When does a school become a scam?
With the student loan debt bubble starting to look to many worried observers like Subprime Mortgages 2: Electric Boogaloo, the question of whether college is really worth it as an investment has been raised with increasing regularity. But as Jordan Weissman at Slate notes, the right question might be less “Is college worth the money?” and more “Which colleges are worth the money?”
Weissman looks at records from the salary comparison website Payscale, which ranks colleges and universities by their “return on investment” – that is, how much more than a typical high school graduate an alumnus can expect to earn, minus what they spent in tuition. Unsurprisingly, the numbers are highly favorable for graduates of the Ivy League, well-respected state universities, tech-focused institutions and prestigious liberal arts colleges (though some of these, like my own alma mater Wesleyan University or the similar Amherst College, don’t appear on the rankings at all, presumably due to insufficient data). Schools that fit into more than one of these categories, like number-one-ranked Harvey Mudd College and number-two-ranked Massachusetts Institute of Technology, do better still.
However, the list isn’t just about patting deserving schools on the back. It’s also about shaming institutions that not only fail to provide a useful education, but are actively detrimental to students’ life experiences. Contrary to the prevailing impression that for-profit colleges are the primary bad actors in this area, it is largely traditional research institutions and liberal arts colleges that comprise most the very bottom of the roughly 1,300-school list.
To be fair, many of public institutions near the bottom fall that low based on calculations of the higher tuitions that out-of-state students would pay, and they are largely not schools that would draw many out-of-state applicants in the first place.
But the bottom school on the list is the private Shaw University in North Carolina. According to Payscale, 20 years after graduation, Shaw alumni are $156,000 worse off than if they hadn’t gone to college at all. Other private schools near the bottom of the list include Bluefield College, a Christian school in Bluefield, Va., where the 20-year return on investment is -$123,000, and Ohio’s Ashland University, with an ROI of -$91,600.
The idea that anyone pays to attend schools where the average student are worse off for going ought to be beyond belief. People who pay Nigerian princes to send them fictitious millions of dollars lose less money than the graduates of some of these schools. One has to ask, at what point does a school cease being a school and simply become a scam?
Weissman suggests the federal government develop rankings like Payscale’s and make it mandatory that schools disclose this information. To be sure, average salary isn’t everything. But when education is priced like a luxury good and treated by millions of parents and students as an investment in the future and gateway to the middle class, greater transparency should be a first step toward solving the problem.
But serious questions also need to be asked about whether to start treating certain colleges as predatory institutions. Student loan debt could be a bubble that pops the entire economy, all because millions of students were raised to believe a college diploma – any college diploma – was a nest egg. If schools like the above operate without accountability, many of those students will end up with nothing but egg on their faces.
