Education versus the Economy Debate: A Third Party Analysis

Written By Emmanuel Yaafi

The Obama administration commitment to see a USA with more college graduates than any other country in world caused uproar in some quarters. In fact, from President Obama’s point of view, by the year 2020, America should have more college graduates than any known country on the surface of the earth. As indicated the uproar caused as a result of producing more graduates prompted Miller Center of Public Affairs to organise a debate on the subject: Education and the Economy.  The analysis made here is about the supply and demand relationship and its implications in the expansion of graduate production. The analysis is the perspective of a viewer of the debate. An attempt will be made to re –examine some of the concerns raised in ‘The Supply-Demand Bargain of Graduates’.

Let me throw more light on the subject and probably reduce the broadness of the subject as well. The core of the subject debated was that, to produce more graduated means more public (state) spending. Those argued practically from economics perspective thought that such a venture is a waste of time and resources of the public (state). In the capitalist economy like the US, job creation, to greater extent, is the business of the private sector. Listen to the debate about whether to tax the rich or not and you will fairly get more information about whose duty it is to create jobs. George Leef who argued against the idea of producing more graduates and does so from economic point of view said employers will not create jobs because there are more graduates. Stressing on this point, he said “supply does not create its own demand’. That is producing more graduates is not a guarantee that the graduates will be demanded.  He further argued that more graduates will lead to “rigid credential inflation”. He pointed out that getting degrees will no longer be ones ability to learn since expansion of education to produce more graduates will also extend to more ‘unprepared, students. The result of all these in Leef’s own words is to ‘trash’ the qualification.

Let us look at some of the concerns raised by George Leef. Some of the concerns raised appear to fit well into the concerns raised in ‘The Supply-Demand Bargain of Graduates’ but from different angle. The issue of ‘supply does not create its own demand’ in education is very important to warrant further discussions. Let us look at the entry and exit points of university education. There is an apparent insatiability in the demand for higher education at the entry point. All sort of university education are being provided to meet the growing demands. Unfortunately, the same cannot be said at the exit point. At the exit point, once a student does not drop out from university he is bound to be supplied into the system whether there is demand or not. It appears that at the exit point, supply far exceeds demand and it is not about to be ceased or changed anytime soon. Therefore we have more graduates in the system than they are demanded. The result of this is the credentialisation. What it means is that increasingly, jobs which do not need graduates to do are increasingly being done by graduates. In the process, the graduates scare the non graduates who are ‘better equipped’ with necessary competences to do ‘some menial’ jobs. Again it calls into question the competencies or the quality of the graduates produced. The resultant effect is that degrees become worthless. A typical example is theSouth Korea case. Dr Terri Kim, a specialist in Comparative Higher Education at Brunel University, in the last quarter of 2011 presented a paper at Danish School of Education, Denmark. She elaborated on the credentialisation of the South Korean society – degree, everybody has one.

The continuous process of credentialisation and the resultant worthless degrees creates a new a function of supply and demand in the system. That is, the graduates become part of the system so new supply and demand relationships are formed. The numerous graduates, now the labour (to be employees) far exceed the number of jobs and the creators (employers) so the normative narrative changes. Instead of employers demanding the labour, the opposite happens. The labour is over supplied and therefore in abundance, seeking fewer jobs and making the jobs scare. Hence, labour becomes cheap and easily to be replaced or discarded. From, Professor Richard Vedder point of view and equally speaking against the expansion of graduate production, the public spending that will be made in the process of graduate production expansion will be a waste. This is because in the face of huge social security and health care problems, the public resources should not be used to produce graduates who will end up cutting trees.

The complexion of the argument from here changes because there is an introduction of efficiency. Klees (2008) defines efficiency as the application resources in the area that will yield better returns. The prudence of the state spending in the production of the graduates with next to nothing degrees is indicted. To be succinct, it is a colossal blunder to spend public resources to produces useless graduates. This line of argument moves from ridiculous to unacceptable if an individual obtains a loan to obtain a worthless degree since loans are to be repaid. So a worthless degree means the investment made as a result of the loan obtained to pay for the degree becomes a bad investment. But one may argue that to obtain a loan to get a worthless degree is entirely an individual decision and therefore responsible for it. It appears to be easy to blame the individual who made a decision to take a loan to obtain a worthless degree. But let us extend the blame a bit further to the managers of the economy which are the governments whose duty in this sense is to create conducive economic environment for graduates to flourish. The economic quagmire we have since 2008 can inhibit the likes of Albert Einstein. But the economic quagmire is as a result of the actions and inactions of the same institution Professor Vedder wants it to spend its resources to fix social security liabilities.

