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Politics & Current Affairs

Reinventing the University

What’s the Big Idea?

On average, students pay $35,000 a year for the privilege of being educated at a private nonprofit American college. In December of 2011, indebtedness among college graduates reached an all-time high of one trillion dollars. But with unemployment among 16 to 29-year-olds also sky-rocketing, many young people are wondering whether a degree from a prestigious university holds the same value today as it did for their parents’ generation.

“Americans are hungry for better alternatives, yet fearful of leaving the tried-and-true path,” wrote Think Tank blogger Jason Gots in a previous post. Andrew Rosen, chairman and CEO of Kaplan, believes passionately that online universities could fill that role.

What’s the Significance?

An Ivy League degree brings very real advantages, Rosen acknowledges – but that’s a problem, not a solution, for students who can’t afford the hefty price tag that comes with an elite education.”We have a fundamental misallocation of resources in higher ed.,” he says. And the system is ripe for nepotism and inequity. Americans spend hundreds of billions of dollars a year on education, but “the vast bulk of it is going to people who already have advantages, who already have so much, and we’re leaving people out of the system.” Why?

Expensive private colleges now compete more for prestige than “on the basis of learning outcomes.” That means that instead of lowering tuition costs or funding scholarships for geniuses without the contacts or connections to get into an Ivy, these schools are choosing to allocate their resources to projects that will attract students who can pay. 

In fact, there’s an arms race going on among top-tier universities over who can build the best gym, the best dining facility, and even the highest rock-climbing wall, and the losers are the students, who pay more and more every year for what ultimately amounts to far less. The college experience is becoming eerily similar to a four-year stay at a resort, Rosen argues in Rebooting for the New Talent Economy.

“On many campuses, intercollegiate athletic programs receive an enormous amount of money and attention–both of which would be much better allocated to issues of education and access,” he explains. “Prices have been going up in higher ed. much faster than the rate of inflation.” If colleges would start spending money where it counts – on teacher training and curriculum development – rather than on building a snazzy campus, the price of an education could be drastically reduced. This is exactly what online universities do, says Rosen. 

In the long run, he would like to see all schools adapting to that model. To do so would require a multi-layered approach:

  • Focusing on learning outcomes – How much do students actually learn in class?
  • Accessibility – Who is included? 
  • Accountability- How much does it cost? How long it takes to complete, and what kind of outcomes can students expect?
  • Tell us: Is online education the future of the university? 


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