The Greatest Pyramid Scheme of all Time?

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An Investment that doesn’t always pay

College can be an excellent investment that propels graduates into high powered careers. Plenty of my colleagues finished their undergrad degrees with starting salaries similar to a tenured professor’s pay. The old promise of a better, financially secure life for college graduates is still true for engineers. The same cannot be said for the liberal arts. Today, liberal arts education is functionally identical to a pyramid scam!

A Pyramid Scam?

Pyramid scams work by requiring new recruits to pay a membership fee to their recruiters. If the recruit then manages to sign up enough new recruits, the recruit is promoted and gets a share of the membership fees. Recruits who fail to generate enough new recruits get nothing. Some variants of pyramid scams involve a token transfer or goods or services to disguise the nature of the scam. Participation trophy degrees are the token service that covers up the liberal arts pyramid scam.

The availability of meaningful career opportunities outside of academia distinguishes legitimate education from pyramid scams. For example, the average engineering graduate has little to no trouble finding meaningful employment. There are numerous employers ranging from defense contractors to the oil giants and equipment suppliers. While engineers thankfully can and do take teaching jobs, this is not necessary to an engineering career or even the highest paying career option. The service provided by engineering education has legitimate value outside of training more engineers.

In contrast, history and literature majors have far fewer options for employment in their field. On average, they could work as librarians, high school teachers and similar low prestige jobs. The pinnacle of a liberal arts career is to be a tenured liberal arts professor. But there are far more liberal arts majors than liberal arts jobs at all levels. This makes the top of the field dependent on the tuition of new recruits and extremely competitive. In simple terms, the best positions in the field are funded by the recruitment of excess members who have a near zero odds of attaining a good position in their field. This is the basic structure of a pyramid scam.

What’s the value?

But what about the transferrable value of an education? In the days before participation trophy degrees, a good liberal arts education was valuable. It taught critical thinking, provided a rigorous academic background, and signaled that graduates were both smart and motivated. Grade inflation and the gutting of academic standards mean that most liberal arts degrees provide very little value now. Many liberal arts graduates are in jobs that do not realistically require any degree. The return on investment for liberal arts degree is declining with some programs going negative!

Liberal arts education is effectively a debt driven pyramid scam. It provides extremely limited utility to the average graduate from the average university. The skills are non-transferrable and participation trophies from all but the most prestigious schools have limited signaling value. The pinnacle of a liberal arts career is the tenured professor. The continued employment of the liberal arts faculty requires them to recruit far more students than will ever be employed in the field. A lucky and morally suspect few become liberal arts professors. The vast majority end up with nothing tangible to speak of besides student debt that cannot be discharged in bankruptcy. The liberal arts pyramid scam trades the future wellbeing of innocent students for the decadent and privileged lifestyle of its increasingly useless faculty.

The Deplorable Doctoral Candidate is an engineer, climate skeptic, entrepreneur, critic of academia, and occasional blogger. You can follow him on Twitter: https://twitter.com/DepPhDcandidate

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