March 12, 2019
White House proposes to spend approximately nothing on early childhood education to minimize taxes for top 0.1 percent (Michael Simkovic)
NPR reports that the Trump administration has proposed a meager one-time increase in funding for childcare / early career eduction equal to approximately 0.0045 percent of GDP ($1 billion out of $22 trillion estimated 2020 GDP) or about 0.001 percent of household networth. Total federal spending would increase to $5.4 billion, or 0.0225 percent of GDP.
In contrast, Senator Elizabeth Warren has proposed to spend approximately $70 billion per year on childcare and early childhood education--13 times as much as President Trump. Warren's plan would be financed with approximately one third of the revenue generated by an annual ultra-high net-worth wealth tax of 2 percent on personal fortunes above $50 million, and 3 percent above $1 billion. It would therefore cost 99.9 percent of households nothing in increased tax burdens.
The White House explained that its less generous proposal was motivated by a desire to avoid spending "unsustainable amounts of taxpayer dollars" and instead come up with a plan that would be (politically) "viable."
March 08, 2019
How Big Tobacco’s star advocate became an education expert for the New York Times and Forbes (Michael Simkovic)
Richard Vedder, a leading opponent of excise taxes on cigarettes, takes a dim view of most of higher education. Vedder depicts colleges and universities as overpriced, wasteful, and deserving budget cuts. Vedder argues that academic freedom and research impede teaching marketable skills.
The reality is that public investments in higher education more than pay for themselves. More spending is linked to more innovation and better labor market outcomes. Educational quality and access have improved over time. The economy would likely grow faster if governments invested more in education. More people would find jobs, they would earn more money, and governments’ long-term fiscal position would likely improve.
Vedder would be easy to dismiss if not for his backing from industries that spend heavily on advertising and lobbying—like tobacco, for-profit education, and private student lending. Vedder has become a regular contributor to the New York Times, Forbes, and other publications with wide circulation, and frequently testifies before Congress.
Despite his general antipathy to education, Vedder forcefully defends for-profit education. Vedder likes that for-profit institutions have little interest in “promoting research, saving the earth [or] achieving progressive objectives.” Perhaps harried adjuncts are less likely than tenured research faculty to assess whether taxing cigarettes saves lives.
Public health spillovers aside, for-profit education is typically not great for students or taxpayers.
For-profit institutions spend far more of their revenue on sales and marketing and far less on instruction. For-profits account for a disproportionate share of federal student loan defaults and federal subsidies. Although for-profits typically serve weaker students, after accounting for student characteristics, for profits typically provide less value for the money than non-profit and public competitors. For-profits are the only type of educational institution which have been shown to increase tuition after gaining access to federal student loans, without increasing quality. Many for-profits have been linked to consumer fraud.
March 07, 2019
Inside Higher Education reports that along with an executive order that would politicize federal funding for higher education and scientific research, President Trump may soon unveil a "risk sharing" plan to tax higher education institutions that accept federal student loans. As I noted previously, when Senator (and former Democratic Presidential candidate) Hillary Clinton proposed a similar plan, such proposals are little more than a covert way of raising taxes on educational institutions and pressuring colleges into pushing students into borrowing using higher cost private student loans.
We do not expect home builders or auto-manufacturers to pay when home buyers or car buyers default on their loans--even government backed mortgages--and there is no good reason to impose similar penalties on colleges and universities, especially given how much of the financial benefit of education flows to the federal government as higher tax revenues and lower disability and unemployment benefits costs rather than as student loan repayments.
Under symmetric risk sharing, including upside as well as downside, the federal government would be paying universities more, not less.
March 02, 2019
President Trump uses scuffle at Berkeley as pretext to pressure universities into promoting views he endorses (Michael Simkovic)
A recruiter for a far-right group that maintains a "Professor Watchlist" was recently punched in the face while using slogans about "hate crime hoaxes" to recruit (or perhaps to intentionally provoke an incident) at the University of California Berkeley.
The FBI and Department of Education have both found that serious (at times deadly) hate crimes against racial, ethnic and religious minorities on campus have increased since President Trump took office and a group of conservative billionaires began funding efforts to depict universities as hostile to racially charged "free speech."
The New York Times has reported that neither the recruiter for the conservative organization nor the alleged perpetrator are students or employees of the University of California.
In spite of the minimal connection to the University--which responded professionally, condemned the attack, and worked with the police to arrest a suspect--President Trump and other conservative activists have expressed intent to use the incident as a pretext to threaten universities with cuts to federal funding unless universities do more to promote conservative views on campus.
