>> we are going to begin. we're delighted you are all here and ladies and gentlemen,, good afternoon and welcome to our bookie bench. william that it new book "is college worth it?." here it is we hope you will buy a copy if you have not already from the friendly book sellers. i'm the resident fellow it will be my pleasure to introduce our speakers

today. we are coming up on the 151st anniversary of the moral act enacted july 2nd , 1862 of the remarkable achievements of the lincoln administration in addition to fighting the civil war with a landmark of higher education it begins to donating way and for college for the benefit of agriculture and mechanic guards but the amount of publicly and of support for a least one college with a leading object is to teach as is related to agriculture and the mechanic parts to promote the liberal and practical education of the industrial classis in

several pursuits in professions like it seems that they knew exactly what they were about in 1862. that may be less true for us today. we have gone from a society from one century ago to where two-thirds are pursuing some form of education after high school and this obviously changes everything in economics of higher education. in seems to have produced a debt-financed of a glut of holders many of us have noticed the parallels to the houses and condos when it comes to higher education finance. this is especially a problem

if what is financed is consumption, and not investment. if as it has been suggested for a large number of students, colleges not an investment but consumption for of unfilled years before they have to settle down to a dull life. these and many more problems of college education with the debt explosion is discussed in this practical book bill and david want their work to be practical and useful a and i think it will be. in addition to the discussion today we invite all of you to be back this coming monday june 24 for 80

isolate is -- related conference regarding student financial aid starting at 9:00 in the morning and we hope to see you there. today billy davis will present their book about 20 your 25 minutes that we will speak about two minutes each to give the author is a chance to respond then we will open in the floor to your questions we will adjourn for a coffee reception in the hope he will stay for that. "is college worth it?" will be on sale and we hope he will buy a copy. let me introduce our authors william bennett as you know, is one of america's most influential voices of political and educational issues and is a senior adviser on project lead the way and to his chief

evaluation -- education appraiser to beanstalk television and has taught at boston university, university of texas, harvard and served as secretary of education under president reagan it was the first drug czar under president h. w. bush and includes two number one your time best sellers and has received more than 30 honoree degrees and is one book we were philosophy students together at williams college. he will be followed by the co-author of "is college worth it?." he is the associate producer at did nationally syndicated william bennett did as a claremont institute fellow his studied greek and latin at the catholic university

and now in his honor tried to come up with an appropriate latin'' for dressings student debt and i suggest speaking speaking latin. happy is he who has no debt. [laughter] and i thank you. record your presentation in this provocative book will come to ati. >> [applause] i would say as we wrap the same college and save system i would have copied from the blue books final exams we had saturday class's to remember that? extraordinary.

i will some basic familiarity but i will hit some high points that one of the things we said at the very beginning of the book is that two-thirds of the people that graduate from high school and that immediately enroll in the four year college probably did something else first you talk about options like a committee college to get a job for a year or two, military, and we say this based and what we have read and what the data said including 46 percent of people who start for year colleges don't finish or it takes between six and eight years. there are other reasons there are plenty of reactions to the book summer interesting summer not but it has gotten a ton of reviews and i think a discussion is going on and a debate will follow i hope

one of the more interesting responses from a man in california and said we have triplets better 14 we are proving them for stanford but we realize the return of investment we're now stirring and -- steering them to harvey mudd so i'm thinking we should get a percentage. [laughter] the other was from a recent graduate of north carolina state university who said i'm afraid what you said about liberal arts is true i finished a four year program will not mention the college very well-known i realized i was gonna lead absolutely nothing he didn't say i could not get a job that part of humanity and social sciences that they have changed so dramatically which is what they're not

worth as much after finishing four years he said i'd been enrolled as a freshman at north carolina state university was nuclear engineering and graduate at 25 rummy at 27 he said that was for your mistakes but i had a good time. [laughter] i said that much i know about the liberal arts colleges. you had a good time so now we're getting a lot of invitations to go to campus forums, a stanford may be the funniest one from the university is heather wilson former congresswoman from mexico and wrote me and she said please come to the winter commenced in rapid city in on december 21st

device said maybe not. [laughter] she said recognizer don't have a budget to pay you because they don't pay be much public information it is $62,500 the average graduate make $63,005 i said take a collection in 78 decency. -- a decent feat. if they buy me a pair of boots i will go but this echoed the main themes of the book and we were glad to hear that because people hope they could characterize the book as a diatribe that we were delighted to hear brookings institution said college to be worth it if they study the right subject, graduates and goes to the right school this is

very much along the lines of what we wrote in an editorial that college could still be worth it major in the right subject at the right place look data from the perspective of the individual the brookings institution report said there is enormous variation of the return to education depending on factors such as institutions and attendance, a field of study whether a student graduates while the average return to obtain a college degree is positive we emphasize that is not universally so for some college may not be a smart investment but to tell all young people they should go to college the matter what is a pretty loud message we're doing some of them a disservice and that is interesting.

