If You Learn, You Earn

CollegeMany states, in response to a demand for more college graduates at a lower cost, are pushing, proposing, and implementing free tuition for students in their states. The state of New York entered the fray recently, promising free tuition to students whose families earn less than $125,000 a year. The most notable caveat to their plan is a requirement that anyone who gets that tuition break has to work in New York for a certain amount of time or pay back the benefit: nothing like a little 21st century indentured servitude to remind us how difficult economic mobility is this day and age.

I’m not going to pretend that free college tuition doesn’t have it’s appeal. As a college professor and dean, I recognize and believe in the value of higher education, and I’d have to be obtuse not to see that rising costs are problematic for students and parents. In fact, various surveys tell us that incoming college students and their parents see finances as the biggest impediment to earning a degree. Declining federal and state aid forces students to choose between working more hours or accepting student loans. Worse yet, federal financial aid formulas (FAFSA) that determine non-loan aid amounts and eligibility are often ridiculously out of touch with the actual reality of most family’s pocket books.

Realistically, we can’t, despite what too many politicians argue, create efficiencies that significantly reduce the cost of higher education. Certainly, we could eliminate all college sports, multi-cultural centers, weight rooms, climbing walls, Tutor Centers, and other “wasteful” amenities to offer a bare bones educational opportunity. Doing so would save students money, but at the risk of stating the obvious, people’s loyalty to the University of Michigan, Texas A&M, and other major universities isn’t because of their English departments. 102,000 people don’t show up to cheer a great performance in the physics lab. The reality is that students often choose which schools to attend based on the very things that are inefficient and costly. I’ll also remind everyone that there are hundreds of colleges that aren’t UT, Yale, Harvard, and Columbia. The rest of us are scraping by, scrimping and saving, with faculty and staff regularly working overloads. Not many of us are making six-figures and working 30 hours a week. Don’t get me wrong: I’m certain any organization can find ways to cut costs, but there’s not as much fat at most universities as people imagine.

It’s also worth noting that there already exist low-cost educational opportunities. Students can attend community colleges for two years and then chose four-year universities with lower costs. Some might even choose an online university like Western Governor’s University, although last time I checked WGU’s tuition and fees are not that radically different from tuition and fees and many public, regional universities. Technology doesn’t necessarily equal lower costs. Students who are trying to pinch pennies can live at home, assuming, of course, that there is a college within driving distance of their home.

Free-tuition, though, isn’t the solution. At the risk of stating the obvious and insulting anyone’s intelligence, “free” tuition isn’t really free. Much like all those free-use parks in towns across America, someone is picking up the tab. We just aren’t charging you every time you go down the slide.

While I don’t necessarily prescribe to the idea that you get what you pay for, I do think that paying for things adds value. As importantly, earning a degree or certificate benefits both the state and the individual. Paying for college is an investment and last time I checked no one was voluntarily dumping money in my 403B retirement account, giving me free housing, or picking up the tab for lunch. Because they cost me, they have value above. More importantly, I have to work to earn those things.

The first step to our college cost problem, though, has nothing to do with students. We must, as some point, return funding levels from federal and state governments to their 1980 levels. When I went off to college in 1987, government funding for higher ed equaled around 80%. Students had some skin in the game, but anteing up wasn’t cost prohibitive. Various figures and agencies tell us that for every dollar we invest in education, we get a $5.00 return. I’m no financial analyst, but long term a five to one return seems pretty solid.

Notably, though, the return on that investment only occurs if students graduate from college, though. Regardless of degree, college graduates have a lower unemployment rate and have higher lifetime earnings.

Since, from the state’s perspective, graduation is the end game, I’d like to see us develop a funding model that reflects and rewards students as they get closer to graduation. In some ways, I think we can follow the way many athletic programs award scholarships. The lowest scholarship amounts occur the first two years. As you show you can perform, we start raising your funding and lowering your bill. After all, we only get a return on our investment if you actually graduate. Additionally, as courses get more difficult, labs longer, hours in the library basement researching esoteric and difficult ideas increase, students need more time working on college than flipping burgers. Essentially, we’re going to increase your up front cost, but we’re also going to reward you for performance and reduce your back end costs once you prove you will be successful. I realize some students might have to delay the start of college to earn a little money or they might have to work their first two semesters, but for my money completion is more important than easy access.

Any scholarship and grant model has to be predicated on elected officials funding higher education at acceptable levels, recognizing that students who graduate with degrees (or certifications demonstrating mastery of skills that help them get employed) are beneficial to the larger social good. If we continue to defund higher education, we’ll see higher student loan debt and continue with stagnant graduate rates. In today’s dollars, funding from the feds and the states hovers around 35%, pushing the other 65% on to the backs of students and their parents. Let’s start by flipping those numbers, charging students tuition their first two years and then slowing phasing out their costs the closer they get to graduation. We can reward those who demonstrate the ability to learn with the potential to earn.

At that point, I suspect we can let those New Yorkers move anywhere they want. Heck, we’ll even let them move down here to Texas. Maybe.

