Glenn reynolds who was recently on booktv. I mean, 40 of College Graduates wind up in jobs they could have gotten without a College Degree. Whats the difference between a starbucks barista and a barista who went to college . Underground [inaudible] which barista would you rather be . You can watch this entire interview at booktv. Org. On wednesday booktv tweeted a New York Times article on the future of the ox forked Oxford English dictionary, and on facebook we posted a link to a Huffington Post article that reported the Chicago Public library was named the best urban public library. Like us on facebook, facebook. Com booktv for more news about the world of publishing and whats happening on booktv. Youre watching booktv. Next, Glenn Reynolds argues that americans need to start looking for alternatives to our public and Higher Education systems, which he argues are either subpar, too expensive or both. He proposes a multipronged approach made up of charter or private schools and Online Education. This is about 40 minutes. [applause] thank you very much. Ive never been lapidary before, that i knew. [laughter] well, one small correction to what john said. 10,000 page views from a link is not bad, but ive discovered that you can double, triple or even quadruple the number of people who go through a link so long as it contains the word boobies. [laughter] because this is the internet, after all. Ive never been able to do that with one of johns posts, but maybe now hell be inspired to offer something. Well, johns introduction is exactly right, my take on education in america and its actually both Higher Education and k12 education comes from herb steins famous statement, if if something cannot go on forever, it will stop. And frequently compressed, even by herb stein later on, as if something cant go on forever, it wont. Well, what cant go on forever . If you look at Higher Education right now, you see a lot of stuff that cant go on forever, but the big thing is this die very generals between what people make when they get out of college and this what it costs to get out of college. In the 70s, we had a growth of tuition and fees that has been more than double the rate of growth in family incomes. And that means people have made up the difference with debt can, debt being the form of federallysubsidized and guaranteed Student Loans. For the most part, back before the housing bubble people would sometimes take out a Home Equity Loan to finance juniors college. Theres a lot less of it now because theres a lot less home equity. So what does that mean . Well, it means that when you graduate from college, you owe a lot of money. And when you graduate from college and you owe a lot of money, you need a job that pays a lot of money to pay it off. And is heres the problem, there arent so many of those jobs. Not as many as there used to be. Youth unemployment is dreadful. The youth misery index, which is some new compilation somebody came up with just today, i think, at least i just found out about it today, combines unemployment rates under 29 and student loan balances, and its at a record high. And i think thats actually a moderately useful metric. And you see it all the time. In fact, i was on tv a couple of nights ago talking about the book x when i came out and the sound man was coming over and disconnecting my microphone and everything, he said you were telling the story of my life. I owe 110,000 in Student Loans, and im working 70 hours a week to try to get them paid off. Well, yeah. Thats a common problem. And thats if you have a job. And people dont really think this through. When i was many law school, i had a friend who was paying his way through law school on Student Loans, and he borrowed more money than he really needed to, ask he said i just think of it as buying law student rob a beer. Yeah, sort of. Yale law school was cheap back then by comparison to now. And salaries then were lower but not as much low or as Yale Law School is more expensive. And i see this with my own law students. You see people graduating with a lot of Student Loan Debt and getting good jobs that pay a lot and still being strap ised. Strapped. Its easy to graduate with sixfigure debt. The highest debt load for a student i have personally known was 400,000, which i stress to add was not accrued at the university of Tennessee College of law where i teach, but rather at pricey, private undergraduate and graduate institutions attended prior to law school. But, you know, when you get out and you owe 400,000, it almost doesnt matter how much you make. And a job that pays a salary, thats a brutal burden. And the Federal Reserve recently did a study of the impact of student debt, and they found that students are putting off marriage, putting off car purchases, putting off home purchases and all sorts of things we normally think of as the kinds of things young and middleaged adults do and we rely on to drive our economy because they cant afford it. You cant buy a car when youre making a big freaking car payment in the form of student loan payments, you cant buy a house when youre essentially already carrying a marriage on your back. Im sorry, mortgage on your back. [laughter] maybe both. Or you cant get married, as i was about to say, when you cant afford to buy a house or a car. And thats part of the problem. That is retarding the lives of people. It is retarding the economy and society as a whole, and its something that cant go on forever. So it wont. And, in fact, there are already signs that its starting to not go on forever. Which is to say colleges this year in particular are starting to see buyer resistance. People are thinking very hard about whether they really want to spend 50, 60,000 a year and up. Every time people find out what the tuition is, theyre always