In 21st century America, disruptive technology is all around us. Smartphone apps allow us to summon transportation at the touch of a button, to book accommodations in a stranger’s apartment, to arrange an impromptu dinner party with people we have never met and to navigate our way through unfamiliar cities without the need of a map or compass.
Of course, not everyone is delighted by these miraculous innovations. The people still doing business the old-fashioned way see technology as an existential threat, and are scrambling to find ways to defend their positions — typically through the use of government regulations.
The world of higher education is being disrupted by technology as well, in perhaps a more dramatic way than any other sector of the economy. Thanks to the Internet, the range and accessibility of free educational content has never been greater. Those who want to learn about a subject can now do so from their own homes. And this does not just mean reading page after page of dry, textbook-like material — on the contrary, the web offers no end of immersive, interactive resources for the eager student, all without the necessity of shelling out thousands of dollars for a glorified piece of paper from an accredited institution.
Just as taxi companies are trying to shut down Uber, however, and just as hotel chains are trying to stop Airbnb, the educational establishment wants to use government power to protect itself from the competition created by technology.
President Obama has argued that “college has never been more important,” all the while decrying the high costs of education. Sen. Elizabeth Warren, D-Mass., is pushing legislation to allow students to refinance their loans “just like you can refinance your mortgage,” in a pattern eerily similar to the run up to the housing crisis in 2008. Meanwhile, total student debt has topped a trillion dollars — a bubble which, when it inevitably bursts, could wreak economic devastation on an entire generation that was told the only way to succeed in life is to mortgage its future to get a bachelor’s, and then a master’s and then a doctoral degree.
Government policies to extend student loans to help cover the cost of college are creating the very problem they purport to solve. Easy credit drives up the demand for higher education, which in turn drives up the price. The result is Ivy League schools with beautiful campuses and massive gymnasia turning out students who still can’t find a job. In the universities’ struggle against obsolescence, they are merely delaying the inevitable, holding back progress and simultaneously laying the groundwork for economic disaster.
Franz Oppenheimer, the German sociologist, observed that there are two ways to generate income. He called these the economic means, and the political means. Under the economic means, people make money by adding value to society and engaging in voluntary exchange with other. Under the political means, they rely on government force to boost their profits and cripple their competitors. Oppenheimer wrote a century ago, but today we have a clear example of the political means at work: The higher education industry operating through the mechanism of student loans.
We need to stop propping up colleges and universities with government loans and propaganda campaigns on the importance of meaningless certificates. Instead of attempting to treat the symptom of high education costs, we should be treating the cause. If Americans learn to embrace the alternative education approaches that technology makes possible, the demand for traditional universities will drop, and tuition prices will drop with it. The increased competition will result not only in cheaper degrees, but in higher quality education for all.
Adam Brandon is the Executive Vice President of FreedomWorks. Thinking of submitting an op-ed to the Washington Examiner? Be sure to read our guidelines on submissions for editorials, available at this link.
