A different kind of higher education

There's a new book out called Change.edu by Andrew Rosen. I saw a review of it and wanted to pass it along to you. Once again, it involves education, my area of interest.

Mr. Rosen, who is chief executive of Kaplan Inc., one of the largest for-profit higher-education providers in the country, has created a book after lots of research. He did in-person interviews and firsthand reporting at colleges across the country. One of the book's themes is that most colleges and universities have trouble identifying exactly whom they are trying to please and thus what exactly they are supposed to be doing.

And little wonder—think only of the tangled network of income sources and self-interested constituencies that vie for the attention of a college administrator. There are of course students and the parents who pay the tuition bill. There are taxpayers, who underwrite college subsidies in one form or another (including research grants and financial aid). There are alumni, whose donations are a key to university solvency. There are even sports fans, whose enthusiasm plays no small role in college branding and consumer appeal. Unfortunately, this mix of financial imperatives can lead colleges to focus too little on what students are learning in the classroom. Amen!

Mr. Rosen's answer to the higher-ed mess is for-profit education. He believes that for-profits are the rightful inheritors of America's abiding mission to expand access to higher education. But unlike public and private not-for-profit schools, for-profits can be single-minded: The student is the customer. Imagine that. Tuition makes up almost all the revenue of a for-profit school. At private not-for-profits, tuition accounts for only 29% of revenues and at public colleges as little as 13%.

The accusations of misconduct that have been leveled at some for-profit schools in recent years, Mr. Rosen concedes, are not unfounded—pushing unaffordable loans on students, recruiting students who are not able to do the work, etc. He merely says that, in the for-profit world, companies that cheat their customers or that aim at only short-term profits will not survive. Meanwhile public and private not-for-profits can remain in business regardless of how badly they behave.

What are the teachers like at for-profit schools? Their professors are engaged exclusively in teaching, not research. No one has tenure, so incompetence means dismissal. Teaching is quality-controlled and student performance strictly measured. Nice . . .

The for-profit schools can track "learning outcomes" because much (though not all) of their education is online. For a book with a "dot" in the title, Mr. Rosen's Change.edu does not spend a lot of time defending this mode of education—it's just, well, the future. And maybe it is. He is careful not to overstate the value of online learning, acknowledging that there is plenty to be gained in the traditional, seminar-room, residential model of college—he calls it the "meandering" model. But there are many students who want a "direct route" to knowledge and skills. Mr. Rosen makes a strong case that for-profits, when properly run, are ready to provide it.

I still enjoy seeing students in a classroom, but I do believe some would benefit from online classes. We'll see how these for-profit places do when they come up against the power of traditional schools. It should be interesting.

A threat to traditional higher education (and I like it)

As a teacher, I like to see what's going on in the world of education. There's an article in the Chronicle of Higher Education that tells of something called "Alternative Certification." It's a new development in the education marketplace that should make many educators nervous. I actually like the idea.

The announcement of agreements between Burck Smith's StraighterLine and the Education Testing Service (ETS) and the Council on Aid to Education (CAE) to provide competency test materials to students online is potentially very important, along with several other recent developments. It all comes down to economics to explain why this is important.


With regards to colleges, consumers typically have believed that there are no good substitutes–the only way a person can certify to potential employers that she/he is pretty bright, well educated, good at communicating, disciplined, etc., is by presenting a bachelor's degree diploma. College graduates typically have these positive attributes more than others, so degrees serve as an important signaling device to employers, lowering the costs of learning about the traits of the applicant. Because of the lack of good substitutes, colleges face little outside competition and can raise prices more, given their quasi-monopoly status. And, of course, this is the problem--no competition.

So colleges have been able to raise prices at will, knowing that students and their families will pay through the nose. But people are now asking an important question: Aren't there cheaper ways of certifying competence and skills to employers?

If someone could offer a less expensive job-hunting license--one that assessed an entry-level job-seeker's worth to a prospective employer at least as accurately as a college degree does--then the demand for college would plummet, as young adults could realize the same gains from a much smaller investment. I'm OK with this since the market should be allowed to operate and come up with better alternatives.

That's where ETS and CAE come in. They will offer two tests. One, called iSkills, "measures the ability of a student to navigate and critically evaluate information from digital technology." The other, the CLA, "assesses critical learning and writing skills through use of cognitively challenging problems." Students can tell employers, "I did very well on the CLA and iSkills test, strong predictors of future positive work performance." The idea is that the business can hire people for less than they would have to pay college graduates who score less well on these tests.

