The higher education bubble

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Rachel’s post yesterday got me thinking about university education. Like many, I’m coming to think of it as being the next big bubble. Money is being ploughed into it higher education, and for many – probably most – people, it’s just not worth it. We’ve become afflicted by acute credentialism: to be taken seriously in many professions, you need a couple of letters after your name.

What’s wrong with this? Well, for a start, it makes it harder to break into new jobs. Credentialism raises barriers to entry, and protects certain professions from competition. (Incidentally, occupational licensure – which I consider to be one of the great evils of our time – is worse.) Moreover, it increases the penalties for making bad decisions. Did you spend your teenage years getting drunk and skipping class? Well, sorry, you’ve ruined your life because you can’t get the degree from that Russell Group university that you needed so you could do the job you wanted to do. And God help you if you chose art history instead of accounting on your UCAS form.

Worst of all, credentialism forces people in education to conform so that they get the grades they need. School and university are the two places in people’s lives where freethinking and contrarianism can thrive; where being brilliantly wrong is better than being boringly correct. When your on-paper performance matters so much to your future job prospects, this becomes more difficult. As a result, university becomes more like a training course and less like the thoughtful, argument-filled Academy that it should be. 

In a speech at Oxford Brookes University last June, David Willetts said that more than 50% of degree courses were "license to practice" courses. In fact, the true figure is likely to be a lot higher. By now, almost all university courses are credentialist training courses, even humanities and social sciences, because having letters after your name is now so important to finding a decent job. 

How did we get here? Mostly, I blame government. Long ago, it was decided that education was the key to social mobility. Targets were set to get people into university, irrespective of their ability. That someone thought it a good idea to get 50% of school-leavers into university says it all – university was just an extension of mass schooling, and shunting as many people through it as possible was the key to making people smarter.

Where a bachelor’s degree once set people apart from the crowd, now it’s a master’s degree. Some day, I’m sure a PhD will be the minimum. Standards have fallen and costs have risen as the bubble grows. Once, everybody wanted to own expensive tulips. Today, people are putting their money into letters after their name. Bubbles are pointless, madness of crowds hysteria driven by easy money, and we're seeing one in education.

People use qualifications to signal their intelligence. It’s hard to show an employer that you’re smart, and a degree is like a good reference letter vouching for you to an employer. But forcing more and more people into university education has devalued that reference. Like trees competing for sunlight growing taller and taller, the credentials have become loftier and loftier to achieve the same ends. The bubble is growing. Someday, it will have to burst.

There's more to life than university

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Newspapers at the end of last week were filled with pictures of teenagers jumping in the air. A-Level results day is the one day of the year where Britain's youth throws caution to the wind, remove the shackles of an emotionally repressed British childhood and allow photographers to convince them that such photos won't haunt them in future. This year's news reports seem dominated by images of students "scrambling" for clearing places, having narrowly missed out on the grades required for their firm and insurance offers.

Most, if not all stories heighten the drama by continually referring to the looming prospect of next years (up to) £9,000 tuition fees. Surely the last thing nervous students need is the continual insistence that this year is the last year that the "average" student can afford to go to university.

The effects of the media and student union's false representation of the Browne Review still remain, and may just be the reason why many students accept places that they are not entirely happy with or have little interest in pursuing. Rather than piling the pressure on those who narrowly missed out on places this year, we should be extolling the virtues of the large range of options available to them.

Students opting to take a year out to either re-think their options or to re-take exams are not burdening themselves with "mortage-style debts", but sensibly saving themselves from rushing into a university course that will take nearly £3,500 of their money each year whilst potentially offering them little personal value in return. It must also be remembered that university isn't the only route open to college-leavers: a range of apprenticeships, training schemes and alternative qualifications are available. And, of course, there's always the option of going straight to work.

The positive outcomes of the increase in tuition fees have been, thus far, hidden from those applying to university. Such increases give students greater powers and larger choice, forcing universities to provide courses that are better value for money. And the fact that students are now considering whether university is a good finical decision for them should be seen as positive. Fees are paid back after graduation according to the amount the student is earning. If a university degree will afford them greater earning potential then the increased tuition fees can certainly be justified. If this isn't the case then there are plenty of other options.

The media's advice to those who've missed out of university places should have been along different lines. Taking time to properly assess whether university is the best choice for your future should always be the advice given by teachers and the media. Hopefully, the increase in tuition fees will mean that next year's applicants are fully aware of their options and choose the route that best suits their goals, regardless of the perceived financial costs attached.

