The Dorm Key Ritual

by Gary North, March 7, 2003

Over a decade ago, I gave a presentation to a conference of conservative college students. I told them this:

“When the person at the front desk of a college dormitory building hands an incoming freshman the dorm room key, the parents’ authority over the student symbolically and operationally ends.”

There are three important symbolic events in this life: birth, marriage, and death. There are three rituals that match these events in Christianity: baptism, wedding, and funeral. In some Christian traditions, confirmation is a fourth. Jews have circumcision, bar mitzvah, wedding, and funeral.

All groups today face a new ritual: the ritual of the dorm key.

The Ritual of the dorm key

For a majority of educated American Christians, the ritual of the dorm key has replaced confirmation as the more significant rite of passage. It takes place definitively only once, and every parent of a college freshman senses the finality of this rite when it takes place, or soon after. With the steady increase in the divorce rate, the ritual of the dorm key, which happens as a rite of passage only once, has replaced the ritual of the wedding, which may happen more than once.

A parent may go through a few additional motions, such as helping the student with luggage, a computer, and the stereo, but then the final moment of passage takes place. The student, key in hand or pocket, says goodbye, and the parent walks down the hall toward the parking lot.

The parent may briefly notice that the person in the room right across the hall is not of the same sex as the child who has just been left behind. But he shrugs, swallows hard, and keeps moving, eyes straight ahead.

Mixed dorm halls had not appeared in my antediluvian era. But in the college days of today’s parents, this arrangement had begun. What goes around comes around. The ritual that not so long ago provided a sense of liberation in the departing parent now provides a sense of foreboding.

From this event on, a parent has virtually nothing to say about the student’s collegiate experience, other than writing the checks.

There will be many, many checks to write, all large. If you are like the vast majority of American parents of college-eligible children, you’re going to write them.

We hear about peer pressure on teenagers. Kids’ stuff! Such pressure doesn’t rival the pressure of this comment:

“I hear that your kid got accepted at [XYZ] University. That’s great.”

How many parents reply along these lines?

“I’m not going to contribute one dime to send my child into that moral cesspool. That place is a recruiting ground for atheists, feminists, Marxists, and envy-driven anti-capitalists. I refuse to put child under their authority. That place is a meat-grinder.”

The number of these parents is not legion. They constitute a remnant.

If you, as a parent, do not see this coming at least a decade before the day of reckoning arrives, then you have been living in fantasyland. You may be suffering from SAD: “Selective Alzheimer’s Disease.”

If you know this day will come sometime in the next two years, you had better develop a plan of action to delay it or even avoid it altogether.

There are a lot of things you can do. The problem is, most parents don’t perceive the existence of these highly practical options, and among the few parents who do, most do not have the strength to persuade their college-bound children to implement any of them. The peer pressure is just too great. I don’t mean peer pressure on the students. I mean the peer pressure on the parents.

[If you’re a grandparent, your have watched your children go through this rite of passage. Your children haven’t overseen it. They deserve to be reminded. Remind them. Forward this report.]

A $140,000 crap-shoot

Let’s talk about the risk-reward ratio of an investment in your child’s college education. The risk is high. You have no assurance that your child will graduate. Half of those who begin college don’t finish.

Not-quite-a-bachelor’s degree is worth approximately zero. A student’s time would far better have been spent as an apprentice to a plumber, or as a heating-cooling system technician. Failing to finish college is an economic risk.

Let’s go through the numbers. Here is the worst-case scenario from a parent’s point of view. You probably won’t have to go through these particular numbers. Let’s call these numbers “Ivy League numbers.” Tuition: $25,000 this year, which will probably rise 5% to 7% per year. Room and board: another $8,000 a year and rising. Books: $1,500 a year. Transportation? Your guess. New clothes for your daughter: your guess. You will be on the hook for at least $35,000 a year, except that costs will rise at least 5% every year. Count on it.

“Maybe there will be a scholarship.” No, there won’t be. There are no scholarships, except for super-brilliant students and gifted athletes. The collegiate marketing tools that are called “scholarships” are in fact a legal form of what economists call price discrimination. The “scholarship” committee estimates how much money the school can probably get you to fork over, given your level of income, and then it lowers the fee schedule to whatever level that the committee thinks you will be willing to pay. If you’re rich, you will pay 100%. Sucker!