 

 

 

 

 

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Cousin Eddy and the Union Blues

Clark's_Rant

Clark Griswald’s Rant–Christmas Vacation (Click to view)

Around the beginning of December each year, my family and I nestle on the couch and celebrate the coming holiday season by watching National Lampoon’s Christmas Vacation. Chevy Chase’s slapstick-driven look at family holiday gatherings always seems to strike just the right chord between cynical and sweet. Chase plays Clark Griswald, a man whose expectations and desires to celebrate the holidays with kith and kin collide with the realities of family squabbles, ageing relatives, annoying in-laws, yuppie neighbors, and squirrels running amok in the house. Easy to dismiss as an anti-Christmas movie, Christmas Vacation lampoons cultural representations of families with a smile on their face and a song in their heart during the holidays. The movie offers, instead, a comedic look at the tensions holidays create while still valuing the core need to gather with our families around the hearth at certain times of the year.

But the movie is about more than cousin Eddy holding out for a management position or Clark enduring Uncle Lewis’ smelly cigar.

Chase’s movie is also a subtle (and sometimes not so subtle) attack on the soulless corporate world that puts the bottom line before the worker. Mr. Shirley, Griswald’s boss, is a man who values efficient production and investor profits over employees. Enrollment in the Jelly of the Month Club (see the video) might be the gift that keeps on giving, but such a gift is a scant reward for company loyalty and dedication.

At least Christmas Vacation ends happy. The American middle class, folks like Clark Griswald, might not be so lucky as they witness their power–both politically and economically–shrink each year.

Or, to put it more accurately perhaps, the wealthiest American’s are increasing their wealth, the poorest American’s are falling farther and farther behind, and the unlucky saps in the middle are hanging on for dear life. Most of us know this intuitively when we pay bills each month, but if you want evidence check out Emmanuel Saez and Gabriel Zucman’s slide show, look at the charts from the World Income database, consider that those of you earning $68,000 make more than 75% of the population, and realize those of you making $160,000 are richer than 95% of your friends and neighbors. Anyone earning $300,000 feel super-rich? You should because you are in the top 1% of all wager earners.

In the meantime, Clark Griswald’s boss, the man who changed cash bonuses into a Jelly of the Month Club membership, earns 350 times more than the average worker and his salary increases while Clark’s remains flat.

Criticism and distrust of American corporations is nothing new, of course. Herman Melville’s 1853 short story “Bartleby, the Scrivener: A Story of Wall Street” ends with the narrator lamenting his own inhumanity when the bottom line conflicts with his ability to serve as his brother’s keeper. Oliver Stone’s Wall Street takes a scathing look at greed and American culture, and Mike Judge’s 1999 Office Space satirizes the de-humanizing impact of cubicles and management drones.

This tension and interplay between worker and owner (or the bourgeois and proletariat) created labor unions, workers who banded together for fair labor practices, safe working conditions, and a living wage. Profits were shared among the workers and management. If pay and work conditions became untenable, unions joined together to strike, demonstrating the power of the working class.Unions and their corporate counterparts worked throughout the years to create a vibrant and powerful American economy. In our golden age, wages were more important than stock value for anonymous shareholders.

Until now.

At the risk of confusing correlation and causation again (see my post from last week), I can’t help but notice that American workers have lost wages and power in equal proportion to the collapse of labor unions.  Edward McClelland, over at Salon.com, offers some basic facts. In 1965, McClelland tells us, $2.35 (starting salary for shoveling taconite) was enough to pay rent and buy a car. That $2.35 would equal $17.17 in today’s wages, almost $10 higher than minimum wage.

I don’t think anyone would argue someone could pay rent and buy a car on $7.25 an hour.

Labor unions, at their heart, offer workers collective bargaining, recognizing that the value of any company is determined not by the person in the corner office sitting in a leather chair, but by the worker shoveling coal, writing reports, and interacting with customers. When profits are shared fairly, America’s economic boat rises in equal proportion.

Somehow, though, American voters and politicians turned union into a dirty word. President Reagan, friend to almost no one who didn’t live in a gated community, convinced too many workers to turn their backs on their own best interests. In a show of solidarity with the corporate owners, he broke the air traffic controllers union, proving that government really was part of the problem not the solution. Ironically, we named an airport after him but that’s a different blog.

As importantly, President Reagan obfuscated the conversation by emphasizing social issues over sound economic policy. We became obsessed with the welfare queen who might be getting an extra $40 more food stamps while the corporate executive was finagling another 30% more in tax cuts.

Meanwhile, union membership dropped dramatically and Republican politicians, buoyed by redistricting and corporate donations in the 1990s, trumpeted the free market, off shoring, and corporate welfare.

Wages froze. The middle class shrunk. And Walmart took over the world.

Even now, as the economy recovers and unemployment drops, wages are stagnant. Fast food workers are demanding a living wage and prices for gas, utilities, and other essential goods and services are rising faster than our paychecks.

Yet, we are all single voices raised in competition with each other, fighting over limited resources regulated by owners who control both the mode of production and the product.

In Clark Griswald’s world, cousin Eddy, a big, bulging man in a blue polyester suit, has to kidnap Mr. Shirley to remind him that “Sometimes things look good on paper, but lose their luster when you see how it affects real folks. I guess a healthy bottom line doesn’t mean much if to get it, you have to hurt the ones you depend on. It’s people that make the difference. Little people like you.”

The rest of us don’t really have to rely on kidnapping (or blue leisure suits). We just have to remember that divided we fall. United we stand.

Things I Read

And Things I Learned

Washington Monthly

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

Joanne Jacobs

Thinking and Linking by Joanne Jacobs

Inside Higher Ed

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

FiveThirtyEight

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

Balloon Juice

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

Scott Adams' Blog

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)

The Full Feed from HuffingtonPost.com

Do I contradict myself? / Very well then I contradict myself, / (I am large, I contain multitudes.)