Higher Education in Crisis | Timothy D. Terrell

so I wanted to to start off with a discussion of higher education and I've got to talk later on today on energy economics and hopefully I'll uh um be able to keep those two straight um I've been teaching for I figure about 25 years maybe a little more and um I enjoy teaching thoroughly but things have certainly changed in higher education since I started and um most of you are in higher education on the consumer side and so I'm hoping this will be interesting to you you certainly noticed that the cost of higher education has gone up that's one of the things I want to talk about this morning and I before I move on for my my introductory slide here I just want you to notice where College tuition is on price the price change trajectory here from the last 25 years or so the only thing that has exceeded the increase in the cost of college is Hospital Services which I talked about yesterday in my medical care talk and you'll notice that housing College tuition Hospital Services child care and nursery school all of these are areas where government has subsidized or is providing some of these Services directly and I don't think it's a coincidence that we see some very high price increases in those areas last year when I gave this talk I had three crises to discuss now I have four if that tells you how things are going and I've rearranged this a little bit but I want to talk first about ineffective teaching and then we'll talk about the enrollment clip which is a new one for this year I have not discussed that in the past so um I think there's a lot of very effective teaching and going on in college but there's a lot of ineffective teaching as well and the incentives that we see are such that poor quality education excuse me poor quality education is becoming more and more common part of that is because the incentives that professors face and part of that is because of the way colleges are administered um so what is we we need to think about exactly what it is that we're doing in college um it's it's very common to think of a college or university education as being one that is transferring useful skills to you um at best it's it's the best conception we have of higher education is this is teaching people how to think um how to reason um maybe uh some technological kinds of knowledge that are that are coming along with that um but basically enhancing what is commonly called a human capital another possibility is that college education is kind of a signal of your motivation your your willingness to persevere at a difficult task at your level of intelligence and capability um maybe this is something that is that is uh useful because it signals to a future employer that you're a hard-working capable individual who would make a good employee and maybe it's less about the content of what is learned than the fact that you are willing and able to learn something another possibility is that it's simply a consumption good you go someplace for four years and you have a good time and occasionally you show up for classes because you need to be able to maintain grades that are good enough for you to be able to stick around for the next year and there are certainly a lot of facilities on most campuses that are intended to kind of cater to students enjoyment of their their time there um but we can see part of the part of the uh transition that we've seen in the last several decades in college education is toward higher and higher grades with less and less effort on the part of students and so this is um something I'll mention in a minute but first let me give you the the case for higher education as you'll see from say a high school guidance counselor or a a lot of the colleges will trumpet this kind of information about how much more you can earn if you are a college graduate as opposed to not being a college graduate and and certainly we can see that if you have a college degree you are more likely to be in a high income group that's not really new information however I think there's some confusion about this maybe some misinterpretation what we're lumping in here is not just recent college graduates but people who are you know baby boomers who have been around for a long time they graduated from college in the 60s or 70s and they uh they've been working for a long time and when they graduated from college going to college was not as common as it is today so we're seeing some high earners there that may have been through the higher education system at a time when it looked very different from what it it looks like today this chart here table is from Richard vetter's book restoring the promise which I um I've got a review on that book on the uh qga AE quarterly Journal of Austrian economics website if you're interested more about that book but he um he says so so we we see this this very significant increase in in earnings as you obtain more education there's no real um I'm a surprise there so if you look at the median uh person with a with a bachelor's degree males are earning about sixty three thousand dollars a year in 2016 females about forty one thousand dollars a year and if you had a high school diploma only then that Medium is a lot lower 33.5 for males about 20 000 for females and that that's a pretty significant income boost that appears to be correlated with more education and then of course if you look at alternative Investments it it looks like college is a great deal um and it let me be sure to clarify this is a good deal for many students I mean it makes sense for many students to go to college I'm not trying to say this is a racket for everybody and nobody should go to college and this is useless and don't take that that's not the takeaway I want you to get from this I don't want to talk myself out of a career for one thing but that's that's uh