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In which John ponders whether a college degree is worth the high tuition, student loans, opportunity cost, and low-paying entry-level positions involved. Is the cost involved worth the returns? Is this even a simple economic question, or are there intangible benefits that come along with education?
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A Bunny
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Good morning Hank, it's Tuesday. (points behind) Evil Baby Orphanage Genghis Khan.

So last night, longtime nerdfighter Roxin Punch posted this to her Tumblr:

"I keep going through college degrees and the jobs you could land with them and I just keep going back to how overpriced it all is. Is it even worth it?"

That's a really interesting question, not just to prospective college students but also to people in their mid-thirties still paying off their college loans, so let's examine it!

Now of course most people outside the United States will be like "Of course university is worth it. University is free!" or at least very inexpensive...

We also have subsidized education here in the United States, but it's much LESS subsidized. So here, if you live in Indiana, for instance, Indiana University costs about $10,000 but if you don't live in Indiana it costs about $30,000 a year.

So is it worth it? Well, let's say you spend $100,000 on college, including, like, $60,000 in student loans. With interest, you're going to pay about $80,000 on those student loans, so the total college cost will be about $120,000. Except you also will have spent a lot of time, writing papers and attending classes and going to supposedly epic frat parties that are never actually very fun because even as you're dancing and drinking and talking to vaguely attractive strangers, there's this omnipresent gnawing feeling in your gut that nothing means anything and you feel this endless existential isolation...was that just me?

Right, so anyway, you're doing all of THAT when you might be working, that's called opportunity cost. On the other hand, the $80,000 that you spend will actually be slightly less than $80,000 would have been because of inflation...I'm going to ballpark here and just say that your college cost is like $140,000 in this example.

But then you have fifty-ish years of labor force drudgery to look forward to. Now again, we have to deal with inflation and stuff, but let's just say that if you make $175,000 more than you would have made then college was "worth it."

So how much in per-hour earnings does a college degree have to generate in order to be worth it? About a dollar seventy-five. So over the course of your career, if you make thirteen dollars an hour on average when you would have otherwise made $11.25, college has paid for itself. And so most studies show that college is still very much worth it, although I should note that there are some for-profit universities and misleading vocational training programs that probably aren't worth it. But assuming you go to a reasonably good accredited university, there are two things that are true: one,it is criminally overpriced, and two, it is probably still worth it.

But Hank, my problem is, that calculation assumes that human life is a purely economic phenomenon. It isn't. Let me give you an example.

As you know Hank, a long time ago I worked the graveyard shift at Steak and Shake and I made about fourteen dollars an hour on average. It was a great job with good benefits, there was even a stock buying program which is why I still own fifteen shares of Steak and Shake stock. But about once a week at about three or three-thirty in the morning, I would walk into the bathroom, and even though the toilet was fully functional, I noticed there was vomit in the urinal. Now Hank, I don't know if you've ever cleaned a stranger's vomit out of a urinal, but let me assure you that the most intense games of rock, paper, scissors I will ever play were played to decide who was going to be on vomit urinal duty.

After graduating from college, I actually started making about a dollar per hour less when I started working as an assistant at Booklist magazine, but the job was better in every way. I was surrounded by books and people who love them, I had opportunities for advancement, and in six years of working there I never once saw vomit in the urinal!

Hank, it's been my experience that maximizing income is a hell of a lot less important than maximizing passion and fulfillment in your life, both professionally and personally. When I was in college, I remember fearing that the dreary grind of adulthood would feature, like, infinitely more existential dread than frat parties had, but the opposite has been true for me. I'm much less likely to feel that gnawing fear of aimlessness and nihilism than I used to be, and that is partly because education gave me job opportunities, but it's mostly because education gave me perspective and context.

Whether you're studying electrical engineering or poetry, college is not finally about maximizing income, it's about becoming a better and more informed observer of the universe. And for me at least, that's what leads to a more fulfilling life.

Hank, in a world where about half of humans live on less than two dollars and fifty cents a day, the opportunity to learn and study in a formal, dedicated way is still a gift. Even if it has become a very expensive one. I'll see you on Friday.