Education Is A Business

Many Americans I meet are fascinated by where you went to college. Student loans and whose loans are bigger are common topics. The possession of a college degree is perceived as having huge social, economic1, and cultural value. That value is so high that when I sometimes criticise the US education system and question the value of doing a degree at all I get a strong negative reaction.

So why is that? Well the credit goes to the education providers who have done a magnificent job of fooling people into believing they are philanthropic organisations. Education is a business. It exists to make money and sell a product. It certainly doesn’t exist to give away that product AKA educate people. That education is an economic product you purchase on the education market just like any other goods and services transaction.2

Why do I think that? Well the obvious example is that education providers actually hate students. Students are grit in the cogs of the education business. The more the providers can fund themselves via bequests, grants and research, all activities that don’t require actual students, the better.3 Any student who has experienced enrolment or dealt with student administration knows the system is fundamentally not designed to service students. Less facetiously, the providers wouldn’t exist unless they got paid. So instinctively they tend to gravitate towards activities that generate income with lower cost overheads.

So why then do people feel so strongly that education isn’t a business or at least refuse to perceive it as one? I think it’s mostly because the education providers are sensational marketers. They have created an almost airtight perception that they are educational institutions who exist to share knowledge rather than businesses who exist to make money.4 They generate such incredible brand loyalty, cf. college sports and legacy enrolments, that it becomes impossible for people to see themselves as what they really are: customers.


  1. This is more than perception economically. Studies indicate students who graduate college earn more money. The “better” the college, the more money. Are they hence better employees, smarter or more productive? Or are they merely the beneficiaries of an excellent marketing campaign? [return]
  2. High school, depending on the nature and type of your school, can perhaps be considered a “free” product sampler. [return]
  3. Ironically the structure of federal student loan funding means that many colleges continue to get paid even if the student stops attending. This is one of the key criticisms of institutions like the University of Phoenix. [return]
  4. I think this is one of the reasons that the more commercial “paid” colleges are treated with such disdain is that they pierce this illusion. [return]
comments powered by Disqus