My 15-year old son recently told me he doesn't want to go to college. Instead, he plans to be an electrician.
My pride as a father swelled. He gets it.
Don't get me wrong, he could do very well in an undergrad program. He's far smarter than his old man.
But he and his friends understand that America's college system is dying. For most people today it's a bad investment.
Students are graduating with $100k+ in debt to a brutal job market. There's too many college grads and not enough desk jobs. We've long passed the point of saturation.
And it's not just the fact that college doesn't offer a good return-on-investment...
America's colleges and universities love to brag about their robust diversity programs. But in reality they've become hopelessly biased and one-sided institutions.
Faculty collect huge paychecks to indoctrinate youth with neoliberal propaganda.
For example, a recent survey at Harvard University found that 80% of professors identified as liberal, 16% "moderate", and only 2% labeled themselves conservative.
Here's a chart showing how the left has taken over U.S. institutions. It shows the percentage of liberal professors in a given field since 1970 (in black) and 2018 (red).
Source: X
There is no intellectual diversity in today's academic world. It's a one-sided affair. Is it any wonder college grads are overwhelmingly liberal, at least in the first few years following college?
The era of "everyone must go to college" has peaked. What a boondoggle and catastrophe it was...
Now comes the reckoning.
Americans have $1.77 trillion worth of student loans. And it's increasing by about 8% per year.
Mainstream news tells me that of the 44 million student loan borrowers, 20% are 90+ days past due. But according to the Department of Education, it's worse than that:
Only 38 percent of borrowers are in repayment and current on their student loans. Most of the remaining borrowers are either delinquent on their payments, in an interest-free forbearance, or in an interest-free deferment. A small percentage of borrowers are in a 6-month grace period or in-school.
In other words, only 38% of student borrowers are regularly paying their loans. With $1.77 trillion of debt outstanding, this is going to be a major problem.
For the past 5 years, since COVID, student loan borrowers have been given some leeway. They've been able to avoid debt collections.
That ends today, May 5th. Investopedia:
The Department of Education said 5 million borrowers have defaulted on their federal student loans, and expects 4 million more to default in the next few months. Starting May 5, the department plans to resume the collection of defaulted loans, eventually leading to involuntary wage garnishment for some borrowers.
So the wage garnishments start soon. This will accelerate the downfall of U.S. higher education.
I do believe people should be held responsible for loans they took out, but one thing about this situation does bother me.
Currently it is very difficult to discharge student loans, even in bankruptcy.
We need to give student loan borrowers a way to ditch the loan, like any other debt. Bankruptcy should offer a path out of crushing student loan debt, but right now it doesn't.
We shouldn't punish someone forever just because their guidance counselor told them that a student loan would repay itself many times over.
Over the next decade we will see the death and rebirth of education in America.
The future of education will be powered by AI (carefully monitored and controlled by parents). Customized and interactive software will offer a far superior learning experience.
As parents, we will be able to direct our children's learning experience to instill our own values in the process. Yes, there are concerns about AI manipulating users, as we discussed in recent weeks. But there are providers who offer transparency and customization options that allow conservatives and independents to preserve their family's values. Even with mainstream AI models, as long as you direct them correctly, by telling it what your values are, it will comply and represent those values. We just have to be careful about the "default" AI settings, which lean hard-left.
With a trusted AI guiding them, kids will be able to follow their own interests and curiosities. It will be a huge step-up from the current system.
And instead of $60,000 per year, it'll cost $20 a month.
Of course, we will need to figure out a way to work social experiences into this new AI-driven education system. But that part should be easy. Just get together with nearby families and have the kids play together on a daily basis. Form sports leagues and social clubs, and we're set.
In terms of vocational learning, we will need to re-build a strong apprenticeship culture in America.
Kids who wish to pursue a trade should start learning about it early, and begin an apprenticeship in their early teens. This was the gold standard for thousands of years, and it will be so again.
So despite the near-term chaos, the future of education in America is bright. We're about to build an entirely new and better system. That's exciting.
The Daily Reckoning