 I just want to say, it's a pleasure to be here. The last time I spoke in this forum was a few years ago, and it was about my research. And this is more about a problem that we share. And I've given some thought to it, but it isn't my research, per se. So it has the strengths and it also has the weaknesses of somebody taking a fresh look at that. But I do want to talk about some trends in our educational crisis. I'm going to start off by doing something that I don't usually do, but I seem to appropriate there. I'm going to tell you a little bit about myself to start with. And then I'm going to talk about the context in which this crisis is taking place, the crisis itself, and what we might do about it. So what I'm going to tell you about myself is that I sort of moved into the academic world at a very interesting point in time. I was completing my PhD when a whole lot of major things had happened. The Cold War had come to an end. We had gotten all sorts of, the internet went live in 1989. So the first time people could access the internet. We had just received a huge cascade of science-based information about environmental change that was taking place planet-wide. And I was very interested in what was happening in, in my case in Rwanda, it happened previously in Somalia, the levels of violence. And so all of these things became the elements of the life that I would lead as an academic. I became very involved in understanding environmental stress in war-torn countries and conflict zones of the world. And so my research typically takes me, this is in Sierra Leone. So I led the, I led two peace-building missions in Sierra Leone for the UN. And so, and these are some photographs. So typically I'm in these, this is in Rwanda, flood camp in Rwanda. I was on UN peace-building mission in Rwanda years ago. So typically these are the environments I find myself in. And I have to say that, you know, for me it's been a very exciting 15 or 20 years. I am a professor here. I direct a research center. I'm part of a, I'm a senior fellow at various places in the world. I've been able to become a member of the UN's expert group on this and participate in peace-building. I've published, in a sense, many of the things that I wanted to achieve in my life 15 or 20 years ago, I've been able to achieve. And I imagine that I'll be able to do many more things over the next 15 or 20 years. It has been extremely exciting for me. I had no idea that one day I would be in Africa on a peace-building mission. I had no idea that I would write books and that people would read them and these sorts of things that I would be able to teach to hundreds, thousands and thousands of students actually. But the key thing that I want to point out is everything I have done in my life, every opportunity that has come to me has been built on the education that I received. The education for me has been the platform to everything. I'm not sure I could have achieved any of the things I have achieved with my life if I hadn't been able to benefit from this education. I went to school in Canada at first and was a visiting student in France. Then I moved to the United States where I've been for the rest of my life and did a couple of degrees at Princeton University. I was a visitor at Oxford, a postdoc at UBC. I spent, I felt long to me but now these days it doesn't seem all that long. But I spent 12 years and here's what I want to point out. I was the first person in my family to go to college. I grew up in a very rural community. My parents wanted me to go to college but nobody had been to college before. They had no funds to finance me. From the very first day I set foot in college until the last day I left college, I worked and I benefited from fellowships and scholarships. I got exactly nothing from my parents and that's fine. But when I graduated I owed exactly nothing. I was able to get four university degrees without spending, without borrowing one cent. And I believe that I may be the very last generation to be able to do that. I don't believe that it's possible anymore to do that. And I think it's important that people have that opportunity. I'm not saying it was always easy. You know, I was lucky at times. I was able to qualify for certain types of fellowships and scholarships. But I also worked. I worked every summer. I worked every single week of every single year that I was in college. I worked. It didn't detract but the point is I was able to make enough money to pay for everything. Year after year I was able to get by. That's no longer the case. For most students it is actually impossible. In fact, a student would have to work about a hundred hours a week. A hundred hours a week at the typical jobs available for students to be able to afford the average cost of education in this country. It's not possible to work a hundred hours a week. So this generation of students today have to make up a gap which if I had been faced with the prospect of 50 or 100 or $150,000 of student loans, I'm not sure that any of this would have come together for me. It was because I knew it was affordable and I knew when I was finished college I was finished college. And I could devote the rest of my life to other things. I have three children. I have a house. I have a job. All these other things. And I didn't have the burden of enormous debt hanging over me year after year after year. So what I want to talk about is a little bit is not just myself but oh, okay, awesome. I'm going to take a quick wardrobe break here. This makes it easier for me. Why is it so important? Why is it so important? Some studies are arguing today that this country over the next 15 years will produce 20 million less degrees than it should be producing because of the high cost of college. 