This form of discriminatory pricing is a highly sophisticated competition among Ivy League schools to recruit very bright students who will become either famous (the production of prestigious alumni, which is a marketing strategy) or rich (the market for future donations). It’s an investment in the future: the college’s future, not yours.

You can easily spend $140,000 after taxes in tuition, room, board, and books (TRBB). Your child can give up four years of his life to earn a degree at an Ivy League university, assuming that his college board scores are high enough and his high school grades were all A’s, and he speaks Mandarin Chinese. You may think I’m joking. I’m not. Straight A’s and a 1600 score on the SAT’s won’t necessarily get a student into Harvard. He or she also needs extracurricular activities or the correct genetic background (which includes being the white son of a Harvard multimillionaire alumnus).

Let’s say that the total bill is $140,000. I come along and say, “I can get you almost the same product for about $7,000, but not from an Ivy League school.” You turn me down. Your Jenny Sue has just been accepted at Princeton, and you’re going to pay the tab. I ask, “Will Jenny Sue earn 20 times more money just because she is a Princeton graduate?” “This isn’t about money!” you insist.

The day a parent says, “This isn’t about money,” the family’s net worth is about to suffer a substantial decline.

This leads me to North’s law of collegiate financing: “A proud parent and his money are soon parted.”

That’s why, when I speak of “your child,” this applies equally well to your grandchild. Every dime that your children spend on their children’s college educations is a drain on your family’s inter-generational capital.

Market Strategy #2

An acquaintance of mine is a direct-mail marketing genius. I know maybe six people who may be as good as he is in selling things through direct mail. One of them is his wife.

I was at a Jay Abraham conference a few years ago. I was sitting alone with Mr. X, and off the top of his head, he gave me one of the most profound insights into marketing strategies that I have ever heard. I’ll share it with you.

There are two ways to sell things. The first is well known. “At this rock-bottom price, supplies are running low! Act now!” But there is a less well-known approach. It’s the Ivy League’s strategy. “We really don’t want you. We really don’t need you. But, under certain limited circumstances, we might just let your child attend here. But don’t count on it.” Parents can’t get their checkbooks out fast enough. They beg to have the opportunity to write large checks.

The Ivy League universities’ approach rests on the public’s perception of high walls to match their ivy- covered halls. They are selling exclusivity. Their marketing strategy has been perfected ever since Harvard opened in 1636. They have fine-tuned it. Their freshman classes are oversubscribed by ten to one, yet most high school seniors don’t even bother to apply. They know they can’t get in.

Most colleges cannot pull off marketing strategy #2. They don’t have the aura of exclusivity. They will enroll any student with a warm body and a blank check. But they also can’t use the “Act now!” strategy. This is because of the oligopolistic system known as academic accreditation. Later in this report, I will be more specific about how this system works, but trust me: accreditation is the key to high costs, the restricted entry of new competitors, and low value for parents’ money.

If you play the collegiate game by the official rules, you and your money will soon be parted.

The good news is this: there are unofficial rules. If you know what they are, and if you can persuade your child to follow them, your child’s college education won’t cost you an arm and a leg. It will cost you only a rib or two.

A Sucker’s Game

Here is the dirty little secret of the academic degree-awarding industry known as higher education:

A college degree is way overpriced. Students (parents) pay way too much money. Students spend way too much time in class — time that is far better spent in reading and writing. Then they pay room and board on top of it.

Paying for a child’s college education is the largest single expense that parents face, other than buying a house. But buying a house is done over decades. A college education must be paid for in four or five years. Loans are available, but they must be paid off even if the student quits or flunks out, unlike buying a house. Also, a house may appreciate in value. It rarely falls in value. In contrast, there is no re-sale market for receipts for college expenses.

What I’m going to discuss here, very few people know about. If I had not spent so much time inside academia, I probably would not have found out, either.

I know how the American academic system works. I was trained as a scholar. In 1972, I was awarded a doctoral degree by one of America’s better universities. I have written 43 books. I have taught at the college level.

I’m outside the academic system, and I have been for most of my post-doctoral career. I know enough about how the system works not to be overly impressed with it. I also know how to beat the system. The system is rigged against upper-middle-class parents.

Rolling the Dice for $11,000 a Year

The average college bill per year at a tax-funded university is about $11,000 a year. This is where most students attend.

About 15 million Americans are attending college today. About half pay their own way. The other half are supported by their parents. Fewer than half of all students who enroll in college graduate with a bachelor’s degree.