An education reform for the many, not just the few

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Hidden amongst noisy coalition politics are a handful of policy goals whose effects will linger longer in the sphere of public debate than the scandal du jour. Of these, the free schools programme is remarkably fortunate. It has thus far escaped a watering down, where it might have become a shapeless puddle, completely lacking in direction or purpose. Yet, with the final applications for free school-status having rolled in last month, policy-makers and politicians must be careful not only to ensure that the programme is not derailed out of fear of decentralisation, but also to acknowledge that it is insufficient to solve the problem of declining standards.

The potential benefit from the free schools programme is two-fold: on a micro level, parents dissatisfied with the state-funded education available to them are now able to fix the problem for themselves, and other parents will benefit from the resulting greater choice of schools. On a macro, and less publicised level, the allocation of funding within the free school and academy system according to student numbers will subject these schools to market forces.

In time, the worst-performing schools must either improve, or drop out of the system altogether, and be replaced. It is on this macro level that the programme most risks a derailment. Introducing a whole subsector of state employees to the consequences of poor performance (permanent dismissal for incompetence is almost unheard of) will continue to be met with staunch opposition by the notoriously vocal and active unions through which they are represented. Any further reform may simply be brought to a standstill. But it is further reform that is needed: for as long state-funded primary and secondary education is split between schools with per-pupil funding, and those without, there will not be an efficient allocation of resources between schools, and an improvement in standards will not be adequately, if at all, realised.

A system rewarding only that minority of parents – those endowed with the means to widen their choice of local institutions – should not be a satisfactory result. Surely, those schools most in need of upheaval are the very same schools that are the least likely to submit themselves to the market, without the appearance of some benevolent investor. There is a distinct absence of willing capital. All the more worrying we inadvertently add another ‘tier’ to the system. The solution, then, lies in universal implementation; a voucher system, if you like, where state funding follows the student, wherever they go.

Further reading: Profit-making Free Schools: Unlocking the Potential of England's Proprietorial Schools Sector, a report for the Adam Smith Institute by James Croft.

Paying professors not to teach

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On this day in 1740, Adam Smith set off for Bailliol College Oxford, where he had won an 'exhibition'. It took him a month on horseback from his home in Kirkcaldy, Scotland, and he commented how, the further south he went along his journey, the better the cattle seemed to be fed, and how much more opulent the living was. Perhaps this was the start of his interest in economics.

At Oxford he was taught another lesson in economics – that if you pay people whether they work or not, they will invariably choose not to. This was true of the professors at Oxford, who were on annual salaries rather than being paid directly by their students, which was the system Smith himself would teach under at Glasgow some years later. "In the University of Oxford," he observed, "the greater part of the public professors have, for these many years, given up altogether even the pretence of teaching."

“The discipline of colleges and universities is in general contrived," he went on, "not for the benefit of the students, but for the interest, or more properly speaking, for the ease of the masters."

This may be something that, at last, will change now that British students are facing £9,000 a year fees. It will turn them into discerning and demanding customers. The "masters" won't know what hit them.

Why students benefit from fees

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The universities are very keen indeed to extract the maximum £9,000 a year fees from their students. Indeed, half of them have already said (to the government's initial shock) that they would indeed charge this maximum figure. But the universities may get something they weren't bargaining for in return. Namely, much more discerning customers.

To a student in particular, £9,000 a year is a lot of cash. If they are spending that sort of money, they will be asking some pretty sharp questions about teaching standards, course quality, and their job prospects after they get their degree. And the universities will have to have answers to those questions – or see students drift away to other universities that have better answers. Universities will find that they can no longer drift along doing things as the academics and administrators deem fit. They will need to ditch that public-sector ethos and actually start doing this in the way that best suits their student customers.

For a time I taught at a small private college in the US, and I saw this first hand. There was fierce competition between colleges, so teachers were all expected to go out on a schools roadshow to show the college's wares to prospective students – exactly the sort of thing which will come as a shock to British academics. If I was late marking an essay, the students would be banging on my door wanting to know why – not as sheepish supplicants, but as rather irritated customers. If they didn't understand something, they figured it was more likely to be because I had not explained it well enough, rather than that they were too dim. And they wouldn't let me go home until I had explained it better, and they had properly understood it.

