This has been discussed before in many other sources. The cause of the bubble is probably the way tuition and financial aid are used by many colleges. Perhaps the most in-depth analysis was by The Atlantic.<p><a href="http://www.theatlantic.com/doc/200511/financial-aid-leveraging" rel="nofollow">http://www.theatlantic.com/doc/200511/financial-aid-leveragi...</a><p>If this hypothesis is correct, then it has interesting implications for how a pop in the education bubble might play out. Since a fair portion of college budgets are propped up by moms and pops taking Mortgage Equity Withdrawals to finance their kid's education (who may or may not actually be deserving to go the college of their choice, but probably not) then we can expect (1) the tuition portion of institutions' income to drop precipitously and (2) that there will be fewer sort-of-rich-kids going to elite schools.<p>This doesn't seem all bad in my opinion. Maybe academia should return to humbler roots. Do the top schools really need Olympic sized swimming pools, or gyms that would require a $100 a month membership in any big city?
I'm always surprised when people suggest "community college", as opposed to an elite university, for the masses to flock to. I don't mind if people take on vocational tasks like welding, and as Mike Rowe of dirty jobs explained at his TED talk society definitely has a problem with imbuing meaning towards regular tasks. But all too often I hear that snide remark, which translates to: "Not everyone can excel towards, or afford, an elite education with all the debt and opportunity it offers. But get yourself to a community college and do something basic, to get your portion of the pie. Otherwise you are nothing."
The cost for higher education that steadily climbs faster than the inflation rate will need to stop when it equals to its time-discounted marginal benefits. (Given its many alternatives--both for learning and socializing--the marginal benefits of higher education do not seem to increase nearly as fast.)<p>If the cost goes higher than that, the bubble will indeed burst--sooner or later.
In order to keep "the education bubble" growing, the article speaks highly of reducing teaching costs by 40% (by relying less on actual PhD professors who know what they are talking about) and instead giving "students ... a choice of learning styles and ways to get help online from ... fellow students". Oh, and paying university presidents huge incentives for using such "cost cutting" measures.<p>Yeah, right. Take their $50K+ in annual tuition, then plug students into an e-learning social network where they "TEACH THEMSELVES" through "INNOVATIVE LEARNING STYLES".<p>If these moves are genuinely embraced, it will indeed create a bubble that will grow until these poor disillusioned students realize they are just sheep following other sheep wandering around, going nowhere, ... when they should instead have been following a shepherd who knew where he/she was going.<p>Why would we want to create a bubble anyway? By definition, it is only a bubble if it will eventually burst.
I can't help but think the real bubble is in our own inflated sense of ourselves. Everyone thinks their child is capable of becoming the next great whatever, but the reality is that there are only so many people with original and useful ideas out there.<p>Higher education is dangled as the carrot that is the means to achieving greatness. Everyone speculates that the future will yield awesomeness, but when it takes too long to reach our unrealistic expectations we overreact in the opposite fashion. We have this never-ending cycle of overinflated possibility followed by reality and an overreaction of conservation.<p>Is it perhaps a flaw in our culture? Selling an idea is more important than the idea itself. Getting "traction" or "backing" is more important than delivering something real and of actual value.