Below is a guest post from a friend of mine (who wishes to remain anonymous) in rebuttal to my post about A Harvard Education and what an exclusive, private college education can provide. As a new parent, he answers the question of whether sending his child to an elite private institution would be worth the extra cost, and more importantly why. Hope you enjoy.
Two weeks ago J.P. wrote about a car conversation she had with a child-expecting couple about college. Part of the discussion centered around this question: suppose your child (let’s call him/her L.F.) is choosing between an Ivy or other elite private college for ~$240,000, or a public university for ~$120,000.
What advice would you give L.F.? Put differently, assuming you were paying out of pocket, would you rather L.F. attend a top private university, or a public university with the chance to leave with an extra $120,000 to start her life?
J.P. talked about her perspective last Thursday as a Harvard graduate, and invited me, the decidedly-not-better-half of that child-expecting couple to talk about mine today.
Unlike J.P., and unlike my spouse, I didn’t go to an elite private college, or close to one. I scored a perfect SAT but went to State U on a full scholarship. It wasn’t a terrible school, but it wasn’t a great school either; our average SAT was around 1300/1600. I graduated with honors and a ~99.9 percentile LSAT, which sent me to Top Law School. I graduated with honors again, and now work at a Top Law Firm. I work for big banks and companies, spend a great deal of time at my job, and in exchange get paid frankly unreasonable sums of money. I wouldn’t work at any other firm, and a lot of law students would kill for my job.
You might think that that story means that I come down on the “State U plus $120,000” side. As J.P. put it to me: I saved lots of money on my education and ended up at Top Law Firm, along with people who went to considerably more expensive schools. Didn’t I turn out pretty well? Wouldn’t I advise my child similarly, to follow in my footsteps?
Exactly the opposite. State U wasn’t very useful to me: I’ve never applied for a job where having State U on my resume was a positive. Indeed I was quite lucky that Top Law School admitted me at all: numerous worse (and better) law schools didn’t, despite a strong GPA and LSAT. In other words, I wasn’t admitted because of State U; I was admitted despite State U.
By contrast, Top Law School was extremely useful to me, because the opportunities it provided were literally invaluable. Why? Because my firm, like most other Top Law Firms, does not hire from law schools below a certain level barring exceptional circumstances. Even 5-minute screener interviews are a privilege granted only to about a dozen or so law schools; if you’re not a student at one of those law schools, you’ll have to mail your resume in and hope you get contacted; historical precedent suggests you probably won’t be.* And once you’re in the door at the firm, you are set: so long as you invest the effort, you can be handsomely compensated, have excellent job security, and enjoy top of the line exit opportunities to jobs of your choosing.
And what happens if you don’t go to Top Law Firm? Well, take a look at the bimodal salary distribution graph for new lawyers: you’ll likely make about $50,000: that is, less than a third of what you’d have made at Top Law Firm, and barely more than each year of law school cost. Your job security will probably be thin and your exit opportunities will be rare. So you see why earlier I referred to the opportunity to work for our firm as literally invaluable. Where you start work as an attorney has a vast impact on your career and your life, and where you start work is hugely dependent on where you attend law school. So how much money would you have to be offered to forgo this opportunity as a prelaw student? It sure as heck is a lot more than $120,000.
This isn’t a phenomenon limited to the law, though admittedly the law is a profoundly signaling-focused field. If you want to work at Goldman Sachs, McKinsey, the kind of place where J.P. worked, all of those top modern-day finishing schools for the professional elite: you’re not likely to get there through State U.*
In that regard, the dichotomy could not be more stark. I went to State U, and it was worth nothing to me, but for some fortunate law school admissions officer willing to overlook my alma mater. By contrast, my mere attendance at Top Law School was pivotal to me now working at an excellent firm and doing as well as I reasonably could be in my field. It should therefore come as no surprise that I would strongly advise my child towards the elite private college, and do whatever is financially necessary to support that.
College used to be about education. But now it’s about access.
In her post on this topic, J.P. talked about what she had learned from Harvard. And back in the day, people would choose their colleges based on the quality of the education they would receive.
But this was also when colleges cost about a tenth as much as they do now – after controlling for inflation. Imagine if all your food also now cost ten times as much. Suddenly you’d start caring a lot less about the finer aspects of your food and a lot more about its caloric efficiency and what foods you can continue to afford while meeting your dietary needs.
