When Peter Thiel, co-founder of Paypal, told Techcrunch that the next bubble is higher education because "a true bubble is when something is overvalued and intensely believed," he caused a stir of reactions. The argument about education being overvalued stems from the belief that paying enormous tuition rates at any cost (including high loans) leads graduates to an unhealthy sense of entitlement -- one that is not justified by the actual opportunities one gets from a high-priced college education. He further stirred up circles within higher education when he announced the "20 Under 20 Program" in which he will pick twenty students and pay them to drop out of college and start a business -- believing this will show the possibility of another path than that of education followed by debt, experienced by many.
On the one hand, he is absolutely right when it comes to the cost of higher education -- it is a cost that many can't afford. Simply put, the cost of higher education, especially in the United States, is extremely expensive today. Nplusonemag.com asserts: "Since 1978, the price of tuition at U.S. colleges has increased over 900 percent, 650 points above inflation. To put that number in perspective, housing prices, the bubble that nearly burst the U.S. economy, then the global one, increased only fifty points above the Consumer Price Index during those years." Smart Money laid out the increasing cost of education in an article in its college planning section, where it claimed that "over 10 years ended [in] 2005, increases in tuition and fees outpaced inflation by 36% at private colleges and 51% at public ones." So, yes, higher education at such a heavy cost can become more of a lifelong burden than a road to opportunity.
Yet on the other hand, Peter Thiel is missing the point and throwing the 'baby out with the bath water' by encouraging college drop outs. Higher education includes benefits that go beyond the financial opportunities it may provide down the road -- such as individual benefits attained in relation to self improvement, friendships, empowerment, global awareness, access to diversity, exposure to different ways of thinking or topics of interest and more. Additionally, education is crucial to efforts to promote equality and world peace as it not only impacts the lives of individuals but also the societies and communities in which they live. Crime rates, social awareness and economic stability are directly tied to the accessibility of post-secondary education. Taking into account the additional benefits of higher education on both individual levels and also global levels, one can conclude that Peter Thiel should not encourage drop outs, but instead to challenge the cost of higher education to decrease.
It is both apparent and proven today that the cost of higher education can be reduced with the incorporation of online courses which utilize open educational resources and open-source technology. For example, University of the People's pedagogical model draws on the principles of e-learning and social networking, coupled with open-source technology and open educational resources -- the amalgamation of which allow it to offer a tuition-free model that students can afford. Perhaps this solution may not be the best for everyone, yet the benefits of online education (such as tuition-free) may provide a swift answer. Even if students only use online education for one to two years of an undergraduate degree, and then switch to a traditional university, they have saved a good amount of the cost -- costs that for many students would mean heavy loans. If online education is not perfect, which it is not, it is clearly better than the alternative where students without financial means either are not be able to pay off their extensive non-forgivable loans after graduation, or as Peter Thiel suggests, drop out of school midway (many that do would unfortunately and probably do so with loans), or not go to college to begin with because they can't afford it.
There is a higher education bubble in the United States currently as Peter Thiel pointed out. However, the best solution may be to re-evaluate the expenses of delivering education, rather than to encourage young minds to turn away from education entirely.
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