So, it’s a very big gamble to invest time and money in trying to earn a degree. The odds are against you. Your goal ought to be to reduce these odds. You can do this by taking advantage of loopholes.

Every system has loopholes. Loopholes are official exceptions that are mandatory for any system to be consistent with its official standards, but which would threaten its economic survival if more than a small minority of users took advantage of these loopholes. Higher education is no exception.

Here is my view: there is no good reason for people not to use them when they’re available. They are made to be used. You might as well be the person who uses them.

Paying retail is not necessary. If a person knows where to look, he can earn a fully accredited bachelor’s degree that is not overpriced: not in money charged, not in time invested (if he can meet certain life-experience requirements), and not in distance travelled. He can earn it at his desk for under $7,000. In under three years.

Because of the World Wide Web, a student never has to leave his desk to earn a B.A., except to take monitored exams at the local library.

The Web has changed just about everything. But it’s only one option. There are others. There are many ways to skin the academic cat.

Beating the System

You can send a child to a distant campus, either tax- funded ($44,000 TRBB) or private ($80,000 TRBB). Or you can let him live at home, work part-time to fund his own education, and spend as little as $7,000 over 2.7 years.

I know of a case of a home-schooled student who earned a college degree in six months for $5,000. This was not some phony diploma issued by an unaccredited diploma mill. It was a degree from a state university. He never left home to attend. He did not even live in the same state.

How was this possible? Because there are a few accredited colleges that grant people academic credit for their education-related work experience, and even life experience, meaning unsalaried work. I call these “merit badge courses.” If a student can show that he has the knowledge equivalent to a college class, he doesn’t have to take the class. He just has to pay for it — sometimes at a big discount. Some students can knock a full year off of their course requirements this way.

This option makes sense educationally. What we learn on the job sticks with us. Our work teaches us in the broadest sense. Why shouldn’t adults receive formal educational credit for knowledge they have mastered — not just learned in a classroom, but truly mastered — on the job?

Only a few accredited colleges grant academic credit for work experience and life experience. Some that offer this don’t publicize it. They can’t afford to. Advertising is expensive. So, the story doesn’t get out. That’s why so few Americans know of this opportunity.

A degree from Harvard, Yale, or Princeton will have a lot more prestige than one from any of these colleges. But will that Ivy League degree get its holder a job that pays 20 times more (after taxes) than a degree from a college that costs 20 times less? Not likely.

College expenses for most students are high because colleges are inherently inefficient. That’s because the original model was invented eight centuries ago, when there were only six or seven colleges in Europe, and the printing press had not been invented. A library of a thousand hand- copied manuscripts was worth a fortune. Young men had to journey long distances to earn a college degree, back when travel was expensive. Not many people could afford to do this.

Colleges adopted the lecture method because students back then could not afford to buy books. Lectures are highly inefficient ways to teach. Consider how you learn anything that’s important. You don’t do it sitting in a lecture hall, except maybe for a brief introduction, and even that could be put on videotape. You probably don’t read a textbook. You learn from a manual. Then you learn on the job, preferably under the immediate guidance of someone who does the job already.

Why would anyone choose to sit in a classroom for 50 minutes, three times a week per course, five courses per semester, for 16 weeks per semester? No business teaches its employees this way. Yet colleges teach mainly this way. It doesn’t make sense . . . from the student’s point of view. It makes a lot of sense from the teachers’ point of view — teachers who may lecture only 6 times a week, and rarely more than 12.

Today, there are local public libraries (which became widespread less than a century ago), academic paperback books (introduced about 50 years ago), videotapes (introduced widely only in 1978), CD-ROM’s (1991), and the Internet (which really got rolling in 1995). But, despite all this technology, traditions die hard in academia. It costs college students (or their parents) a lot of money to keep these traditions alive.

A student can read a book at home or at a local city library. He can write a term paper at home or in the library. He can take an exam at the city library, with a librarian as a proctor to make sure he doesn’t cheat. He doesn’t need to attend college. But most colleges require students to attend classes on campus. Why? Not for the students’ sake.

Paying for what you don’t need

The vast majority of colleges require students to attend classes on campus. This requirement has nothing to do with the way that most students learn new academic material. It has everything to do with paying off mortgages on the college’s expensive buildings. It has everything to do with shelving $100 million worth of books in a $50 million library building, with a full-time staff, so that faculty members can write term papers for each other that almost nobody will ever actually read. This is called “publish or perish.”