like i cant believe how expensive it is to last year or five years ago when i was last paying attention. Especially if its going to be financed by debt. Right now a lot of colleges are dealing with this sort of sub rosa price discrimination thats what Financial Aid really is, its price discrimination. They figure out how much you can possibly afford to pay, and thats the rice for you because i like you. Thats really whats going on. You are seeing some schools actually having their Credit Rating downgraded because moodys looks at their Business Model and doesnt think its sustainable. You are seeing enrollments drop across the board many lots of schools and in lot of schools and within colleges youre seeing humanities departments, the New York Times had a piece on this recently, humanities departments unhappy because theyre losing their prestige and their majors and their enrollees because people, interestingly especially women dont want to major in the humanities because theyre concerned about getting a job when they get out. And that has internal ramifications within universities where budgets are set based on how many students take your classes and things like that that are fairly dramatic. So i think it cant go on forever, and i think it wont. So what happens next . Well, there are lots of things people can do. One thing we might see is people not going to college. I mean, 40 of College Graduates wind up in jobs they could have gotten without a College Degree. Whats the difference between a starbucks barista and a starbucks barista who went to college . Hundred grand in Student Loan Debt. Which barista would you rather be . Theres some story about that, im not sure ive got it right, but when donald trump was in a lot of financial trouble, he walked along and pointed at some homeless guy, see that guy . Hes got 500 million more than me because he was just broke and not this debt. Thats pretty much the lesson for some College Graduates. [laughter] and, you know, in todays world while getting ahead is probably harder than its ever been, just getting by is probably easier than its ever been. Between video games, internet porn and hookup culture, who Needs College . [laughter] you can have a pretty great life. Many of the things people used to think they add to exert themselves in order to enjoy are now available much more easily, and ill leave it at that. Laugh so one thing you may see is just exit. And, in fact, there is some evidence that men in particular are less likely to go to college now because they dont see it as sufficiently rewarding, but ill leave that to the experts who write on that subject. Another possibility is cheaper alternatives, and were seeing growth in some of that already too. One of them is Online Education, and theres a lot of that going on. And it is now no longer just the domain of the university of phoenix and a few other forprofit schools, georgia tech is offering a haasers in Computer Science masters in Computer Science online that is a fullservice degree. Everybodys good at their regular masters except its super cheap. Kind of appealing. Another thing were seeing that i would like to see her of of and i think more of is and i think will we will is certification in place of diplomas. Im not as convinced as an article that was in the Harvard Business review today which saysst the end of degrees, people are just going to get certificates that show employers they know how to do useful things as opposed to diplomas. But i do think a certificates actual ability are a big deal, and people who think that too are colleges because the Higher Education establishment is getting behind thirdparty education as a way to explain to people that their degrees mean something. And i think thats pretty useful. And another thing thats starting to happen is the rise of apprenticeship models. There was a sad article in the washington post, i mean, it was about people who had gone to college and couldnt get jobs going back to trade schools to learn how to be electricians and plumbers and things like that. Now, theres nothing sad about being an electrician or plumber. In fact, i was talking to one of my fellow law professors a few years ago about one of the articles about the exploitation of the working class and his response was, yeah, i might find that persuasive if i hadnt seen my electricians house. [laughter] being an electrician is good work, and theres no reason why a smart person cant be an electrician. The story said that the sad thing for these people was theyd gone to college and run up all the debt before deciding to be spectrummers plumbers or electricians. According to the article, Guidance Counselors in high school dont want to tell smart people to pursue a trade. They steer them to college. Well, smart people make better electricians. So i dont know that its so bad. And electricians make good money, Skilled Trades good money. They often make more than a lot of people make with bas, and in the coming years 2001 huge one huge advantage is they cant be outsourced to bangalore. Back in the 90s we had all the stuff from michael lend about knowledge workers and how they were going to run the world. Heres the problem with being a knowledge worker, youre in competition with every other smart person on the planet. Thanks to the internet. When youre a toilet fixer, youre only in competition with people within about a 15, 0minute 30minute drive. Thats a real advantage. So i actually think those kinds of things might be better. Other possible alternatives, one thing i think the whole model of education as weve pursued it recently is probably obsolete in an era where things change rapidly and people live a long time. The old model was you got your education up front. It was like filling the gas tank in your car, right . You