If the practice became widespread, it would drive college costs down and force cost-cutting and downsizing within the higher-ed industry. Sounds great to me. But you can expect the industry to fight hard against it.

I'll discuss ways the schools and colleges will fight back in the next blog.

The soaring costs of college

This is a second blog dealing with higher education--its failure to do its job and its soaring costs. I got the information from Jack Kelly's article entitled "The Big College Scam." Notice his word choice--it's a scam.

Last time I focused on Kelly's attack leveled at the failure of higher education. Students don't learn. The president of the American Council of Trustees and Alumni said,"Students who say that college has not prepared them for the real world are largely right. The fundamental problem here is not debt, but a broken educational system that no longer insists on excellence."

For this blog, let's take a closer look at the sharply rising costs of higher education. Kelly claims that the cost of college soared and its value diminished once the federal government started to "help." The supposed purpose of federal guarantees for student loans was to make college more affordable. In fact, according to Kelly, they did the opposite by fueling the massive tuition hikes. Colleges spent the extra money to expand their bureaucracies, increase the compensation of faculty and staff, and improve physical facilities. Some of this sounds fine, but I've seen the costs even at the community college level. When the school adds a new dean, for instance, the costs soar since that person doesn't function alone. He or she needs an entire staff, adding enormously to the costs of running the school.

Kelly has some discouraging statistics on the costs associated with higher education. We spend about $10,600 per pupil in public schools, 377 percent more, in inflation-adjusted dollars, than we spent in 1961. Yet among students who go to college, 75 percent require some remedial work. And, according to a study by the American Enterprise Institution and the Heritage Foundation, teachers are paid $120 billion over market value. That's painful to hear considering that I'm a teacher.

So students who succeed in college often come out with massive debt. Add to this the problem that their skills were not improved while in school, and you have a real problem. Kelly notes that roughly 60 percent of the increase in the number of college graduates since 1992 work in low-skill jobs. In 2008, 318,000 waiters and waitresses had college degrees, as did 365,000 cashiers and 18,000 parking lot attendants.

Unfortunately, very few are honest with students considering college. They often refuse to say that college isn't for everyone ... or that rigorous exit requirements at any level do not exist. It goes back to my comments in the previous blog. Higher education is often "sold" as a commodity to students with the implied message that they will get the diploma, no matter what their skill levels or their study habits.

So how is our current President doing with this problem? It looks like he will keep the current system going a little longer. He recently proposed a student loan forgiveness program, with taxpayers eating the difference. It would save students about $8 a month, but it won't slow down college costs or make the schools better places to learn.

School choice in developing nations works

As a public educator and a conservative, I have been interested in the ongoing debate over school choice. The teacher unions fear choice and fight against it fiercely. They have various reasons and scare tactics, but mostly they have money to battle against giving parents the chance to put their children into schools that will do the best job educating their young. A recent movie, Waiting for Superman, exposes the unions for their selfishness in this regard and holds out hope that parental choice would be a better option.

I thought about all this as I read an article in World magazine. By the way, you ought to consider getting this magazine because it acts like Time or Newsweek but without the liberal bias as it reports on news, entertainment, and politics. Anyhoo, World had a report on school choice I found interesting.

The magazine told about a professor of education who studied private schools in a dozen developing countries. He was surprised to learn of private schools existing without government money. Instead, they depended upon "$2-per-month fees paid by rickshaw pullers who scrimp and save to give their children a chance not to pull rickshaws." He found all sorts of for-profit schools created by poor but persevering entrepreneurs.

The professor was especially amazed to see the results when he compared these private schools with better-funded government schools. He found high motivation and better results where he least expected it -- in these poorer schools. Parents had genuine choices of a number of competing private schools that were close to their homes and were in competition to keep prices low. Educational entrepreneurs were responding to parental needs and requirements, with the result that their quality was higher than that of government schools provided for the poor.

A large grant allowed him to create research teams that went on to test thousands of schoolchildren in countries like India, China, Nigeria, and Ghana. They found that poor children in private schools scored 75% better than comparable students in government schools. Of course, this did not go over big with government "experts," who saw these schools as a threat to their bureaucracy.

Sound familiar? We encounter the same results and foot dragging here in the United States. The experts don't want to give up their monopoly on education, so they fight school choice whenever they can. But I think choice is the wave of the future, just like we have seen in the rise of for-profit higher education like the University of Phoenix. Competition is good in all fields, especially education.