Make Colleges Co-Signers Of Student Loans?

As often has been said, if everybody is a genius, then nobody is. The wisdom in this apothegm is little changed by the modification: if everybody has a certification of genius, then nobody has. Especially so if the certification is a bachelor’s “degree.”

The goal of ensuring every citizen is possessed of a bachelor’s “degree” is thus silly. If everybody has a “degree” then there is no use asking to examine the “degree” of any person. Cornell

There would still be an advantage in asking in what subject is a person’s “degree.” But this question is only a proxy to asking what a person knows and what he can do. To the extent a “degree” signals this information, it is useful. But when knowing a “degree” only makes it slightly more probable than not that a person has a set of desirable skills, then again, having the “degree” is of little value.

Which is why it makes sense, if you view college as extended-beyond-high-school jobs training, to do what China is doing. Their “Ministry of Education announced this week plans to phase out majors producing unemployable graduates…The government will soon start evaluating college majors by their employment rates, downsizing or cutting those studies in which the employment rate for graduates falls below 60% for two consecutive years.”

They are doing this because of the tremendous increases in its citizens attending college, and because they recognize that all “degrees” are not equal. “In 2010, 72% of recent graduates found work, up from 68% in 2009, according to the Ministry of Education.” So it can work—although how much of this increase in jobs placement comes from toning down college programs is unclear.

We should recognize that the vast majority of those seeking college “degrees” do so only for the certification, so that they can find a job. There is no other reason that a person would elect a “Business” major except that they are hopeful of job.

The people in majors like “Communications”, “Food Science”, “Marketing”, and on and on are not budding scholars, nor should they be treated like them. We should end immediately the pretense of creating “well rounded” graduates and switch the majority of college undergraduate education to jobs training. Eliminate off-topic mandatory courses—which themselves are enrollment sops to what would otherwise be forlorn departments.

If the kids don’t sign up for certain majors, out the door those majors should go. Many departments in college are just superfluous as many suspect, only kept alive because of Enlightenment politics. Let enrollment vote on what to keep and what to eliminate.

Jobs training should only take two to three years, not four. Right away, the college bill is cut 25% to 50%. Make classes pass or fail, lest any ego be bruised by a grade less than A. Students who play sports for the financial benefit of the school should be paid whatever measure befits their semi-pro status. These kids should not be required to take any classes either, save what the sports program themselves thought relevant.

Keep a core—a Marine Corps, if you like—of intense classes for those who have the brains and ability to manage, for those in the minority who would go on to be scholars, or who would go to college in an effort to gain an education, to become learned, to better themselves intellectually. This will never be more than 5% of our youth. Graduate school can be kept as it is. The only change: entrance exams and personal interviews as criteria for entry, and not blind certification (i.e. “degree” production).

Glenn Reynolds (the Instapundit) would have colleges back the loans of it students. His argument is that a college will not make a loan which it knows is risky. This would back-door the reductions spoken of above: if the colleges themselves won’t fund the kids wanting to go into a field, then that field loses the bucks, and thus eventually the headcount.

But so much for caveat emptor in this system. Plus it seems to forget that as part of Obamacare, Congress slipped in a measure which has we the taxpayers administrating and backing student loans. Having loans bunched up inside the colleges provides yet another way for Congress, through the metastasized bureaucracy, to dictate which programs should be funded and which not. All it would take is a politically connected university (Harvard, Yale, etc.) to come running and the dollars would flow from its ex-students, who fill most of the seats of the government and bureaucracy.

No, let the citizens themselves in conjunction with employers (i.e. the “market”) decide what they want to fund.


  1. dearieme

    “for those in the minority who would go on to be scholars, or who would go to college in an effort to gain an education, to become learned, to better themselves intellectually. This will never be more than 5% of our youth.” I went to university when about 5% of British youth did, and I went to one of the better universities. Even then not all students had recognisably intellectual interests. But there was one great saving grace: a fairly brutal slinging out of those who did not prove up to snuff.

  2. Speed

    … let the citizens themselves in conjunction with employers (i.e. the “market”) decide what they want to fund.

    And a rational market isn’t going to let a 17 year old high school graduate with no assets qualify for tens of thousands of dollars of school loans. Tuition will have to come from Mom, Dad, Grandma, Grandpa and scholarships. And the student’s savings from the part time job at Wendy’s.

    Tuition and fees at Oberlin College:
    o Tuition $42,842
    o Standard Room $6,000
    o Board $5,550
    o Fees $368

    Total $54,760

    Other Expenses:
    o Books $930
    o Personal Expenses $978

    Plus $871 per academic year for Student Health Insurance.

