There’s a lot to unpack in this interview with Scott Galloway but when he says that top tier universities in the USA have become ‘luxury brands’ and that we have created a caste system through education, he is really stating the obvious although it has been obscured by other narratives of fairness, equality and meritocracy that aren’t truly warranted.
This interview was held in May 2020 right in the beginning of America’s disastrous Covid experience but that doesn’t make it any less relevant to other periods in time.
Here are some of the top-line takeaways from the interview…
- Foreign students are a cash cow. If they don’t show up, we’re in trouble
- Zoom has uncovered how disappointing many college experiences are; why am I paying for this?
- it’s a great time to take a gap year if you got accepted to a top tier and a great time to be on the waiting list, if not; there’s going to be a waterfall and demand destruction will go down the line of prestige
- a tier-two brand with high costs of education (4,500) are like what department stores are to retail and half of the could go out of business
- wealthy people are living their best lives through this pandemic and the luxury brands that service them are doing great; higher education is like luxury but better because it gets 90 plus points of margin and taps into the global wealthy; Harvard will probably expand their enrolments but going down the line there’s going to be a culling of the herd; there is no higher margin product than high-level education;
- we have raised prices faster in education than in health care
- we have created a caste system and the primary arbiter is not your family name (like in Europe) but where you got your educational degree
- universities should cut costs and yet this is the last thing they talk about (or, not talk about as the case may be)
- tenure is nothing but a debt on young people; the initial notion of tenure to protect voices from persecution still makes sense in a few occasions but in most (like in business schools) it is not protecting controversial speech but it is giving job security to educators who are about to enter their least productive years, putting a drain on innovation and hurting the economy, while increasing student debt
- unless you are growing your freshman seats faster than the population you are not doing a public service, you are a luxury brand
- we need to dramatically increase enrolment size and dramatically decrease costs
- the children of rich people are 77x more likely to get into elite college but the rest have to split all the spoils in society; this is a caste system and educators are the arbiters of it;
- we’ve become drunk on exclusivity; deans brag about the high percentage of applicants they turned away; people are proud of this but it means that your children are not getting into the college you went to; why is this a good thing?
- we have priced ourselves out of the affordability of middle class homes and the Covid storm is coming to bring a reckoning; we probably deserve it;
- The government stimulus should be called, “The Amazon, Apple, Google and Facebook Shareholder Act”; 98% of corporate world is playing defence while Big Tech is becoming ever more powerful yet they stifle innovation by preventing competition, not held accountable if their platforms are weaponised, bad for citizens and the economy in the long run as they become the biggest monopolies