20 million less degrees. But we are facing some of the biggest challenges in history. The challenge of the Cold War was big. The challenge of World War was big. Yes. But this generation faces huge challenges as well. The world is continuing to grow. There's going to be another 3 billion people added to the world this century. And most of them are moving into cities. Most of them are moving into cities and we have to accommodate the growth. We have to double the capacity of cities around the world over the next 50 years. Double them. The capacity, that's the waste management, the water systems, the transportation systems, the educational systems, they have to be doubled over the next 50 years to accommodate this influx of people. In OECD countries, we're one of them, the populations are getting older and older. So we face a new set of challenges. Never before has the average age of population been so high. Which means that we, but just great news, that means people are living longer and longer. This also means a new set of challenges for us as we accommodate. We are going to have over a million people in this country aged 100 or over this century. At the same time, over a million people. That's a lot of people over the age of 100. So we have some huge changes taking place that we haven't fully figured out how to deal with. Technology has grown enormously. Right now, every single day, something in the order of one and a half quintillion bits of information is downloaded onto the Internet. The amount of information on the Internet is now mind-boggling. The people who are going to fare well, whether it's in business or in engineering or in medicine, are going to be the people who understand how to use these technologies effectively. They are the people who are going to create wealth. They are the people who are going to create jobs. We are not going to create jobs the way we did in the 20th century or the 19th century. We're going to create them by using the enormous connectivity and the vast pools of data. But that means you have to understand them. We don't even understand today how to mine data on the scale that it exists. We don't know yet how to take that data and use it to improve healthcare or use it to improve national security or use it to improve energy use. We're beginning to experiment, but so is everybody else in the world. So are all of our competitors in every other country. And we, by the way, produce the smallest number of engineers and IT people in the world per capita. So there are going to be huge opportunities. There are also going to be big challenges. We all know about espionage and computer crime. People say that today, computer crime is the fastest growing sector of criminal activity on the planet. We don't yet really know how to control it, and you can basically commit computer crime with impunity anywhere in the world because it almost never gets prosecuted. So we have to deal with these problems. We have to take advantage of the opportunities and we have to deal with the challenges. But that requires that we understand these things and we understand them in a sophisticated way. The global economy is shifting. The global economy is shifting dramatically. There are still large numbers of poor people in the world and their conditions are tremendously important. They are not only an affront to our moral sensibility, but they're also, because of their poverty, incubators of disease and extremism and patterns of crime. So we have all sorts of reasons to try and deal with poverty. But the economy is also shifting and the growth areas of the world are now in South Asia and parts of Africa. And for us to take advantage of those markets and to forge partnerships with who will continue to benefit us, we have to understand those places. And that requires education as well. We need more, a higher level of global proficiency than we have had before because in the past we had this huge domestic market and we could do well looking inward. But today, if we want to link into the parts of the world that are exciting and growing dramatically, we need to understand them. And that understanding needs to come in large measure from our educational system. We know that our political system is facing all sorts of obstacles. And there are different assessments. But one of the things that has meant is that more and more of the challenges are being met by nonprofits and social enterprises and private corporations. And that means that wherever you are, wherever your career takes you, you have the potential to have an important role in dealing with the governance of this country and dealing with its problems, its educational problems, its healthcare problems, whatever they are. Whatever, wherever you are, we don't have to leave it to Washington. But to play a role, you have to understand the issues. And that understanding, that's one of the things that college is able to do. When you put lots of people into cities and you give them powerful technologies and you grow big countries like India and China very quickly, you put enormous pressure on the natural environment. And we are seeing enormous pressure, huge demands for energy, huge demands for water, huge demands for arable land, rapid deforestation. And it's feeding all sorts of problems, air pollution and biodiversity loss and climate change. And as people are discovering, as they've discovered in many parts of the world, this tends to mean more flooding. It tends to mean more severe droughts. It tends to mean bigger storms. And so we have to figure out how we're going to manage those situations. We need engineering solutions to those types of challenges, which requires that we educate people. We have, in this country, a looming public healthcare crisis. The cost of public healthcare is rising dramatically more quickly than in other countries. It isn't because of life expectancy. Our life expectancy is not at the top. Our healthcare costs are, but our life expectancy is actually no better than many of the countries which have managed to spend fewer dollars per person. We know one thing, that this trajectory cannot continue forever because if it does, then in about 20 years, every dollar of our GDP would, in principle, be going to healthcare. So we cannot possibly afford that situation. So we need solutions. We need to find new ways to deliver healthcare. We're not going to ask people to remain sick or to stop aging. So we need to find new ways to deliver healthcare efficiently. But that requires new technologies and the ability to use data more effectively, and to use the power of IT more effectively, which requires education. Right now there is, and there has been for several years, a debate. Some people say we are not the gap between the sort of problems we have and the ingenuity, the educational capacity that we are growing in our system is getting bigger and bigger. And the ultimate result is our systems are