Peter Thiel: The Education Bubble Is Becoming Dangerous (2018) [video] | Hacker News Reader

Peter Thiel: The Education Bubble Is Becoming Dangerous (2018) [video]

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45 pointsadmiralspoo28 comments

I agree college is overpriced, but I doubt Thiel's companies often hire people without a formal college education. He's really just stating the obvious here without mentioning any viable alternatives.

I don't think hes the type of person to offer the next religion that people should crowd into… maybe less focus on working for companies that filter on "formal college education" above all else, even if they are "his" companies (its debatable the level of control an owner has over the day to day operation of companies esp if you own a lot of companies [principle-agent issues]).

Agreed. And it's not just "overpriced", because "overprice" says you are not getting enough output per input. In this case, with higher education, the economy (and nation) needs skilled workers, and universities are not producing them in the quantities needed even as they graduate more and more students who have degrees that don't help them succeed in the job market.

I think the solution should be a combination of things:

1. Make universities cheaper. Say fire 90% of non-academic staff, and force universities to have more academic staff than non-academic staff. Also make admission more rigorous, so they are more selective. Also get rid of the non-tenure track slave labor in academic staff. Ideally roughly 1/3 of the population should go to university, say 30% fresh from college students and 5% older students.

2. Provide vocational training so that people can have as option vocational education such as electrical work, carpentry, plumbing, machine tools, and yes, programming, day care, medical assistant, accountant, etc. Vocational training should be max 3 years of focused training with an apprenticeship period in the last year, and unlike universities, these vocational schools should be setup so that everyone can access at least a couple of vocational school options, at government expense. Ideally 2/3 of the population should go to a vocational school.

3. Stop providing government loans to universities entirely. Universities can provide scholarships and there should be government scholarships available based solely on merit. There should also be student aid based solely on financial need, but with high academic requirements, otherwise route the student to a vocational school, which should be fully paid for by the government.

4. Safety valve. If someone goes to a vocational school there should be an option to go back to university based on academic merit. Say a construction worker really takes to it and wants to become an architect, etc. The safety valve should be rare, say 5% max.

5. Online learning/certifications for people switching specializations roughly within the same field.

I think other countries do well without such expensive universities, like Germany for instance where students are much more on their own. So I disagree with reducing "non-academic staff" and making admissions more difficult. In my opinion class sizes could be even larger and moved online completely. After all students only spend a fraction of their time in classes. Most of the time needs to be spent actually learning the stuff from the lectures, both alone and in groups with other students. Universities are there to facilitate the latter, it's just not possible with pure online learning - yet. To me most valuable are tutoring classes that are lead by staff or just more senior students, so it's possible to get qualified feedback and help with exercises and to actually understand things on a deeper level. At least for CS, Math, Natural Sciences.

There is a tendency to automatize a lot of basic work. Speaking for myself, I moved out from home 15 years ago and had to hire someone to repair something at my place only once. And that was because they messed up an installation that was initiated by the landlord. Societies as a whole are economically much better off when people get a higher education and should strive to enable it for everybody who wants to get it. (Many people actually don't want to study.)

The reason why education in Germany is affordable whereas education in the US is not, is precisely because we have 7-10 non-academic staff per academic staff, whereas Germany has less than 1. These proposals of reducing non-academic staff, increasing rigor, reducing time to graduation, etc, is an attempt to be more like the German model.

You might want to look at this comment where I provide some numbers:

https://news.ycombinator.com/item?id=23817814

Thanks for sharing, this is really interesting.

Still, I wonder how German and U.S. universities compare for example in numbers of tutors. ("HiWis") I would estimate there is one per 20-50 students per course and they might fall into both groups since those helping out in 1st or 2nd semester courses might not have a university degree yet. Also the payment is typically quite low, although considered good enough for a first student job.

They are actually quite an important part of studies like Physics and Mathematics.

Regarding time of gradution/number students: in the past German model (which is now obsolete) where people studied for diploma, the typical lazy student would mean basically no extra cost for univsersities. Since this person usually doesn't occupy any lecture room or tutoring capacity... ;-) But the introduction of Bachelor/Master introduced quite some changes, in particular closer support for the students and more stringent time lines. But still, the Bachelor usually takes 3 years and the master an additional 2 years. Basically the curricula for diploma studies were just being split.

So people like tutors, graders, TAs, are considered academic staff, and you can add them up in terms of FTE (full time equivalent), so 5 tutors that each work 8 hours per week add up to a single FTE.

It turns out not to make much of a difference to look only at full time staff versus FTE -- I didn't know this when I started looking at the data, but the slices of time by tutors end up being a marginal correction to counting just full time staff when you look at things like student-teacher ratios or total expenditure per staff.

In the US, there is a meaningful difference between tenure track and non-tenure track, as universities shift ever more funds away from academic staff and towards non-academic staff, one way this is accomplished is to pay the academic staff less, and this is accomplished by keeping the old professors at current pay but hiring mostly non-tenure track instructors as headcount is increased. The other way this is accomplished is by identifying some problem that needs an immediate solution, and then creating multiple vice provost positions which require their own department position, etc. Say community relations, gender equality, many different types of "outreach" positions, etc. European universities have so far resisted this type of cannibalization of tuition dollars by non-academic staff.

