“No bubble is so iridescent or floats longer than that blown by the successful teacher.” — William Osler
Recently I've been talking about the high cost of a college education,
some emerging lower cost options, and why tuition rates might generally
be so high. It's a subject that really interests me, and one that concerns us all.
So since I've had that on my mind, I was intrigued by this
recent Yahoo! Finance article that suggests that maybe we're seeing a lot of bubbles, but that one of them is an education
bubble — it's number six on the list. And it's not the one one; there have been a number of articles in the mainstream media and blogosphere asking whether tuition rates are going up in an unsustainable way, and whether that means a crash in prices is coming.
Now, you remember bubbles? First we had the dot-com bubble, where stock prices kept going up and up and up, only to crash down in a meteoric debacle where instant millionaires became instant paupers. Then, more recently, we had the cause of the current global recession, a
housing bubble in the U.S. where easy access to irresponsible mortgages pushed housing prices up and up and up, only to crash down to the point where even little people like me might even be able to afford a house, if only any of the banks were still lending money.
So for those of us laboring under ever heightening tuition rates, it's a reasonable question to ask whether we could now also be experiencing an education
bubble. I think we are, but not one that's similar to those other financial bubbles, as there are some unique circumstances that apply to higher education in the U.S.
One way this bubble-like trend could end would be that tuition rates drop dramatically, like stock markets and housing prices did. As discussed here recently, the federal student loan system artificially makes prices higher, but while I may have remarked on how that system isn't well designed, no one thinks it's going away any time soon, and that means that we shouldn't expect a sudden dramatic drop in price.
Another way for things to change would be for prospective students to respond to high tuition rates by deciding not to go to college. But there's a very strong belief that permeates this country that going to college is part and parcel of success in life. Who was the last president who didn't talk about going to college like it was the end all and be all? Warren G. Harding maybe? I personally think that too many people feel like they should go to college regardless of whether their goals mandate it or not, but I recognize that it would take a major cultural shift for people to stop valuing that Bachelor's degree the way they do.
The final way things could go, and the one I think is most likely, deflates the bubble rather than pops it. That way is for alternatives to expensive traditional schools that are somewhat integrated with the old higher education system to become more popular. I mentioned some of these a while ago; I'm talking about services like Straighter Line and nationally accredited schools like Penn Foster College and Andrew Jackson University becoming more and more mainstream, and with many more like them finding ways to elbow their way into the higher education marketplace. I believe these alternatives are game changers, and that in the next decade unless the traditional schools get control of their tuition rates, these alternatives will become more and more prominent.
After all, one way or another tuition rates can't keep outpacing inflation. Something has to give!
Next up, are electronic textbooks worth it?
Image courtesy of Tim Lindenbaum