the second point i would make to talk about the stem and jobs in reid say this as outsiders of classics major which one is more pathetic to get a job after college it is tough competition returning to the university of texas i went to the jobs bulletin board the only thing up there was a notice about department of labor and minimum wage to what you were entitled to. it did not look very promising. student walked by eisenhower you doing and i of a ph.d. in he said now was that working out? he said i have a radio show and he said it is dialogue

but we talk because those are the jobs that are very much worth it we base some of the conclusions we come up with with the pay scale and this has shown that this pattern continues that with the return on investment that these institutions have a strong preference of science technology in math south dakota and caltech and tenth is a standard which is very strong in that and others. another brookings report shows one at the 10 jobs in the u.s. economy are some of

a bachelor degree stem jobs. they have an average salary of 50,000 -- $53,000 per year. in dallas and the milwaukee there were so bachelor's them jobs and edward snowden. you know, that name we're not recommending him of trader or hero of the bet note he had no hall -- high-school or college degree but is paid to with a thousand dollars per year for his technical abilities. i should have said this a minute ago with the rankings they have a heavy stem focus harvey denied which is an all engineering school in california where the graduates earn $2 million

more in their life to than just with a high-school education. in 2013 that number of prestigious private schools princeton and yale slipped i would not give too much attention to this but i would if there is a pattern over time. . . >> there were more graduates in 1985 than there are today in the fields of microbiology to mechanical engineering, and

computer science. have a dramatic increase in the number of students enrolled in college, tremendous opporunity in these fields and 50 percent fewer graduates in these fields. i have some notions about why that is the case. as to do less with college and high-school and even elementary school. but that is extraordinary. the other thing i want to say is a very hopeful note. we say at the end of the book that we think technology, the internet, other things can have a transformative effect of higher education. the next revolution may be coming. we talked about some of the programs like you-city to which i am a special senior adviser. of course sarah and other companies. low and behold not long after our book, i think this is the vanguard. it was announced, some of you may have seen it. georgia tech is now offering a

totally online master's degree in computer science that normally takes two years. pricetag $7,000. it used to be $40,000. $20,000 or so for in-state. $7,000 is the price that the students will pay. a prestigious university. first-rate academic program. there they go. this may be part of the future. a few of the fact that we put and that have come from the book would be blood found interesting deciding the ones that people have commented on. they did not know these. tweeted not needed until we did our research. 43 percent of students under the age of 25 have student debt. the average total amount for that age group is around $20,000 which is tough which would -- when you're just getting out. there are 150,000 janitors with

a bachelor's degree the united states. the study academically and draft found that 45 percent of college students made no statistically significant gains in critical thinking, complex reasoning and writing skills in their first three years of college. what are you actually paying for? that's the big paint -- question. what is the value added here. academic study also found the average college student did only 12 to 13 hours per week. whether they doing? don't answer that. when i was secretary of education i went to france and met with the minister of education for france. we were talking. he had his nose up in the air. american secretary of education. and i said, good morning. how're you students doing. elected is watch and said, it's

10:00. they're already there seen. good. what are your american students doing? god only knows. we have a decentralized system. many are in recess. anyway, another thing we talked about, this is so much of -- so much of our research turned by the work of dr. venter and his colleagues. this is a very interesting fact about the faculty and costs related to costs and related to overhead. at the university of texas at austin where i did my ph.d., 57 percent of the credit hours are taught by only 20 percent of the faculty. this has gotten a lot of people thinking. we heard from a lot of people on board and trustees. this is pretty generally true. the answer is, yes. a small part of the faculty teach is the largest part of the student load. the media south dakota school of

mines is not earning more than the median graduate of harvard. you do have to spend four years in rapid city. in up, life is law. if you could survive williamstown for four years, you can survive rapid city, i think. in 1970 this, to me, is -- this is the thing that we have engaged in. it has been the toughest nut, not that it is -- not that it is not true, but that it is not something that people have gotten angry about and that we have had some real back and forth because you know when you talk about increasing the price of higher education the answer you get most often, the answers you get most often are too. one, we have already been engaged with college presidents, university presidents of this. one is that is the price of excellence. well, that is just not an answer because a lot of places may have bought excellence. a lot of places they have not. as we point out and a lot of

places they've bought climbing walls and gourmet room service for the dorms, believe it or not. and other things, but they have not bought excellence. that is not what the money was about. the second thing we have heard is that the price goes up, we charge a wealthy students more money so that we can give more money to poor kids so that they will come. as best we can tell, and only that there will know for sure, in 1970 something like 12 percent of recent college graduates came from the bottom quartile of the income distribution. forty years later, 2010, the percentage was 7%. so this whole notion that we charge more so that we can give away more to the port has not worked. we have fewer poor students in college. this combined with the marvelous new york times story which pointed out how to the colleges, the elites are not reaching the extremely talented poor kids in america even with their enormous

budgets and the enormous recruiting budgets, is still remains a scandal in higher education. anyway, we are very pleased with the way the book has been received. four to more conversations about it. finding out more, and we look for to changes in higher education. many in which i think the conversation has begun to turn. thank you very much. [applause] >> thank you, bill. david. >> well, thank you very much. i wanted to first thank a eye for having me here today and think pill for giving me the opportunity to co-write this book. now i'm sitting on this distinguished panel with man with decades, centuries of experience. or i am just the best looking 70 year-old in america.

