There was a good article in the February Atlantic Monthly about trends in the American economy. The author made a pretty good point about college education. One of the reasons why this country did so well economically after World War 2 was the fact that it built a lot of colleges and made college available to the masses. Having a lot of fairly educated people around (OK, I know that a college degree doesn’t automatically make you smart, but on average it does seem to help) really did help businesses to operate better and develop new products, and that really helped the economy to grow.

After the War, the GI Bill sent a lot of guys (and more and more women) to college who otherwise didn’t have a shot at it … including one of my uncles. Then in the 60s, a whole lot of state schools and community colleges were built or were expanded, putting a college in just about everyone’s neighborhood. Maybe because of our fear of being outdone by them smart Ruskies (who by then were putting people into space and shooting off some pretty nasty H-bombs), our nation decided to open these colleges up to just about everyone who seemed bright enough; money was not to stand in the way. I went to a state engineering school here in New Jersey back in the early 70s, and I remember tuition for a full 16-credit semester being maybe a couple of hundred bucks; hardly any more than the cost of books for 4 or 5 classes. OK, money was worth more back then, but still, today that would be around $1000. I know for sure that a full semester’s tuition for a decent state school today is much more than $1000.

Yea, times have definitely changed with regard to the cost of a college education. Let me mention one more example of the good old days: until the late 70s, anyone living in New York City could get a 4 year college education for free at City University. But that sort of thing required a citizenry that was willing to put up with higher taxes in return for greater social capital (i.e., a greater number of educated people in town). Today, the general mood of the citizenry is to cut taxes to the bone. Ironically, even those who benefited from a low-cost college education courtesy of other people who put up with high taxes have agitated for tax cuts, at least once they bought a house and an SUV.

So, the Atlantic article points out that due to skyrocketing college costs (which correlates with government support cutbacks needed to finance bigger tax cuts), the percentage of Americans with a college degree is no longer increasing, as it did for most of the 20th century. It seems to be leveling off at around 30% of adults. The author thinks this may have serious long-term consequences for the American economy over the next 20 years or so. Other nations are still putting money into free or low-cost advanced education. Somehow, a lot of poor or near-poor people in India are getting college degrees, and are then taking over American jobs like computer programming and claims processing (through Internet-based outsourcing). On this issue, we Americans may well be in the penny-wise, pound-foolish zone with regard to tax cuts and government spending limitations. Sure, we may be enjoying our McMansions and super-sized SUVs right now, but in 10 or 20 years, our kids may be dealing with an economy that ain’t the world’s best anymore. It happened to Great Britain, with all its sorry decay and unemployment, and it can well happen to us.

Thanks much, Mr. Bush, Mr. Reagan, and all you other rabid tax-cutters.