Thus the extra cost of non-academic staff is a good first order explanation for the diverge in annual tuition between US and Europe, and the fact that our students take 5-6 years to graduate and many don't graduate is another multiplier that explains differences in total spending on tertiary education per bachelors degree holder.

Taken together, these three factors: non-academic staff, longer time to graduation, much higher dropout rates, basically explain the full difference in spending between the US and Europe.

I agree with most points but I don't think admissions should be more rigorous. retention should be more rigorous, you should not be guaranteed four years because you had a good SAT. they should let in more freshman's and mercilessly cull each year. I don't get why they hold hands for some students when so many would have loved to be in their place.

So if you want school to be more expensive, then a good way to do that is to let in twice as many people as can cut it, and then have half of them drop out. Basically what we are doing now. That more than doubles the cost and also screws a lot of people out of good years of their lives, since those who drop out then have to seek education elsewhere.

I find myself having binary reactions to virtually all of Thiel's positions: I either strongly agree or strongly disagree. I guess that's what his methodological contrarianism generates.

I agree with this one. Not only are college costs out of control, but the fact that colleges have seen tuition increase much faster than inflation while simultaneously decreasing the number of real tenure track positions and other academic positions should be a national scandal. It's borderline fraud.

What the hell is all that money going toward? As near as I can tell it's unnecessary vanity buildings, executive salaries, and runaway bloat in administrative offices. It's going toward everything but real tenure track professorships, better teacher/student ratios, and everything else a university should be doing.

See The Baumol Effect by Alex Tabarrok [1]:

> After looking at education and health care and doing a statistical analysis covering 139 industries, Helland and I conclude that a big factor in price increases over time in the rising price of skilled labor.

The interesting question, in my mind, is why the United States is an outlier compared to other advanced nation states.

[1] https://marginalrevolution.com/marginalrevolution/2019/05/th...

I find that discoverability is the problem. Out of all the classes I took, 2 without a doubt made the whole experience worth it and is still paying dividends: (discrete math and advanced algorithms) -- but I had no idea at the time that they would be the ones that would provide so much value. They were the classes that convinced me that I wanted to write software and not do electrical engineering. I wonder how you can solve this without simply going through the four years and hoping for the best.

Which discrete math class? (Currently trying to decide on a math class for autumn as CS major)

This one back in 2014 -- just the intro undergrad class. I actually absorb very little from lectures and do most of my learning by reading and doing problems myself -- the book was so good I read it cover to cover and did a lot of the practice problems.

https://wl11gp.neu.edu/udcprod8/bwckctlg.p_disp_course_detai...

https://www.amazon.com/Discrete-Mathematics-Applications-Ken...

This appears the final section of a 2014 episode of Conversations with Bill Kristol [1]:

> CH. 6 : THE HIGHER EDUCATION BUBBLE (1:13:57 - 1:36:39)

> Is American higher education heading towards a major fiscal crisis? Thiel explains he thinks it is.

[1] https://conversationswithbillkristol.org/video/peter-thiel/

IMO, adding 2018 in the title would be better.

Peter Theil is an insulated idiot genius who happens to be right on this

Couldn’t have said it better myself.

Hard for me to separate theses Thiel is partially right about from the great harm his existence has done to our species.

He's not nearly the first one to make this claim, so I'm not sure why it's even notable... "billionaire believes an oft-feared problem"

Yes, but Thiel has been saying this for many years, if not decades, and he did put his money where his mouth was, by paying students to drop out as part of the Thiel Fellowship program: http://thielfellowship.org/

At this point I think Thiel lives in his own wealth bubble so distinct from the experience of most people that his reckons just should be ignored by default.

I suspect that the main reason we see what he has to say so much is that he can pay a publicist to get people to listen to him .... he's essentially trying to buy\ his way into the 'marketplace of ideas' using money rather than actual ideas, essentially trying to skew the marketplace in his favor

When you put it that way it sounds really sad.

Seems to me that you failed to address his claims.

Although there's merit to the fact that people can be blinded by their wealth-bubbles to the point that they cannot adequately identify/assess solutions to address problems that seem obvious to the rest of society, to discount someone's views based on their wealth-bubble status is likely ultimately a recipe for division, grid-lock, and a more closed-off society. Perhaps it's more useful to try to evlauate an individual's ideas based on the merits of their feasbility and overall utility versus writing them off by default in order to achieve a more functional society for everyone?

actually it was because of his expressed ideas that I was saying I think that he doesn't seem to live in the same reality as the rest of us

Why should we listen to the ideas of a rich guy rather than an educator? How many times have have you seen an education expert on this site discussing these topics from a critical standpoint?

The bigger issue is why to people want to listen to rich people rather than experts in the field? This reminds me the climate change where some people don't want to listen to the experts but instead want to listen so someone (or news organization) they already know.

don't discriminate much, take every idea, the odd idea that gots strong reaction (in a good, strange, nonobvious way), probably is on to something.

same idea with anova, the variable that causes a lot of variance is probably significant.

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