you know, anyway, i want to see a few -- i will go heavy on statistics and the beginning and then i am going to talk a little bit about what it means for millenniums especially because i am one. i think this is something useful. a generational perspective. young college graduates are still struggling with student loan debt and unemployment even as the economy has approved -- improved somewhat in the last couple of months. and the major economic consequence of this is the inability to get married, have kids, buy a car, things like that. there will be a lot less room to achieve a lot of the aspirational goals for people of my generation, people who are saddled with this kind of student loan debt. and you can look at a couple of numbers year the tell the story. a survey done by wells fargo found that one-third of all anneals report regretting going to college. they said they would be better off working and earning money. half say that that is there biggest financial concern with 42 percent calling it

overwhelming. 35 percent of in day graduates under the age of 30 are more than 90 days delinquent on their student loans. the average graduate in 2013 had a debt burden of around $30,000. i think the median debt burden for recent graduates is $14,000 which is not 30, but that is still quite a hefty sum of money to be burdened with when you come out of undergraduate school. in the new report from congress just found that student loans if increased from a nationwide total of $550 billion in late 2007 to just under $1 trillion in the first quarter of 2013. so in only six years, five years we have doubled the amount of indebtedness in this country with pretty bad effects. as bill alluded to, the major culprit, the schools themselves. at think for capitalizing on a

prominent social belief that to make it in the labour force as a worker, as a human being, you need a college degree. it is all but essential. i think just speaking from experience and anecdote is not the beginning of data, was speaking from experience i see people, no people, the people of viet have college degrees and there will attest that generally the feeling not only in themselves, but feeling a perception by other people that if you are without a college degree you have somehow messed up and life. i think that is not a good thing. i don't think that's america. so the schools can raise prices to capture students who can pay full price. the very top tier schools, harvard, princeton, yale, always will have of a huge amount of demands, so they can jack up prices as much as they want and people will pay it because that brand is synonymous with achievement in american life.

day -- and what has happened is that a lot of second-tier schools have followed scoot -- followed suit and also have raised their tuition too exorbitant levels that most people cannot pay. and not to make this school the whipping boy, but george martin university is one school that is kind of the exemplar of this. it is the most expensive school in the country, but no one would say that it is of the highest quality. but i think it is capitalizing on the belief that price is synonymous with quality. so if you're a parent or a student to really maybe is uninformed about the college process were informed in d.c. that and think, if i send my kids there there will be a great shot at a high level of achievement. i know for a fact that there are a lot of kids coming out with huge amounts of student loan debt. when colleges captured this money they sink into expensive building projects, student

centers, hot tubs and rock climbing walls and things like that which are fund. you know, i went to american university. was the beneficiary of a lot of these nice amenities. i'm not going to like but in truth they were unessential to the learning process and i would have been happier being less in debt and having a nice warm room or cafeteria or something like that. and then lastly they play a game of financial aid for low-income students which i think is, at times, somewhat despicable. this is all undergirded by the ubiquity of student loans. anyone basically wants a student loan in america from the federal government can get one. knowing that that is an and in the money spigot, the schools like to raise their prices and don't have a lot of compunction about doing that. and i think there is a big area of hypocrisy because we know that the philosophical leitmotif

of most colleges today is social justice, fairness, things like that, lot of these various moral perspectives and better in the world. and that's fine, but if you're going to hold to the notion of economic and social betterment as tightly as the universities do, the better be prepared to be honest with students when they're ready to sign a $20,000 promissory note per year for your student loans. i think that's exploitive, to say the least. want to point you to some stats from the new america foundation. this is an incredible steady it just cannot. it talks about grant recipients at some of the nation's best colleges. so they say they will give you money and then enroll some low-income students. what we are finding is a lot of the students still come out of school heavily indebted. so at boston university 15 percent of the students there are low income which means their

full-time freshmen whose families make $30,000 or less per year. 50 percent of the students are low-income. the students are still forced to pay $24,000 per year either out of pocket or student loans. santa clara university was the worst offender. 50 percent of the students are low-income and are paying an average share of $46,000 per year out of pocket between student loans and out of pocket costs. that's ridiculous. it the consequence of all of this beyond, i think, each individual perilous financial state and not being able to get married, have kids, by car, what have you is we are creating a class of citizens who are perpetually alienated, disillusioned from the economic system. they feel like a but then, worked hard, did but there were supposed to do, made an investment as a lot of these students loans are sold as, and it can be.

