Thursday, March 30, 2017

Not Enough Indians....

Journalists are still using backward-looking statistics to prop up the idea that college is a panacea for all our nation's problems.  Click to enlarge.

In a recent article online, I read some snotty comment from a journalist that while some people are questioning the value of a college education, these claims have clearly been dis-proven by statistics that show college graduates make 50% more than non-college graduates over their lifetime.

The actual quote is this:
More than 25 percent of people in their 30s who have attended college at some point have no degree — neither a community-college degree nor a bachelor’s degree. They fare vastly worse in the job market than their counterparts who do graduate (despite all the overwrought commentary claiming that education is overrated).
Overwrought commentaryIs she talking about ME?

What irks me about these sorts of statements is multi-fold.   First, you are not a statistic, and the Left loves to use statistics about people to pigeon-hole people for life.   Second, this statistic is old and based on old data.   To figure out someone's lifetime income, you have to wait, well, a lifetime.   That someone who graduated in 1960, 1970, 1980, or even 1990 made more money that a peer who did not is not really helpful in evaluating the value of a college education today.   And college is radically different today than in the past, as we shall see.

The other problem with statistics is that they assume all college educations are equal and that a college degree is a fungible commodity - that a 4.0 from Harvard is the same as a 2.5 from Community College, or a "phone it in" from a "for-profit" University (the latter an illustration of how college has changed since the authors of these condescending articles graduated).

As I noted in an earlier posting, as a college dropout from General Motors Institute, I was able to find better-paying career positions than my brother who had a B.A. in "Communications" from Syracuse University.   He bummed around trying various "jobs" that were not really jobs at all - working at call centers (telemarketing) for a freezer-scam company, and even selling vacuum-cleaners door-to-door in a short-lived venture.  He struggled with a college degree.

Meanwhile, I landed a salaried position with United Technologies Carrier, working in the lab, with full medical benefits, a retirement plan, and even a tuition-reimbursement plan to send me back to college.   A dropout from an Engineering program has more job prospects that a graduate in "communications", liberal arts, philosophy, or whatever.   All college degrees are not alike.

The theory the Left is selling - and it is past its sell-by date - is that we can lift everyone out of poverty by getting everyone a college education.   And clearly, liberal arts majors are falling down in math, statistics, and probability when they make statements like, "College graduates make 50% more than non-college graduates, so if everyone became a college graduate, everyone would make 50% more!"

But 50% more than what?   If everyone goes to college then they can't make "more than" the non-college grads, as non-college grads would cease to exist.   Simple logic, but it eludes the Left.

As a result, college degrees are worth less today.   A college degree isn't worth as much as it used to be, as so many people are going to college.  You can't simply elevate everyone from the factory floor to the executive suite.   Someone has to do the bottom-level jobs.

We are seeing this today.  Trump wants to kick out all the Mexicans, but meanwhile, the construction industry is lagging as no one wants to work construction anymore - at least not native-born Americans.

Meanwhile, in some flophouse somewhere, a young millennial sits and smokes pot and laments the fact there are no "good paying jobs" with a future left - for someone with his credentials from Useless Party University.   How can he pay back his student loans without some six-figure salary job that he is entitled to?   His experience negates the philosophies of leftist newspaper journalists.   And likely that unemployed millennial has a degree in journalism, ironically enough.

The problem we have today is not the lack of blue-collar jobs (as Trump posits), but the lack of blue-collar workers.   One of the myths about immigrants is that they take jobs "no one else wants to do" like dishwasher, lawn service, home cleaning, or picking crops.   Migrants, we are told, are taking only sub-minimum wage jobs and working under the table. 

The reality is, the number one job (outside of the service sector) that migrants are taking is in construction.

And the reasons are not hard to fathom.   It is seasonal work, it is easy to "hide" on a construction site, as you may be working for only a day or two for a subcontractor.   Subcontractors can easily bring in day-laborers and skilled illegal workers without the knowledge of the general contractor.   And many migrants from Latin America have solid construction skills.

Hiring "American" workers is harder to do.   As I noted in an earlier posting, all you need is an old dented pickup truck and a circular saw, and you are a "carpenter" of sorts.   And it is not hard to get jobs framing up a house.   But Contractors know that the first week of deer season and the first week of fishing season are unofficial holidays in the US for construction workers - half your work force disappears during that time period - leaving only undocumented Mexicans at the job site.

