May 22, 2014 by History in a Hurry
The Higher Education Bubble Begins To Pop
by Contributor • May 12, 2014
By Richard Vedder
Everything created by humanity is subject to a cycle of creation and destruction. Humans live 70-80 or sometimes even 100 years; their business enterprises rarely last that long. A generation ago, there was no Facebook or Google, but Enron and Eastman Kodak were going strong. Even buildings seldom last more than 200-300 years.
Until recently, higher education has seemed immune from this reality, as few colleges or universities ever died or closed. The perpetual gain of college enrollments, combined with increasing government subsidies and private philanthropy, shielded higher education from the discipline of market forces that lead private businesses to face relatively high mortality rates. That’s changing. As tuition revenues and outside subsidies stagnate and cost-saving innovations fail to materialize, more and more schools are facing serious financial problems.
How to Navigate Today’s Economy
An interview with Charles Hugh Smith on the Tom Woods Show: