[hrothgar]

Coincidentally, I just ran across the following chart

http://www.calculatedriskblog.com/2010/03/...t=Google+Reader

[Winstonm]

Personally, I would rather have my taxes go to pay for subsidizing 4 years of drinking at the Delta House than 4 years of more Iraq war.

[phil_20686]

Principle reasons to subsidise education:

1) Heavily subsided educationi insures that you draw on the biggest possible pool of talent. Ie if some people are essentially excluded because of cost then your economy is not allocating its talent efficiently. This is important on a marco economic level because it seems intuitively clear that the more highly skilled your job is the bigger gain there is to the economy if you can do your job better. EG, if i can manage microsoft 1% better then that gains us more than if i can lay bricks 1% faster.

2) If education leads to better jobs, and education costs a lot, then very soon only the educated can afford to educate their children, which gives rise to a class society. This has a high social cost.

3) The governement (by which i mean it is in the national interest of the country) to maximise the gdp per capita. Then via tax and redistribution you can help the largest number of people who need it. Thus government subsidy is more like an investment in its citizens, which from a purely mercenary perspective, will increase the pool of talent who are competing for places, which will raise the quality of graduates, which will lead to higher revenue, so the government should at least pay for as much as is profitable.

[phil_20686]

hrothgar, on Mar 9 2010, 12:44 PM, said:

Take a look at the following chart from the Bureau of Labor Statistics.

http://www.bls.gov/n.../empsit.t04.htm

The unemployment rate for individuals hold a college degree is roughly

1/3 of that for individuals without a high school diploma.
About half that for individuals with just a high school diploma.

The unemployment rate dips even more if you look at post graduate degrees of various types.

If you are claiming that having a degree improves your employability, i think thats pretty uncontreversial.

If you are claiming that *therefore* giving out more degrees will lead to lower unemployment. I think thats an open question. For example, its clear that if 100% of people had degrees, gaining a degree would not give you an advantage in employability. The advantage derives partly from the skills you aquire at university, but largely from the fact that having a degree is self selecting - students compete to get into uni's so the unis pick the best students. Thus if your education system is selecting effectively, then your chart only shows that companyies are more likely to employ more able people, and your degree serves as a shortcut by which companies can discriminate between the suitablitiy of various canditates.

If you give out too many degrees, then their value as a discriminator drops, and consequently so does its value in terms of increased wages.

I think as well that normally joining a company teaches you the skills needed in that company far more effectively than a general purpose degree, thus the arguments that degres are crucial to the economy at large is somewhat flawed. On the other hands, there are a huge number of jobs for which further education is critical. Thus i surmise that there must be an optimal level to educate your population.

I have heard it said that the british economy is 17% graduate jobs. Thus i would guess that 20-25% is the optimum fraction of your population to go into university. This gives some room to grow, and accounts for the fact that not everyone who gets a degree will necessarily work in a graduate job. I do think in the future that this number will go up, but i seriously doubt whether there will ever be enough graduate jobs for the 50% of british youngsters who currently go to university.

[luke warm]

phil_20686, on Mar 11 2010, 01:07 PM, said:

For example, its clear that if 100% of people had degrees, gaining a degree would not give you an advantage in employability.

i guess it depends... we could choose our plumbers then by post grad work... why hire a plumber with a bs when you can have a phd?

[jjbrr]

jdonn, on Mar 9 2010, 11:37 AM, said:

It's going to take me 30 years total to pay off my loans and I didn't even go to graduate school (well one semester that I paid up front). Along the way I had 2 small scholarship and 2 grants so it could have been even worse (well presumably the same with higher payments) and I had 1 or 2 jobs at all points in college as well, which is pretty amazing for anyone who knows how much OKBridge I played back then.

Actually I could pay them off much sooner if I wanted to but they are locked in at such a low interest rate it would be like throwing money away.

Sorry, I'm grunching this whole thread but I saw this post and had to brag that I made a profit from going to college. Full ride+ excess financial aid yielded $2500 a year in profit.

[kenberg]

I was uncertain whether I should grunch a bit myself. It is an issue worth looking at although I wouldn't, myself, go nuts over it.

I can understand Josh's slowness in paying off the debt. Why should he rush? Presumably we can also understand that a taxpayer might look at this and say "Hmm, my tax dollars are supporting a forty year subsidized below market loan? Maybe I need to rethink my support of this program." And of course the jjbrr post adds to this. How extensive is this, we might ask. Definitely more than we would like it to be.

My outlook would be more toward trying to learn what real needs are and how they might be met, Not everything needs to cost a lot of money, here is an example:

The next door neighbor girl graduated from high school last spring, wants to study psychology, and is attending the local community college. This is just right for her. She had to start with non-credit math, we are friends with the neighbors so my wife volunteered to tutor her, she has now moved on to a credit class and is doing well, probably A work. I expect, after two years, she will finish at the CC and transfer to a four year school. The comfort of home and a helpful neighbor is just what she needs. Giving her some money to go off to Bryn Mawr or some such would be not only a waste but a mistake. I think this is replicated in great numbers throughout the land.

At the risk of sounding a little corny, I would like young people to develop their talents as they see them (exceptions to be made for hit men and drug dealers). For many, two years of community college followed by two years at a four year campus is not only adequate it is ideal.

Of course there are other cases, very strong students are out there. A kid who is ready for MIT should go to MIT. Or Cal Tech. But before we fork over a lot of tax payer cash for this we should be pretty clear that it is where he really belongs. We should be clear that he needs our help. And we don't need to give him a forty year loan.

[PassedOut]

jjbrr, on Mar 11 2010, 06:10 PM, said:

Sorry, I'm grunching this whole thread but I saw this post and had to brag that I made a profit from going to college. Full ride+ excess financial aid yielded $2500 a year in profit.

Is this the same jjbrr who posted in the "simple conversational question" thread?

[jjbrr]

I completely agree with kenberg. For many students, 2-year CC is such a perfect situation. They can work a job in addition to taking classes, which gives them valuable work experience while teaching them independence and money management and all the important life skills they need to be good at. I hope we all agree here that many 18 and 19 year olds aren't at a point in their life to make important decisions about the direction the rest of their life will take. I went to a school where first year dropout and failure rates were amazingly high. Many of the students who flunked out for no reason other than irresponsibility and immaturity were eligible for and received thousands of dollars in scholarships. These scholarships are funded by the state lottery, but I don't know if that's the source of all the money.

Anyway, I think we can all agree that there is some waste that occurs regarding taxpayer money. Some of that, as far as education goes, is wasted because of poor choices by students themselves.