going to start to break down. What we're seeing in New Jersey and New York, what we saw in New Orleans, what we've seen with our economy in this difficult recession of the past several years are all evidence that we're not supplying ingenuity quickly enough where it's needed to solve the problems. And if we continue along that trajectory, if the problems grow here, and we can't get, because there's no doubt that the country has the capacity to innovate, it has an enormous capacity, but if we can't generate the ingenuity that we need and deliver it quickly enough, then these problems will get more and more expensive. And the people like John Castee, whose book came out this year, X Events, about all the ways our world could fall apart, history will prove them correct. And that would be tragedy. On the other hand, there's just as many thinkers who say, if we use the skill sets that we have effectively, then we can solve all of these problems. And we can continue to lead the world. And we can continue to improve the quality of life and reduce poverty and improve health care and so on. So much is on the table, but much depends on the educational capacity of this next generation. And this next generation is in a somewhat unique situation, not only relative to my experience going to school in the US 20 years ago, but relative to the rest of the world's experience today. We are facing this enormous crisis, where the middle class, according to some estimates, it is now typical for students to graduate with $80,000 of debt. Think of that, $80,000 of debt. As this cartoon shows, and maybe it shouldn't be a cartoon, it is driving people back to home. In fact, according to, I think it's the American Psychological Association, people do not reach maturity in this country now until the age of 30. They are 30 before they actually have to sign a lease or buy their own car or do these things, not necessarily because they don't want to, but because they can't afford to be on their own. They are being driven back, but that's a tremendously important period of life, where you develop those life skills and where you don't yet maybe have the sort of responsibilities which are going to force you to manage risks differently. This is a period when people should be entrepreneurial and they should be able to try new things, and they shouldn't be driven back home. But this is what we're seeing. Student debt today is over $1 trillion in 2012. Over $1 trillion. That's roughly the debt of the rest of the planet in this. Now, education, as I've tried to say, not only do we need it to meet all those challenges, but it's one of those unique things that provides general goods to our whole society. It is in our educational systems, and it is through people who have gone to university and college, that we get most of the innovations, that we get the sort of workforce that attracts investors, which means greater wealth creation, which means more tax revenue, which means and so on and so forth. But it's also a private good. In other words, getting an education in this country is the surest pathway, and I can tell you from a personal experience, to changing your life. There is no doubt about it. For me, the education I got transformed my life, completely and beyond my wildest dreams. It is the path to vertical mobility. A BA adds an average of $1 million to your lifetime earnings. $1 million. If you don't have a bachelor's degree in this economy, your economic prospects are extremely, extremely limited. It gives you the opportunity to continue to supplement your education, to change careers, and these days people are arguing that the average educated American with a college degree will have 14 different jobs over the course of their lifetime. The days where you went to work for a company and you stayed there and you retired are largely over. So it offers all sorts of benefits and we also know that it allows people to get jobs which tend to be more satisfying to them than what high school graduates are able to get. So of course people want education. Look at the difference. The average high school graduate today makes $18,000. The average college graduate makes $55,000. That is an enormous discrepancy. And if you go on and get an advanced degree, the average in the country is $65,000. Now of course not everybody's a highly paced surgeon. Some people are, you know, but the general trend is pretty clear. Most people will want to get into this class for simple financial reasons. Yes? I would like to know why should anybody, if they're going to make, instead of $18,000, $55,000, why should they worry about an $80,000 debt? OK, we'll get to that. I mean, there's one school of thought which says that until education costs about $700,000, it remains a good investment. If you want to pay it off over the course of your life. But there are other reasons why we might want to go that direction, and you'll see them shortly. And if that doesn't answer your question, I'll revisit it. But we have to think not only in terms of managing an $80,000 debt, but we have to think in terms of our competitive position vis a vis the rest of the world and what you can use capital for. Now, OK, one question that rises is why do we have so much debt? Part of the reason is that the cost of college has risen 1,100% since 1978. That is more than any other commodity or service that we know of in the country. Medical care has risen more slowly. The cost of food has risen more. The consumer price index has risen more slowly. So if you look at all these things, why has the cost of college risen so dramatically? That's a big question. There's lots of controversy over it. But what we know is that it's risen four times the rate of inflation and that it is rising very, very quickly. And that when they graduate, only 10% of students are getting jobs, only 10%. Eventually, over time, they will get them. But when they graduate and their loans are due, only 10% are actually able to get employment right away. So the vast majority could be six months. It could be a year. It could be two years. It could be three years of job searching. And that has intensified, obviously, during this recession of the last several years. So you're burdened with debt, but you don't automatically start making that extra money very quickly. And much of it comes later in life. Much of the