Education Opinion

Higher Education Is Still a Good Investment

By Russell I. Thackrey — December 21, 1983 5 min read

Societal subsidy of higher education was worthwhile when the generation that is currently running things went to college, but it should be cut sharply now because it is no longer a good investment. That’s the thesis of Warren C. Robinson’s Commentary, “Has the U. S. ‘Overinvested’ in College?” (Education Week, Oct. 5, 1983). A longer version of this article had previously appeared in the September issue of Policy Review, a publication of the Heritage Foundation.

(The Heritage Foundation, in case you don’t remember, is sometimes described in the press as a “conservative think-tank” and was instrumental in developing policies and selecting people for the present Administration.)

Mr. Robinson’s theme is that investment in education by society--and individuals-- “paid off” when the percentage of young people going to college was relatively small and higher education was a means of acquiring skills needed in a period of rapid technological progress. College enrollments grew, as did the supply of trained and credentialed workers; the economy flourished; and most of those who went to college “realized the American dream.”

have this view of the value of higher education as an investment. But Mr. Robinson says they’re wrong. Too many people got into the act. What was true when only 5 percent of high-school graduates went to college is no longer true when about 50 percent go, he argues. He insists that there is “considerable evidence” that excessive in- .. vestment in higher education is responsible for most or many of the economic ills of society today. Increasing numbers of young people are “overqualified” or otherwise mismatched for the jobs they hold and are “not receiving the rewards they expected"--hence the reduction in productive efficiency in recent years.

“It is no accident that the period of the most rapid investment in human capital has been followed by the most sustained slowdown in productivity in U. S. economic history,” Mr. Robinson says.

I have several problems with his thesis and the “evidence” he says supports it. He cites no real evidence that the “cause” of the slowdown in productivity is the fact that increasing percentages of young people have had access to higher education. What Mr. Robinson calls “evidence” is the fact that increasing numbers of young people went to college during a period when there was a slowdown in productivity and that some of these people are now unhappy because they didn’t get the job or the cash they hoped for.

people in the early 1930’s. As a member of that generation, I can testify that those who did get jobs didn’t spend much time bemoaning the fact that they were “overqualified.” They tended, instead, to be glad they had employment and to give their job all they had. I doubt if young people today are all that different.

Another problem with “Educational Disinvestment” is that its author sees no value of any kind in advanced education other than the cash it might bring to the individual (or to society in the form of increased productivity). He says, “There is (or should be) no reason for thinking that higher education has any mystical value above mundane economic calculations.” So there you have it. He adds that “a significant percentage of college graduates could have done just as well with only a high-school education"- the term “just as well” referring, in this context, to cash income. So what’s new? Mr. Robinson also adds: “Whatever can be said about ‘happier’ or ‘more socially conscious’ workers, education will not be a profitable social investment unless it leads to more productive workers.”

Fortunately, there are other views on the societal value of advanced education. In a 1956 address on the theme of the contribution of the public university to American life, James Reston attributed the U. S. role in the “salvation of the Western World” from the barbarism of Nazi and Communist threats to the success of the great experiment of popular education in this country.

Said Mr. Reston: “No intellectual aristocracy, no plan for the nourishment of the best minds alone or for the education of the sons and daughters of the rich alone, could possibly have brought the American people to the rescue of the Western World.

“The government in Washington had to rely on one thing alone ... on the common sense of a fairly well-informed people, and without popular higher education for the masses, it is inconceivable ... that the United States would have made the sacrifices and assumed the responsibilities without which our whole civilization might very well have been overcome.”

Mr. Robinson’s “evidence” contains many qualifications. He says advanced education “may” result in increasing worker frustration and decreasing productivity and that this “seems” to have occurred in U. S. industry during the last 10 to 15 years. There are no qualifications attached to his summary, which contains statements such as: “Recent data ... show conclusively that the rate of return on college education is falling sharply. . . The use of the public sector to promote investment in education has had exactly the opposite effect from what was intended.” ... A workforce that is overeducated ... ends up being relatively unhappy and unproductive. This describes the situation in the United States today.”

Mr. Robinson’s prescription for the future is to cut societal subsidies to higher education sharply and to “quit promoting it.” He rejects as “specious” the idea that all should have access to higher education. He would have colleges and universities charge the’ “full cost” of providing education. (Some already charge some students more than the “full cost” of their education, thereby making these students subsidize others.)

The rich, he says, could still go to college if they want to and can meet admissions requirements. For student from very low-income families, Mr. Robinson says, one “could design a system of Federal scholarships based on need and merit.” (He apparently hasn’t designed it.) The “middle class” would have to decide whether the “returns” would justify the “sacrifice necessary to pay for it.”

Education is “artificially cheap,” Mr. Robinson says, and he argues that “when colleges must charge the full cost of their programs, they will deliver a better product at a lower unit cost.”

As with his other major points, he gives no evidence whatever for this last assertion. (Available studies, by the way, tend to show that “more affluent” institutions spend higher proportions of their income on administrative staff-in short, more-on “overhead” than on instruction, as affluence increases.)

Mr. Robinson, however, has an advance answer to all critics and criticism: name-calling. The last paragraph of his article in Policy Review says:

“The strident attacks on this policy prescription must be recognized and rejected for what they are, pleas from the education industry-administrators, teacher, researchers, bureaucrats, and misguided students- for special subsidies and favored treatment.”

A version of this article appeared in the December 21, 1983 edition of Education Week