    Same for Cleveland State University is about $21,600. Most CSU students live at home with mom and dad or their spouse so you can knock $12,000 off that number.

  3. Ken

    RE: “The government will soon start evaluating college majors by their employment rates, downsizing or cutting those studies in which the employment rate for graduates falls below 60% for two consecutive years”

    I recall, from many years ago, time on active duty in the USAF with one of those “additional duties” that became a dreary full-time chore: determining USAF advanced degree requirements then feeding that info to the Air Force Institutte of Technology (AFIT), among others, so it could plan accordingly. As it was, USAF was pretty much saturated in a couple of key areas of interest to AFIT…and fudging the numbers was not an option as the data was tracked–all USAF-funded grads had to work, immediately after graduation, in a position requiring the degree.

    In fending off AFIT’s pressure to provide it the numbers it needed (yes, we worked for AFIT! per at least some of thier official’s viewpoint — or, that’s how I recall it…) I found some data from a number of universities that had voluntarily quit admitting students to PhD programs in certain areas of physics, etc. — because they were unemployable [at the time anyway due to lack of demand outside of academia]. If the private sector was self-limiting this there was no reason we couldn’t do the same…was part of the argument.

    AFIT ultimately lost this battle (this was in the early-/mid-90s) — which was truly a battle for its survival….but….innovation of the sort not usually associated with a government, or military, institution saved: and thus was inspired & created the Dayton Area Graduate Studies Institute (DAGSI): a collaborative arrangement between AFIT, University of Dayton, Air Force Research Laboratory (AFRL) and Wright State University (WSU). The Ohio State University (OSU) and the University of Cincinnati are also included in the patnership. The goal is to synergistically share faculty expertise and research facilities. The Ohio Board of Regents provides support in the form of scholarships and research grants.

  4. David

    I sense a serious degree of frustration with the ‘way things are in the land of higher education’ and a wish for a better system. The wish is reasonable but I’m not sure some of the solutions mentioned are.

    What the Chinese are doing is a form of man-power planning. This was a popular notion in the 1960s and 1970s in North America but it is, over the longer term, unworkable. One year you have to few nurses, three years later you have too many nurses and so on. Doing what the Chinese are doing would be a mistake for another reason. They have a top-down planning system that generates its own problems.

    Costs in higher education are driven, not so much by demand, but by the desire of organizations to grow (increase the number of students and/or the fees). Within institutions there are pressures to short-change the students (e.g., by having part-time lecturers do much of the heavy lifting while senior faculty concentrate on ‘research’ or have more administrators than faculty and so on).

    The costs are also driven by the quasi-monopoly held by the existing institutions. There are large barriers to entry (i.e., starting a new college or university). So there is a serious absence of price competition.

    Having the educational institution agree to the ‘student loan’ might help. A different, and I think better, idea would be to have an independent agency approve the loan where the independent agency has some reliable data on the ‘costs and value’ of the offerings of a particular educational institution. A bank will lend a client money to purchase an automobile knowing what the market value of the automobile is. Letting the institution guarantee the loan will land everyone back into the same nightmare that can be characterized by the sub-prime mortgage market mess.

    The short-term and the long-term solution is to create something resembling a market. For a market you need competition and information about the product being sold.

    It took a generation or two to get into the mess. Turning things around is going to take at least that long. A quick and easy solution might look attractive but it’s hard to see where one could come from short of the Chinese taking over.

  5. Ray

    People with a college degree tend to make more money so if everybody has a college degree evryone will make more money. Perfectly logical. Of course it’s an example of cargo cult thinking to belive the degree causes the higher income. It’s like the scarecrow in the wizard of oz receiving a diploma and suddenly becoming intelligent because of the diploma.

  6. Isnt there a chicken and egg problem with this proposal? Unless we make a change like this wholesale, it will mean that people doing “job training” in two/three year colleges will always be considered inferior to those graduating from four year colleges.

    Also, companies want to hire the best of the lot in a graduating class. I wonder how they will take to the idea of students just getting a pass/fail grade.

    Instead if companies changes their hiring philosophy to hire on probation, observe the candidate for six monts to a year, and fire if he didn’t work out, might that work?…

  7. The first “training” course, required of all students, should be Gamblers Anonymous. Learn how NOT to make absurd bets. Such as, wagering a couple hundred G’s on a diploma.

    How are our colleges different from racetracks? Racetrack betting is confined to adults only. Colleges seduce children into gambling huge sums on sure loser propositions. We should heavily tax and regulate colleges, just as we tax racetracks and other sin mills, instead of financing them.

