Many people have linked to this Techcrunch article by Sarah Lacy about Peter Thiel and an education bubble. Here’s Freddie DeBoer and E.D. Kain (at his new Forbes blog that covers a lot of education territory) on the article. I actually think the argument is flawed because it tries to wrap itself in an egalitarian critique and misses a far, far more interesting critique of the state of elite higher education.
From the article (my bold):
Thiel talks about consumption masquerading as investment during the housing bubble, as people would take out speculative interest-only loans to get a bigger house with a pool and tell themselves they were being frugal and saving for retirement. Similarly, the idea that attending Harvard is all about learning? Yeah. No one pays a quarter of a million dollars just to read Chaucer. The implicit promise is that you work hard to get there, and then you are set for life. It can lead to an unhealthy sense of entitlement. “It’s what you’ve been told all your life, and it’s how schools rationalize a quarter of a million dollars in debt,” Thiel says….
But Thiel’s issues with education run even deeper. He thinks it’s fundamentally wrong for a society to pin people’s best hope for a better life on something that is by definition exclusionary. “If Harvard were really the best education, if it makes that much of a difference, why not franchise it so more people can attend? Why not create 100 Harvard affiliates?” he says. “It’s something about the scarcity and the status. In education your value depends on other people failing. Whenever Darwinism is invoked it’s usually a justification for doing something mean. It’s a way to ignore that people are falling through the cracks, because you pretend that if they could just go to Harvard, they’d be fine. Maybe that’s not true.”…
Thiel’s solution to opening the minds of those who can’t easily go to Harvard? Poke a small but solid hole in this Ivy League bubble by convincing some of the most talented kids to stop out of school and try another path. The idea of the successful drop out has been well documented in technology entrepreneurship circles. But Thiel and Founders Fund managing partner Luke Nosek wanted to fund something less one-off, so they came up with the idea of the “20 Under 20″ program last September, announcing it just days later at San Francisco Disrupt. The idea was simple: Pick the best twenty kids he could find under 20 years of age and pay them $100,000 over two years to leave school and start a company instead…
Of course, if the problem Thiel sees with the higher education bubble is elitism, why were so many of the invitees Ivy League kids? Where were the smart inner-city kids let down by economic blight and a failing education system of a city like Detroit; the kids who need to be lifted up the most? Thiel notes it wasn’t all elites. Many of the applicants came from other countries, some from remote villages in emerging markets.
But the program has a clear bias towards talent, and like it or not, talent tends to be found in private universities. Besides, he’s not advocating that stopping out of school is for everyone any more than he’s arguing everyone should be an entrepreneur. But to start a new aspirational example– an alternative path– it makes sense to start with the people who have all the options. “Everyone thinks kids in inner-city Detroit should do something else,” Thiel says. “We’re saying maybe people at Harvard need to be doing something else. We have to reset what the bar is at the top.”
So what’s the problem we need to solve? According to the article it’s that higher education, especially at the elite end, is exclusionary and involves high debts, perhaps artificially so. The piece hits a wall quickly – Thiel wants more people from Harvard and elite colleges to work as entrepreneurs using language around the idea that everybody who can go to college shouldn’t have to, especially if they have to take on a lot of debt.
In practice, people who can get into Ivy League schools are probably going to be ok, and we as a society shouldn’t spend too much time worrying about their work outcomes. I like to make a note when I see wonks fret about whether the right kinds of people can get into Ivy League schools but never make a stink about the mass defunding of higher public education. The real worries for everyone about student debt should be the people in for-profit schools and people who drop out, not those at the top of the food chain.
But what I found frustrating is that the piece is near a serious critique of something that is even more sacred to our culture, our embrace of the meritocracy. I think the Thiel critique would be more fascinating if it was couched in the idea that elite education is structured not only to replicate the status quo but to find a way to collect the best minds across society and dedicate them to the replication of that status quo.
The idea that talent would be more naturally distributed throughout society without a meritocracy and with one talent would be concentrated at the high end was a serious worry a generation ago. Daniel Bell, Public Interest, 1972, On Meritocracy and Equality:
But with that transformation came an unexpected reaction. Previously, talent had been distributed throughout the society, and each class or social group had its own natural leaders. Now all men of talent were raised into a common elite, and those below had no excuses for their failures; they bore the stigma of rejection, they were known inferiors.
Others worried that the best working-class minds that would build unions and a stronger labor force would be scooped up by the meritocracy and become the foot soldiers for management (see the recent movie Ressources humaines for an example of this narrative). If you view entrepreneurial activities as the act of challenging and disassembling powerful incumbents, as I imagine Thiel does, the meritocracy poses a very similar problem.
This critique would go: Right now our best minds go off to the financial sector and high-end business and law programs, channeled through elite education. To pick an example at random, our best minds are hard at work making sure JP Morgan can squeeze local businesses with ever increasing interchange fees, instead of at work in Silicon Valley coming up with a way to circumvent and take apart that oligarchy using technology. They’ll continue to find ways to create regulatory arbitrage, or find obtuse mechanisms to manipulate earnings reports, or help one group of corporations sue another group of corporations, instead of creating real new value and innovation. The carrot and stick of meritocratic rewards and debt collection push our elite onto this track, and Thiel’s program can break that cycle. I’m not sure where I stand on it in practice, but it’s an interesting debate.
I bring this up because I know the idea that the debt of law school forces promising lawyers away from public interest and towards corporate law firms, firms that are the only ones who can pay enough to cover student loan payments, is a serious worry (I’ve only read The Destruction of Young Lawyers on this, but I know there’s more). I like the idea that we have to extend that analysis to the undergraduate level, both for the age of high college debt and the age of massive, entrenched inequality.