to extend the guild system to a slightly larger cohort, but, rather, to abandon it altogether. In other words, we should abolish the tenure system. In a world with thousands of institutions of higher education, along with now an almost unlimited upper bound of educational opportunities online, there can be no justification for the economically stifling and restricting system of guild benefits for a privileged elite.

In earlier times, the guild system was so detrimental to those not lucky enough to enter one that it often prevented people from finding gainful employment of any kind. That led to obvious and predictable disastrous results for the unlucky, even while it enriched and protected the lucky. Exactly that same dynamic is being played out now with the lucky few members of the restrictive guild (i.e., tenure-stream professors) and the unlucky many who are locked out (i.e., the adjuncts).

The one saving grace for today’s unlucky adjuncts is that we now live in an economy that is, compared with earlier eras, extraordinarily dynamic, diverse, and productive. So they have other options if they don’t land a winning lottery ticket admitting them into the guild. But until the core of the problem—restrictive guild membership rules—is recognized and addressed, the other suggestions you make in your article will, unfortunately, have only marginal effect at best. And recommending unionizing would merely contribute to the problem—especially when we are probably on the cusp of a bursting educational bubble.

With best wishes,


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Roger Koppl argues this week at ThinkMarkets that “Income inequality matters.” He thinks it matters so much that he says it twice. He believes “Austrian,” pro-market, economic liberals should be speaking up more on this “central issue.” I think Koppl could not be more wrong. The issue deserves all the inattention we can muster for it.

The problem I think is not Koppl’s motives. He rightly says that we should “watch out for ways the state can be used to create unjust privileges for some at the expense of others.” He is certainly right about that. He argues that unjust state policies may be skewing market results in such a way as to increase inequality. He may be right about that. But he is wrong in suggesting that we ought therefore to be paying attention to income inequality. We ought therefore to be paying attention to those policies. Whether they produce greater inequality is neither here nor there.

Koppl gives four examples: (i) policies that privatize profits and socialize losses, (ii) bad regulation, (iii) collapse of the rule of law, and (iv) public schools. I can certainly join Koppl in a hearty wish that we not only attend to these unwarranted policies, programs, and tendencies, but that we do so with a degree of urgency prompted, in part, by their effects on the poorest and most vulnerable among us. But talking about inequality is precisely a distraction from doing so.

In a great paper of a few years ago, Harry Frankfurt argued that “Egalitarianism is harmful because it tends to distract those who are beguiled by it from their real interests.”* Frankfurt thought that focusing on equality was actually pernicious because it distracted us from attention to real harms, of which inequality is at most an indicator. And he was right. It may well be that, for example, the evisceration of the rule of law results in greater income inequality. But it also might not. Whether or not it does so, however, it is unjust, and it deserves our attention. Similarly for the increase in moral hazard and regulation, to say nothing of the deplorable system of public education. All of these need attention, and one prime reason they do so is because of their effects on those least capable of circumventing their evils. If we care about the poor, what we ought to care about is bad policy, not indicators that may or may not have anything to do with policies that are making people worse off. As long as we are worrying about income inequality, we are worrying about the wrong thing.

* In “The Moral Irrelevance of Equality,” Public Affairs Quarterly, April 2000.

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