College Costs Are Dollars Well Spent

Would Ronald Daniels please answer the following questions:

1) In our hypothetical $50K/year sticker price scenario, are you talking cost (what it actually costs to deliver the education) or Price (what the student pays)?

For example, imagine it actually costs $40K, and students pay that on average, then those who pay full sticker price are underwriting the others, and those being underwritten still cost $40K even if they don't pay a cent. The money could have been spent by others elsewhere. Imagine every student paid zero because some wealthy individual underwrote every student to the tune of $100,000 at a university where the faculty was getting rich because cost was no object and students slacked off because it wasn't their money. The costs could be astronomical but the price could be zero, and you could make the case the guy underwriting the whole thing is a victim of fraud.

So what are we talking about? And do you admit that in my hypothetical, fraud is being committed?

2) Is value relative or absolute? I have an employee who has >$100K in debt to a grad school for an Masters in Journalism where courses cost $5,000 a pop. I've sent her to Gotham Writer's Workshop courses that are as long, as rigorous, more effective, and better taught by professionals (not academics) and they cost $395. She still has a problem saying her degree is not worth it and that the debt is ruining her life despite the fact that she left it off her resume when she applied, and she breaks into tears when we discuss it. I can tell you that no matter what anyone says, paying $5,000 for something that might even be worth $10,000 is foolish when the same thing can be had for $395. That's $4,605 in subsidy to something that isn't delivering value, only cost. (PS. Gotham runs at a profit, and the teachers report they are better treated by them than at the grad schools where they also teach as adjuncts).

Ronald, Your response, please.

3) How does one get at the truth at John's Hopkins? Are sample sizes of one big enough. Why not ask EVERY one of your grads. What if only 10% say it wasn't worth it, and only 1% say their lives were ruined, that may well be good enough to win a bet, but is it good enough for you? Do you adjust for psychological factors? Many victims of con artists don't admit their mistakes; indeed con artists rely on this.

I bought a Prius for $21,000. Had I paid $50,000 and thought it was worth every penny, then discovered I could have it for $21K, is my dealer being ethical? If a defect in the Prius only hurts 1% of the customers, is that OK?

Since I hold our institutions of higher education to higher standards than our manufacturing firms given their commitment to the truth, please give me answers to these questions.

Regards,

Brooke Allen

Brooke Allen of NJ 9:43AM March 27, 2011