I saw these two articles going viral: College Became the Default. Let’s Rethink That., by John McWhorter, and College Was the Biggest Mistake of My Life, by Jamie Paul.
McWhorter’s criticism is more nuanced, but yet again, we see another well-educated individual who parlayed his prestigious degree into a good-paying, high status career who now is trying to tell society that, no, college is not the way.
In spite of debt and indoctrination (or what some may call ‘wokeness’), college still offers the best shot for the median talented person to attain a good standard of living, without having to rely too much on external, uncontrollable factors such as luck, rich parents, favoritism, connections, timing, etc. Yeah, if you have those necessary ingredients, then maybe you can skip college or delay it to do something else, but most people do not have these luxuries, innate gifts, or fallback plans. Not everyone at 14 is a coding genius as Vitalik Buterin and Bill Gates were.
All too often in these ‘self made’ success stories there is a large but uncredited or downplayed role of luck, connections, or help (such as from rich, well-connected parents). For example, Mary Maxwell Gates, the mother of Bill Gates, knew John Opel, then-chairman of IBM, and suggested he take a chance on her son’s start-up, that of course being Microsoft. And as the say, the rest is history.
That’s the funny thing about this juxtaposition, you got these people with degrees, and also these ‘e-hustlers’ such as Gary Vaynerchuk, who are saying to not go to college even as the wage premium is the widest it’s ever been, and keep widening with no end in sight, even after accounting for inflation and student loan debt. In high inflation or low inflation, the wage gap persists. High inflation only makes college more attractive. Inflation hurts poor, working-class people, whose wages suck and persistently lag inflation.
Each successive crisis, such as the Great Recession or Covid, has only seen the gap widen. This is in spite of the rise of online learning/MOOCs, coding bootcamps (which can be as pricy as college and have a habit of inflating success metrics), unending predictions of an impending student loan debt crisis and bubble, and the growing ‘anti-college movement’ online.
Politicians are incessantly bemoaning how expensive college is, but are unwilling or incapable of doing anything about it. Similar to healthcare costs and housing unaffordability, it’s one of those things in which everyone seems to be in agreement that there is a problem, yet solutions and the motivation to implement them, are lacking. I am not optimistic about the ability of politicians to solve, or at least attenuate, this problem. Rather, I think it has to come from the marketplace, that is, the wage premium needs to shrink, and or employers need to stop requiring degrees for so many jobs.
Stories of graduates with ‘six figures’ debt are outliers and get all the media coverage, but the reality is more mundane and less newsworthy, around $26,000 per student, or about the same as a car. Running the math shows that the college wage premium is more than enough to offset this, even after accounting for the 4-year ‘head start’ of entering the labor market after high school. This head start is negated not only by low wages but also a much higher unemployment rate for high school grads compared to college grads.
I think also ‘hustle culture’ has created unrealistic expectations of the attainability of wealth without college. You’re probably not going to get rich reselling shoes on Shopify. There are not enough bipedal organisms in this galaxy and neighboring ones for everyone to get rich that way. Or by cutting out your daily Starbucks consumption, waking up at 5 am, or from cancelling Netflix or whatever else has become the latest lifehack promising success.
It’s opposite sides of the same coin: boomers who give dated, useless advice, such as the “firm handshake,” are equally out of touch and clueless as marketing ‘gurus’ who say to not go to college.
Same for Peter Thiel…he is wrong to encourage young people to drop out of college, especially considering he himself graduated from Stanford and used those connections to eventually become a billionaire. Because recent successes build on past connections and successes, it’s disingenuous for someone who was successful early on in life after college, to now say that college is useless or overrated because he or she became successful later in life at something unelated to his or her initial career path or success. These are not mutually exclusive events. Graduating from Harvard or Stanford opens doors for the rest of your life.
Moreover, most grads major in ‘actionable’ subjects, like business, nursing, economics, or ‘STEM’, not the humanities or film. Matters pertaining to human events get a lot of media attention, so one may be inclined to overestimate the popularity of humanities degrees. Nursing is boring…the nursing profession only became newsworthy because of Covid, but otherwise no one cares that much. Culture wars are more fun.
From Jamie Paul, regarding a common argument that teens do not have the emotional maturity to make financial decisions (in the context of student loans):
It’s worth taking a moment to reflect on the fathomless insanity of expecting teenagers to hatch decade-spanning plans intended to shape the course of their lives, while their brain’s prefrontal cortex, responsible for long-term planning, is seven years away from being fully developed.
I don’t buy the ‘underdeveloped brain’ theory either. I don’t think it’s well understood what it means for a brain to be fully developed, and if so, at what age or how this is related to impulse control or decision making. Plenty of older people, such as boomers, go into debt and are bad with money. ‘Credit repair’ exists for a reason. Gambling addiction afflicts all ages. Additionally, according to the Consumer Financial Protection Bureau, 90% of student loans are co-signed by parents.
This week the price of Bitcoin and other ‘cryptos’ crashed. Bitcoin has lost about 55% of its value since peaking on November 2021, and down over 20% in the past 7 days alone. Other coins have lost far more. So many people were expecting to get rich this way, and such hopes have seemingly been dashed. Same for the stock market, which also fell a lot. That’s not to say you cannot get rich with stocks, but day trading and option speculation (such as on Reddit’s hugely popular r/WallStreetBets community) is typically a fool’s errand.
We see this over and over again, in which something which is touted as a shortcut to success at life–be it cryptocurrency, home flipping, day trading, self-publishing, drop shipping, etc.–falls short of its hype, and most people end up wasting time and money. The reason why people such as myself keep recommending college and index funds, is not a lack of originality or some ulterior motive, but it’s because those are things that have been proven/shown to work consistently for most people, compared to the alternatives, which have more variance and a lower median. The odds anyone is going to find a ‘lifehack’ to bypass this are poor.
I too would like to see the 4-year-degree become less important as far as being a ticket to social mobility, but we live in the world that exists, not the world we want.