benefit comes as your career moves up. But let's continue on. Let's look at our competitors. Our closest competitor is Canada. In Canada, the average cost today of a four-year degree, that's the average, the total cost, we're not including living expenses. Living expenses vary enormously. If you live in Vancouver, it's going to be more expensive than Winnipeg, just as it's going to be more expensive to live in Orange County than in North Dakota. But the actual cost where the university receives for the average Canadian, whether they're going to McGill, or the University of Toronto, or the University of Waterloo, is $22,000. The average cost in the US is $56,000. The average cost. Now, look at other countries, countries that we competed with, countries where that money has to go into maybe starting up a company, maybe purchasing a house, purchasing a car, in those first 10 years after a person graduates. When we want people to start things, to start to become consumers, but also to start to become entrepreneurs and create businesses. Our competitors, Canada turns out to be one of the most expensive places to go for a college degree. Nothing like us, it's about a third the cost that we are, but it's more expensive than almost everywhere else. So all of these other countries, you can go to France. In France today, a full four-year degree costs $2,000. That's how much you will pay, whether you went to the Sorbonne or the Institute of Digital Politics or Paris One, you will pay for over four years $2,000. The UK is the only country that comes close to the cost of Canada, and as we said, that's only a fraction of the cost that we impose on our students. Well, that means right away that a student who's gone into the school system in Europe or in Australia or in Canada, moves into the workforce with a tremendous advantage, debt-free. So they can immediately start to use whatever capital that they get from their job for other types of productive purposes, like starting businesses, creating jobs, creating wealth, investing in retirement funds, and so on and so forth. Now, if the cost of college was the same across the board and everybody was paying that, then you might say, but what we're doing is we're putting our students at a competitive disadvantage. And anybody, nobody would like to go into a game burdened with a large debt compared to the other people who are investing in that. The result of this is that, according to much analysis, the cost of education is slipping out of the grasp of the American middle class. Household incomes, and that's largely driven by two people working, have risen 147% during the same period that college tuition has increased 1100%. That's why some analysts argue that we will give out, we will award 20 million fewer degrees over the next generation than we ought to, than we would if our cost was closer to Canada's or the UK's. How did it happen? Well, there's a big, big debate. And people have very strong views about this. And the empirical evidence is not very clear, although we have some very smart people. The former presidents of Princeton and Harvard, for example, are studying this and involved in task forces and trying to figure out how did this happen? And one culprit that a lot of people point to is administration. I saw a study about the University of California system done by an economist at San Diego who said, well, the UC system has a quarter million students, it has about 20,000 faculty, and it has 170,000 administrators. And people have looked at that and they said, wow. So the number of students have grown a little bit. The cost of instruction has grown, although the number of faculty have not grown very much, but the number and the cost of the administration has grown dramatically in the same period. So some people say, there's the culprit. We have too many staff. And one of the problems is we have, obviously you shouldn't have departmental managers or librarians or people providing health services and so on, but we have a lot of programs set up to solve problems which then become permanent things which never get retired, even though they may not be, all those programs may not be that useful anymore. So some people say, well, if we really want to reduce the cost of education so that our students are purchasing their education at the same rate that their competitors are purchasing it in other countries, we need to reduce the number of staff. We need to reduce administrative costs. Another group of people say, you know, we are giving our students largely a Cadillac experience which is wasteful. We are investing heavily in luxury dorms and luxury athletic facilities and all sorts of add-ons which may not be really central to the mission of education and research. And these are costly add-ons. And yes, I was, two weeks ago I gave a talk at the University of, at the School of Oriental and African Studies at the University of London. Very, very distinguished place, world famous, has been around for a long time. And the first thing that I noticed when I arrived at the speaking venue was how modest it was. Sort of just very simple. There was nothing fancy about this place. It's famous, it's been around forever, it's right in downtown London, but it's sort of the way I remember my high school looking. It doesn't look at all as grand as the infrastructure we've built, but infrastructure is expensive. So some people say, well, do we need, given that the students don't want $80,000 of debt, do they need a billion dollar recreational facility? Or should we start looking at that? Maybe this shouldn't be, maybe this is a little bit too club-mad. And when we look at our competitive institutions around the world, they're not nearly as luxurious. They're actually, they're a lot simpler. And a lot of, doesn't mean that they don't have, they're not steeped in tradition and they have beautiful old buildings, but the experience is very, very different. And the students' expectations are not for luxury dorms or luxury athletic facilities or luxury eating clubs and so on and so forth. But there are others. People say, well, students are implicated in this as well. Here's another difference between us and the rest of the world. Only a third of our students actually complete their degree in four years. So part of the reason that they have to borrow so much money is