Are Americans getting tired of “bubbles?” In the last decade, we have suffered through the collapse of two huge bubbles with each leaving the economy in a tough spot. This is particularly bad for Ohio, a state that typically is one of the first in to a recession and one of the last out.
First there was the “Dot.com” bubble that burst in 2000. That led to a major recession. Then, notoriously, there was the “Housing Bubble” that burst in 2008 and led to what has been the worst economic time America has faced since the Great Depression.
Now, as one can see from the graph in this blog, we may be confronted with a “Higher Ed” bubble.
Check out the money section from the blog,
“In the ten-year period starting in 1997, home prices increased by 68 percent, or more than twice the 29 percent increase in overall prices, and that home price appreciation caused an unsustainable housing bubble that burst in 2007 and contributed to the financial crisis of 2008-2009.
During that same 1997-2007 decade that home prices increased by 68 percent and created a housing bubble, college tuition and fees rose even higher—by 83 percent. In fact, college tuition and fees have never increased by less than 73 percent in any ten-year period back to the 1980s. And in the decades ending in 2009 and 2010, college tuition increased by more than 90 percent. The still-inflating increases in the price of higher education are starting to make the housing bubble look pretty tame by comparison.”
Given our previous blogs on just a few of the issues surrounding Higher Ed in this country, these numbers should be startling. Recall that universities around the country seem to be employing grade inflation as a way to assure themselves of tuition revenue while many members of the faculty are busy NOT teaching students or bringing in research dollars. So now, we see how much the expense of such an “education” is becoming.
It sure seems that there is a major disconnect. Hopefully, this bubble will be less devastating the last couple. But make no mistake, when it does go, there will have to be a paradigm shift in what passes for Higher Education.