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The “Education Bubble”

I read two interesting blog posts about Peter Thiel’s (founder of Paypal) views on education. I think the education bubble is an interesting idea and I do agree that higher education is somewhat overvalued to its own detriment. However, I think the counter argument is a good one. Not everyone can drop out and achieve success in independent business ventures. I think the real message here isn’t that college or education in general is not worthwhile, but maybe that we should start thinking about other options. The comments regarding the price of education definitely strike a familiar chord (check out this documentary from PBS College, Inc. ). I know a lot of people who have gone into debt for the sake of their future, and find the return on their investment to be much different from what they anticipated. Also, I agree with Peter Thiel’s comment about education being somewhat taboo. What if we did question it? Could we change it? Do we need to?

Original post about Peter Thiel and education.


  1. Kathy
    May 2, 2011 at 6:20 pm

    I actually have a degree from an ivy league university and I don’t really know if I learned anything during my four years in attendance (I should note that I really didn’t take advantage of my time there; I was just completing the motions to get a degree).

    Upon graduation, I decided to become a teacher mainly because I knew the program I applied to would place me in New York City, giving me a chance to live on my own and explore a new city. Little did I know teaching would change my life. Eventually, I did leave the teaching profession and had trouble finding work when I moved back home to Miami, FL (my college degree from a distinguished university did not help me secure a job–I had to prove myself by submitting writing samples and responding to job-related problems during several rounds of interviews). When I was eventually hired, I found that many of my co-workers had degrees from local colleges. We all did the same work and received the same compensation, but I was still paying off college loans!

    I managed to secure a better paying job at a less demanding company, but my credentials didn’t help me get my foot in the door there either. Actually, someone I had worked with knew the head of the department where I applied…again, my ivy league degree had little to no impact on their decision to hire me (yes, I needed to have a degree, but it could have been from anywhere; my degree just made me eligible for the position, but didn’t guarantee me for it).

    I think employers have recognized the education bubble; there are quite a few people with college degrees (even with post-bac degrees) that don’t know how to analyze written information, think critically, or even write in a coherent manner. I think that educational experiences now-a-days lack quality (e.g. sit through this lecture and pass a test vs. communicate ideas via discussion and work with others on a real-world related project). How do we know that people aren’t just going through the motions to “get that paper?” And let’s face it…higher education is a business! Colleges need to fill their seats in order to pay professors, keep the lights on, etc. It makes sense that they would lower admissions standards to get people in the door (again, contributing to the existence of the bubble).

    How do we fix this problem though? Do we urge businesses to drop old-school eligibility requirements like having a college degree and instead let prospective candidates prove themselves in other ways? (Very time consuming, especially if the candidate proves to be unqualified.) This is a hard argument to sell since many employers establish these criteria to avoid an overabundance of applicants (which then need to be filtered and sorted somehow). In essence, the solution must re-establish the trust between institutions of higher education and the business world in terms of producing people who can think for themselves and are capable of generating original thoughts/ideas. Or, can we make the case that real-world experience matters more than education?

    To me, Peter Thiel’s approach as described in the article does not do either of these two things (primarily because he seems to have a hidden agenda re: investing in the next big idea). We do need to question education as he points out, but instead of pouring his money into this area (perhaps by funding a think-tank) he chooses to encourage people to drop out and start companies. It just doesn’t seem like a logical solution…

    • May 5, 2011 at 2:30 am

      I am glad you shared your experiences with me, Kathy. I feel like I have heard variations of this story from many of my peers. I have a somewhat different perspective, but it results in the same conclusion. I do have a degree, but it is not a “good” one. However, no one ever questions me about it. I feel as though I am hired for many positions that my formal education has not actually prepared me for. I wonder what my supervisors would think if they actually took a look at my transcripts. They never will because as you said, the degree is the ticket in, but it is not representative of how one will perform on the job. More often than not, I end up learning via on the job training. For example, I am teaching myself how to create a social network for my current job. Have I ever taken a class with computers a social media? No. How could I have predicted that I would need this knowledge when it didn’t exist when I started college?

      In sum, I feel like my degree is nothing more than a check mark in the boxes of many employers and higher education recruiting departments. But if I didn’t have one I would be a lot worse off. I agree that Peter Thiel’s solution is unreasonable. The emphasis for every drop out to come up with the “next big thing” seems like a lot of pressure. Would it be so terrible if people dropped out and waited tables or arranged flowers? As a society are we ok with those standards for the future generation? I believe we must question education as Thiel says, but I think the real taboo is in questioning the value of certain vocations. If we begin to value all members of society for their contributions, not just the extremely successful or intellectual individuals, then we might be able to address the issue of the education bubble.

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