because they take so long to finish. Now, people might say, is it because it's expensive that they therefore have to work more, therefore it slows them down? According to the best study that I've seen, those things are not correlated. So it doesn't seem to be driven by cost. It seems to be simply that we have students who take longer to complete their degrees than any other country. And it doesn't seem necessary. When we look at certain groups within our own student bodies, Asian women and foreign students do complete their degrees much more quickly than everybody else. So they get through these programs in four years, but only after six years, only about 57% of our students have actually got their degree. So for many people now, there's no stigma to being in college for seven or eight years, but that drives up the cost for the college and it drives up the debt of the student. So, you know, is this the, you know, other people have said, look, we have a very different system of financial aid than the rest of the world. Just like the mortgage crisis, we have given students loans automatically. Very, very easily. Every student can qualify for a loan. And they said, and some analysts say, as the student loans become easy, universities have simply increased their costs to absorb more funds, because they sort of say, well, you can actually afford 40,000 a year and we'll give you these extra services. So, because you can borrow 20,000. And so, you know, and I remember when I was a graduate student at Princeton, everybody in my class was borrowing money. I was thinking, why are you all, and they were saying, well, it's easy, you know? You automatically get 15,000 every year and then you can have a car, you can take a vacation, you can go and spring break, you automatically get that money. Yes, but at the end of four years, that's 60 or 75,000 dollars. So, a large administration, luxurious facilities, a slow completion rate, easy credit, all of these have been identified by analysts as part of the problem. And there's the, here's something I'll say, you know, which is deeply, deeply sacred in the University of California system, but according to analysts, the shared governance system between faculty, regents, and administration does not tend to be problem solving. It tends to reproduce things. And as somebody, if you follow the retirement issue here, where, you know, we've got this enormous exposure and not quite enough money to pay for it all, you sort of see that the information has been there for 20 years, but nobody stepped in to solve the problem. So, one form of analysis, and I'm not at this point saying who I believe, I'm just saying that another problem may be that we don't have the structure to solve these problems. We have nobody really looking at the bird's eye view and taking responsibility and saying, this is not acceptable, I'm gonna stop it. Instead, we have all different stakeholders, each of them looking after their own interests and trying to say, well, I'm administration, you're never gonna cut me. Everything I do is essential, we're cut to the bone, there's nothing else, there's no lean here. And faculty saying, you want me to research and publish and raise grants and you're increasing class size, there's no flexibility here. And the region's saying, well, you know, this is a good gig, I'm not gonna rock the boat. So, what are some of the implications? Well, according to some studies, young people are foregoing college. Some studies suggest that 20 million young people will decide not to go to college. They're deterred by the cost of it. One thing we do know, and this comes out of a study done at Berkeley, is that the top students, the top students in our country will choose private colleges or republic colleges because they get a better financial deal there. I'm a good example of that. Princeton has the capacity to defray most of the costs. And so my deal at Princeton meant that if I could earn another $70,000 a year, I could pay for myself because they covered everything else. But that's not true in the University of California system. So the very top students will tend to go to the private institutions and not come to the public ones. And the top international students, what we're now seeing, the best engineers, the best IT people are saying, I'll go to Germany or I'll go to UK or I'll go to Canada because it's much less expensive for me than going to the University of California. We want them here because we want those networks. We want those skills. We wanna have those relationships. But our system is expensive for them. It also looks, according to some analysis, that students now as the cost, the dimensions of costs are sinking in are giving up things that are probably important, like study abroad. So they're saying, well, I can't afford that. But that's an area which almost everybody recognizes is a slight deficiency in our country. We need more people with global proficiency, but students are saying, I can't afford that. I can't afford that. I've gotta finish as quickly as possible because the costs are mounting. But then you get other types of problems, because what happens to, at my level, is the class size gets bigger. The class size gets bigger. What happens when the class size gets bigger and the incentive system is based on your research? I don't get rewarded for the number of students I teach. I get rewarded for the number of publications I produce and the amount of funds I raise. That's the biggest incentive in all of the top universities, not just the UC, everywhere. Well, what happens? I remember when I first started teaching. I was moved into an office beside a guy who had been there for a few years. And one day he stopped by my office and he said, I see all these students coming to your office. I see you in there with them. He said, you're killing your career, man. You're killing your career. What are you doing? Why are you spending so much time with the students? And I said, well, they got a lot of questions. That's really interesting. I'm really interested in the courses I'm teaching. And he said, you are going to shoot yourself in the foot and you won't get tenure. He said, you gotta cut this. He said, you know how much time I spend grading? I said, no. He said, I spend half an hour, half an hour a year grading. And he said, I don't give any