Millennials, rise up! College is a scam

Nov 25, 2013 by

Students chase degree after degree, adding crushing debt, as jobs vanish. It is time to radically rethink college

Randall Collins

Credential inflation is the rise in educational requirements for jobs as a rising proportion of the population attains more advanced degrees. The value of a given educational certificate or diploma declines as more people have one, thereby motivating them to stay in school longer. In the United States, high-school (i.e., twelve-year secondary school) diplomas were comparatively rare before World War II; now high-school degrees are so commonplace that their job value is worthless. University attendance is now over 60% of the youth cohort, and is on the way to the same fate as the high-school degree. It is a worldwide trend; in South Korea, 80% of high-school graduates now go on to higher education. The main thing that inflated degrees are worth is to plough them back into the educational market, seeking still higher degrees. This in principle is an endless process; it could very well reach the situation of the Chinese mandarin class during the later dynasties, when students continued sitting for exams into their thirties and forties— only now this would affect the vast majority of the population instead of a small elite. Different countries have gone through educational inflation at different rates, but from the second half of the 20th century onward, all of them have followed this path.

Educational degrees are a currency of social respectability, traded for access to jobs; like any currency, it inflates prices (or reduces purchasing power) when autonomously driven increases in monetary supply chase a limited stock of goods, in this case chasing an ever more contested pool of upper-middle-class jobs. Educational inflation builds on itself; from the point of view of the individual degree-seeker, the best response to its declining value is to get even more education. The more persons who hold advanced degrees, the more competition among them for jobs, and the higher the educational requirements that can be demanded by employers. This leads to renewed seeking of more education, more competition, and more credential inflation.

Within this overall inflationary process, the most highly educated segment of the population has received an increasingly greater proportion of the income; at least this has been so in the United States since the 1980s. One should be wary about extrapolating this particular historical period into an eternal pattern for all times and places. Those at the top of the inflationary competition for credentials have benefited from several processes: [a] they were in the relatively safe havens when technological displacement was hitting, initially, the last of the decently paid manual labor force, and then low-paid clerical work. [b] The quality of work performance between different levels of the educational hierarchy has apparently widened.

What has been insufficiently recognized is that the inflationary spiral in schooling has brought increasing alienation and perfunctory performance among students who are not at the top of the competition, those who are forced to stay in school more years but get no closer to elite jobs. Grade inflation and low standards of promotion are symptoms of this process. There is considerable evidence, from ethnographies of teenagers, of youth culture, and especially youth gangs, that the expansion of schooling has brought increasing alienation from official adult standards. The first youth gangs appeared in the early 1950s when working-class youth were first being pressured into staying in school instead of going into the labor force; and their ideology was explicitly anti-school.

This is the source of the oppositional youth culture that has grown so widely, both among the minority who belong to gangs and the majority who share their antinomian stance. Employers today complain that jobs in the lower half of the service sector are hard to fill with reliable, conscientious employees. But this is not so much a failure of mass secondary education to provide good technical skills (one hardly needs high-school math and science to greet customers politely or ship packages to the right address) as a pervasive alienation from doing menial work. The mass inflationary school system tells its students that it is providing a pathway to elite jobs, but spills most of them into an economy where menial work is all that is available unless one has outcompeted 80% of one’s school peers. No wonder they are alienated.

Although credential inflation is the primary mechanism of educational expansion, overt recognition of this process has been repressed from consciousness, in virtually a Freudian manner. In this case, the idealizing and repressing agent, the Superego of the educational world, is the prevailing technocratic ideology. Rising technical requirements of jobs drive out unskilled labor, the argument goes, and today’s high-skilled jobs demand steadily increasing levels of education. Thirty years ago, in The Credential Society, I assembled evidence to show that technological change is not the driving force in rising credential requirements. The content of education is not predominantly set by technological demand; most technological skills—including the most advanced ones—are learned on the job or through informal networks, and the bureaucratic organization of education at best tries to standardize skills innovated elsewhere. In updated research on credential inflation vis-à-vis technological change, I have seen nothing that overturns my conclusions published in 1979. It is true that a small proportion of jobs benefit from scientific and technical education, but that is not what is driving the massive expansion of education. It is implausible that in the future most persons will be scientists or skilled technicians. Indeed, the biggest area of job growth in rich countries has been low-skilled service jobs, where it is cheaper to hire human labor than to automate. In the current US economy, one of the biggest growth sectors is tattoo parlors: a non-credentialed occupation, small-scale business, low-paying and thus far immune from corporate control—and selling emblems of alienation from mainstream culture.

Although educational credential inflation expands on false premises— the ideology that more education will produce more equality of opportunity, more high-tech economic performance, and more good jobs—it does provide some degree of solution to technological displacement of the middle class. Educational credential inflation helps absorb surplus labor by keeping more people out of the labor force; and if students receive a financial subsidy, either directly or in the form of low-cost (and ultimately unrepaid) loans, it acts as hidden transfer payments. In places where the welfare state is ideologically unpopular, the mythology of education supports a hidden welfare state. Add the millions of teachers in elementary, secondary, and higher education, and their administrative staffs, and the hidden Keynesianism of educational inflation may be said to virtually keep the capitalist economy afloat.