So far, the others who spoke in favour of the expansion have not been discussed. Mr Lomas speaking in favour of the expansion raised some important issues. Among them are two issues which are deemed appropriate to be discussed. The first issue was about ambition. He argued that not everybody who starts a university education will complete it and therefore most of the challenges discussed and raised by his opposite side are almost right. But he queried that because of these challenges, we should not be ambitious as people?  He is of the view that mediocrity should be discarded and we as people should continue to push the limits. Dr Patrick Awuah said the goal should be perfection. So in the process of pursuing perfection we can at least achieve excellence. Lomas again said that setting the goal so low is what we do for others other than our own children. He said we tell our children the sky is the beginning while we tell others that they should aim just below the ceiling of their rooms. Again, he queried that because of social security liabilities should we ration education like the slave trade era when educating a particular race was a crime. He is of the view that funding is been used as tool to ration education. In reference to ambition, Margaret Spellings said that this was what President Bush meant when he said “the soft bigotry of lower expectation” when he was signing No Child Left Behind (NCLB) bill.  But this bill is indeed a different game changer from its name which space and time will not permit us to examine. But to be brief here, NCLB by any stretch of imagination do not mitigate the problems. I think Miss Spelling reference to NCLB was merely in reference to the fact that, we should not allow financial constraints to limit our ambition as people. In conclusion what we want as individuals, as people, as a country will hugely decide what we want to do with our resources. A country that has prioritized education will find the resources to fund it. A country that has not prioritized education will find an excuse.

The Supply-Demand Bargain Of Graduates

Written by Anonymous 

When the supply is higher than the demand, the price of the goods or services get lowered.

If human beings are considered resources, such as natural resources, we would know that those human beings who have skills and knowledge which are more scarce in the world would be more valuable (financially), whereas those whose knowledge and skills that are very easy to find in large quantities, their economic value will be less. At the moment – with the massification of university degrees, the supply of university graduates is much higher than the demand for them. Graduates are an overly supplied resources today. Our value fluctuates according to the market and to the country. Given the emerging educationalization at the global scale, our value is doomed to decrease with the increase of university graduates. Because of this oversupply, the price (economic) of human resources gets lower, and this resource may even be wasted (thrown away after use), since it can be found in such abundance.

A metaphor might help picture better what will happen with all these graduates. What happens with the oversupply of food? In the markets, in order to keep cheap prices, there is overproduction of food. The supply of food is higher than the demand for it (at least in the developed world). The result is that half of the food in the supermarkets gets thrown away. The big multinational corporations do not care about it, because they have calculated their profit even including such big waste. The supermarkets have no choice because they keep on ordering new stuff every day and they have to remove the old one (even if it is good). So half of the good perfectly eatable vegetables, bread, and other goods get trashed every day. Imagine: you dear graduate student one day may be like one of those good vegetables in the rubbish bin that is being thrown away as a waste or surplus. Unemployed because nobody bought you…there were cheaper and better quality graduates on the market.  Trashing graduates is byproduct of the capitalist system.

The problem is that, human beings are not objects, natural resources or products. And the inflation of their value, leads to inflation of their salary, and the waste of their resource, means the dismissal from employment at any time…from their salary their existence and that of their families is dependent.

The underpayment, exploitation and redundancy of the oversupply of graduates make their lives extremely unstable, and at risk of severe poverty or death. This is not exactly what graduates are promised when they enroll in university. It has been shown that a considerable percentage of graduates have been disappointed and disillusioned by discovering that their degree is actually worth a little more than nothing. Many students according to EU Strategy 2020 are disgruntled, disenchanted and disengaged due to problems which include the worth of their degree after graduation.

Further, the fuel of this illusion that having a degree would open access to high paying jobs is like believing in Santa Claus. A lie that society keeps on repeating to young adults before and during their college years. Which then disappears as soon as they have accumulated the debt for paying tuition fees. University education is a business and a big one off course. Students are the customers and eventually the victims.

We will are exploited. For an agenda that is not ours, with no or little chance to change it. We will see global injustices without seeing any global impact of our attempts to reduce them. We will give up our social relationships, families, for surviving. The system is organize to maximise profit, at the expense of every thing else. Including our lives.

The war we fight against each other to get jobs, internship or to enter university cannot but benefit the system. We have to realize that the system is consuming us, and say NO. This is not progress. So many people toiling for the enjoyment of few. Collective struggle is necessary to change this.