August 28, 2012

HIGHER EDUCATION BUBBLE UPDATE:

The cost of a college education has soared far in excess of the cost of health care. This is in spite of — or, more accurately, because of — massive government involvement in subsidizing and running schools. On the one hand, we have President Obama, who wants to double down and have Uncle Sam play a larger role in the classroom. On the other, we have reformers like presumptive GOP vice-presidential nominee Paul Ryan, who wants to limit the growth of Pell grants while ensuring the neediest students still have access. . . . College tuition grew at almost 7.5 percent annually between 1980 and 2010, when average inflation was 3.8 percent. At less than 6 percent annually, even health care costs grew at a slower rate than the university tab.

Young people aren’t getting much in exchange for this huge outlay. While enrollment has increased, completion rates remain dismal. Barely a third of students complete their degrees in four years, and less than 60 percent earn their degree in six years, according to Mr. McCluskey. That means at least two out of five enrollees don’t finish and fail to reap the benefits of a post-high-school education. Even those who complete their programs of study and are fortunate enough to find employment find that in one out of three cases, their degree isn’t required for their work.

Indeed.