Crazy White House Proposal: Rank Colleges Based On How Much Graduates Earn
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The Obama administration is transporting Wall Street logic into higher education by proposing to measure the value of a college by the earnings of its graduates. This conceptual coup may be the best news for Wall Street since the abolition of Glass-Steagall.
We need not repeat all that has been written about how this money-making metric misses the point of college; about how students should be studying to become good citizens and leaders, to find and know themselves, to discover which pursuits in life best suit them, to develop an inquiring mind and so on. But such musings, however admirable, miss the main point: Using future earnings as a measuring stick transforms the entire notion of higher education into yet another financial instrument. No doubt some Wall Street hustlers are already dreaming up how to create derivatives they can sell to insure students and their families against less than expected earning outcomes from the college investment. Wow, an entire new casino in the making, right up there with the ethanol market.
Should this pernicious metric really catch on, it will create even more pressure for colleges to suck up to high finance. Not only do colleges court their hedge fund graduates as if they were gods instead of crooks, but an earnings metric will encourage colleges to become feeder schools for Wall Street firms since that's where the highest salaries are. What a virtuous cycle: train the kids for Wall Street, get a higher earnings ranking, get more ambitious applicants, then get rich graduates to donate to your college. The next step is to sell the naming rights. How about the JPMorgan School for the Dark Arts?
Obama the Community Organizer?
The President's early career serves as a poster child for what colleges should avoid. As we all know, after graduating from Columbia University (tied for 54th in graduate earnings as recorded on PayScale.com) Obama began his working career as a low-paid community organizer. I assume he did this work because he wanted to serve the residents of the economically depressed areas in Chicago's south side. Luckily for Columbia's PayScale.com rating, the future president made quite a jump from community organizing to Harvard Law School, to state politics, to best-selling book author, and then to POTUS. He has not yet reached the million-an-hour hedge fund income level, but he's probably no longer hurting Columbia's ranking. However, those who worked with him as community organizers, and then continued with do-good work, would be viewed as liabilities, not assets, to the rankings of their alma maters.
Solidifying the values of the Billionaire Bailout Society
This making-money metric illustrates how far we've drifted into a new era of financial hegemony, which I'm calling the billionaire bailout society. A generation or two ago, Obama's proposal would have met with derision, and not just from obstructionist Republicans. For the WWII and baby boomer generations it was honorable to serve—to help make your community and your country a better place. After so much war and destruction, and after so much poverty and discrimination, it was a badge of honor to join the Peace Corps or help build a cooperative or community organization to serve the disadvantaged. Even wealthy political elites like the Kennedys made it clear that they considered public service a much higher calling than just making money. You didn't have to be a radical or even a liberal to believe that public service was a good in itself. Going to college gave you special access to develop a deeper humanistic view of the word, to find your calling, and to sharpen the skills needed to help make the world a better place instead of making seven figures. How quaint!