can be. and i sang the student loans are never a good idea because it can be. but especially in light of looking at the last election, looking at that the use of that election of 307%, income inequality, economic fairness, i think that this is to be a part of that conversation for republicans or conservatives. and a lot of scholars have done a really good job of talking about that. in conclusion, yes, college can still be worth it. it does depend on what you're studying, we're going, things like that, but i think it is important to recognize that the kinds of people that we are turning out of the university system not only economically but also specifically were creating a class of people that were not going to co here as citizens and

are missing out on what america is really about. thank you very much. [applause] thank you, david. we have two experts. his book in these ideas. the first will be dick george, chairman, president and ceo of great lakes higher education corp. head of finances 1972. chairman of the wisconsin covenant foundation and director of the national association of student loan administrators. previously a director of the national stigma clearinghouse and was a principal negotiator in 1992, 1998, and 2007, the u.s. department of education's negotiated rulemaking committees for student loan programs. he is also a consultant on post secondary education finance with

the international finance corporation and as a director of great lakes higher education corporation myself i can attest to his acute and creative insights into the issues we are addressing today and hope you all pick up a copy of his little piece called a new modest proposal for higher education finance which is available out in the reception area. our second discussant will be rich better who is a distinguished professor of economics at ohio university, the director of the center for college, affordability, and productivity. how are you doing on that? affordability of productivity? >> not so well. >> and an adjunct scholar at ati which previously served as a member of the department of education commission for the future of higher education. he has written widely on american economic history. out of work, unemployment and government in 20th-century america and the american economy in historical perspective and particularly with respect to a

today's subject and issues, the book going broke by degree why college costs too much. in the future going broke by degree and is college worth it ought to be sold as a to-book said. rich is also the author of numerous scholarly papers and many shorter pieces for the popular press. i should mention that congressman had hoped to join us today but is caught in a markup. so we will have to look forward to his joining in this discussion which is certainly going to be ongoing on another occasion. you have the floor. >> thank you. thank you to a ei for having this event and the invitation to participate. i have to say, bill, david, i thoroughly enjoyed the book. i think when you look at some of the overarching issues in the

post secondary space, and particularly the fundamental issue of whether it's intended to confer a societal benefit or an individual benefit, the answer to that question in part determines who should pay for that post secondary education and whether it should be the public with the individual beneficiary. the second overarching question is what is the purpose of post secondary education, is a classical education and enlightenment or is it turning? i think both of those issues heart grappled with mightily in the book. anyone who wants to understand where we need to go in post secondary education driven by the answers to those overarching questions need to know read this book. if a compilation in many

respects of much of what those of us who are practitioners in this area have seen in piecemeal in the past, it does an excellent job of bringing it together and documenting it and for anyone who wants to do research in this area, particularly the notes in this book that provide a real transcript of much of what influences the debate. that was particularly taken by the book in terms of its second -- the second overarching issue of whether education is more classical enlightenment or training, and the statistic that is cited in the book that 2011 survey of students where 88 percent of the students responded that the principal interest and principal purpose and post secondary education was training and job opportunity.

that tells us, again, a lot of who might be most appropriately paying. should it be the individual or should it be the prospective employers either going to be the beneficiaries of that training? as i said, in dealing with any of these questions, this is an excellent primer. i commend it to all of you. i also particularly agree with something that the book touches on several times. it's really the fundamental issue of whether colleges with the. the answer is yes and no. it depends. it depends on where you go, what you study, what your preparation is, what your motivation is. and so will we see is of very, very much differentiated space

and post secondary education. yet as the book also clearly points out, we have a monolithic system that addresses a particularly in the context of financial aid. and i'm going to end my remarks by focusing specifically on the student loan program. and i should say that all of my comments or my personal observations. alex as a board member i make this disclaimer so that nothing is reported as having been said on behalf of great lakes. nonetheless, so all of you who may not be familiar understand, we service over $150 billion in student loans. over 6 million borrowers ashley. we see every day what this debt burden means in america. it is a picture that is not particularly attractive unfortunately.

much has been said about college cost increases. how it is out creased inflation significantly, but the more important comparison is out college costs increase. that simply an unsustainable course. it will need to continue a the problem that we see, particularly the problems outlined in chapter two of the book. but if i have one criticism of the book, it is that it only touches briefly on one of the significance moral issues that underlies the problem with student loan debt, and it is the on heard voice that is very rarely focused. that is the voice of the defaults. we have an unfortunate situation in this to where the overwhelming majority of defaulters of those who are not completed the, not completed

their degree, not completed their credentials. and unfortunately the overwhelming majority goes to our most vulnerable cohorts. mirer is, first generations costumes, low-income students. with the broken gate desk will system and the idea that everybody has to have post secondary education, what this does is give rise to the concept of free public education. if everybody has to go on to post secondary education, pau secondary education is free and reforests underprepared students to pay for that post secondary education, we have given rise to a free public education in this country. when we do and create an enormous pool of defaulters who are not persistent students who then we lose contact with because we have not put the resources into skip tracing and

