Mornin’ Milton: “Really, Fed? Really?”

A shortie-but-goodie.  I have no idea when this video was made, but it’s never been more relevant than it has today.

Via Common Sense Capitalism

Mornin’ Milton and some bonus regrets…

Milton Friedman on greed:

Did you know Friedman helped invent the United States payroll withholding tax system?  It’s a little like how Alfred Nobel invented dynamite, then invented that whole prize thing as a sort of apology to humanity.

Unlike Nobel, he made no apologies for his work, but did state in an interview with Reason magazine that he wished “there were some way of abolishing withholding now.”

More:

Best of Both Worlds, Friedman’s 1995 interview with Brian Doherty at Reason

The Story Behind the Nobel Prize (according to a Korean news outlet).

Why Did We Go to College?

When I was growing up, my parents told me I could be whatever I wanted to be.   So I decided I was going to be a babysitter.  (In retrospect, I think that was the only career I knew about if “parents” didn’t count.)

I’m told later I wanted to be “an angel” (which I guess I became, at least according to dozens of clever and not-at-all creepy bar patrons I’ve met).  I also considered doctor, writer, veterinarian, caterer, scientist, journalist, dentist, photographer, and dozens of other choices before even getting to high school.  Let’s not debate my fitness for some of those careers and move on.

Surgeon of debatable fitness.

No matter what I decided to do for a living, I knew I couldn’t do anything until I finished my college degree.

To our generation, obtaining a college degree always seemed like the very best thing to do.  My parents were among the first in their families to go to college and always hoped that I would do the same.  They talked about my going off to college one day.  In elementary and middle school, my friends and I would talk about who would room with whom and which dorm we wanted when we finally got out of the house and got to do cool stuff like eat pizza for every meal and stay up late.

We had to go to college.  Even Zack and Kelly went!

Though they only stuck around one year before eloping to Hawaii.

A lot of people from my generation went to college because it was the “smartest” thing to do.  The idea of a university education has become so entrenched into our culture that receiving one has almost become a natural step in the pathway to adulthood: high school, college, house, marriage, kids.  (We’ll save the relative merits of those other steps for another day.)

But why did we go to college?

1. Employment opportunities

When I was in high school, my mother gave me a book that was essentially an alphabetical listing of thousands of college majors.  I’m sure many other college-bound kids had a similar book.

Each potential concentration of study had a list of careers that you could obtain with each degree.  I believe it also had projected sample earnings by degree acquired.  I wish I could find it now, because I’m sure it would be a hilarious read.  Have an anthropology degree?  Well, expect to earn $50,000 more per year, AND you get to be a museum curator!  Journalism degree?  You’ll be Diane Sawyer by next week!

Guess what you can do with your Earth and Mineral Sciences degree!

My last year of college, I submitted applications and resumes (and e-mails and calls and follow-up e-mails and follow-up calls) to hundreds of employers.  The positions ranged from salesperson to schoolteacher to lab assistant to administrative assistant.  Since you already beat me to the punchline, I won’t bother to tell you that my extra handy biology degree (that book had, like, fifty different things I could be!) didn’t exactly land me that great of a job.

Or… any job requiring a degree.

A couple months after graduating, I decided to move to Texas and try my luck.  After two weeks of unemployment there, I took a job that paid minimum wage and did not require a diploma or degree.  I wanted sick days and health insurance.  I kept searching for a “real” job.

Then I realized the horrible truth I had suspected all through college but was too afraid to admit to myself: employers do not care how much you know about invertebrate taxonomy.

Has the liberal arts degree become the new high school diploma?

2.  The path to adulthood

Think about your days in college.  (If you didn’t go, think about college students.)  Don’t you remember intelligently discussing current events with your peers?  Did you critique the merits of your various professors’ teaching styles with friends over lunch?  Each night you spent diligently musing over your classwork so you were prepared for the lecture the next day.

Not really?  Well, did you at least learn practical skills like how to write business correspondence?  How about making a resume or managing a budget?  Well, at least tell me you didn’t spend pretty much every night pounding down beers and hooking up with different strangers.

Except you did.

Look, I know a lot of people who worked very hard in college, and I would like to consider myself one of them.  But we are lying to ourselves if we think this is preparation for adulthood.  The vast majority of people who go to college treat it like the four-year vacation from the real world that it is.

3. College as a financial investment

Let’s return to the book I was discussing earlier.  That book was full of attractive numbers.  Glowing statistics highlighting the financial benefits of going to school.  If you go to this school, this will be your median salary,  so long as you have this major and these grades.  No matter what, a four-year-degree was always an attractive choice.  “Even bank tellers and dishwashers with college degrees make more than those who don’t have them!” guidance counselors said.  Even now, those who suggest college is not for everybody are shouted down by those who point to salary figures showing that those with college degrees do make more, no matter what, so you’re still getting a good return on your investment.

The return is debatable… what about the investment?

Last August The Atlantic showed us some interesting charts showing us that student loan debt has grown 511% since 1999.  You guys, I remember 1999.  How have we gone into so much more debt so quickly?

In 1994, the federal government began backing a lot more student loan money.  If you examine past loan limits you will see that until 1994 we had an aggregate PLUS loan cap of $20,000.  Now there is no limit to the amount of money a parent can borrow, so long as that amount does not exceed her child’s tuition.

So after parents received a federally-backed promise to pay as much tuition as the school charged them… what incentive did schools have to keep tuition costs affordable?

Did you ever ask yourself where your tuition money was going?  The cost of an education should not be exploding this quickly, but it is.  Family incomes are falling, but the cost of college tuition keeps increasing.  I refuse to believe that over $200,000 for an education at Berklee will pay for itself.  Ever.

Which brings me to my final question…

4. Why did we go to college?

Despite all this, I’m still happy I went.  College expanded my world.  I had brilliant professors who genuinely cared about their students.  I got to know people from all over the world- Chile, Nigeria, Mauritania.  I made friends I still talk to almost every day.  I had lab class in an actual coral reef.

But I had scholarships and worked several jobs to pay for all that crazy fun I had.  I went to a relatively inexpensive school and didn’t take out any loans.  If I were in a mountain of debt and facing the employment prospects we are now, would I feel differently?

Why did you go to college?  Did your degree help you find a job?  Would you do it again?