The same is true for education. Once upon a time you paid colleges for an education to help you become a better member of society. Now you’re paying for the signalling value of that degree to grant you access to jobs that can pay off your student loans. And who really cares about what kind of education you received, because no one ever pays $120,000 to $240,000 just for some education, no matter how quality.*
So I never once mentioned the quality of my education, or the friends I made, or intellectual frontiers I explored while at State U, because the profoundly cynical truth is that none of those things are worth $120,000 to $240,000. The only economically rational reason to pay hundreds of thousands of dollars for a degree is the exchange rate of that degree towards a future income stream. And if there are certain income streams that can only be attained by graduating from certain schools, then in my view, there’s not much choice but to pay whatever those schools are asking.
At this point many of you are undoubtedly thinking “Gee, this guy has an awfully one-dimensional view of what success is. Isn’t there more to life than trying to work at Goldman Sachs, ‘the great vampire squid wrapped around the face of humanity‘? Doesn’t a life worth living, goddamn it, mean something more than working and chasing money?”
And you’d be right.
But that doesn’t change anything.
There are all sorts of ways a person defines success. Ted Turner said that life is a game, and money is how you keep score. Others would say that only by renouncing society’s trappings can you transcend man’s modern, desperate existence. About all that can be truly said is that success is something one must define for yourself, something very difficult to do in modern society. The point is that there isn’t any objective answer as to what success is: it’s an intensely personal and subjective question, to which anybody’s answer is as valid as anybody else’s.
With one exception: some forms of success are objectively easier to achieve than others.
L.F. might find happiness being paid large sums of money at Top Law Firm. Or she might find happiness growing a small vegetable garden in Kailua-Kona, Hawaii. I don’t know which, and more importantly, I don’t care which – it’s her choice, and she’s capable of deciding what brings her joy in life.
But what if she changes her mind? Well, Top Law Firm L.F. has lots of options. She could switch to a less demanding job. She could retire early and start a personal finance blog. She could move to Kailua-Kona and start sowing.
Vegetable Garden L.F. doesn’t have those options. Part of it is that she’s unlikely to have the savings built up to do those things. But a much bigger part of it is simply that doors have been permanently closed. She can’t just move to New York and start working at Top Law Firm: that’s a life she can never pursue, because of decisions she made years ago.
Which is fine! All of us lead ghost lives, symbolizing the paths we could have taken but have forever abandoned. But sometimes those ghosts come back to haunt us. And unless L.F. knows for sure at 18 (and let’s be honest—what do 18 year olds know?), I think it’s your job as a parent to ensure that if L.F. wants to become a part of the great vampire squid, that she can; that whatever doors your child closes are their own; and whatever regrets your child may have are their own and not yours.
Someone once told me the definition of hell: the last day you have on Earth, the person you became will meet the person you could have become. I can live with my hell: I have no regrets about the person I became, and I’m ready to accept the consequences of the choices I made with my life. What I can’t live with is L.F. confronting the hell created by the choices I made. Because of that, I optimize around optionality for my child. That optionality – the access – is worth an extra $120k. I’d send my child to an expensive top college every time.
1 For example, the very same State U I attended for undergrad also has a rather large law school. Our 1000+ attorney firm has hired exactly one attorney in the past few decades out of State U Law School.
2 At this point you’re probably thinking, hey, I know a guy who went to a State U-equivalent school and then to a place like Top Law Firm. There must be many of those people. And you’d be right – after all I’m sort of one of those people! But they are of course the exception, not the rule. The real relevant statistic is, what percentage of people going to State U-equivalent schools are going to Top Law Firm? What percentage of those people even have the option of going to Top Law Firm? Do you want to take those chances with your children? Or would you prefer the percentages from an Ivy?
3 Indeed, college qua source of quality education cannot explain why tuition prices have been skyrocketing yet applications increasing, but college qua signaling device can. One day the tulip subsidies have to stop, and then this post might look very different.
JP: I am a fan of having thoughtful, different opinions on this site and really appreciate today’s guest post. He’s right that I deliberately stayed silent on the subject of access in my own reflections, and that it can provide huge value – perhaps more than the education itself – to a new graduate. As a side note, our guest poster delivered the first draft of this post to me on the day his child was born. He’s now enjoying sleepless (but meaningful!) nights with the very kid he talks about in this essay.
So what about you: if your child had the opportunity, would you rather provide them the capital for a top private college education, or a solid public school degree with an extra $120k (either in capital or lower debt) to start their lives? And would your decision change if you were deciding for yourself instead of your child? Which do you think opens more doors for a child: $120k of seed money to start life or an exclusive degree?