that that's not the case what we're seeing however is that there are at the margin there are people going to college for whom that payoff is not going to materialize and that's where we're seeing a lot of problems people are are accumulating student loan debt and they're absorbing four or five or six years of their time trying to get a degree that is not going to actually generate that kind of return so it really depends on who you are and what your what your interests and capabilities might be um Richard Vetter has pointed out that we we are over educating many people so we've got um about half of the occupations that we see people in require a bachelor's degree but a little over a third only require a high school diploma at best um and about 11 require something more than high school but maybe a two-year degree would have been sufficient we see many more people graduating from college than we have jobs that actually require a college education so we've got at least according to this what is that about 12 or 13 or 14 million people who are graduating with a college degree but we don't really have to have that level of Education to take the kind of job that they will eventually get and we can see how this has changed over time so the on this uh chart here the black column is in 1970 the gray column is for 2010 and we've got about 15 percent today oh well in 2010 we have 15 percent of taxi drivers who have a college degree whereas a in 1970 it was a very very tiny number of taxes why do you need a college degree to go to to drive a taxi uh same thing with shipping and receiving clerks uh sales people firefighters Carpenters bank tellers these are nothing against these jobs I mean we we need people to do these things but do they really need to spend four years of their life and at least tens of thousands if not hundreds of thousands of dollars gaining that sheepskin in order to do those kinds of jobs now if if you've seen this talk before you'll know about my little pipeline diagram here I'll just go through this very briefly um if you've got the population here on the left you've got the the blue and the red or uh two different kinds of people so you've got motivated persevering intelligent people and then people that are not so motivated persevering or intelligent they're kind of all mixed together in the population so if you're in the population and you're a motivated persevering and intelligent you would like to be able to demonstrate that character those characteristics that you have to a potential employer you'd like to be able to say look here's proof I'm not just saying that I am motivated persevering intelligent I actually am and here's how I will show that I will go through a four-year program that will test my motivation perseverance and intelligence and then if I come out on the other side with a certificate call a degree then you'll know I really am motivated persevering intelligent doesn't matter too much what the major is well it some Majors require more motivation persevering and intelligence than than others right so this is why for example Wall Street firms like to hire people with uh you know like physics degrees and and and and engineering degrees it's not that you need to know uh the you know the curvature of a pipe and how much head loss there is in a in a pump system in order to be able to trade stocks but uh you know if that person is willing to go through that very different uh or very challenging program they must have the kind of characteristics that you want for a demanding kind of occupation so uh people go through this filter they put themselves through this in an effort to show what kind of person they are now some people don't make it through the filter they fail or they drop out not the dropping out is always a sign of lack of motivation I mean Bill Gates dropped out and he's a pretty motivated person um and uh then you've got people that just don't enter the filtering process as well so some of those are motivated persevering and intelligent they just didn't want to spend four years and a lot of money going through the filter but then you get people that are certified and that would be more or less what we had in higher education prior to World War II prior to the GI Bill and huge amounts now there were there were government subsidies of higher education before World War II but World War II and the GI bill that came later on really um turned the system into a a system where we are we are pushing more and more people into this this kind of filtering process and colleges and universities like money they like to get more students coming in if you could colleges and universities can see every 18 year old as someone with a backpack full of federal or state money and the only way to get access to that federal or state money is to admit this person into your into your college or university so with that additional incentive that we get a lot more people trying to go through this filtering process and the college or university has incentives to extract as much from that person over the four-year period as they as they can so the filter becomes less effective it's not as as useful for certification purposes and we get a lot of people to kind of make it through that filter they get their college degree but it doesn't really mean as much as it might have at one point and we get a kind of an arms race among people who are uh who are college who are seeking a certain kind of occupation and they want to be able to prove that they're motivated persevering and intelligent but maybe the four-year degree isn't as effective at conveying that signal as it once was so we have for example um Brian Kaplan who wrote a book called the case against education he is a college professor as well he might think he's trying to self-sabotage his own career in saying this but he you know