UPDATE 3/4/2019: An advocacy group that works to protect academic freedom from efforts to politicize universities has prepared an online form to help those who wish to email their Senators to ask them to block President Trump's Executive Order.
UPDATE 3/6/2019: The AAUP opposes the executive order and has prepared an open letter that interested parties can sign here.
UPDATE 3/7/2019: The President of the University of Chicago, Robert Zimmmer, the former dean of Yale law school, Robert Post, and Professors Geoffrey R. Stone, Catherine J. Ross, and Noah Feldman have all spoken out against the proposed executive order. Teri Kanefield has published an interesting analysis of the proposal at CNN, linking it to Global Warming Denial and White Supremacy.
A Washington Post Editorial warns that the proposal violates conservative values, undermines conservatives' credibility and, if enacted, would create a bureaucracy that could be turned against religious institutions when Democrats retake the White House. And editorial in the conservative Washington Examiner makes a similar point about the relationship between academic freedom and religious freedom from government interference.
FIRE, a conservative advocacy organization which defends controversial speakers, is waiting for more details before expressing an official view on the proposal. However, individuals affiliated with FIRE have endorsed it.
Frederick Hess of the American Enterprise Institute, writing in Forbes, is strongly in favor of the proposal, arguing that federal funding for scientific research through the Department of Defense, the National Institutes of Health (NIH), the National Science Foundation should be subjected to ideological litmus tests as a form of "quality control." AEI does not explain the connection between the quality of university research teams working on better treatments for cancer or technologies to keep U.S. military personnel and civilians safe and the extent to which undergraduate student groups on campus choose to provide a platform for Milo Yiannopoulos or Ann Coulter's views on sex. Nor does he express any of conservatives' usual skepticism of top down government control.
In an essay defending Trump's proposed executive order in Inside Higher Education, Hess misunderstands a survey by FIRE of "self-censorship" by students on campus, which found that 54% of students say they sometimes pause before speaking every thought that occurs to them. The leading reasons students "self-censor," according to the survey, are because they believe they might be wrong and are concerned about their peers judging them. Students were not concerned about any formal sanction from the university for deviating from an approved ideology, but rather were worried that if they appeared foolish in public, they might lose social status with their peers. Some students also point to tact, empathy, and basic norms of decency as reasons to choose their words wisely. The same survey found that "Almost all students (92%) agree that it is important to be part of a campus community where they are exposed to the ideas and opinions of other students" and that "(87%) feel comfortable sharing ideas and opinions in their college classrooms." This is not strong evidence of problems on campus. Hess also incongruously cites the AAUP, which (as noted above and below) unequivocally opposes federal regulation such as Trump's proposed executive order that would strip universities of autonomy.
Adam Kissel, formerly at the Koch Foundation, FIRE, and the the Department of Education, is only slightly less enthusiastic in his support for Trump's proposed executive order. Writing in the National Review, Kissel argues that although in an ideal world the federal government would spend nothing funding scientific research, conservatives would be justified politicizing federal research funding as retaliation for liberal efforts to deny federal research funding to principal investigators who engage in sexual harassment, inadequate due process for those accused of sexual harassment on campus, overly burdensome internal review boards that are established to ensure that scientific research does not unethically harm human test subjects, and campus speech codes meant to prevent harassment and emotional abuse. Kissel argues that conservative control of universities should be enforced through courts rather than an administrative agency to ensure that conservative advocacy groups continue to have influence even if Democrats take control of the White House.
February 23, 2019
A fascinating, albeit intemperate and sensationalist, perspective on the history of conservative activism on college campuses is available here.
The essay discusses strategies such as top-down national campaigns funded by wealthy donors, programming crafted by national organizations staffed by well compensated and experienced political operatives with ties to the Republican party, and executed on particular campuses by (sometimes less than fully autonomous) local campus chapters with substantial assistance from national organizations. Many of the campaigns featured subtle exploitation of racial anxieties, appeals to anger, and intentional efforts to upset political opponents so that their reactions can be recorded and used for propaganda purposes.
As previously reported, and confirmed by numerous press stories and leaked documents (see e.g., here and here) many of these strategies continue to be used on campus by many of the same or similar conservative organizations today.
Unfortunately, the essay counter-productively uses militant language to encourage students to "combat" these "threats." Physical violence is both morally wrong and strategically ineffective: it only affirms conservative activists' narrative of victimization. Indeed, a conservative activist group recently scored a major public relations victory after a campus recruiter from a national organization tabling at Berkeley was struck in the face by a passerby who may have been offended by the organization's racially charged slogans about "hate crime hoaxes." This particular conservative group has been accused by rival conservatives of allegedly condoning racism and sexual assault, and criticized for maintaining a McCarthyist Professor Watchlist.
