Mark Cuban’s blog post on the cost of tertiary education and the level of student debt in the United States has relevance which extends beyond his country and topic. It grapples with major issues about the future of tertiary education. It’s a huge topic.
Cuban’s title is overblown: “The Coming Meltdown in College Education & Why The Economy Won’t Get Better Any Time Soon”. While he is often a scrappy writer he’s also easy to read, explores new ideas, and debates opinions, often in opposition to popular views
On student debt the alarming debt figures he quotes speak for themselves. He states that the “37 million holders of student loans have more debt than the 175 million or so credit card owners” in the United States. He says this is more than the debt on cars in the United States.
In the Australian context his comments on tertiary education, not student debt, remind me of conversations I’ve had for decades on how out of touch law school education and writing can be in terms of serving student needs.
Some themes in those conversations were aired in public online in the U.S. due to one blog. It was taken up by major papers. The blogger continues to agitate for change at http://insidethelawschoolscam.blogspot.com.au. The blogger is a professor of law.
The passion of both Cuban and Inside the Law School Scam is driven by a very U.S. issue – escalating student debt and dwindling job opportunities for graduates.
I have no comment on debt or jobs. However both are an important part of the cut and thrust of their arguments. Cuban foresees a rise and rise in tertiary student debt in the U.S. and tuition fees, making some analogy to real estate asset price inflation that was the closest trigger of the 1997 U.S. economic crisis, and now longer term trend.
That analogy (between U.S. student debt and city real estate prices) inspires several interesting new economics questions about how to interpret a graphic that accompanied a 2006 Richard Florida article (see the graphic at the end of Exporting and benefiting from education). Is the graphic support for Florida’s presumably intended equation, which seems to me to say – more students equals higher real estate prices? Now, post 2007, is the alternative and depressing equation instead this – more students equals more people willing to go into debt, for not just real estate but also increasingly for education?
What I do have thoughts on is the future of tertiary and post-graduate continuing education. It’s this that I read into Cuban’s post. In particular I’m encouraged by, and see some logic, in Cuban’s brief promotion of the non-establishment institutions or education providers. Note he says he is speaking too as an employer willing to hire the best no matter where they graduated.
Due to constraints of time I won’t extend this point here. It awaits proper marshalling of facts, arguments and solutions.
For Cuban there’s a creative destruction future ahead. His final paragraph, inclusive of his capitalisations is here:
The Higher Education Industry is very analogous to the Newspaper industry. By the time they realize they need to change their business model it will be too late. Higher Education’s legacy infrastructure, employee costs /structures and debt costs will keep them from being able to re calibrate to a new generation of competitors.
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