Opportunity: The Bright Shiny Object

I was a guest on the Arizona at Work radio show yesterday. A good portion of the hour was devoted to the cost of higher education. In the discussion, the point was made that it’s “all about opportunity.”

Sorry, but it really isn’t. I’m all for lowering the cost of higher education, because the current system is absurdly discriminatory and is wreaking havoc in all sorts of ways. I also believe there are other compelling reasons to decrease the cost of higher education, a point to which I’ll return later.

But, first, mass higher education isn’t the answer to the demolition of the middle class. We already have college grads unable to find work. Oh, I know, they didn’t pick the right majors. They all should have majored in engineering or accounting. Which would create a glut of engineers and accountants, resulting in substantially lower incomes in those professions.

Consider this: When I graduated from law school three decades ago, law students were receiving multiple job offers and young lawyer salaries were skyrocketing. Fast forward to today. A friend of mine just lost her job as a law school professor because enrollment was down over 50% from year to year. The decrease in enrollment was far less about the cost of a legal education than it was about the glut of lawyers. So, do we really want more law students? Hardly. Could the same thing happen in the vaunted “STEM” fields? I don’t see why not.

Conservatives, including many Democrats, love to preach how “what matters is equality of opportunity, not equality of outcome.” In their minds, if everyone has a reasonably equal chance of making it to the top 1%, our absurdly unequal sharing of wealth and income is fair.

Memo to progressives: Stop getting tripped up by this canard. If you’re at a loss to respond when confronted by the “opportunity vs. outcome” argument, remember:

The largest percentage of the population you can squeeze into the top 1% is …..[drumroll]………. 1%. Keep repeating that over and over. It’s really true, I promise. So, no matter how equal opportunities are, if you don’t change the sharing between the 1% and the 99%, life for the 99% won’t improve.

This isn’t hard to figure out. Nobody needs a college education to work at Walmart or McDonalds. Those jobs won’t pay more because a few more kids graduate from college. So, unless the sub-living wages currently paid to Walmart and McDonalds workers are forced to increase through policy changes, life for those workers still will suck no matter how many new engineers we graduate.

Do we need to bring down the cost of higher ed? Absolutely. Is equality of opportunity a worthy goal? Yes, but if we don’t do something about equality of outcome, we’ll never achieve equality of opportunity.

Truth is, even at today’s bloated levels, the cost of higher education still is justified by the increased earning power a college degree represents. But having college graduates saddled with debt is terrible. Among other things, it forces them to choose the highest paying career path, which is not necessarily the one that fits their passion.

What about those other compelling reasons to reduce the cost of college? Consider what happens to the economy as more young people go to college. First, we create demand for college professors and other folks who work in higher education. So, it’s a job creator. More jobs means more people working, and the greater demand for workers translates into higher wages.

But the bigger impact of increased college (and, really, graduate school) attendance is not on the demand side, but on the supply side of labor. When a young person attends college, he or she spends four or more years out of the job market. Add on graduate school, and you’re looking at up to 20% of a person’s working years out of the job market.

That’s huge. We desperately need a reduction in the labor supply. Ultimately, increases in productivity reduce the demand for workers. I recently wrote about this in Productivity: Where Marx Nailed it on Capitalism. Somehow, we need to find a way to reduce the pressure that creates, and it’s going to have to be accomplished on the supply side. A reduced work week sure would help. Denmark is at 33 hours. We could achieve that tomorrow by updating the overtime laws. A return to one-worker households also would help. And keeping people out of the job market in order to attend college and graduate school would help. A lot.

One agenda item of conservatives that wouldn’t help on this front, by the way, would be raising the social security retirement age. But that’s a post for another day.

9 responses to “Opportunity: The Bright Shiny Object

  1. dobleremolque

    So, okay Sen. Kavanagh. You’ll lead the charge to restore the money for JTED?

    “The society which scorns excellence in plumbing as a humble activity and tolerates shoddiness in philosophy because it is an exalted activity will have neither good plumbing nor good philosophy: neither its pipes nor its theories will hold water. John W. Gardner

  2. dobleremolque

    Ok Kavanagh, … so you’ll lead the charge to restore the money for JTED?