location finding. we can't help those defaulters with the tools available. and so we need a student loan program that is different and in the context of financial aid program where no one should be allowed to borrow until they have demonstrated preparation and capacity to persist. it is far cheaper for us to make enhanced grants to those most vulnerable courts than it is for us to make loans and then pretend that we collect on those loans or put those loans and said income based repayment or income contingent repayment or any of the other host of variations because the reality is it is cheaper for us to make a grand then it is to make an income contingent loans that is forgiven some time in the future we need to protect those

vulnerable cohorts from borrowing and all. schools need to have skin in the game. they need to fund remedial education. many to enhance pell grants and other grand and institutional aid for vulnerable courts. to borrow until they're able to demonstrate the capacity to persist. and at that point then we need differential underwriting of the loans so that we match with the capacity to pay maybe in the future with the amount of capital we're willing to commit to that education. that is the only way we will get complete transparency in the student loan space. it would be by having a new information sheet or new disclosures, it will come about when the provider of the capitol tells the individual student, this is how much will be made available to you based on what you intend to study because this is the anticipated outcome based on that. that will get as transparency.

so if we can combine grant funding affordable coleworts, full transparency with differential underwriting, we can create a student loan system that will fundamentally change how post secondary education operates today. it needs to be done. it needs to be done now. we have the wherewithal. we have the resources to do it. if we look at the money that is bin and tax credits, tax benefits, and the existing student aid system, there is more than enough money to do it. it just takes the will for fundamental remediation of the program. thank you very much. [applause] >> thank you. rich.

>> before i read bill and dave its new book i sat down and listed what i thought were the three biggest shortcomings in american higher education thinking would compare my list with theirs after read the book. my first shortcoming, by the way, not surprisingly, was that american higher education is extremely costly and inefficient , burdening students enormously and leading to a student debt crisis of increasingly serious magnitude. second, i think that american higher education involves remarkably little learning with teachers, students, and even buildings being grossly underutilized. many students fail to graduate from college, and too many head do are not much better critical thinkers or have required much more knowledge or virtue than they did his freshman. third, i think, the overproduction of college graduates and related

pathologies such as the proliferation of students majoring in topics of little relevance to the world of work has created massive underemployment of college graduates and caused a general decline in the financial rate of return on college education. then i read, "is college worth it?". interestingly the authors reached exactly the same conclusion as i did. making me wonder why i was not a co-author. [laughter] the evidence is overwhelming. i should have been. i have cited enough the but. [laughter] >> royalties. [laughter] >> the evidence is overwhelming and to my way of thinking irrefutable. colleges are too costly, students learning to little, and

the employment prospects of graduates are increasingly dismal. what i like most about the book, however, is the way it is written and the audience to which speaks. it makes the factual case convincingly, but literally using a non technocratic writing style that the average moderately literate citizen contemplating attending college can understand. it is filled with numerous real world examples of some of the tragic results of higher education shortcomings such as individuals running up huge debts, living in their parents basements with huge seemingly unending financial albatross around their necks. the authors think this current situation is unsustainable and that a big change is coming to hire education. early indicators already pointed that. in 200468 percent of those going

on to college to for your schools, 68%. eight years later, 2012, that has fallen by over 11 percentage points to 57%. four year colleges are too costly, so people are starting to look to lower cost alternatives. in 1970 less than 1 percent of our nation's tax drivers have a college degree. today more than 15% due. on sunday at d.c. taxi driver -- this is anecdotal evidence which is to say not random sample. on sunday at d.c. taxi driver told me that he had a bachelor's degree from georgetown and more recently a nursing degree to become an ariane but he cannot get a job in either of the areas that he studied in and so he is driving a cab. as stories like this become more

and more common, prospective students are starting to turn away in big numbers from traditional higher education in spite of the propaganda from the college crowd. you don't need a bachelor's degree to drive a taxi or to mop floors where there are 115,000 janitors with bachelor's degrees the colleges are too slow to change, burdened by tenure, union rules, murky governments, and other problems. so many mediocre liberal arts colleges and secondary qualities state university's increasingly face the prospects of extinction . created destruction is coming to higher education with a vengeance. bill and dave make that point beautiful in this great, new book. now, i think higher education reform will revolve around three words, information, incentives,

and innovation. much of the moderate this functionality entire education reflects massive information gaps which bill and david are trying to help fill with this book. colleges are notoriously reluctant to provide information about themselves. they have lacked incentive to make cost reducing changes that typically involved innovation. federal funding has fueled an academic arm brace that puts a premium on spending money and lowering productivity, not raising a. so as traditional higher education loses market share what will be the substitute for traditional schools? new technologies hold great promise to reach what might be called the walmart on this of excitement of the education market. those who want high-quality

learning of low price. the moves, of course, are the best example, but there are trade schools that are offering vocational training, specific schools that are now booming. many more electricians, welders, long-distance truck drivers, but your anthropology's or women's studies majors. one of the virtues of having ten year is you can say anything you want. the only virtue. [laughter] education is both an investment and a consumption good and the harvards and williams of the world will survive serving alexis steven marcus and of the market, also protected by vast endowments. it is the of lowly in doubt private school, the lowly in doubt private schools with marginal reputations and similar counterparts in the public sector that are most vulnerable. plato allegedly said -- tell me if i am right, necessity is the mother of invention.