Unless a student wants to major in physics, chemistry, or engineering, any college should be able to teach him whatever he needs to know through the Internet. This education should not cost more than $2,000 per year for four years. And that is with no government subsidy.

Even today, with very little competition among the colleges, it need not cost more than $1,750 a year if you know where to look. But you have to look very carefully.

So, why does it usually cost so much more? Because the colleges want it this way.

Only a handful of colleges have adopted 100% Internet- based B.A. degree programs. The instructors employed by a 100% Internet-based college would have to work a lot harder than they do now. They would have to grade a lot more papers for a lot more students. They would not be paid $50,000 a year mainly to deliver nine hours of lectures a week, 32 weeks a year — lectures that they wrote 20 years ago.

The only thing that keeps Internet-based education from replacing 90% of the colleges in America is this: the people who run the colleges have got themselves what economists call a cartel. They don’t want to lose it.

The Academic Cartel

What is a cartel? You have heard of OPEC, the cartel that controls the supply of oil. Its full name is the Organization of Petroleum Exporting Countries. OPEC representatives get together and agree to reduce their production of oil. This keeps oil prices high: high demand, low supply.

That’s exactly what colleges do. They have set up an academic cartel. They keep out new colleges — colleges that are willing to meet consumer demand by selling educational services at a lower price. The higher education system doesn’t allow them to do this. There is a legal barrier to entry for new colleges. It’s called “accreditation.”

Existing colleges have joined regional accrediting associations that Ph.D.-holding bureaucrats operate. The representatives of these colleges set the standards for accreditation. It’s kind of like a club. I mean the kind of club that you hit people over the head with.

Accrediting organizations are not run by the government, but they depend on state governments to make non-accredited colleges illegal. The legal use of the words “college” and “university” is controlled by the states.

State governments define what constitutes a college or university inside their own borders. Most states define a college in terms of one criterion: it is accredited by one of the regional accrediting associations. This pretty much freezes the number of colleges that are legally allowed to issue accredited degrees.

Accreditation reduces the supply of degrees actually awarded. This reduced supply of education is not based on a lack of supply of students who are smart enough and who are willing to work hard enough to qualify for a college degree. It’s a question of an artificially limited supply of degree-granting institutions.

The colleges have those huge buildings, lawns to mow, employees to pay, and all of those professors, assistant professors, and teaching assistants with no Ph.D.’s (who do most of the work grading papers and leading discussion sections for freshmen and sophomore classes). This is a huge investment. If there were true competition, 100% Internet-based colleges would bankrupt hundreds of these schools. Most of the others would have to learn how to compete.

As a general rule, accrediting associations only accredit schools that invest millions of dollars in buildings. But in today’s digital world, liberal arts instruction doesn’t require real estate. It only requires dedicated teachers and dedicated students who are self- motivated.

If the degree-granting system were really honest — if it were not run by a cartel — then accredited college degrees would be offered to any person who could pass the same exams that the tuition-paying students also have to pass. If the student could learn the material on his own, but pass the standardized exams, then he would get the degree.

Accrediting associations don’t allow this. Why not? Because it would bankrupt hundreds of colleges that are protected from true competition by the accrediting associations. It would wipe out the colleges’ tuition system, real estate system, and low teaching load system.

In every system, there are loopholes. Accreditation has left intact at least seven of them. Hardly anyone knows about all seven. One of them is off-campus learning.

Off-Campus Learning

Off-campus learning is a huge threat to the economics of today’s campus-based system of higher education. But a few colleges do offer it in the name of democracy. The accreditors dare not ban these programs altogether, for that would be undemocratic, but they monitor them carefully to make sure that the programs don’t get too price- competitive.

Only about 10% of 4-year colleges and universities offer their students as many as half a dozen degree programs by distance learning, even if they offer a hundred majors to on-campus students. Most of these schools charge the same tuition to distance-learning students that they charge to on-campus students, even though off-campus students don’t use the colleges’ real estate. Nevertheless, some real bargains have slipped through the cracks. But you have to know about their existence and then go looking for them. Here is a good introductory list.

Colleges like to pretend that off-campus learning is substandard, second-best education. But is off-campus learning really substandard? The evidence says otherwise. The most recent evidence suggests that off-campus learning is superior to traditional classroom education, from high school through college.

