If US Colleges are Stocks, 'Buy' Science and Engineering

Colleges rise. Colleges fall. Let’s look at France and the US to see how they fare.

In May 1968, student riots broke out in universities across France. What followed was a general strike of 11 million workers. The government of Charles de Gaulle nearly fell, and the French economy slid into recession.

At first, the rioting students en- joyed the support of the French population. More liberty, more equality, more fraternity—who could argue with that? French higher education had always been a bit stuffy, hierarchical and pompous.

Then the facts emerged. The student uprisings had not been, as the French people were led to believe, spontaneous affairs. They had been organised by French communists and student anarchists months before. The student organisers made a huge PR mistake by going on TV. They “behaved liked irresponsible utopianists who wanted to destroy the ‘consumer society’, ” wrote historian Mattei Dogan. The students quickly lost the support of the French people.

A silly spring fling? Kids being kids? French higher education was permanently damaged by the 1968 riots. In the 2013 Academic Ranking of World Universities by the Center for World-Class Universities of Shanghai Jiao Tong University, France had no schools in the top 35 and only 4 in the top 100. Which were the 10 top-ranked universities? In order: Harvard, Stanford, UC Berkeley, MIT, Cambridge, Caltech, Princeton, Columbia, Chicago and Oxford.

In May 2014, several American universities and colleges appeared on the verge of French-like suicide. Student hissy fits at Brandeis, Haverford, Rutgers and Smith caused either an invitation for an honorary-degree candidate to be withdrawn or the invited commencement speaker at those schools to bow out. In the case of Smith the irony was thick. Smith, a women’s college, had invited IMF Chief Christine Lagarde, who ranks fifth on the 2014 Forbes Most Powerful Women list, to speak. The Smith students accused Lagarde of patriarchy. Go figure.

Make no mistake: The expensive liberal arts colleges in America are going down—fast and hard. Schools like Haverford and Smith are extremely vulnerable. The return on a four-year $250,000 investment will be poor. Their brands have become laughing stocks. Harvard, Stanford, Berkeley and Princeton are protected because they are true universities. Their engineering departments and graduate schools for medicine and business are (for the most part) isolated from the ideological nonsense found in liberal arts schools. Caltech and MIT are pure plays in science and engineering and thus are protected.

Three Cheers for State U
If colleges were a stock market, I’d short the heck out of Haverford, Brandeis, Smith and their ilk. I’d want to own those American universities in the Global Top Ten. I’d also buy the great public universities known for their strength in science and engineering: Michigan, Texas, UCLA and the like. And I’d be biased towards universities with a land-grant history. These often have the word “State” before “University”. Most were started in the latter half of the 19th century to provide education in agricultural and other practical sciences. I’d buy Iowa State for agricultural science, Oklahoma State for oil and gas engineering, and Montana State for its tech hub in Bozeman.

I’d also buy community colleges. They’re the great untapped resource in the US today. Lastly, I’d buy some for-profit online universities. The University of Phoenix is reinventing itself as a corporate-employee trainer. Solid idea. Ashford University has a Forbes MBA programme, so I vouch for that! Northcentral University, where I’m giving a commencement speech, is an impressive up-and-comer.

Don’t despair for American higher education: The fools will perish, and the golden age will burn brighter.


Rich Karlgaard is the publisher at Forbes