feedback. But if you give high enough grades, nobody's ever going to question it. Now I'm not saying that this particular advisor is representative of all faculty, not by any means. I know lots of faculty who dedicate tremendous amount of time. But the point is for some, for some you get the size, the class size gets bigger. There isn't many reward. And so one of the easiest solutions is to, is grade inflation. And so sort of say, well, I'm not going to give you much feedback, but I will shut you up with a higher grade. So that is certainly happening. And the other thing related to that is students are, there's a whole marketplace in identifying easy courses. Easy courses that students don't have to spend much time in them, you know, from student websites. What we need, of course, are people who understand global affairs and science, technology, engineering, math. But what we're getting is as students being advised, take history of rock and roll wherever you see it. Cause that's a guaranteed A and it will take no work, you watch movies. Or this one, I like the college confidential. Look for these giveaway things. A low course number, that means it's easy. No prerequisites. If it has the word intro or survey, it's guaranteed to be an easy course. Load up on those. You know, is it for somebody who isn't a major? That's great. Intro to whatever, basic whatever, whatever, general whatever. Those are all, if it has the word society with it, women in society, minorities in society, take that. Cause this is the way to move your GPA up and you won't have to spend any time actually studying. We can lament that, but we can sort of also understand it. And for those students who are saying, I've got to work 20 or 30 hours a week, do I really want to take five really tough science-based courses, which are going to require an enormous amount of time? Or do I want to sprinkle a few history of rock and roll? I don't want to bash history of rock and roll. That's probably a good course, but I like rock and roll. But you understand what they're getting at here. And what this does is it reproduces a problem that everybody recognizes in our system, is that students aren't arriving particularly well-prepared compared to their competitors. When we look at the, this is the program in international student assessment, generally perceived as the best measurement of people before they go into college, their level of proficiency in science and math. Finland has long been number one, number one among the advanced countries. And the inequality measure is a measure of the gap between the top 20% of students and the bottom 20%. And Finland is the lowest. So that the number one and all the students are learning math and science pretty well. Canada is number eight. We are number 20 out of 36. And the gap between our top students and our bottom students is enormous. Our top students are among the best in the world. Our bottom students, however, are way below the bottom students of any other country that we would like to be compared to. So where you go to school matters enormously in this country. And if you go to a wealthy school and a wealthy neighborhood, you are going to get a much better education. That is not how we're true for other countries. And the end result is that those transferable skills that you can acquire in school are more widely diffused through other countries than they are in our own. What are the long-term impacts? Well, people are worried about a gap, and this is a huge issue. Probably everybody from Bill Gates to University chancellors around the country have pointed out that the new jobs being created are those jobs I described earlier. IT jobs and engineering jobs and health services jobs. Those are the jobs that are being created. But our students are shying away from those types of courses and they're shying away from those types of majors. And I'm not suggesting that the only reason they're doing that is the high cost of education. But that's a reinforcing thing. So if you also want to try and simplify your college life and I'm taking a few courses in history of rock and roll, is an easy way to do that, the sad thing for our nation is that you could be learning IT or engineering instead of the history of rock and roll. And we have to think very carefully about, and I understand, I know that this is controversial. Some people will say, look, you know, but there's more reasons I'm going to. So we may be losing ground, according to many metrics, compared to our competitors abroad. At a time when growth is largely taking place in South Asia, Southeast Asia, Africa, so we want to be able to compete with those engineers. We want to be able to compete with engineers from Europe or engineers from Canada or engineers from Australia to get the big contracts and build the new dams, railways, transportation systems around the world. We want to establish those networks. And we want to make sure that we have enough ingenuity throughout our country to solve the problems that come up, whether they're transportation problems or healthcare problems and so on and so forth. Now, what are the solutions? Well, one solution that is very popular, and there's a lot of books written about that, is let's cut staff. Let's take out all those programs where they deal with people's gender issues or sexuality issues or cross-cultural issues or these issues, and let's say that those may be hugely important, but they're not, we can't afford them on our campuses. They're not on campuses at other places. Let's focus on things that are more to the core of the mission. Is that a good choice? I don't know, I don't know. But there is, as Anthony Grafton, who did a very, very nice synthesis of the literature points out, there are some strong evidence that we are supporting that our systems have a lot of costly extracurricular activities and people are low to give them up because they're jobs, and I understand that, and if you've been doing something for 15 or 20 years, you might consider it essential. Is it essential? We can reduce the resort experience. Here's something that I think is interesting. When the collegiate of learning is, now this is only for the United States, it's not for the world, but what they looked at, when they did a study of American university students, they discovered that they made no gains in the first two