Returning from a wonderfully pleasant Thanksgiving gathering, my lovely wife and I discussed something Peter Schiff wrote in his The Little Book of Bull Moves in Bear Markets. Namely, the basic uselessness of most college degrees. Liberal arts degrees are little more than an expensive job screening mechanism. A huge education bureaucracy benefits while countless middle class families take on a boatload of debt.
We lamented how much useless stuff was involved in our own education. The typing and computer classes were certainly useful, but we sure spent lots of time learning junk like social studies instead of dirty-fingernail things like home repair, construction, appliance repair, car repair, hunting, gardening, survivalism, etc. Why aren’t practical things considered part of education instead of just theoretical (and perhaps effeminate) pursuits? The practical stuff will prepare people for any economic environment, including a forthcoming depression that appears more likely with every massive Keynesian attempt to avoid it.
Schiff is blunt. As a liberal arts major, I have to say the “ouch” that one says when the truth hits close to home:
In the past 30 years or so, our government and business leaders collectively shot the U.S. economy in the foot by encouraging a major transition from a manufacturing-based economy to a service-based one. Today, more than two-thirds of the U.S. Gross Domestic Product (GDP) is produced in the service sector.
Many U.S. residents see this as a good thing, and no wonder. A service economy has many lifestyle advantages for the people living in it. There are no smokestacks to interfere with the view from million-dollar-mortgaged homes, and no need to follow a demanding factory schedule. College graduates with useless humanities degrees can always find work pushing pencils in an accounting, legal, or financial firm. Best of all, no more calluses on hands or aching muscles from the physical labor many factory and agricultural jobs require. Plus production jobs are capital intensive, requiring major investments in plant and equipment; service sector jobs, by contrast, require relatively little in the way of capital– perfect for a nation devoid of savings. It sounds like a good deal, but there’s a basic problem. Just as an individual can’t survive by only consuming and never producing anything, so the United States in the global economy must produce as well as consume. The only way to do this is to export, and services, for the most part, can’t be exported.
… As Americans are forced to curtail their spending, demand will fall sharply for services like manicures, therapy sessions, and legal advice. p.189-191
During the years that the United States was dominated by a service economy, it didn’t really matter if students graduated with degrees in political science, communications, or other liberal arts. There was always some sort of clerical or administrative work to be found. With the service economy withering and the US. job market shrunken, those options will not longer exist by the time today’s students become graduates. For some, trade school might offer a more useful– and much less expensive– alternative. For others, a degree in a practical field such as engineering, geology, animal husbandry, or computer science will provide a fighting chance at a good job in the tough years to come. In addition, don’t neglect the foreign languages portion of your education. p. 202