he says look um uh we're over educating people he says once workers have been ranked giving everyone extra years of education is socially wasteful and so we're probably under utilizing he says certain kinds of Alternatives like apprenticeships testing boot camps and so on so he says signaling if you think of education is not so much the conveying of information to students but as trying to prove that you are at the top of the stack and motivation perseverance and intelligence he says signaling explains why students are more concerned about grades than about actual learning why it is that you you um uh can take a test kind of dump your knowledge onto this test and forget about it thereafter and you're not too worried about what you've retained signaling explains he says why cheating pays a cheater is not really gaining the information but the cheater is impersonating a student who is motivated persevering and intelligent and carries the same degree at the end of the four years as anyone else so he says look we just need to stop educating as much as we currently are and the way to do that is to cut a government education spending it at one point you could make a decent living with a high school diploma in a lot of occupations that was perfectly sufficient you could do do pretty well for yourself but what we've had is a kind of credential inflation which we probably need to to counter with some credential deflation you might be able to be a if if your objective is to be a retail sales clerk and why go to college I mean you don't need that anymore if you had less money being pumped into the education system and then two there's there's not a lot of evidence apart from the occupational boost that you might get from a college degree you could say well there's other things in college that are valuable apart from just preparing yourself for some chosen occupation but Kaplan says look there's there's little sign that education is causing much Enlightenment or Civic understanding even at top schools he says most students are intellectually and culturally apathetic most professors are uninspiring not this crowd of course but that is I mean you probably observed this if you're in higher ed among your fellow students just a lot of apathy there's a lot of uh they don't care and a lot of Faculty are that way as well um I I wanted to say a couple of things about plagiarism which is rampant it's all over the place um administrators the admissions offices and in colleges and universities are often incentivized to take students because again they come with that backpack full of federal and state money um if the student can't write very well or doesn't have a lot of other requisite skills um well maybe maybe we can kind of Shepherd this student through uh with some additional help but we don't really need to have students who are adequately prepared or at least we've got an incentive to accept students that are not not very good at basic College skills and administrators as well once the student gets into the higher education environment the administrators don't have a whole lot of incentive to prosecute plagiarism faculty um often are well I can I can speak for myself I I get personally offended when students plagiarize and so that kind of motivates me out of a sense of justice to prosecute cases of plagiarism when I when I see them but Administration their incentives are a little different I think they do need to maintain the reputation of a school but at the same time there's a lot of incentive to kind of sweep things under the rug or at least make things so difficult for faculty to actually effectively prosecute uh plagiarism that it is it is not done very often or not as often as it should be AI is making this worse and it is it is becoming a real problem uh faculty and administration are still trying to figure out how to handle a lot of this it's a fairly new thing um that that you know chat GPT has been around for less than a year and we're still trying to navigate some of that um so uh Jonathan Newman uh who wrote an article for uh Mrs wire um a few years ago on this title was four reasons why college degrees are becoming useless uh he he says that some of the most prestigious Flagship universities test results indicate that the average graduate shows little or no improvement in critical thinking over four years um uh great inflation is largely responsible for the increased graduation rates that we have seen and we are seeing higher graduation rates I've had people tell me well that's because students are smarter now than they used to be and that's why they're able to stick around for four years and not flunk out I I no um so one National survey found that 41 percent of students had gpas of an A minus or higher in 2009 compared to 7 40 years previously um a 2022 study showed that the increase in graduation rates over the last three decades is driven by great inflation it's not that students are actually learning more or that they're more capable they are receiving higher grades with less effort you can see the grade distribution has become very much skewed toward A's and B's D's and F's are are rare I think a lot of this is because faculty don't give C's as much as they once did um a lot of there's a lot of pressure on faculty for to to give students higher grades and a lot of this again is tied back to government money you know in order to get my scholarship I've got to maintain a GPA of X and Professor if I don't get a grade of a or b or whatever in your class I'm going to lose my scholarship well no faculty member want I mean if you've got a heart at all you don't want to you know be responsible for the student having to leave College I mean uh so yeah okay well I mean the student has a 76 maybe I can fudge that a little bit and make that an 80 so the student doesn't have to flunk out I mean um