Getting a college degree has become part of the mythology of the American Dream. But when you consider the load of student loan debt that most students have to take on today, instead of blindly following the dictates of the American Dream, it is prudent to stop and ask ourselves if we really will be better off when that diploma comes laden with a ton of debt. In this article I’ll do a cost benefit analysis of the worth of a college degree.
I challenege the conventional wisdom that with a college degree you will be better off in the long run. For one thing that debt can never be discharged in bankruptcy. It will follow you the rest of your life. Even social security checks can be garnished to pay it. Student loan debt has more than quintupled since 1999. Earlier this year American collective student loan debt passed the one trillion dollar mark, more than the nation’s collective credit card debt.
More than half of all recent graduates are either unemployed or working in jobs that don’t require a college diploma. There is a surfeit of college degrees to the extent that they are being required for the most casual jobs just because employers can afford to be choosy, not that the job has anything remotely to do with the training received in college.
According to Ohio University economics professor Richard Vedder, “Employers seeing a surplus of college graduates and looking to fill jobs are just tacking on that requirement. De facto, a college degree becomes a job requirement for becoming a bartender.” Or a barrista. In a study by Richard Arum and Josipa Roksa, entitled Academically Adrift, the authors find that at least a third of students gain no measurable skills during their four years in college. Furthermore, for the rest their increase in knowledge is minimal.
So what is the point of a college degree? The heart of the matter is that what going to college is really all about is not gaining an education but gaining a credential. That credential tells a prospective employer that the holder was smart enough to get into college, enough of a conformist to put up with all the bullshit, and compliant enough to sit there for four years. Presumably, he or she would make a docile and compliant employee and a docile and compliant consumer, in other words, a good American living the American Dream.
But for many the American Dream has become the American Nightmare. For many the dream of living independently goes by the wayside and they have to move back into their parents’ house. For many their payments on their student loans take up most of their meager paychecks, and late payments, forebearances and defaults double and triple the amount owed.
Let’s consider for a moment the “statistics” that maintain you are always better off with a college diploma. Who gathers these statistics? Why it’s people who have a vested interest in recruiting college students, think tanks connected to colleges themselves. And as anyone with a little savvy knows, you can lie with statistics. The college-industrial complex is heavily invested in having you believe that you will make more money over a lifetime with a college diploma than you will with just a high school diploma. Problem is they never include in their statistics the likes of college dropouts like Bill Gates.
In fact, four of the five wealthiest Americans are college dropouts. In addition to Bill Gates, there are fellow billionaires Michael Dell (who dropped out of the University of Texas), Larry Ellison (who dropped out of two colleges) and Microsoft co-founder Paul Allen (who dropped out of the University of Washington). Did we forget to mention Apple co-founder Steve Jobs (who dropped out of ReedCollege)?
If these guys had been included in the statistics, the results would have been different for sure. They would have skewed the statistics to show that college dropouts made the most money and acquired the most wealth over the course of a lifetime. Furthermore, these guys are in high tech fields, the knowledge for which was not garnered in college!
And what people with just high school diplomas are being included in the statistical studies? It’s surely not enough to just graduate from high school with some generic diploma and say, “Here I am on the job market. What you got for me?” No, but those who use their high school years to acquire useful skills and to set their sights on useful careers are way ahead of the game. People like this are probably not included in the statistical studies either.
I know of a high school dropout from my home town who set up an auto body repair shop and is now a millionaire. There is no reason why a self-employed person using skills developed within and outside of high school during high school years can’t be successfully self-employed. Then the college diploma which at best is only a ticket of admisssion to a corporate job is completely unnecessary. And one is not at the beck and call of one’s employer. You don’t have to bow and scrape and kiss your employer’s ass. Or worry about being laid off!
So what college is really about is credentialization. If you want to be an employee you have to have a credential to please your employer. If you aim towards self-employment, you can not only make more money in the long run, you don’t have to kiss your employer’s ass. You are truly independent. In my article “10 Reasons Not To Go To College” I write about the fact that kids are finding out today that a college diploma does not guarantee you a job. There are many PhDs out there who are driving cabs. And you can be laid off, downsized, outsourced at any time.
How much job security is in that? A case could be made that money spent on a college education could be better spent buying a business or investing in real estate. Then you’re in a position of building wealth not just simply being immersed in the debt culture of a mortgage, car payment, student loan debt and paying bills even if you have a job. And you have a four year head start over those who go to college! The American Dream of being a worker/consumer with debt up the ying-yang is replaced with the American Dream of real financial independence. You don’t have to kiss up to your boss and hope that he won’t be giving you a pink slip. As I said in the previous article:
” College trains you to be a docile and compliant employee. Is this how you want to live your life? As Caspar Milquetoast? The second you mouth off to your boss, you’re history! Be a free and independent individual instead. Have a passion for what you do. Have real knowledge instead of a piece of paper that says you know something. Do real work instead of make work. Be willing to take the risk of starting your own business instead of the pseudo-security of being somebody else’s employee. Then you don’t have to take crap from anyone or kiss anybody’s ass!”
Learning resources are readily available and mostly free. Libraries and the internet enable anyone to receive the equivalent of a college education and learn every possible skill. Khan Academy will teach you everything from math skills to the Greek debt. MIT Opencourseware allows you to take courses ranging from the humanities and the arts to architecture and engineering. Become an autodidact. You will learn a lot more if you study what you are interested in rather than what your professor wants to cram down your throat.
In a recent Newsweek article, Megan McArdle asks “Is College a Lousy Investment”? It is if, after sitting patiently in class for four years, you come out and the only job you can get is flipping burgers or are otherwise employed in the service economy.
If, instead of becoming a professional, you have become a serf. Then you are forced to move back in with your parents and contemplate the huge monthly payment you have to make on your student loan. Forget about getting married, buying a house and raising kids. You are already saddled with a mortgage! Welcome to America’s Screwed Generation.