even in the short months as bill and david finished writing their book, new ideas are evolving. only yesterday the educational testing service announced it was creating a proficiency profile and electronic certificate offered to those doing well on the test that assesses critical thinking, reading, writing, and mathematics. a second certificate will be issued to those doing well on a digital technology related test. new screening devices to certify employment competency are evolving. certificates that cost $100 or $200 instead of the prevailing 100,000 or 200,000. in at 200 page book you cannot deal with everything. this is not a book for policy wonks that want to extensive critique to public policy. and more comprehensive treatment of the elements of higher

education would need to deal with some of these issues. let me just mention four briefly to point out that there are some things that they don't talk much about. first, a majority of professors outside of the sciences are doing research of some marginal use to anyone. nearly three papers are published daily on william shakespeare, for example. why? why not incentivize professors to teach more? second, the reason government browbeating of the for-profit colleges has been excessive with rules being proposed for that sector that if extended to public institutions would lead to the closing of literally hundreds of public schools. the for-profit industry owes its existence largely to the dysfunctional federal student financial aid program to be sure and it does have something of an uneven record of accomplishment. it as proven itself highly

efficient in delivering decent quality education for both conventional and electronic means. it hopefully will play a significant role in the evolution of american higher education. third, the accreditation system in the u.s. is broken and needs radical change, something our authors were moderately silent about. for, the scandals and increasing costs associated with big-time intercollegiate athletics has finally reached the point where they are starting to impose real burdens on american higher education. in general however the errors of omission on minor. the errors of commission are nonexistent. this is a marvelous book, quite frankly not quite the equal of, say, plato's republic or even king lear, but it is still pretty darn good.

to bill and david, congratulations on a great book. to those investing or considering to invest in post secondary education for yourselves or your children or grandchildren, jen, do not walk, to your bookstore to get your hands on this book. you will not regret it. thank you. [applause] >> thank you, richard. thank you to all of the panels for four really great presentations. i want to give bill and give it a chance to respond if there would like to any of the points made by gingrich. would you like to start? >> sure. one thing that was alluded to was everyone feels like the need to get in college because of the k-12 system being broken. and i think we have to look too hard to see that it is broken. our test scores on the national assessment of educational process basically has remained flat since the early 1980's.

a lot of low-income and minority groups have underperformed significantly. if anyone remembers, around christmas time there was a commercial done by the target, the big retailer. it was a montage of a bunch of students opening of their college education or college acceptance letters. in fairness it was very touching in their raw celebrated wildly. but then it flashed on the screen and said every kid deserves his chance. that's why target is giving $1 billion to hire education by 2020 or something like that. and my reaction was, well, why are we saying, okay, every kid deserves the chance to graduate high school and get a good job? i think we moved on. a lot of people, i think, in america in general i don't know necessarily in education policy community, but in america in general have moved on from the idea of redeeming and reforming

k-12 in the way that i think now especially with the rise of technology in a blended learning, we could do. i think that is one thing in particular that stuck out to me. >> thank you. bill. >> i think the criticisms are fair with the exception of intercollegiate sports. i will be spending part of the fall in college campuses, alabama at texas a&m. i'm sorry. but there are serious questions here that sec football is very hard to beat. in fact, no one beats them. we could talk about that. the one question i have you may know the answer to which is overall -- i know the answer will be different a different campuses, to intercollegiate athletics -- let's say the big places, the places i just mentioned, are they a drain or did they bring in money? >> at the big places, at the sec, the big tent, the school's

using a narrow accounting firm marker pretty much breakeven and arguably with some of the spillover effects that they give have a positive effect. the problems are the other schools. that total subsidies and ncaa schools, by the ncaa definition division one is 2 billion which is one or 2% to budgets. it's not the huge, huge item. at some schools it is a thousand dollars a head that the kids are paying in student equi. and that's -- 4,000 in four years, 5,005 years is a pretty big burden. >> right. i just think this could go on forever, but i think education from john wooden or of mike shish-you might be better than you would get in the sociology majors for four years. >> no argument with me on that. >> okay. decor rich and many other points before we open the florida questions?