if you're not relying on massive government funding of higher education you know you have students that are getting C's but because they're more often if they if they were more often self-pay you still get your degree maybe your GPA is not a 3-0 but you graduated and um and and that's fine it used to be this thing called the The Gentleman's C I was reading a buyer biography or something of Franklin Roosevelt who apparently was not a stellar student um not really surprising but I mean he he I had to take a swipe at FDR but um but you know he was kind of a c student and made it through and and uh he apparently had other priorities or something so uh that was at one point acceptable and it was fine and students weren't just um tormented by the thought of getting a c um students are spending less time uh I gave this talk a couple of years ago where I showed this um this slide and I had a student say well maybe maybe this is because we have the internet and so because we have the internet and we don't have to go through card catalogs like you did back in the 80s maybe we're able to just do research faster and we're able to type faster because we have computers as opposed to handwriting and typewriters and so forth uh I I was on the I.T uh committee at my college I talk to our I.T or CI CIO I guess the equivalent of the CIO and years ago I remember uh talking to this person and he he told me what the internet usage was uh among college students and it is not research uh predominantly it it should be but it is predominantly other other things uh video games among other things the second um see you know all right so uh so uh the second crisis is the enrollment cliff I was talking to Sean Ritenour earlier this week and he said so you're going to talk about the enrollment Cliff right and I thought oh I guess I better so I will um so this is a a phenomenon that's resulted from from changes in birth rates um we as you know the population of the United States and other countries fluctuates uh we could you know the baby boom and we get the baby bust and then we get the Millennials then we so um I'm Gen X I know you don't know what Gen X is because we always get forgotten but we're in between the Baby Boomers and the Millennials and so we get to make fun of both uh groups um but we we were a fairly small generation and because Gen X um I'm 50 years old so people my age because we're small the generation of our children which I guess is Gen Z yeah uh is also correspondingly small so what we're looking at is the prime College age student is getting scarcer in the U.S population so uh I pulled this chart um I guess it was yesterday the day before was today the 27th so yeah yesterday and uh there's where we are and we're looking at an increase in the number of 18 year olds followed by as you can see just falling off a cliff um so from around 9 million uh 18 year olds today to around 8 million in a few years um so this this is sometimes called a population pyramid as not very pyramid e in shape but it is the age and sex distribution of the United States and you can see here um the the Baby Boomers are there and the orange the Millennials are there and the blue um I'm there in the in the middle uh Gen X and you can see that there's a there's a a narrowing of that population pyramid toward the bottom and that this is for 2020. so this is three years old um we we see these age groups of course March upward on that pyramid mortality takes people out as we move upward so right now the Millennials are I guess the largest Generation by number but there aren't very many people behind that millennial generation and so when this uh this uh bottom gray section here reaches College age uh that is we're going to feel that at colleges and universities are not going to have as many students now this this it's kind of difficult to say that this is the fault of government per se although government does affect demographics but it is something that's going to push colleges and universities to do several things one of which is to ease admissions requirements another is going to be to pursue more government funds to kind of shore up their finances and allow them to keep all of their various Administration that they have been so eagerly hiring over the last couple of decades the effects of this are not going to be uniform across the United States this shows the the the red uh are in orange are where you're going to see the biggest enrollment declines the blue are where you're going to see um maybe slight increases so the West Coast uh the mountain states and oddly enough South Carolina where I teach are going to see some increases but much of the country is going to really see some contraction in the number of students coming into colleges uh so um Elite institutions are probably going to do better than Regional four-year colleges and universities so I don't think Harvard and Princeton and Yale are too worried about about this um according to uh the article that I've cited there at the bottom of that slide Regional bachelor's institutions are expected to lose more than 11 of their students by 2029. um and uh a lot of that is um affected by migration as people you know older populations maybe in the in the New England states younger populations maybe in the mountain states or California so we're going to see some differences across States but a lot of colleges are not going to make it through this they're going to fold we've already seen some colleges that are that are in trouble that are in trouble financially their enrollments are declining and some of them are not going to make it through to the other side by the time the children of the Millennials make it into and a lot of this Cliff is connected to the recession of 2008-2009 there's my connection who caused the recession of 2008-2009 okay so the FED right so the FED actually