Sunday, May 08, 2011

Is education the next bubble?

Higher learning is just an overpriced, speculative investment that typically rewards graduates with dismal career prospects, says billionaire Peter Thiel

Billionaire libertarian businessman Peter Thiel, the founder and former CEO of PayPal, is perhaps best known as the venture capitalist who gave Facebook the angel investment it needed to really get started. But, increasingly, he's getting attention for his controversial views on higher learning.

Last year, he launched the Thiel fellowship, which gives grants as large as $100,000 to 20 tech entrepreneurs who drop out of college by age 20 to pursue their own ideas. Then, in a National Review interview earlier this year, Thiel said that higher education is a "bubble in the classic sense," because education is "overpriced," something people have "an intense belief in," and an investment that's unlikely, in the majority of cases, to have a positive return. He made the point again last week at TechCrunch.

Given the "financial disaster" of student loan debt surpassing credit card debt, does Thiel have a point?

No, education isn't about returns on an investment: The concept of the education bubble is based on horrifying, false logic, says Freddie deBoer at L'Hote. "To see an education, college or otherwise, as merely a way to increase the amount of money you make is a terrible corruption and fundamentally unsustainable." Increasing earning potential was never meant to be the sole purpose of education, and if it's reduced to that, we're all in trouble.

Well, college is overpriced: College has gotten too expensive, with state governments cutting aid to public universities, says E.D. Kain in Forbes. But let's not abandon institutions of higher learning. If needed, we should raise taxes to make public universities more affordable. "Yes, education costs money. But that money should not fall squarely on the heads of middle class kids who are forced to take out tens of thousands in debt just to attend school."

And grad school is a particularly poor investment: College is still a good decision for most young Americans, but I can't say the same about grad school, says Conor Friedersdorf at The Atlantic. Grad school has become a socially acceptable way to drink beer, read, and go into massive debt in your 20s. "Upper-middle-class Americans tend to overvalue the non-financial benefits of grad school." Thiel's wrong about a lot. But at least he's "challenging the cultural assumptions that cause a lot of people to make bad life decisions."


Are You Getting Your Money’s Worth Out of Public Education?

If you find an investment no longer meets your needs, you quit investing in it and find a worthy substitution. That is exactly what is happening within the public school system. Taxpayers are becoming increasingly dissatisfied with their return on their public school education investment, so they are finding other solutions.

A recent Rasmussen Reports national telephone survey found that 72 percent of taxpayers say they are not getting their money’s worth from public schools. How much money are they referring to? Well, the nation as a whole spends about $9,000 per student on the public education system. Of course that number varies state by state.

But what’s more interesting from the poll is that only one in three voters thought that sending more money towards the education system would aid student performance. The rest of the poll takers were either unsure or disagreed altogether that money was the answer to the problems within the public school system.

There are many reasons why parents and taxpayers in general are becoming increasingly dissatisfied with the system. States are trimming back spending, and all programs that receive state funding are subject to the cutbacks. Those taxpayers and parents who don’t think enough is spent on education currently are worried students’ performance will take a hit if less money is devoted to the system.

But the majority of taxpayers in the poll say spending isn’t the issue, so what is fueling their dissatisfaction? “One reason is that voting Americans remember how much better education was when they were in the system and how it cost much less,” says Jon Coupal, president of Howard Jarvis Taxpayers Association in California. “There is a mentality that education money is being used for things that do not give a good return on investment.”

As dissatisfaction grows within the public education system, so do more opportunities. And with new opportunities available, the status quo no longer suffices. This has led to many states now offering charter schools or voucher programs for students to attend private schools. Also, the number of parents who opt to home school their children continues to grow as well.

“Students should come first in the education system,” says Bill Wilson, president of Americans for Limited Government (ALG). “Parents deserve options when deciding where their child should attend school.”

School choice leads to competition in the marketplace and children often reap the positive benefits.

In 2009, about six million students were enrolled in a private school, which is about 11 percent of all U.S. students. Students enrolled in private schools consistently score well above the national average in every academic area. They are also more likely than public school students to complete a bachelor’s or advanced degree by their mid-20s, according to research done by the National Center for Education Statistics (NCES).

There are many advantages to a charter school as well. There are more than 5,400 charter schools serving more than 1.7 million children across the country. And that number is growing. For the 2010-2011 school year, 465 new charter schools opened in 40 states and Washington, D.C.

Charter schools have more freedom from the many regulations of public schools. They allow students and teachers more authority to make decisions. Instead of being accountable to rules and regulations like public schools, charter schools are focused on the students and academic achievement and upholding their charter.

Another option for parents who want full control over their child’s education is to home school them. Today, about 2 million students are homeschooled, and the population continues to grow at a rate of 5 to 12 percent each year, according to a report by Brian D. Ray, Ph.D., President of the National Home Education Research Institute (NHERI).

Many factors are involved when the decision to home school a child is made. Academic concerns and religious motivation are the top reasons for homeschooling, says Nathan Mehrens, currently a Counsel for Americans for Limited Government and previously a legal and legislative assistant for the Home School Legal Defense Association (HSLDA). Another key reason for parents choosing homeschooling is concern over unspecified current problems within some public schools.

As parents now have more options than ever as to how to educate their children and as states continue to evaluate their budgets, it is important to compare education spending in the past and its connections to academic performance.

Research by The Heritage Foundation finds that increased spending on education has not led to better student performance:
“Since 1985, inflation-adjusted federal spending on K-12 education has increased 138 percent. Since the 1960s, real per-pupil federal education expenditures have more than tripled. Meanwhile, academic achievement has languished. Since the 1970s, math achievement has increased slightly, reading achievement has stagnated, and graduation rates have remained at about 73 percent nationally.”

And it looks like more taxpayers are finding those results consistent with their own children’s academic success rates.

Dissatisfaction within the public school system allows states to reevaluate spending, increase competition and boost a child’s academic performance levels. All good things for the many states that are struggling to stay afloat in these hard economic times.

As taxpayers reassess their priorities and investments, the federal, state and local governments should do the same. Reexamining the public education system would be welcomed change to both students and taxpayers.


'Unruly' British school suspends its headteacher after 70 teachers went on strike

A headteacher has been suspended after her staff went on strike, claiming that she would not help them crack down on unruly pupils.

Seventy teachers brandished placards and picketed the gates at Darwen Vale High School in Darwen, Lancashire, on April 7. They were angered by an alleged ‘lack of backing’ from head Hilary Torpey, 52, when they had to confront wild pupils.

Pupils frequently challenge teachers to fights, push and shove them in the corridors and classrooms and are constantly swearing and insulting them. But teachers said that when they take the matters to the headteacher she often sides with the pupils instead of staff.

Complaints were also made about pupils having filmed teachers on mobile phones and posted clips online. They claim that when teachers have confiscated the phones, they have been returned by the school’s management - leaving them ‘totally undermined’.

The strike followed an announcement by Education Secretary Michael Gove of a new crackdown on ill-discipline in class.

Now governors have suspended Ms Torpey. A statement – with spelling mistakes – was issued by Blackburn with Darwen Borough Council on behalf of governors’ chairman Don Heatlie-Jackson, saying that there would be ‘a full and proper investigation’.

Simon Jones, of the National Union of Teachers, said: ‘Intense negotiations have been taking place with senior local authority officers and the chairman of governors.

'Considerable progress has been made towards agreeing strategies that should lead to the resolution of this dispute.’


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