Saving for college today feels like trying to land a bottle rocket on the moon. My kids, still fairly new members of this world, won't head off to college for more than a decade and a half, and most estimates I've seen say they'll need nearly $200,000 each to fully fund an in-state public university experience. This of course assumes that tuition inflation will continue at the breakneck speed it's sustained now for years.
The astronomical increase in college tuition over the last several decades doesn't make a lot of sense on the surface. Yes, we've become a more knowledge-based work force, and it seems reasonable to posit that the demand for education has increased. But the number of institutions has also risen greatly, and technology has greatly increased the accessibility of education.
In an Times opinion piece, Paul Campos essentially paints the modern university as a money-gobbling bureaucratic black hole. College tuition has increased sharply even despite increases in public funding:
In fact, public investment in higher education in America is vastly larger today, in inflation-adjusted dollars, than it was during the supposed golden age of public funding in the 1960s. Such spending has increased at a much faster rate than government spending in general. For example, the military’s budget is about 1.8 times higher today than it was in 1960, while legislative appropriations to higher education are more than 10 times higher.
Even more disturbing:
Interestingly, increased spending has not been going into the pockets of the typical professor. Salaries of full-time faculty members are, on average, barely higher than they were in 1970. Moreover, while 45 years ago 78 percent of college and university professors were full time, today half of postsecondary faculty members are lower-paid part-time employees, meaning that the average salaries of the people who do the teaching in American higher education are actually quite a bit lower than they were in 1970.
By contrast, a major factor driving increasing costs is the constant expansion of university administration. According to the Department of Education data, administrative positions at colleges and universities grew by 60 percent between 1993 and 2009, which Bloomberg reported was 10 times the rate of growth of tenured faculty positions.
To me, this has all the markings of a bubble. As we barrel faster and faster through a technological era which tends to flatten bureaucracies, what role will these institutions really play in ten or fifteen years? Should the number of people earning seven-figure salaries in the administration of a university approach that of a corporate board? What product is the university customer receiving in 2015?
What net value are universities adding to society if middle class graduates face an adult life enslaved to lenders?
The older I get, the more I attribute much of my financial freedom to never having paid a cent on student loans, especially when I see people my age still making payments on student loan debt that they've carried for the better part of two decades.
I value financial independence as much as education, and I believe that both will continue to be attainable for decades to come. It's becoming less and less clear to me what practical role universities—as we know them today—will play in that, though.