Maybe you think I’m exaggerating. Maybe you think there is some tremendous educational benefit that students receive by attending classes on a college campus, compared to the education gained by students who learn at home. Let me prove to you that you’re wrong.

Well, actually, I won’t prove this to you. Thomas L. Russell will. He has been studying this question for a long time. He has gone back and looked at the published evidence of the comparative performance of students who have taken their courses on-campus vs. those who have taken their courses off-campus. These academic studies go back to 1928.

Russell’s amazing discovery is this: there is no significant difference in student performance. This is what study after study has shown, decade after decade.

To read the findings of educational professionals, click here.

Click on any year to see a summary of that year’s report. The years are on the left-hand side of the screen.

Here are just a few samples from the era before TV was widely used as an alternative to actual attendance in a classroom:

1928: ”...no differences in test scores of college classroom and correspondence study students enrolled in the same subjects. “

1936: ””[Results of this study were very similar to Crump 1928 and showed]...no differences in test scores of college classroom and correspondence study students enrolled in the same subjects...”“

1940: “In all but two comparisons, correspondence study students performed as well as or better than their classroom counterparts and in the two cases which were the exception the differences were not significant.”

1943: ”... showed no significant differences between the groups in terms of motivation to use supplementary reading material.”

1949: “[Results of this study were very similar to Hanna 1940 and Meierhenry 1946 and showed...] in all but two comparisons, correspondence study students performed as well as or better than their classroom counterparts and in the two cases which were the exception the differences were not significant.”

It gets even more amazing. Recent studies have revealed that students who have been educated in a off- campus learning setting produce higher performance rates than conventional classroom-based education does.

I ask you: Why are you determined to have your child at age 17 or 18 go through the ritual of the dorm key? Why not keep the child closer to home for an extra two years, and then send the child off to college?

Even better, why not let the child stay at home for all four years, work part-time, earn enough to make a down payment on a home, and get the B.A. by mail?

Best of all (this is not hypothetical), why not pay $5,000 and have the child get an accredited degree in less than one year? Even I, as a man from inside academia, didn’t know that this is possible. I found out less than a year ago.

## Why Pay Retail?

No college can afford to give information away. Yet there is almost nothing that is taught in a college that a student could not get in a local public library or on the Web.

If you have ever seen the movie, “Good Will Hunting,” you probably remember the scene in the Cambridge, Massachusetts restaurant where Will, a high school graduate who is a genius, blows away a hot-shot Harvard student. Will knows far more than he does. That’s because Will has spent time in the public library, and he remembers everything he has read. He tells the Harvard student that he is spending a fortune to learn what Will has learned at the public library.

There is a mid-way position between the Harvard student’s parents’ enormous expenses and Will Hunting’s lack of formal education. You child or grandchild can earn an accredited degree at a fraction of the cost. I hope I have motivated you to pursue other paths to this needlessly expensive, high-risk, government-regulated crap-shoot.

Conclusion

Not all of you will want to pursue this topic any further. Maybe you discovered this information too late. So, I don’t think I should devote any more space to the topic here. This article is probably too long already.

But for those of you who are in the market for an accredited college degree at a wholesale price, but who just aren’t sure if I’m blowing academic smoke (or maybe even inhaling), I’ve written a follow-up report. It’s called, Thirteen Myths of American Higher Education, and Why You Shouldn’t Pay for Them

[I even offer a special bonus for all you hard- core types who have made it to the end of this issue. I refute the myth that non-students are not allowed into the research libraries of America’s most prestigious universities. There are two words that do the trick: the “open sesame” of research libraries. If you know these two words, you don’t have to be enrolled as a student or be an alumnus to get in. In every case where a gatekeeper has ever told me that I was not allowed in, I have said these two words. The person then unlocks the turnstile. Yet I pay nothing to enter. This is a very useful piece of information, especially at a research university a long way from home when you’re on a tight deadline.]

To get your copy of my report about 60 seconds from now, click here. Your email program will pop up an email box. Then all you need to do is click the SEND button.

About 60 seconds later, go to your email browser program’s SEND/RECV button and start clicking. When my report arrives in your mailbox at your internet service provider, your click on SEND/RECV will download it.

For those of you who have already written lots of checks to a member institution of the oligopoly of higher education, I can only say that I’m sorry that you read this report too late. If I believed in either luck or reincarnation, I’d tell you, “Better luck next time.”