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  #1  
Old 05-21-2012, 03:28 PM
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Mark Cuban: College is a Business Decision

I thought this was interesting. Cuban's a goofball, but he's a pretty sharp guy and has done pretty well for himself. I think he's on to something.

U.S. News and World Report-Education
Quote:
A meltdown is coming to the higher education sector, billionaire computer magnate and NBA Dallas Mavericks owner Mark Cuban warned in a blog post on May 13. With education costs that rise each year, a hungry market of students plied with easy-to-get loans, and little incentive for colleges to make meaningful changes, the arena is ripe for a major shakeup, the entrepreneur writes.
From the linked blog post:
The Coming Meltdown in College Education & Why The Economy Wonít Get Better Any Time Soon

Quote:
This is what I see when i think about higher education in this country today:
Remember the housing meltdown ? Tough to forget isnít it. The formula for the housing boom and bust was simple. A lot of easy money being lent to buyers who couldnít afford the money they were borrowing. That money was then spent on homes with the expectation that the price of the home would go up and it could easily be flipped or refinanced at a profit. Who cares if you couldnít afford the loan. As long as prices kept on going up, everyone was happy. And prices kept on going up. And as long as pricing kept on going up real estate agents kept on selling homes and finding money for buyers.


Until the easy money stopped. When easy money stopped, buyers couldnít sell. They couldnít refinance. First sales slowed, then prices started falling and then the housing bubble burst. Housing prices crashed. We know the rest of the story. We are still mired in the consequences.


Can someone please explain to me how what is happening in higher education is any different ?
And:
Quote:
It's far too easy to borrow money for college. Did you know that there is more outstanding debt for student loans than there is for Auto Loans or Credit Card loans? Thats right. The 37mm holders of student loans have more debt than the 175mm or so credit card owners in this country and more than the all of the debt on cars in this country. While the average student loan debt is about 23k. The median is close to $12,500. And growing. Past 1 TRILLION DOLLARS.
I think we're rapidly approaching a crossroads. You have the students, who are increasingly deciding they don't want to go into a house mortgage-sized debt to pay for college. Then you have the Gen-X and Y moving into the management/upper management positions who are much more open to alternative education or at least less concerned with where a perspective employee went to school and more with whether of not they can successfully perform the tasks required. 'What have you done for me lately' if you will.

Quote:
As an employer I want the best prepared and qualified employees. I could care less if the source of their education was accredited by a bunch of old men and women who think they know what is best for the world. I want people who can do the job. I want the best and brightest. Not a piece of paper.
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Old 05-21-2012, 04:03 PM
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Makes sense.
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  #3  
Old 05-21-2012, 04:14 PM
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Quote:
Originally Posted by SwampYankee View Post
I thought this was interesting. Cuban's a goofball, but he's a pretty sharp guy and has done pretty well for himself. I think he's on to something.

U.S. News and World Report-Education
From the linked blog post:
The Coming Meltdown in College Education & Why The Economy Wonít Get Better Any Time Soon

And:
I think we're rapidly approaching a crossroads. You have the students, who are increasingly deciding they don't want to go into a house mortgage-sized debt to pay for college. Then you have the Gen-X and Y moving into the management/upper management positions who are much more open to alternative education or at least less concerned with where a perspective employee went to school and more with whether of not they can successfully perform the tasks required. 'What have you done for me lately' if you will.

Universities are partly at fault for straying from the focus of teaching, training and providing opportunities for educational/career experience. Now the schools-for-profit are doing their best to "sell" as many "clients" as possible on their college: yeah right, become a Phoenix. See if hire you.

Regular universities are bloated with administrators making 300K like the VP of admin at Oakland University. Whay value does he add? I'd rather give a raise to the business and technical profs who teach kids a skill and how to start a business.

I spent 11 years at Chrysler working indirectly for Harry Lewis and Bob Lutz when they ran the reengineering operation in Chrysler, up to 1997. The idea was simple: everyone does something that adds value to the company or they get redeployed into a job that does. If you lost your job because your skills were superceded, you had three choices: limited unemployment, training for a new position and/or movement into something else you could prove that you could do. Over 11 years we displaced almost 16,000 salaried and hourly people (witrh the blessing of the UAW, because no one was "sacrificed"), but no one was laid off, because people wanted to be a part of a company they were proud of, and that took care of them. That's why Chrysler was voted the Company of the Year in 1997, before the MB merger, when selected people then made power plays and ruined it for everyone.

The same type of stupid greed will ruin it for people who want/ have a degree. That's why I want my son to graudate without any debt before the whole mess boils over....and Cuban is right-- it will!
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Old 05-21-2012, 04:24 PM
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The problem is not the education, its people getting these retarded pointless degrees like Liberal Studies (LOL) etc... Goodluck on your job search where your competition are those who don't even have a degree.

I'm studying Finance at ASU and I have a somewhat larger student debt than the Median, but I already understand my payments, and the options available for me. Even if I continue at the part time job I am at now, I will be able to make minimum payments, but more than likely I'll hop into a decently paid job without much interruption because I won't have a garbage degree.
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Old 05-21-2012, 10:33 PM
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When the economy was toast in the early '90's, paychecks were few and far between. College loan debt collectors were contacting me with new reasons why I should be stiffing my landlord and utility to cough up cash for them.