years of their college. No gains of transferable skills, none. They tested the same after two years of college as they did when they went into college. That is shocking, but one reason may be that they're only spending 12 hours a week doing college work. They're in college full time, but they're actually only doing 12 hours a week of college work, much less than past generations, much less. So maybe it's not surprising, they don't do that much writing. They don't do as much thinking. There are other ways we could construct an explanation. Some people say, look, internet has allowed people to go online, find all the answers quickly, and they don't have to go through the library and read stuff and think about it. They just go online, they download it, they more or less import it into, in fact, we have programs designed simply to detect whether students are doing that. And they do, sadly. We can speed up the time to completion. Even at the elite university of California, when we look at what students actually do throughout the system. 12 hours a week socializing, 11 hours playing computer games, six hours watching TV, six exercising, five doing hobbies, 13 studying. So maybe there's a way to get that six years down to four years and cut the costs for everybody dramatically if they spend a little bit less time playing computer games and watching TV. And a little bit more time in the library, which is always emptied. Is this true? Again, what I'm saying are these are solutions that people are floating out. Many of them required more empirical study to determine, you know, is this completely valid? I'm not suggesting that these have all been studied as well as they need to. Increased subsidies, that's a big thing. That was the argument of the University of California. The state has to pay more. But William Bowen, the former Chancellor of Princeton has done a very, was head of a task force which studied this and said, that doesn't seem to really be the key factor. Yes, students don't want to graduate with lots of debt, but it isn't the cost which is really extending the period. It is the fact that they're not using their time very well. They're not managing their time effectively. That's his conclusion. Now, some people say we should deregulate. That's been a big conversation in this system. Let's deregulate. And another important finding is that there is that private institutions tend to cater to kids who went to really good schools and who have families that are very supportive of education and they tend to do extremely well and they do indeed compete effectively with the entire world, but they're a smaller number of our overall student body. So yes, there's no doubt that the top universities in this country are among the best in the planet. There's no doubt about that. But they don't service all that many people. In fact, all the top private colleges and universities in the country don't service as many people as the UC system itself. So we have to keep that in perspective. Yes, it's great, but there's a small number of people who go to Williams College or go to Swarthmore or go to Brown or whatever. Small, small numbers. Forgive loans. Again, we could do that and that would certainly solve the student debt problem. We could forgive a trillion dollars with the loans. And maybe that would have been a better thing than bailing out Wall Street. I don't know. It's an idea and so on, but it doesn't necessarily solve the structural problems, the deeper structural problems. An interesting thing which we're trying in, this is from Utah. My little image didn't show up that well, but you get the idea. It is stop subsidizing universities, give vouchers to students, and force universities to be competitive. Every student in California would get $15,000 a year voucher and they could use it to go to wherever they can get in. And so university would have to compete and students would get that for four years and they would know that they have to complete in four years if they want to use that voucher and so on. So some people say when they look at that, that would increase the efficiency of the system dramatically if we used market forces. It has its critics as well. Another popular one is let's move education online. And I think there's a huge push to see, can we deliver high quality education virtually? And there's no doubt that there's lots of very compelling experiments and that is being practiced at MIT, it's in the UC system, it's all over the place. What's not entirely clear is will it ultimately really reduce the cost substantially? And which costs will it reduce and what will be lost in this process? So this is still a work in progress. Online education is promising but not yet. Provide education credits and return for public service. This seems to be something that is done in many other parts of the world much more effectively than here. You graduate from high school, you spend two years whether it's in the military or in some sort of public service capacity and in return the state pays for your college. But why don't we have that system here? Why don't we have more opportunities for that here? That would seem to be a sort of no-brainer. Create incentive programs so that you know you could have incentive programs and say if this community reduces water use or reduces energy use and saves the state money, then we will provide education credits to this community which they can use to educate their children. Would that be beneficial? When you look at the dollar potential value, it's enormous, it's enormous. What could be transferred to families in exchange for something. In exchange for something that we want as a country. Huge. I think that the cost of education is my own sense is that we cannot allow it to continue to get more expensive. We can't allow it to grow at its current rate of about 7% here. That is too much. It's just like the healthcare. That rate of growth has to somehow be slowed down. Whether that's by cutting staff, reducing the luxury experience, speeding up the time to completion, moving more online. Whatever the solution is, and maybe it's a package of many of those things put together to optimize our educational system. I don't think anybody would think we can continue to allow it to grow. That in 15 years if the cost of education is increased by 2000%, people would say, oh