PayPal Founder Challenges Higher Education Bubble

PayPal founder Peter Thiel discusses the higher education bubble.

San Francisco philanthropist Peter Thiel, photo courtesy of David Orban via Flickr.

PayPal founder and early Facebook investor Peter Thiel challenges the higher education bubble in a recent interview. His 20 Under 20 Fellowship encourages young people to create technology rather than go to college, and is likely to prove that smart young people who work hard become successful regardless of whether they attend college. College expenses have increased much faster than general inflation, and Thiel hopes to offer an alternative to government college subsidies and propaganda that terrifies young people into believing that they’re unfit to thrive in the real world. Many of the largest technology businesses were started by college dropouts, such as Bill Gates of Microsoft, Steve Jobs of Apple, Michael Dell of Dell, Larry Ellison of Oracle, and Mark Zuckerberg of Facebook. There are so many successful dropouts from Harvard alone that CNN wrote a story about 8 of most prominent, including writer Matt Damon:

Damon’s big break was “Good Will Hunting,” the 1997 film he co-wrote and starred in with his friend Ben Affleck. In one scene, Damon’s character tells a Harvard student, “You drop $150,000 on an education that you could have gotten for $1.50 on late charges at the public library.”

When I was in junior high and high school, my parents and the government forced me to learn a foreign language, and as Canada was the nearest foreign country, I learned French. Unfortunately, it’s difficult to predict what skills you’ll need in 20 or 30 years, so I agree with Thiel that learning should be a process that occurs throughout life. My French studies ended up being worthless, and during the last 20 years, I have learned Spanish. Even so, I knew at the time that studying French was a waste, since my highest priority was earning money. When you’re dependent on your parents and the government, breaking free to independence matters most.

College discourages learning by giving graduates a pompous sense of entitlement. You can always tell a college graduate, but you can’t tell him much. As Billy Joel sang:

She can do as she pleases, she’s nobody’s fool;
and she can’t be convicted, she’s earned her degree.

Photo courtesy of Rob Boudon via Flickr.

Colleges destroy the desire of many students to read, as documented by the National Endowment for the Arts in their study, Reading at Risk. The government found that 43% of college graduates will never read a book for pleasure for the remainder of their lives, while only 34% of non-graduates suffer the same fate. The study does not discuss the 9 point gap or the education bubble. Apparently, colleges fail to convince all students that learning is beneficial. It appears that some graduates believe that they have already paid their dues as a member of an elite club, and don’t need to pay a second time. Many of these graduates who don’t enjoy reading are among the 45% who don’t learn much in college.

Screenshot of a phone using the Android operating system, courtesy of Wikipedia.

Thiel’s initiative has emboldened many young people to consider dropping out of college, and they understand the inefficiencies better than the hoping and dreaming of their parents looking on from a distance. I hope that more aspiring software engineers learn that it is more important to invest time learning open source software such as the Android operating system for mobile phones and tablet computers, which is displacing the Apple iPod and iPad similarly to the way the IBM PC architecture replaced the Apple II and Macintosh 20 years ago. Many other occupations can benefit from open source software; everyone can benefit from learning WordPress, which powers this blog and has exploded in popularity in the last year.

I hope that the 20 Under 20 Fellowship is a pilot program that expands to hundreds of entrepreneurs, and that more philanthropists refine Thiel’s model and produce thousands more. The higher education bubble cannot pop soon enough, and Thiel should be applauded for accelerating the process.

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