Peter Thiel, Facebook billionaire, hedge fund manager and PayPal co-founder, doesn’t mind courting controversy. After correctly foreseeing the dotcom and subprime busts, he has been lambasting higher education as the next big bubble, in the Journal, the National Review and most recently to TechCrunch’s Sarah Lacy.
He draws the following comparisons between the real estate bubble and higher education:
- A consumption decision masqueraded as an investment decision. Building that megamansion with a pool and gold bathroom fixtures really isn’t an investment. College is often a four-year party rather than a real investment in education and the future. This thesis isn’t new: Norwegian economist Thorstein Veblen wrote in 1899 that higher education was a form of conspicuous consumption.
- A kernel of truth transformed into a dogma whose every critic is shouted down. “House prices only go up!” “We must invest in education to win the future!”
Thiel has also created a program called 20 Under 20 that will award 20 people under 20 a $100,000 cash grant and mentorship from Thiel and his network, to stop out of school and pursue projects, which has been predictably controversial. How dare he encourage impressionable young people to quit school!
Well, if the program had been around when I was under 20, I would have applied, and it could have saved me a whole lot of trouble.
I was never really good at school. As a child I was expelled from a handful of prestigious prep schools and graduated high school at 15 but with scores putting me in the top 30% nationally, way below what is required to advance through France’s highly elitist higher ed system. I enrolled in a second-tier college, studied liberal arts for a year and then dropped out to make movies with friends. Driven by constant parental nagging and a pretty huge chip on my shoulder, I clawed my way to the top law school and business school in my country.
From 2002, when I graduated high school, to 2010 when I graduated business school, I accomplished approximately nothing, at least professionally.
This isn’t to complain about problems that are utterly insignificant in the grand scheme of things, but to say that there are plenty of smart people who simply aren’t that fit for elite education. Even though they could (and sometimes do) pursue it, it’s really a waste of resources on both ends. I learned plenty of stuff in business school and met plenty of interesting people, but was it worth the debt and the opportunity costs? I don’t know for sure, but something tells me Business Insider would have hired me regardless.
When I was under 20 I was an aimless computer geek who had no idea that you could actually build interesting stuff online and potentially even make money from them. There’s no question 20 Under 20 would have been a lifeline for me and saved me a lot of trouble.
In any case, despite the controversy Thiel is not going to back away from 20 Under 20. In a 2007 article on philanthropy for First Things, before he set up his Thiel Foundation, he wrote:
[R]emembering that the distinctive purpose of foundations is not to provide charity but to help find innovative ways to effect permanent positive change in society, thoughtful donors should look for projects that are instrumental and uncharted, instead of merely expressive and replicative. And that means taking risks—not just the risk of financial loss but also the risk of social embarrassment.
Look for more controversial initiatives out of the Thiel Foundation.