well, that's fine. I don't think we can have it double now. Now it's already extremely expensive. But one thing that we realize is there are not any easy victories. Our educational system reflects some of the weaknesses of the students who come. Many of them already, having spent too much of their high school time doing computer games and watching TV, the average American watches more TV by the time they're 16 than they have spent in school. More TV. Now, I don't know about you. I was, one thing I was lucky with, I grew up in a family that did not watch TV. And so I like to believe that that forced me to read books. Forced me to read books and gave me a lifelong benefit. I don't think my, my parents just didn't like the chatter, chatter of TV. They thought it was obnoxious. They were, they were conservative and they just thought it was obnoxious. So I didn't get to, and my children don't watch TV. They do not watch TV. But they play classical piano and they read and they travel around the world. So they have a lot of interesting experiences, but they don't watch TV. I think TV is the killer. I think, I think it sucks up time without, without nourishing the body or the mind. So, so, you know, students arrive, used to getting, skating through high school pretty easily, getting into a nice college and having spent maybe 15 hours a week doing it. We hear a lot about how, how hard the work is and how much time they spend. But the studies suggest that's not true. The studies suggest that when they're, they're not doing homework. They're online, on Facebook. They're not really, they might call it homework time, but that's not actually what they're doing. Now, are these studies correct? Well, there's an awful lot of them. So, so, you know, and administrators might be catering to this mentality, sort of, sort of convincing themselves that having lots of fun things to do on campus is a good thing because it keeps them employed. But maybe it's sort of feeding the beast. Maybe we want a simpler, let's say, you know, a little bit more Calvinist type of student experience that focuses on gaining skills that are valuable in the marketplace and valuable in competition with people, with our leaders from other parts of the world. What I want to suggest here is that, is that nobody has the inside track about what the solution is. There's disagreements over the problem. There's disagreements over what's causing the problem. There's disagreements over the best way to solve it. But I think that everybody is in agreement that we cannot increase the cost of education by 7% a year forever. So that is like the healthcare thing. The healthcare costs and education costs, they cannot grow forever because inflation, because family income does not rise fast enough to tolerate those costs. Almost everybody agrees that the rest of the world may not be as good as we are in, you know, high end technology innovation or in national security or in a lot of other things. But they do have ways to keep the cost of education much more affordable. And so we should probably be looking at one and having gone to school in three different countries, it is very different the experience. In the French system, yes, it costs $2,000 a year. You don't get any support. You arrive and you figure things out. Like where your classroom is and where you go and where you get your books, there is no support. You just arrive there and you're expected to sort of, you know, ask around and where do I buy my textbooks? So we don't have teams of people lined up to greet you. I think I'm not sure that that's a bad thing. I mean, for me, it was disorienting because I got there, I had no clue what I was doing. My kids went to the Swiss school. Swiss school, they'd sit down, start learning. That's it. That's what they do. They sit down, start learning. At the end of the day, go home. No homework, by the way. No homework. Why? Because they optimize those six hours or seven hours that they're in the classroom. So there may be things we can learn from other systems. I don't think there's an easy fix. I think there's lots of disagreement about the problems. I would not lay the blame on students spending too much time watching TV or administrators being too large in numbers or any of those things. I'm suggesting what people are saying and that we have to think through each of those things and do more research to figure out which are true and which are not. I am not pointing the finger because I don't know. This is not my area of research. What I am suggesting is that nobody wants the trillion dollars of student debt to increase to five trillion dollars. Nobody wants the average cost of education to go from 56,000 to 112,000, while you can get it for a fraction of that price in Germany or France or Canada or Australia. So we have an issue here and we have to really, I think that this, instead of the story of David Petraeus being the front page of everything from Fox News to the New York Times, we need to get people thinking about things like education and because strong educational system, strong country, strong economy, strong future. I think that that's one of the most secure sets of relationships that we know. If we solve this problem and make sure that it doesn't spiral out of our control because right now we have some of the best universities on the planet. So if we build on that strength but we figure out why is it getting so expensive and start to solve that, then I think we'll have the best, we'll be extremely well positioned for the next 100 years. If we don't, then of course these problems will gather momentum and in 10 or 20 years people will look back and say, how did we let this happen? How did we let this happen? I think that might be the end of my slides. Whoops. Well, more or less what I just said, you know? Let's look into some of these things which could reduce the cost, speed up the time of completion and without sacrificing the quality of experience and make sure that students are learning things. I don't want to, probably there's a professor of history of rock and roll in this room and I probably offended him, I'm sorry. But we need to make sure that enough we're studying engineering and IT and science and math to be competitive in the years ahead and to be able to solve the problems of the years ahead. That's it folks. Thank you.