As long as the educational system can be somehow financed, it operates as hidden Keynesianism: a hidden form of transfer payments and pump-priming, the equivalent of New Deal make-work setting the unemployed to painting murals in post offices or planting trees in conservation camps. Educational expansion is virtually the only legitimately accepted form of Keynesian economic policy, because it is not overtly recognized as such. It expands under the banner of high technology and meritocracy—it is the technology that requires a more educated labor force. In a roundabout sense this is true: it is the technological displacement of labor that makes school a place of refuge from the shrinking job pool, although no one wants to recognize the fact. No matter—as long as the number of those displaced is shunted into an equal number of those expanding the population of students, the system will survive.

The rub is on the expense side. The two main ways to pay for schooling (at all levels: elementary, secondary, tertiary, and whatever further levels become added on) are either by government provision or by private purchase. Both of these come under pressure in times of economic downturn and squeezed government revenue. In the years around 2010, both in the United States and many other countries, the costs of public education became such a substantial proportion of government budgets (especially at the local level) that they gave rise to movements to cut educational spending. In Chile, for instance, where 50% of the youth cohort now attends university, there is a struggle between the organized students demanding free university education for all and administrators and tax conservatives who push an increasing proportion of higher education into the private marketplace. Similar issues have roiled the student population in France and elsewhere. In the United States, where higher education is funded largely (and increasingly) by the students themselves and their families, there has been much concern over the amount of debt in the form of student loans—now (as of 2011) approaching 10% of GDP. If one extrapolates both the numbers of students extending their stay in schools in response to technological displacement, and the proportion of the economy made up by student debt, one can see that another twenty years or so of technological displacement and credential inflation will become enormously expensive to the system as a whole. What would happen if student debt rose to 50% of GDP, or 100%?

Education is a major cost of government, and this tends to limit future expansion. With higher costs, there are pressures to privatize, shifting the burden of funding to students or parents; but this too faces a limit as the middle class is economically squeezed. By 2012, there was a wave of publicity in the United States about what kinds of degrees are not worth the cost of acquiring them, in terms of the jobs one can get or one fails to get. Although one individual solution would simply be to drop out of the educational competition, the more popular choice among youth has been to seek specific vocational education, and there has been an upsurge of schools in areas like apparel design, computer programming, business, etc. But the shift to vocational education does not evade the dynamic of credential inflation, and we can predict increasing competition inside those vocational sectors, and rising inflation of vocational degrees. One indicator has been controversy, both in the political sphere and in accrediting and regulatory agencies, critiquing the low rate of job success for such vocational students, and denying them access to government loans. That is to say, the inflated value of educational degrees has become an explicit problem.

Information Technology is again being invoked as a solution. There is a rush toward university courses online, thereby achieving great economies of scale. Some of these are for sale, albeit at rates far lower than the cost of actual tuition at a bricks-and-mortar institution. Others are offered altruistically for free. Neither method will hinder credential inflation; indeed, both add to it, by putting still more educated persons on the market. As of now, the new kinds of credentials are being labeled as distinct from university degrees, and in that sense not directly competing with them. This remains to be seen; in effect a new form of cheap educational currency is being created, alongside a more traditional and expensive educational currency. If educational currencies are strictly like money, Gresham’s law would apply, and the cheap currency would drive out the expensive one. On the other hand, in economic sociology, as we know from Viviana Zelizer (1994) and Harrison White (2002), high-quality economic objects can exist in separate circuits alongside cheap ones, and that may well continue to be the case in the production of educational credentials.

The dilemma is this: efforts to make education cheaper have the effect of reducing employment in the educational sector itself; if a few famous universities monopolize teaching through online courses, and a few professors can do the vast amount of the teaching with electronic assistance, one more sector of employment becomes technologically displaced. The result is the same through the pathway of old-fashioned tax revolts; a short-term reduction in the population’s tax burden has the roundabout effect of reducing jobs available for that same population.

Of the five escape routes from capitalist crisis, continued educational inflation seems to me the most plausible. An expanding educational system driven by credential inflation reaches a potential crisis point within the educational system itself. This is not necessarily final. One can envision a series of such plateaus, stopping and restarting as our secular faith in salvation through education goes through disillusionment and revival. But if this becomes increasingly government sustained, it amounts to socialism in the guise of education. It is conceivable that liberal governments might find their way to keep expanding educational systems, using them as a Keynesian safety valve, and a form of transfer payments from the capitalists and the diminishing sector of the employed, to sustain the otherwise unemployed. But to get such a government might well take a near-revolutionary disillusionment with capitalism.

via Millennials, rise up! College is a scam — you have nothing to lose but student debt – Salon.com.

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