has an impact on this uh they create a recession birth rates fall uh and then 18 years later uh you see a decline in college enrollments um all kinds of events will affect birth rates I guess in 2038 admissions departments are going to be celebrating everywhere as children born in in 2020 make it to College age so all kinds of economic events will have an impact on on this kind of thing um so again I I'm not sure where this is going to take us it's going to be a difficult period for a lot of colleges I'm a little concerned maybe more than a little concerned that colleges will water down their requirements even further in an effort to keep enrollment numbers up and that's that could erode The credibility of college education even more well that's not all together a bad thing though is it I mean some colleges and universities need to have a a need to have their credibility taken down a couple of notches third is I wanted to talk about the uh the stifled academic discourse that we've seen this is a very widely discussed problem a lot of this is not going to be new to you you may may have seen some of this up close and personal in your own institutions but we we've seen a lot of this kind of um uh uh decline in the quality and the civility of academic conversations one of the key responsibilities of an institution of higher education is to Foster conversations that develop our understanding of the big Concepts in our world and when you can't have those conversations because someone is going to try to get you canceled for expressing an idea that might be controversial then it's it's going to diminish the quality of the entire Enterprise so some of these episodes are very famous unfortunately these have become so common that they're even episodes that would have made their way into the news six or eight years ago or kind of commonplace today and so you get student protest where they take over classrooms and prevent any kind of educational process from going forward students invading administrative offices and and disrupting classes some colleges have struggled to figure out how to deal with this unfortunately it seems that there are a lot of schools where students believe that their protests is a way to Signal their dedication to certain values that they they believe will are are popular among their their peers and the more you protest the more credibility you get among your your favored group in a 2017 study of college students many students said that shouting down speakers and using violence is sometimes acceptable 90 percent of college students say it is never acceptable to use violence to prevent someone from speaking well that's great but ten percent say it's sometimes acceptable and you don't need that many to create a pretty serious problem uh a majority say 62 percent said that shouting down speakers is never acceptable but 37 percent believe it is sometimes acceptable um and students I'm sure I'll have some conversations with some of you afterwards but some students are aware that if if I have if I talk about X or Y or Z then I I could wind up with uh I could be attacked on social media I could be ostracized I could my you know faculty might go after me in some way I um talk to students who say well you know I I'm in this class where I can't say certain things because I know that the the professor is very much opposed to that and so I just want to get my grade and get out of there so I keep my head down I don't have a discussion uh so this is this is um this is a a real uh is it it's a damaging thing it's it's it's killing um the quality of of academic uh discourse in a 27 another 2017 study that polled 1500 U.S undergraduates at four-year colleges fewer than half of the respondents believe that the first amendment protects hate speech now what is hate speech is a whole conversation we could have I mean whoever gets to Define that is in a pretty powerful position um so uh one of the questions was a public university invites a very controversial speaker to an on-campus event the speaker is known for making offensive and hurtful statements a student group opposed to the speaker uses violence to prevent the speaker from speaking do you agree or disagree that the student group's actions are acceptable 19 about one out of five believe that that was that that's appropriate again yes it's a minority but it doesn't take that many to disrupt a um what could potentially be an educational event uh professors of course have been targeted and canceled and forced out over some of these kinds of uh making statements which many student groups find to be unacceptable so we need to think about that as we as we kind of push back against that uh that that tide of um of uh of anti-intellectualism on college campuses and I think a lot of us would support the the idea that we need to be able to discuss issues even that if I have a conversation with someone who is saying something that I adamantly disagree with I can still learn from that conversation college is not about someone presenting you with a set of ideas and saying these are the ideas you must accept and go forth with your degree saying that you've memorized our talking points and we're supposed to be able to to learn how to how to think carefully and analytically about many things and to do that effectively we need to be able to have a conversation with someone who with whom we disagree and do so civil in a civil manner um and and that loss of Civility I think is a is is damaging it causes faculty to be self-censoring as it does students so um there are conversations that I might have been willing to have with a classroom of students 20 years ago that I won't I won't touch today um because I I like my job uh and and I've watched other faculty um who are not necessarily saying at my institution but I've seen faculty that have been that have