okay. ladies and gentlemen, it's time for you to be able to ask questions. let me remind you of how this will work. we have a microphone here. please wait for the microphone to get to you. tell us your name and your affiliation. ask your question. if you feel a sudden urge to make a speech before asking your question, the chair will remind you, it's time to ask the question. i think i have a question right here. okay. >> hi. i am with the eisenhower institute. and i am a small liberal arts school religious studies major which is probably around classics right now, the job market. and hearing this discussion i definitely understood a lot of these points, as i am already overwhelmed by the debt that i know is coming to me within the next zero months. but i am wondering about, some

of the other values that i think as a gun from the college education such as critical thinking, personal relationships with professors, study a broad experience, these experiences that are more developmental rather than just the statistical what my paycheck is going to be after college. >> you want to take that? >> let me take that. you may want to comment on the classics connection. look, you pay your money, you take your choice. what we want is a better informed consumer so that you know you're getting. i went to williams college, a scholarship student. i have loans, are a lot of money, went to graduate school, majored in philosophy, went to graduate school of philosophy. i had a $900 stipend my first year of graduate school, texas. day one meal a day. that's all i could afford at el cheapo or el taco or something. you know, i83 fried beans and

walked out in the texas sun at 230 in afternoon and fell down on the sidewalk. that was a graduate life. when i finished my schooling in 1971i owed $26,000. what would that be in today's dollars? 150. that is a lot of money. regrets, nine. i've loved philosophy. i did not care. i was going to crack the socratic dialogues and figured this tech got business out, the meaning of life. i loved it. and never had a moment's regret. i decided to do as much as i could to pay off the debt as quickly as i could. i'm sure it had something to do with my decision not to get married early. that did not get married until i was in my thirties. that certainly had an impact, but i knew what i was doing. we don't discourage people from doing that. in fact, one of the arguments of the book, richard had it exactly

right. we think most colleges fail on both counts. they don't give you value for dollar. they don't give you the opporunity to get a good job for the most part, and if they want to take the high road and say to save your soul and in larger mind, then start trying to save souls and the large mines. i don't think most of them do that because again another topic in a different place, but that basement of humanity which was the beginning of life itself. i just could not get enough of this literature and philosophy of was willing to pay and pay for years. as long as they're being honest, but one of the things that you had to that, these catalog copy. it's an irony, as richard points out. by the way, we will make it better. is higher education worth it, the better guide to hire education. would that be all right? the better guide. either one.

for all the information that they put out, often they don't tell the truth. and that, you know, i think most of us if we had been told we were major in philosophy, you probably will be able to get a great job, would have done it anyway. probably a lot of us would have said, and independent thinker. on the philosopher. that's the bravado of the 19 year-old. okay. candor. go into it with your eyes open. the catalog should stop lying. >> let me underline the importance of what bill just said. i have a marvelous memory. when i was a philosophy student of the surgeon and soon to be head of the state medical society he would also one day be my father-in-law coming in while i was waiting to pick up his daughter for a date and saying to me in a casual way, well, what do you think you can make as a philosophy major.

[laughter] >> it was a fair question, but i didn't care in those days, despite bill. i fully agree that the key thing is to know what you're doing. we mentioned parallels to the housing bubble and the college cost bubble. the flow of credit in both cases with great good intentions from the government. both housing and colleges have pushed up the cost, and in both cases the most important thing is to know what your doing. in talking about mortgage loans i always tell people, who is making the most important decision about getting a mortgage loan isn't the lender. the lender will under review. as the more important is for you to decide and know what you are doing and if you want to eat oatmeal and hot dogs for ten years so that you can pay for the house of your dreams, that's fine with me as long as you know what you're doing.

the point to make about college is exactly the same and exactly right. the question over here please. >> good afternoon. my name is todd wiggins. a quick side question, is college really worth it for those who are aspiring entrepreneurs? in other words, if you know what your career is going to be your better off in a trade environment or a high-tech business, is college really worth it statistically speaking? >> i think that is one of the great calculations of becoming an not to be york. am i going to forego this experience to do that one? life is often the best teacher of those things. in that thing that is absolutely true when it comes to starting a

business and building a business and things like that. you looked at steve jobs and bill gates, really there was no value added for them of college. i'm sure there are thousands of individuals across the country who said the same thing about themselves and at the next big idea and maybe it didn't pan out so in one sense, it absolutely might be a great fall back if your idea doesn't work out and you can go be a computer programmer at apple or whenever and have a great career. you might not be the next great silicon valley entrepreneur. it's a provincial calculation. >> a couple of things. we do talk about the book. i don't know how much of a model it is for our many people, but to peter teel, the founder of paypall, he recruits the top high-school students in the country, just like carver does. he pays them to come to work with him and the other students.

>> one hundred. >> and they get paid to go. they don't pay. they get paid to go. they make a deal with the company gets a percentage of what young people make as a result of this experience. investing in human capitol, but it is an interesting idea. one anecdote quickly, after graduate school simultaneously i went to harvard law school and was a procter which meant that lived in the dorm and advised students. and became known as the stay in college procter which is kind of funny given this book. people were getting disaffected and wanting to leave college, was the one that told them there were probably better off staying when one of my freshman graduated and went to medical school and became a procter he had a freshman who wanted to leave. one of them was intransigent, could not document staying. he asked me to talk to this segment gates, bill gates. that document document talk to him and he kept saying, i have this thing a lot to do.