  8. Doug M

    If college is job training, why go to college instead of going straight into the workforce. Do you think you are going to learn more about business in a class room than you are in business? Perhaps rather than a business degree colleges should build a network of university / employer partnerships, where the students pay employers for the opportunity to go to work to be trained.

    I never hire business majors. Busniess majors lack the curiosity to study anything intesting and are just looking for a diploma so that they can start the job hunt.

    A favorite rant of James Taranto at the Wall Street Journal — employers are not allowed to give applicants an IQ test. Colleges can. The college degree suggests that the job applicant is at least smart enough to get into college.

  9. Speed

    Briggs wrote, “if everybody has a certification of genius, then nobody has. Especially so if the certification is a bachelor’s “degree.”

    “The goal of ensuring every citizen is possessed of a bachelor’s “degree” is thus silly. If everybody has a “degree” then there is no use asking to examine the “degree” of any person.

    The large economic goal of having a larger set of the population better educated is to increase the economic productivity of the nation as a whole. If the entire US population’s skill set included only substence farming, I’d be eating roots and berries for Christmas (although the rabbits and deer wiped out my already meager production this year). Since the US population includes people skilled in high input agriculture, distribution, automotive engineering, high efficiency gas heat, inexpensive construction materials, digital books, anti-hypertension drugs and so on, I’ll be eating way too much on Christmas while watching services from some far away cathedral and/or video chatting with family and friends (I recommend an Xbox with Kinect).

    My reason for getting more education may have been more personal income but the result of more education at the national (and world) level is greater than the sum of the individuals’ success.

  10. Briggs


    I’m all for an increase in education, of the learning of valuable skills. I am hearty disfavor of earning “degrees”, which is not equivalent to gaining an education. This is why I would change most undergraduate programs to training of skills—engineering, farming, computer programming, etc.—and not the goal of a liberal education, which I would save for only those who can manage it and who want to.

    Love the break down of tuition and costs!

  11. Speed


    As examples of “liberal education” and “training of skills” the Oberlin vs. Cleveland State are perfect examples. Oberlin is as liberal (in both senses of the term) as you’ll find anywhere while Cleveland State has degree programs aimed at gainful employment upon graduation (sorry, no farming). CSU ain’t MIT (neither Microsoft nor Google recruit on campus) but the price is right. Interestingly, CSU was one of the first schools to have a co-op program.

    The idea that students have to go deeply into debt to get a BS/BA is stupid and there is plenty of blame to go around — recruiters, High School advisors, parents, peers. One (likely unworkable) solution would be to have loan repayment (amortized over ten years or so) begin as soon as the student starts school. First payment (based on first quarter tuition) due September 30. January 1 (the beginning of the second semester), the payment goes up.

  12. Gary

    The reasons (valid or not) for general education courses are:
    1. most people will have multiple jobs in their lifetimes and not in the same narrow area.
    2. exposure to different knowledge areas gives a broader prospective and experience that may be advantageous to a narrow career area (think writing & rhetoric or language courses and engineering).
    3. preparing for responsible citizenship beyond career interests.

    Make of those what you will. Not all students avail themselves of the opportunity and not all faculty/administrations are pure in their intentions. But some benefit greatly from sampling a wider variety of coursework in ways that are hard to quantify, yet are valuable.

    The real problem is going to college because you are 18 rather than because you have a goal and a plan. The solution to that starts way before high school graduation. It also begins with parents who understand their responsibility to manage their children’s educations.

  13. Speed

    Alex Tabarrok at The American.

    First, there is plenty of risk in sending a kid to college! Forty percent of students don’t graduate within six years (and probably never will), many more graduate with degrees that won’t help them much in the labor force, and even the ones that do graduate often do so with student debt that will follow them for decades. Moreover, even when college pays for kids is it paying for society? A lot of schooling is just signaling, not the true building of human capital. There is an argument for subsidizing science, technology, engineering, and math fields, but should we really be subsidizing anthropology, sociology, and English lit students?

    By the way, when I make these arguments I am sometimes accused of not appreciating that college education makes for a “well-rounded” person. What a load of rot … take a look at students in Finland, Sweden, or Germany. In these countries, more than half the students enter apprenticeship programs instead of going to college, but these students are very well-educated and well-rounded.


    Tabarrok has a TED e-book selling for $2.99: Launching The Innovation Renaissance: A New Path to Bring Smart Ideas to Market Fast.

  14. commieBob

    Our college has trouble recruiting students into two and three year programs with a 100% employment record. The jobs usually pay OK too. We did market research and held focus groups. What did we find? Parents want their kids to have degrees. They won’t consider anything else.

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