    “The society which scorns plumbing because it is a humble profession and exalts philosophy because it is a noble profession, will have neither good plumbing nor good philosophy. Neither its pipes nor its theories will hold water.” John Gardner

  3. Good points, sounds like we need to one to one on the show.
    Are you interested?

  4. Good points, sounds like we need to one to one on the show.
    Are you interested?

  5. Bob, you hit on several points that I think are critical to the future of our Nation. I have for many years thought we were focusing too much on college as a panacea to our future. Not everyone is cut out to be a college student, nor does our economy need a bunch of college students to function efficiently. When I attended high school, besides throwing rocks at the dinosaurs to keep them away, students could enter trade programs, such as automotive repair, plumbing, electrical, construction, mercantile, etc. You could also enter college prep if you chose. The point was that there were other career fields available for students to choose to enter rather than going to college. Today, for whatever reason, you just don’t see much emphasis on anything except going to college. That has to change. I would argue that we need plumbers more often than we need accountants and refrigeration guys more often than attorneys. Such a change would require a BIG change in thinking on the part of parents and students.

    Your other ides are excellent, too, but they require massive paradigm shifts in thinking to be successful.

    – Shorter work weeks? Good idea! Opposed by: Workers who won’t want to see smaller paychecks; Employers who won’t want to see their Administrative costs shoot up; Conservatives who will complain it is a further erosion of the American Work Ethic, just to name a few.

    – Single family income? Good idea! Opposed by: Families who won’t want to see their purchasing power diminished; Feminists who will see it as an assault on women’s rights; Men who have been raised to expect women to work outside the home as well as inside it, just to name a few.

    We do need to see a major sea change in how we do business because I see little signs that the business machine is starting to sputter. It could just be temporary, but I am concerned, nonetheless.

    COMPLETELY SEPARATE SIDE NOTE: I enjoy your postings, Bob. They are usually thought provoking and insightful and your responses, even when you get angry, are still mostly focused and reasonable. I wish you would post more often, but I am fairly certain this blog is just a small part of your life.

    • Thanks, Steve. You’re right about it requiring a paradigm shift. Take your comment regarding shorer work weeks. When we transitioned over time from a 60 hour week to a 40 hour week, weekly wages went up, not down, because the increases in productivity were such that workers were producing more in 40 hours than they previously had in 60. The same is true now. Workers produce more today in 33 hours than they did a few decades ago in 40. But, instead of allowing the work week to shorten while maintaining workers’ standard of living, we followed policies that translated all the productivity gains into increased profits for the owners of capital. That’s the paradigm that needs shifting. And, if it shifted , your response to your own comment would be “that’s hogwash.”

      • A while back I told you one of the reasons I hung around this Blog was to learn things. In this case, I was inspired by your posting. There was a time, Bob, when you would have been correct and I would have said “Hogwash!” at the idea productivity and wages could increase with a reduced workweek. But not today. I have not been tied to the concept of the 40-hour work week for a while now. I have often thought that my employees could be just as productive with a 4-day, 32-hour work week but have been hesitant to try it because it seems rather radical. Plus, the world we exist in is still a 5-day, 40-hour world. I worry about losing a competitive advantage. And what if the idea fails and my Company starts to fail? Right now we are booming, but if the Company fails, what happens to the employees for whom I am responsible? I may own the Company, but do I have the right to risk it? The Company isn’t a social experiment, it is a business upon which more than two hundred people and their families depend for their livelihood. However, I really want to try and go to a 4-day work week. I am getting old and will either have to sell the Company or leave it to my children. Since none of them seem interested in it, I’ll probably have to sell it, so if I am going to try this, time is running short.

        So, on Monday I am going to call the management team together and start looking into doing it. It will be interesting to see what sort of plan we can come up with to make it happen. I will let you know later what happens.

  6. State Senator John Kavanagh

    An unanticipated consequence of making a college degree readily available to all is that employers now require college degrees for jobs that do not require them. They do this because the quality of high school diplomas is down, they need to reduce the number of applicants to process and because they can.

    This does the greatest disservice to those not academically inclined or enabled who only have high school diplomas but are ready, willing and able to do such jobs and often do them better because they do not feel that their college skills are being wasted on a lesser job.

    We need to better balance our educational outputs with our job needs. It is fine to saddle a student with a $50,000 loan debt, if it made him or her a barrister but not a barista at Starbucks. There is a great need for less educated people in noble and profitable professions that do not require university degrees and the debt that often goes with acquiring them.

    Of course, whenever I say that I get pummeled as an elitist. Fortunately my plumber agrees with me because he makes over $100,000 per year without a university degree and he is his own boss.

    • John,

      You’re not an elitist, your a plutocrat and stooge for the private prison industrial complex aka modern day slavery.

      That’s not based on anything other than your record as a bribemaster and a blowhard.

      Why not just take the filthy lucre from CCA or GEO group and quit demolishing Arizona.