December 12, 2018
LSAC is rolling out several initiatives to make the LSAT more accessible, including a tablet-based version of the test that will increase the number and type of facilities that can serve as test administration centers, and will pave the way for more frequent test administration. LSAT takers will also be able to take the essay portion of the exam from home through "remote proctoring."
LSAC is also offering free online LSAT test preparation and practice questions.
A competing standardized test that is less universally accepted for law school admission, the GRE, is available at administration centers on an almost continuous basis.
Bar examiners might want to consider investing in technology to increase the frequency with which the bar is administered and reduce the amount of time it takes to grade.
September 25, 2018
A recent working paper by Caroline Hoxby (Stanford) suggests that the economic returns to online education (measured in terms of wage growth) may be too low to recoup the costs of these programs, especially as administered at for-profit institutions. Hoxby used a fixed effects approach, measuring earnings before and after online education compared to likely earnings without online education. She found that online education does not boost earnings by very much, and it does not do much to move students into more lucrative industries or occupations. Hoxby found evidence that most students pursuing exclusively online degrees lived within commuting distance of brick-and-mortar institutions that likely offered higher quality education with better returns.
Hoxby's observational results are consistent with experimental studies that have found worse outcomes for students randomly assigned to online education compared to traditional education.
In previous research, Hoxby warned that the spread of online education could undermine highly selective institutions' ability to finance original research and teaching innovations. Hoxby wrote: "selective] institutions weaken rather than strengthen their market power in research and original content creation when they increase their exposure on the internet."
Hoxby's working paper has been criticized by groups advocating partnerships between for-profit technology companies and educational institutions to spread online education to non-profit and public institutions. For-profits have been online education's earliest and most enthusiastic adopters, while private non-profit and public institutions have generally taken a more conservative approach. The strongest of the critiques of Hoxby's paper is that it looked at returns over the course of 10 years rather than a lifetime. The present value of lifetime earnings premiums is a more appropriate measure of the returns to education.
Related coverage: Should online education come with an asterisk?
August 08, 2018
The ABA recently voted to permit a dramatic expansion of online legal education.
Online education is controversial in higher education. It is even more controversial in legal education, which relies more on classroom interaction and less on lectures than most forms of higher education.
Widespread perceptions that online education is lower quality than live instruction in general—and may be particularly disadvantageous in legal education—are backed by numerous peer-reviewed empirical studies.
Proponents of online education argue that it is more convenient because students and faculty do not have to commute, or because students can learn at their own pace. They argue that it is potentially more cost effective, either because physical facilities need not be used, or because it is scalable, or because an artisanal model of teaching through knowledgeable faculty can be replaced with a less expensive, industrial model of low-skill specialized workers who each handle particular aspects of course development and teaching. Some argue that technology can be used to closely monitor and track students, and that the information gathered can be used to improve the quality of education.
Critics of online education argue that it is lower quality, that most students learn and absorb less, and that the social dynamic of the classroom and learning from one’s peers and interacting with alumni is a critical part of education. (In addition to multiple peer-reviewed studies, they point to recent examples of “online education” such as self-paced workplace training modules as examples of the low quality that can be expected.)
Critics point to the failure of MOOCS—which have extremely low completion rates (see also here)—as evidence of the limits of scalability. They point to the pricing and cost experience of most universities, which have seen high costs of developing and maintaining online courses and additional software licensing fees which have prevented them from charging much less for online classes than for those taught in person. And they point to a rash of cheating and distracted learning, which anecdotally seem to be more prevalent online than in person.
Perhaps the most empirically rigorous (and recent) study of online education to date—which relied on an experimental design with random assignment of students to different versions of the same introductory economics course—found evidence that “live-only instruction dominates internet instruction . . . particularly . . . for Hispanic students, male students, and lower-achieving students.” An earlier study which also used a quasi-experimental approach, found similar results, especially for complex conceptual learning:
“We find that the students in the virtual classes, while having better characteristics, performed significantly worse on the examinations than the live students. This difference was most pronounced for exam questions that tapped the students' ability to apply basic concepts in more sophisticated ways, and least pronounced for basic learning tasks such as knowing definitions or recognizing important concepts . . .
Choosing a completely online course carries a penalty that would need to be offset by significant advantages in convenience or other factors important to the student. . . . Doing as well in an online course as in the live alternative seems to require extra work or discipline beyond that demonstrated by our students, especially when it comes to learning the more difficult concepts.”
