“Go to college, young men and women, go to college!”

Abstract

ular by 19-century American newsman and politician Horace Greeley. At a time when the East Coast was plagued by unemployment and economic stagnation, the West offered plenty of land and opportunity to those with ambition and a willingness to work. Two centuries later, the economies of many developed countries are also plagued by unemployment and economic stagnation. Unlike the American West, however, in these countries opportunity is no longer tied to land but to human talent, productivity, and innovation. It is knowledge, not geography, that will make or break an economy—and a young person’s economic future. Universities are by no means perfect and clearly are not the only places a person can acquire knowledge. However, although there is much today’s universities need to do to respond to society’s new demands, they remain the surest, most effective path for most young people who want to pursue a prosperous and impactful career. In the United States, concerns about the skyrocketing cost of attending college have led to a wave of criticism in the media. With state support dwindling, public universities have swiftly transferred the economic burden of getting an education to the students. At our university, for example, as state tax revenue appropriations per student have declined by more than half over a decade, in-state tuition and fees have more than doubled, even though our expenditures per student have remained almost flat. Other factors driving tuition inflation include investments in facilities and equipment, increases in long-term debt, and growth in administrative and support services. The result, according to a recent study by consulting firm Bain & Company, is that the average American family now has to dedicate 38 percent of its annual income to pay for a year of college, up from 23 percent a decade earlier. As a consequence, students are borrowing more and more to pay for college, and U.S. student loan debt ballooned to nearly $1 trillion in the third quarter of 2012, which for the first time is larger than either credit card or auto loan debt. These trends have sparked a plethora of arguments against obtaining a college degree. Citing examples like tech giants Mark Zuckerberg, Bill Gates, and the late