As tuition has skyrocketed, education has shifted from being a public good to a private, consumer product. Students are induced into debt because they are repeatedly bludgeoned with news about the average-income increments that accrue to additional education. This is exacerbated by the ready availability of student loans, obligations that cannot be discharged in bankruptcy.

In parallel, successive generations of students have become increasingly consumerist in their attitudes, and all but the most well-heeled institutions readily give the consumers what they want in order to generate tuition revenue. Competition for students forces universities to invest in and promote their recreational value. Perhaps the largest scam is that these institutions have an incentive to retain paying students who have little chance of graduating. This is presented as a kindness under the guise of “student retention.” The student, or the taxpayer in the case of default, ends up holding the bag, whereas the institution gets off scot free. Withholding government funding from institutions with low graduation rates would only encourage the further abandonment of standards.

So students get what they want: a “five year party” eventuating in painlessly achieved “Wizard of Oz” diplomas. This creates a classic tragedy of the commons in which individuals overuse a shared resource—in this case the market value of the sheepskin. Students, implicitly following the screening theory that credentials are little more than signals of intelligence and personal qualities, follow a mini-max strategy: minimize the effort, maximize the probability of obtaining a degree. The decrement in the value of the sheepskin inflicted by each student is small, but the cumulative effect is that the resource will become valueless.