At last we are getting the same competitive pressures here. And about time. For as Adam Smith put it, "The discipline of the colleges and universities is in general contrived, not for the benefit of the students, but for the interest, or more properly speaking, for the ease of the masters."

Capitalism will deliver the innovation that education needs

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The third Annual Venture Capital in Education Summit is currently taking place in New York which brings together a select group of entrepreneurs and investors with the hope of accelerating education innovation and investment.

Ten early stage education technology companies are being showcased, including: Magic Planet - a digital display with a sphere-shaped screen which provides global information visually; Late Nite Labs – a virtual lab platform which contains 150+ experiment simulations for distance and hybrid learning settings; LessonWriter - an expert-system that automates the detailed and time-consuming task of creating teaching materials, individualizing instruction and assessing performance; Skillshare - a community marketplace for offline classes whose mission is to democratize learning, turning cities into classrooms and its inhabitants into teachers and students; and many more exciting innovations that could revolutionize education.

A key theme of this summit will be the future potential of gaming technology in education which is perhaps one of the most exciting developments to take place in this sector for a generation. Students are already beginning to learn in virtual worlds such as GAIAonline, Neopets and Club Penguin and new adaptive learning games include MangaHigh, Dimension M, Dreambox, Carnegie Learning and Reasoning Mind. Leading the field in this area include organisations such as Games for Change, The Education Arcade, the Learning Games Network and Quest to Learn - a new game-based school in New York with an inquiry-based modular curriculum which incorporates gameplay dynamics into the learning experience.

The summit is designed for educational entrepreneurs and those committed to providing the capital and resources to support their latest ventures, including: angel and seed investors, venture capitalists, venture philanthropists, foundations, private equity investors and directors of education ventures. Politicians and bureaucrats are not invited, which suggests that their role in the future design and development of education is now becoming increasingly irrelevant.

Educational isolationism doesn't work

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What’s the best way to stop drug running in your backyard? Probably not a fence that can be scaled in 18 seconds flat. At an average cost of over £1.5 million per km, the U.S.-Mexico border wall has been pilloried in the British press as “an expensive white elephant”. What an outrageous example of racist American isolationism, one might say. I would tend to agree, but the phenomenon is not uniquely American. The Home Office’s recently announced immigration reforms seem more like a political ploy to xenophobes than sound policy. They also dangerously encroach upon freedoms of movement and action.

Take for example cuts in the number of student visas issued. Monday’s Home Office statement claims, "We expect our new student visas policies to lead to a net reduction of around 230,000 student migrants over the full term of this parliament, from 2011 to 2015."

The whole circus seems bizarre. Where does the 230,000 target come from? It was 400,000 in March before public outcry, and the drop makes the number look arbitrary. Is the government trying to find the optimal point between liberal rage and conservative frustration, ahead of the 2015 election?

No one is directly hurt by the presence of foreign students. Anti-immigration advocates argue that each foreign student admitted means one British student rejected. Well, sort of, but admissions does not exactly work like that. Students are compared against one another as a pool, so it is the most qualified applicant who is admitted. Indeed, international admissions are typically more competitive.

If the argument is that unqualified British students ought get spaces before qualified foreign ones, then all I can say is that I favour competitive universities. The quality of an institution depends upon getting the best people, regardless of from whence they come. Yale and Harvard will continue to outstrip Oxbridge in international rankings if the Home Office insists upon treating world-class institutions like a primary school sporting event, in which everyone gets a prize.

Foreign students pay unsubsidised tuition, contributing more than £2 bn in fees each year. Eliminating this revenue can only harm British students: foreign students’ fees allow British universities to fund projects and expansion they could never afford on government grants and domestic tuition alone.

Most troubling is that the “need” for a government limit only exists because the supply of and demand for foreign students exceeds what government deems appropriate. The limit places an unnatural ceiling on foreign intake, in effect distorting the market. Universities should be free to offer places to whomever they like, and students should be free to pursue educational opportunities outside their home countries. This would be more just, and it simply works better.

On the New College for the Humanities

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Here’s an interesting development in higher education. The New College for the Humanities (NCH), an independent university college, was launched this weekend. Once opened, the NCH will be the UK’s third private university, the latest in a trend that began with the University of Buckingham in 1976.

The NCH will charge £18,000 in tuition, twice the top rate for public universities. Let the furore begin. University and College Union (UCU) general secretary Sally Hunt claims that the move will “entrench inequality within higher education” by serving only the “select few”.