My stock reply was 'I have the education. You are holding paper. Short of a lobotomy, there is nothing you can do except screw with my already effed credit rating'

Ended up buying a house at the bottom of the market and repaying all the loans when we sold.

College is silly expensive and some of those going would be much better off attending trade school.
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Old 05-22-2012, 01:54 AM
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Another billionaire, Peter Thiel, made similar remarks on 60 Minutes last night, perhaps a re-run, not sure:

Dropping out: Is college worth the cost? - 60 Minutes - CBS News
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Old 05-22-2012, 08:32 AM
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When I went to UConn 20+ years ago , it was about $9K/yr. in-state including room & board, it's now $23K (inflation adjusted would be about $17.5K). Out-of-state is over $40K.

My parents gave each of us $40K to use for our education. If we used it wisely, we were covered for 4 years at a state university. If we wanted to go to a more expensive school, didn't use it wisely or failed to take things seriously (like I did ) the rest was on us.

Even with specifically putting money aside towards my kids' post-secondary education, I'm in no position to do as my parents did. Our state university system schools (Central CT, Southern CT, Eastern CT and Western CT) are currently about $14K/yr. including room & board. If I'm lucky, we'll be able to swing that. My oldest starts H.S. next year so I guess I've got 4 years to come up with a plan.
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Old 05-22-2012, 12:00 PM
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Alumni to these places of higher education must feel glad they got in and out on the cheap ,youth of today are screwed to the wall.
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Old 05-22-2012, 12:17 PM
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When I started my University studies the cost for 15 hours was $62. Books cost another $30 or so. At the time this was about one weeks pay for a typical working slob.

There was no such thing as student loans, so I worked my way through and picked up my degree debt free. But then so did everyone else.

And that first job? Easy... The Armed Forces. Then they turned me down and shunted me into a job with a big oil company where I was deemed 'Necessary to the National Defense'.

My point to all of this is that anyone today could do the same thing. Work your way through school and join the Armed Forces. Then retire from there and move into a job that takes advantage of your experience.

But in my day a University degree was necessary since no one would look at you twice without one. And starting my own business was out of the question since that takes Capital and everyone I knew was poorer than myself.

But Cuban is wrong about a University degree just being a piece of paper. It is a piece of paper that proves you can take the worst projects and turn them into a success, and that you can take the stress of dealing with problems that cause some people to kill themselves.

And then there are personal connections to be made. At Texas A&M they used to print in the student handbook 'The relationships you build here will sustain you through the worst of times'. There is a lot of truth in that.

All in all I think Cuban has confused being lucky with being smart.
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Old 05-22-2012, 12:27 PM
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So now a degree is just a piece of paper... wonderful.

Glad I only have $2k in student loans and I have a year left.

The issue with student loans is that those taking them out do, for the most part use them for school but others buy things they shouldnt with them. I couldn't see myself living off of student loans while in school. I would rather work more and have less class hours then have a ridiculous amount of debt.
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Old 05-22-2012, 01:12 PM
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Quote:
Originally Posted by Pooka View Post

But Cuban is wrong about a University degree just being a piece of paper. It is a piece of paper that proves you can take the worst projects and turn them into a success, and that you can take the stress of dealing with problems that cause some people to kill themselves.
Alternatively that you can show up for four years... Whatever that proves

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Old 05-22-2012, 01:33 PM
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Gets back to the root question--What is the purpose of education? If it is simply "job training" then evaluate the cost in terms of the (not guaranteed) job. If education is of value for its own sake, or for the improvement of the self, it's cost/benefit is not so easily calculated.
My education informs in one way or another all that I am and all that I do, yet it has nearly no value in terms of the specific job I am doing.
I think there is a market for job training--at a much lower cost. Maybe, after that, employers should make college courses available for employees they value.
The idea that everyone should go to college is misdirected. High School, too, needs to be more rigorously focused on job skills rather then much of the pop culture BS thart is included today.
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Old 05-22-2012, 01:42 PM
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The idea of college education simply being job training or a "piece of paper" is completely off. Sure, that is part of it, but a true college education will provide the mental tools needed to think critically and effectively. That goes far beyond the scope of just job training.
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Old 05-22-2012, 03:02 PM
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Originally Posted by tbomachines View Post
The idea of college education simply being job training or a "piece of paper" is completely off. Sure, that is part of it, but a true college education will provide the mental tools needed to think critically and effectively. That goes far beyond the scope of just job training.
That is what I have always thought, but if you listen to college ads these days, they promise better jobs and better pay.
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Old 05-22-2012, 03:05 PM
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That is what I have always thought, but if you listen to college ads these days, they promise better jobs and better pay.
Well yeah because that's what initially sells the school to prospective students. Think about it, if a school advertised "can't promise better pay and financial future but you can think better and make more cohesive sense of things" do you think that would draw as many students? A good education goes far beyond that, but money talks.
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