In today’s Wall Street Journal, Joshua Hochschild, dean of the College of Liberal Arts at Mount St. Mary’s University (Emmitsburg, MD) risks the wrath of progressives by comparing the Obama administration’s approach to student debt (i.e, make repayment easier and easier so we keep everybody in college) to a story by Beatrix Potter. His piece is entitled “Welcome to the Ginger and Pickles University.”
In the story, the characters (a cat and a dog) run a store where they never charge customers for anything. People promise to pay, but never do. Eventually, their store has to close. Dean Hochschild writes, “I first read this story 99 years after it was published, during the housing crisis of 2008. Reading it to my children, I found it hard not to see the very same economic forces at work: the inflation and then collapse of a credit bubble.” Connecting the dots, he continues by noting that in the education bubble, “the government has provided huge sums in taxpayer-guaranteed loans, and it is not clear that those taking the loans will be able to repay them. If those loans aren’t repaid, the taxpayer — that is, the public at large — will suffer.”
He sees the college lending bubble as unsustainable, and he’s right. Even with Obama and his fellow “liberals” (liberal with other people’s money) doing all they can to make repayment less onerous and forgiving significant amounts of debt for some students (especially those who go into “public service” employment), “it can’t go on forever.”
A huge number of young Americans get a thin gruel of education in college because they’ve been conditioned to think that they are entitled to pass courses without much effort. To get their college credential, they have to spend or borrow huge amounts of money. They have continued to do so because most Americans believe that getting that degree is somehow going to open up a lot of highly lucrative career prospects — just as lots of Americans were led to believe that owning a house was “the American dream.” Finally, it is starting to dawn on people that the cost of college is far out of line with any educational or financial benefits.
I’m glad to see another writer, especially an academic, compare the housing and higher ed bubbles. (My own Forbes piece on that is available here.) I’m also glad to see someone injecting a little humor into this debate. Many people will better understand the folly of what we’ve been doing in higher education by comparing it to a children’s story than by reading policy papers and studies.