Despite a quarrel over the title “university college”, the NCH will presumably go ahead. And so it should. Our current system respects a parent’s right to send his or her child to private school. It makes no sense to try to stop young adults from choosing private universities.

More than this, there are distinct benefits to private universities. They can launch innovative programmes and attract top talent in a way that their public competitors, reliant upon government funding and beholden to political climates, cannot. See to this effect the professorships of Richard Dawkins, AC Grayling, and Sir David Cannadine at the NCH.

Hunt says, “While many would love the opportunity to be taught by the likes of AC Grayling and Richard Dawkins, at £18,000 a go it seems it won't be the very brightest but those with the deepest pockets who are afforded the chance”. The charge that high tuition merely makes private universities bastions of social snobbery is a common one, but unfounded.

Universities trade on their reputations in academics. They have to take the best people, regardless of their ability to pay, to maintain the brand. At more established American universities, private financial aid is quite generous. Yale assists over half of its undergraduates, with an average grant of $34,400 toward tuition of $55,850. The NCH will offer assistance to 20% of its first cohort, with plans to expand this.

Also in the news recently was a BBC story on a tuition fees funding gap that will cost the government – meaning taxpayers – an additional £95m a year. Apparently a matter of getting their “sums completely wrong”. This makes the private sector look especially good, and the timing of the NHC launch is particularly auspicious.

Academic freedom needs to be protected

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The London School of Economics doesn't care about academic freedom. This is the only conclusion that I can draw from its reaction to the LSE academic who wrote a blogpost for Psychology Today suggesting that “black women are... far less attractive than white, Asian, and Native American women”, and that there was an evolutionary reason for this. Satoshi Kanazawa is being “investigated” by the university authorities and the LSE students’ union has called for him to be sacked.

Kanazawa isn't being attacked for distortion or plagiarism – true academic crimes – but for being insulting. This Guardian piece criticises him for relying on surveys to “show” that black women are less attractive. Very well, but this is a criticism of academic psychology in general, not Kanazawa himself. I suspect that his methodology would have fewer critics if he had been arguing that tall men were more attractive than short men. (Though, as a short man, I strongly dispute this assertion.) 

For what it's worth, I think Kanazawa misunderstands evolutionary theory: attractiveness is shaped by the people doing the sexual selection, so it makes no sense to ask who is "more" attractive – the question is, "to whom"? Beauty is in the eye of the beholder. 

The second most-read story on the Telegraph’s science section yesterday was “Women who lose weight more attractive than their slim counterparts”. Where was the uproar about this? There is no substantive difference between making a claim like this on the basis of weight and on the basis of race. The crime that Kanazawa committed was to talk about the "off-limits" topic.

Why is this so important? Because it shows that the LSE is intolerant of politically sensitive research topics and will “investigate” and possibly sack an academic who does academic work that is offensive or unpopular. What's the point in a university if it isn’t a place where academics and students can be controversial and say things that insult people? Evolutionary psychology, especially, is an extremely controversial and relatively new field. It is critically important that we protect it from people's feelings. 

Kanazawa may well be wrong, but that is beside the point. If academics aren't free to study and write about unpopular things, their value is greatly diminished. And for what – to spare people offence? Sometimes those unpopular things are both correct and important, and it isn't worth losing those just to avoid insulting people. Unfortunately, the LSE’s disregard for academic freedom has sent a warning to any future academic who considers talking about a controversial topic – "watch your back".

Think piece: The folly of the public benefit test

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The "public benefit test" is a misguided attempt to force consolidation in the independent education market, argues James Croft.

This week the long running dispute between the Independent Schools Council (ISC) and the Charity Commission moves towards a conclusion in the courts. While Robert Pearce’s comments on Friday will come as a disappointment to association members hoping for clarity on the question of how schools may meet the new public benefit requirement, I can’t help but think that the issue has become little more than a distracting side-show.

The government has already made it quite clear that the Chair of the Commission must desist or be relieved her responsibilities; a future resumption of her unsuccessful attempts to force consolidation in the sector was always unlikely. In so far as the foray was the brainchild of Labour policymakers, the announcement on Friday that the Commission’s programme of assessments ‘is at an end’ and that irrespective of the outcome of the case ‘the commission intends to review the guidance in the light of its experience of its use’ comes as no surprise either: while politically useful in pacifying interests on the left of the party, this aspect of Labour’s policy excursion into the charitable sector has been far from successful in policy terms. [Continue reading]