been uh persecuted very unpleasantly for their their statements even if even if the statement was objectively true or or useful for academic purposes it it still is not not welcome uh another study here this is from June 2022 if a professor says something the students find offensive should that Professor be reported to the university and most students said yes uh uh now that's what what's offensive um that's a Minefield for a lot of a lot of Faculty um and we we're trying to be able to have a conversation without uh among the students in the classroom without stepping on someone's offensive offense prone sensibilities and um and and triggering a visit to the uh to the Provost office and possibly some really unpleasant consequences so um it's interesting to me that uh if you if you look at the distribution of responses to this uh the left the political left seems to be much more willing to report faculty for um saying something offensive than conservative students but even among conservative students they still a a majority believe that that response is appropriate um these kinds of events this this kind of uh um stifling of discourse is made worse by a growing bureaucracy in the University uh these this is a it's a it's a a rapidly growing segment of higher education student bodies the growth of a student body is far outpaced by the growth of higher education administrators Deans and Associate Deans and deanlets and administroids and various other people that are doing something it's not always clear how it can how it contributes to the mission of the um of the institution although it's it's certainly if you ask them they'll say that their role is is vital a lot of this may be related to um additional regulation placed on higher education by government that has that has increased uh substantially but in the effort to justify your position in a higher education Administration you're you're gonna um create work for yourself so as as we've observed in several high-profile cases even baseless accusations against faculty can lead to Long investigations that often don't have due process there's some kind of internal kangaroo court involved so this is great for a university bureaucracy because it allows them to justify their own existence and see how many cases we had to deal with last year our workload is heavy we need to hire more people to do our our our work which is so vital and but it creates enormous stress even if you're completely innocent and you have you're eventually going to be acquitted or something from this this charge of creating a fence it still creates enormous stress which some faculty say well you know I my health can't take this or I'm just not willing to deal with this for the for the amount of pay that I'm getting here so I'm just I'm out and so that that is an increasing risk Sometimes some of the most effective faculty or some of the most polarizing they're getting people to think and they sometimes do that with some provocative statements uh maybe there's a little bit of shock value to kind of wake people up and say well wait uh I don't think I agree with that but now my brain is working and I want to figure out why I don't agree with that and maybe in that process of figuring out why you you think that that Professor is wrong you're developing an analytical skill which is valuable beyond the rightness or wrongness of whatever was said that's important but some of those effective faculty are being driven out because they are they are offending students I don't have more than a couple minutes here but I will just briefly mention the last crisis here the government is driving up tuition as you know there's been a lot said about student loan debt there's a huge amount of it it is interestingly held mostly by people who have upper middle class or high Inc upper class incomes 60 percent is held by those in the top 40 percent of household income um now that's that's uh people maybe have gone to school for a long time they went to law school or med school or something they've got hundreds of thousands of dollars of student loan debt 92 percent of that is federal and there's uh almost thirty thousand dollars of average debt per borrower we have seen tuition go up very rapidly compared to the rest of uh the prices in the economy and it has become less affordable despite all of this additional money going into higher education from government higher education is taking a larger and larger fraction of median household income so it's not like well we're pumping a lot of money into higher education in order to make it more affordable for individuals and the reason that this is happening is something that was observed many decades ago that if you pump a lot of government money into higher education colleges and universities say great that backpack full of government money just got bigger we're going to raise our tuition so we can grab more of it and that's called the Bennett hypothesis we've seen a lot of this kind of evidence that colleges and universities are raising tuitions not exactly in lockstep with the increase in government subsidies but that is a large part of it tax-based Aid to students is crowding out institutional Aid in other words the institution says well we don't have to give you as much of a scholarship out of our own funds because you're coming in with all of these government funds that are making it more affordable for you if you're interested I've got some studies that I can show you on this that I had planned to go through if I have time but I think the main point has been made I unfortunately I don't have time for questions and answers now but I'll be happy to talk with anybody at lunch or afterward if you're if you want more thank you very much

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Length: 45min 9sec (2709 seconds)

Published: Fri Jul 28 2023