finally and frustration i told my friend, let him go. [laughter] i thought i had a pretty good argument. if you're smart, argue going to get smarter and make the idea better surrounded by some of the brightest and people in the country? he said, this is just something i want to do my own. i said, fine, good luck. i will never hear from you again. >> you have the thought. >> i don't know. mark snyder might have some evidence. that is a hard question to answer. april ballistic world. there are risks associated with anything you do. i do think that there is a class of people for whom the entrepreneur real spirit and the entrepreneurial drive and basically high levels of cognitive abilities to begin with, that could thrive outside of the traditional college environment. it is not for everyone. indeed, it is for a few, and most of returner top

entrepreneurs do not release exceed. is a high-risk venture. >> probably true that the aggregate, all entrepreneurial ventures is negative in the aggregate. that is less some people have to be able to make it big. go ahead. >> the bell curve, the actual bell curve. in the standard will work bill if we suppose universal idiocy to be conjoined with it. any standard or -- will work ill or not be much use if you suppose universal genius. genius, gates, jobs, it works anyway. madison did not learn at all, princeton, madison just and read a lot. this book is not written for those folks. arguably i guess based on the evidence from what i can tell from the jobs book and other profiles of successful people, you should live in a ranch house in california, use your grosz, play the guitar or invent machines and you will make it much more likely.

statistically at think that may be true. >> a question here. >> just kidding. >> hi. i just wanted to thank you all for being here today and making this presentation. have a question. by the way, and also avoid duty alum. two questions. we were talking about the liberal arts education and health it has changed, i was curious to know how it changed and how you think that this is impacting students in terms of their ability to get a job. my second question is that you seem to come in my opinion, over emphasize the economic benefits of an education but under emphasize the ability to think critically which in my humble opinion is the primary reason for going to college. yes, it's important to make a living, always in the real world and have to make money, but i

think the ability to think critically would elevate our society to a different level. my second question is for -- >> that's all the question you get for the moment. >> just wait. >> very quickly, they have been very debased. there is very little left. we have said sense when we were studying shakespeare and the course in trauma and the philosophers that we are engaged in critical thinking that we were learning to think big about big questions. and that by thinking about these things it would help us in the world. we were not thinking that we could make a penny tax that we wanted, that we were engaged in this great and the price,

socratic enterprise about life and that we entered into a dialogue, you did not just defense intellectual footwork. you left the dilaudid different person based upon -- if i ran the college i would not let people just major in anything they wanted. if it was my college would say, you have to pass through certain things. there are certain bugs you'll have to read if you will be an educated person because i believe in that. then i would not have a catalog the says you can get the stars and do it anyway you want, major in anything you want, barolos much money is what. that would be alive. the second part was -- >> the second part was to emphasize economic benefit over critical thinking. >> yeah. i mean, look, as richard commented, you know, this is what the customers said they want. now, you may wish to run the college. if you go to st. john's college there will say fine, but you will read all the great books

while you're here. too bad. that's the way we do it. it 80 percent of the students, this is the number one priority and you present yourself as saying we will get you there, then get them there or be more truthful about it. >> you have the fast question. >> the fast question for richard vedder. just curious to know why you think the studies programs don't have value? >> i knew i was going to get in trouble with that one. i did not say they didn't have value. i said that people in the women's studies, bill and david in their book, having empirical evidence from pay scale the says gender studies graduates, areas to these graduates, led american studies graduates do not on balance arnold of money.

that does not mean they have no value. there is both a consumption and investment value to higher education. you can go to college for his many years as you want and take courses. i studied french literature for a year in french. it has done me utterly no good vocationally, but i'm glad i did it. if you want to major in women's studies, fine. but they're is a public policy issue of women's studies graduates who are in women's studies, they being deceived taking money? and there may be even a public policy issue, the policy makers wanted this stuff on how much public subsidies should we make on private consumption people, whether it be women's studies or basketball or anything else. why should the government be paying for people to live their consumption dream when they don't do it for joe six-pack or

whenever, the guy who has a lunch bucket and works in the steel mill. why should we do it for the college happy. .. a very different approach to college than their parents in terms of focusing around practical skill acquisition and job placement and what is the

role of career prep at the high school level to allow students to be more empowered in figuring out a way of aligning that general education system towards us and career goals? >> i think one of the things that the book ends with is the impact of technology will have on the transformation of the academy and i think clearly if we could fix accreditation which is as broken as the financial aid system itself we could move much more rapidly and most of you are probably familiar with adjutants but i think company based education we are going to see adjutants that are developed to itself caught up in season multiple fields of endeavor including entrepreneurial skills. if you can imagine a badge that is ordered by a consortium of

silicon valley companies, recognizing entrepreneurial skills that badge may be worth far more than a computer science degree or mba. and i think as we more rapidly move into competency-based education, employer raised designation and skill sets for badges that will be one of the most important things in technological transformation the academy can afford. >> that's not unlike an old-fashioned apprenticeship program. i am going to take one more question i'm going to go way to the back. >> jared meyer of st. johns university. i had a question about -- st. johns college. this is a different one. yeah basketball but we talk a lot about outstanding student loan debt. what do you think should be done because you really cannot discharge