But it is a job that can turn into a career if you apply yourself.   I have friends who started out putting up sheetrock or framing houses and went on to starting their own businesses, doing remodeling jobs and eventually becoming home builders themselves.   The sky is the limit, limited only by your own abilities and ambition - something lacking in most people.

And that's OK, too.   What the "everyone should go to college" crowd fails to realize, is that you can't run a company or a country or an economy where everyone is an executive with a corner office and no one actually does the work.   Well, at least not until the robots take over.   The problem in the labor market today is that we are graduating people with useless and expensive college degrees, with the promise that all that hard work and student loan money will pay off in the end.

And it will, for some.   Doctors, Lawyers, Engineers might recoup some of these expenses - although the Lawyering field was a bit overstaffed in recent years and not every lawyer makes a lot of money these days - some in fact are starving, not literally of course.   But others with degrees that are academic in nature are less inclined to see the payback moving forward into the future and not looking back into the past.   Yea, sure, my elders made out OK with their liberal arts diplomas from 1968 or even 1978.  Today is a different world and colleges are graduating people who can barely read and write.    College is the new High School and often is failing at even that.

It will be interesting to see, 30 years from now, whether this statistic "college graduates earn 50% more than non-college graduates" holds up.   In other words, statistics about old people are really not helpful to young people.

But people are not statistics and there are plenty of folks out there who do not get college degrees but still succeed in life.  You may be one of them.  Success depends less on some diploma, but rather on your own talents and ambition.  The most useless person in the world with a college degree is not going to land a job just because they went to college.  The smartest guy in the room will succeed, college degree or not.

It is funny, but almost every big name in the tech sector today - the people who the liberal press salivates about, is in fact a college dropout, as the infographic above illustrates.  It literally is a Who's Who of the leaders in the tech sector today.

The media hangs on every word that Bill Gates or Mark Zuckerberg say about the future of technology.   Then they go back to the newsroom and pound out another piece about how college-is-everything and the key to life and the key to eliminating income inequality or whatever.   They fail to appreciate the irony that the richest people in the world are often not college graduates

A college degree qualifies you to work as a clerk in the office of the really rich guy who dropped out of college, if it qualified you to do even that.   College doesn't teach success, it rarely teaches even skills.  Today, it barely teaches math and reading, but instead stuffs people's heads with ideas about entitlement and "gender studies" or whatever trendy topic-du-jour that academia is keen on but the rest of the world is scratching their head about.

The article accompanying the infographic above includes this startling quote:
Today a college degree is worth $365,000 for the average American man after subtracting all its direct and indirect costs over a lifetime. For women — who still tend to earn less than men — it’s worth $185,000. If the decision to drop out or not boils down to economics, all you need is compare those numbers with what you could do with the money you are spending on tuition now.
Ouch.  Is $365,000 worth borrowing $100,000 to get?  Considering the future cost of money?  Considering compound interest?  And yes, this is an example where opportunity cost kicks in.  Could the money spent on tuition be better spend founding a business or buying your first home?

"But Bob!" you say, "You went back to college, got a law degree and ended up successful!  You made over a million dollars as a Patent Attorney!"   All very true, of course.   But I made far more as a landlord and as a Real Estate investor.    And if you throw in what I made by investing in stocks and bonds, I easily made more than twice what I made as a professional or could have made had I kept practicing, in these other activities.

College was a good deal for me, but I could have made as much if not more in other endeavors - and in fact did.   College is great, but not necessary for success.  And just any old college or any old degree is not a guarantee of success as the Left postulates.  (Why does the Left hype college so much?  Because if you go to college you are more likely to vote Democratic whereas if you don't you are more likely to vote Republican.   Maybe indoctrination is one reason why the Left loves to push college as a panacea for the nation's ills).

Borrowing huge sums of money at age 18 to get a useless degree is not a good idea, in my opinion.   Having the government (taxpayers) fund four-year party schools for everyone is an even worse one.  The problem with college can't be fixed by throwing more money at it or getting more people to go or to graduate.   That is the problem with college.   We've decided to allow "funny money" into the process, encourage everyone to get a college degree, needed or not, and then chained them to a lifetime of debt payments.

The price of college has spiked because of this funny money.   Cut off the flow and you kill the beast.   Colleges, if they had to compete on price, would have to cut costs.   And when Deans and Chancellors are bringing home seven and eight-figure salaries, it isn't hard to figure out where to cut the fat first.