go to high school, you go to college, your education pointer is pointing way over on f, and youre set for life. And you go cruising down lifes highway, drawing on the education that you had pumped in before. And thats not so valid before because people change a hot. People change careers a lot, some careers that people used to have go away. Theres a sad story at my old law firm about a guy who came up for partner with a lucrative specialty in civil air naught usings the year it was abolished. [laughter] kind of a sad story, but thats a met to have for all kinds of things that can happen in all kinds of jobs. And then you have to retool. And education, i think, now is likely to be something where people as they are older want to dip back in and learn specific things or skills or areas of knowledge without having to commit themselves to the sort of fouryear, joe College Experience that we traditionally think. Another reason why thats not so bad is that college is not so great for everybody. We see college sold as a source of opportunity, as a way to address income inequality. But that turns out not to be so much the case. Theres a good deal of research that shows that people who come into college with identical predicters in terms of test scores and grades and such come out of college on radically different tracks depending on what their socioeconomic status was when they went into college. Yeah. Its kind of sad really, but its true. And the big danger for the lower socioeconomic people particularly getting what these sociologists call the party path away which is otherwise known as college these days i think but they often come out burdened with debt and in jobs that are no better than they could have gotten if theyd have skipped college and, perhaps, the liver damage as well. Really want to get a negative view of college, just go on twitter and search the various passout feeds after every weekend tweeted out for the world to see. Other people in college do develop alcohol problems, they develop problems with drugs, sex that could last them for a lifetime, and theres even some evidence that minority students actually leave college with less in the way of academic ability than they had when they got this. There. This many cases. Youve probably heard the joke college is place where knowledge accumulates freshmen bring them in, seniors take none with them, therefore, knowledge accumulates. There actually seems to be a certain amount of support for that. So i think thats reason enough to rethink the college for everyone approach and look at some of these alternatives. The other thing is college is going to have to be cheaper. As i mentioned, colleges have been cutting fees, but cutting prices isnt the same as cutting costs. The problem that colleges have for the most part is theyre bloated. Theres a lot of administrative bloat. The Goldwater Institute did a study on administrative bloat and found it was the single biggest contributor to high college costs. And some of you may have read, and if you havent, you should because its a magnificent rant, william ginsburgs the fall of the faculty which is one take on administrators and how theyve ruined education. And its beautiful. Or. [laughter] well, what do you do about that . I have one suggestion. If anybody from u. S. News is watching in the audience or anything, u. S. News when it does its College Rankings should give colleges points for lean administrations. Colleges are going to have to do this anyway because except for the very few elite colleges, they are going to have to bring costs under control. And even the very elite colleges are going to have to bring costs under control ultimately so long as they expect somebody to pay for it. If they dont, they will become, essentially are, finishing schools for rich people which is, of course, what colleges were 100, 150 years ago. Will we really see, as john quoted me as saying, five elite colleges in the future . I mean, we might. Im not the only one to think that. Sebastian thro, this has said that. Hes a researcher professor at stanford. I called him, and he said im taking the president of turkey for a drive. Hes also the cofounder of you dasty which is an Online Education program as well, and he thinks that we will ultimately see a small number of big brands in education just as we saw a shrinkage from lots and lots of Automobile Companies to a small number of big Automobile Companies. Im actually, the more i think about it, not so sure thats the case. The reason that happened with automobiles was, basically, economies of scale. It was a lot cheaper to make cars in a big factory than in a small one, and im not actually sure its a lot cheaper to educate people in big universities than small ones. And im also not sure that the marketplace is only good for a few brands. But what i will say is this, a lot of colleges that have basically just relied on people to show up at their door and be willing to pay 40, 50,000 a year for an undistinguished degree are going to go out of business because they dont offer very much. Some of them will have religious affiliations that are Strong Enough to get people to come, some may have Strong Enough academic reputations, elite enough reputations to get people to come, but there are an awful lot of schools that dont bring too much to the table, so those schools, i think, are likely to fall by the wayside. What about parents and kids and stuff . What should they do . Well, the big piece of advice i give to people is dont borrow a lot of money to go to school. Somebodys nodding this the front. [laughter] i hope thats not from personal experience. [laughter] i mean, when you borrow a lot of money, you owe a lot of money, and you have to pay back a lot of money. And this seems simplistic, but a lot of students