July 21, 2018
I recently pointed out some factual problems with claims by Northwestern lecturer Mark A. Cohen. Cohen, writing in Forbes, claimed that faculty terminations at Vermont Law School were proof that student debt was unsustainable, not only at Vermont, but at all law schools except for a handful of elite institutions.
Here’s the problem: When student debt levels are unsustainable, student default rates are high. But at Vermont--and at most law schools--default rates are low.
When Professor David Herzig pointed out some of the relevant literature to Mr. Cohen, Cohen responded with the following angry outburst on twitter:
“That "evidence" has been panned by every credible source I know. The methodology and premises upon which the conclusions were drawn are laughable and fly in the face of real studies. I was a bet-the-company trial lawyer for many years--the "study" you cite is 3rd rate fiction.”
Low student loan defaults for law graduates are consistent with the peer reviewed literature, such as The Economic Value of a Law Degree (final version here), Timing Law School (final version here), and related work by me and Frank McIntyre about the value of legal education. Law degrees generally provide benefits that are substantially greater than their costs, even toward the low end of the distribution, across race (final version here), sex and college major, both before and after the financial crisis, and including those who graduate during a recession. More than the top 75 percent of law graduates are getting good value relative to a terminal bachelor’s degree.
Strong student loan performance is also consistent with the After the JD study (compare waves I, II, and especially III), which showed rapid income growth for graduates of even low ranked ABA-approved law schools, and eventually, six-figure median full-time incomes.
Law students’ low default rates have featured in the business strategies of many student lenders, who are eager to refinance law student debt for interest rates substantially below those offered by the federal government.
Professor Herzig asked Mr. Cohen to be more specific about his sources and objections.
Mr. Cohen has yet to specify what he believes is wrong with the methodology in the studies—which were authored with a PhD labor economist, peer reviewed and carefully vetted, use high quality government data, use mainstream methods and assumptions that are well established in labor economics, and include sensitivity analyses and robustness checks. The results have been replicated by other researchers.
Mr. Cohen also has yet to specify which “real studies” he thinks use better data and more widely accepted methods, and why. He has yet to explain how his litigation experience qualifies him as a labor economist, statistician, and literary critic. Or why, as a seasoned litigator, he thinks so many of the lawsuits against law schools have been dismissed.
July 19, 2018
The trouble at Vermont Law School isn't due to "unsustainable" debt levels for students--but it might be because of unsustainable tuition discounting and underinvestment in outreach (Michael Simkovic)
Vermont Law School recently stripped many of its tenured faculty of tenure. A recent article in Forbes by Mark Cohen, a lecturer at Northwestern, claims that Vermont's financial problems are a sign that tuition is too high and student debt is unsustainable.
The data doesn't support his contention. When student debt levels are unsustainable, student default rates are high. But at Vermont--and at most law schools--default rates are low. Vermont Law School's 3-year cohort default rates over the last 3 years available (classes of 2012-2014) are between 0.3 and 1.2 percent, while the national average cohort default default rate across educational institutions is close to 11.5 percent. Nor are Vermont graduates defaulting in large numbers on their Perkins loans. The 2016 default rate, the most recent available, was 3.5 percent for Vermont, versus an average across all educational institutions of around 11.5 percent. Perkins loans are not eligible for Income Based Repayment, so Vermont's relatively strong performance is likely not due too a disproportionately large share of its graduates enrolling in IBR. (Not all Vermont grads will practice law in Vermont, but lawyers in Vermont are actually paid reasonably well--around 120,000 on average according to the BLS).
Vermont Law School's problem is not that tuition is so high that student debt levels are unsustainable relative to students' post graduation income and other financial resources. Rather, Vermont's problem seems to be that there are too few students, and because of aggressive tuition discounting intended to attract them, the students who matriculate are paying too little to make the school financially healthy. Vermont Law School's 2016 529 shows that around 90 percent of incoming students received some scholarship, and half of students receive half tuition scholarships or better.
Vermont Law School could try to respond by offering even more scholarship, but its competitors have deeper pockets, and can outspend Vermont until it runs out of room to maneuver. Escalating a price war that Vermont will surely lose would be foolish. Degrading the quality of its education by relying on more lecturers and adjuncts risks causing a death spiral in which quality, enrollments, reputation, and revenue per student all continue to drop.
To be successful and sustainable in the long run, Vermont may need to find a way to attract students--not just from Vermont, but from across the region--other than offering a cut-rate price. Rather than compete on price, Vermont should find a better way to reach out to those students who are most likely to find Vermont's offerings appealing.