Page 69 - Crisis in Higher Education

Underlying Problem • 43

3. Strong national defense and cyber security: for example, developing
military hardware and Internet firewalls
4. Sustainable environment: for example, creating and implementing
new ways to reduce the consumption of resources and make existing
power supplies cleaner
5. Equal opportunity: for example, creating a society where everyone
has the same chance for success by providing access to good primary
and secondary schools and helping people overcome the physical,
mental, and emotional obstacles they face.

These important activities rely heavily on the knowledge gained from
associate, bachelor’s, and graduate degrees as well as technical skills like
welding and electrical work. The United States has no choice but to invest.
The challenging question is: How much of this investment is the responsibil-
ity of government? There is no definitive answer, but Chapter 7 attempts to
discuss the role of government in higher education. For now, the thought is
that the investment in higher education would have a much better payoff if
its cost declined, while the number and quality of graduates increased. This
would be a productivity increase for universities and a cost decline for pay-
ers, which would free resources for other uses. Individuals could save more
for retirement, donate more to charity, or spend more on entertainment.
Governments could invest more in new highways and medical research.
From the student’s perspective, the decision to earn a bachelor’s degree
is personal, but the financial impact is measurable. Data from the National
Center for Educational Statistics claim that the median income of adults
ages 25–34 in 2014 was $49,900 with a bachelor’s degree and $30,000 with
a high school degree. If this gross difference is maintained for the work-
16
ing life of college graduates (22 to 65 years old, or 43 years), the university
graduate earns $855,700 (43 multiplied by $19,900) more than the high
school graduate.
However, the university graduate must pay four years of tuition, fees,
books, and so on, which could have cost $60,000 (a public university
education with the student living at home) up to $200,000 (a private,
not-for-profit university with the student living on campus). These data
1
are from Table 1.1 in Chapter 1. There are a few ways to spend less than
$60,000 such as taking the first two years at a community college, and
there are ways to spend more than $200,000 with the most obvious ones
being to fail and repeat courses, change majors, and change universi-
ties. Assuming an investment of $100,000 in university expenses over a