EDUCATION IN THE AGE OF AUTOMATION

            Reimagining college in the age of automation begs the fundamental question—what are people sent to college to learn? Originally, the idea of an education was to develop a sense of morality. As Mary Woolley, the president of Mount Holyoke, stated in 1901, “Character is the main object of education.” The Harvard psychologist and philosopher William James wrote around the same time that character and moral significance are built through adopting a self-imposed, heroic ideal that is pursued through courage, endurance, integrity, and struggle. It’s the development of these ideals that was once the purpose of a university education.

            Of course, for many decades now, the point of college has been to set people up for jobs. But what happens when the jobs disappear? Similar to health care, the automation wave should lead us to invest more people in education and human capital development. It should also drive us to dramatically increase our emphasis on technical and vocational training and apprenticeships at the high school level to take advantage of the jobs that will continue to exist. The difficulty is that schools will need to reinvest and adapt even as the monetary returns on education diminish and jobs become harder to come by.

            Some believe that we can inexpensively educate large numbers of people using the latest technology. A couple years ago I spoke at an awards dinner with Sal Khan, the founder of the Khan Academy. If you don’t know Khan Academy, you should—they make education videos that are used by millions around the world on everything from basic arithmetic to great literature to quantum physics. Sal was a hedge fund analyst turned explainer of all things. Bill Gates’s kids used to watch the videos to supplement their schooling, leading Bill to become one of the many million-dollar donors to Khan Academy. Their mission is to educate the world.

            Sal gave an inspiring talk that night. The high point went something like this: “Back in the Middle Ages, if you asked the literate monks and scholars how many of the farmers and peasants walking around would be capable of learning to read, they’d scoff and say, ‘Read? Most of these peasants could never learn to do something like that.’ They might guess that 2 to 3 percent of the peasants would be capable of becoming literate. Today we know that the real number is closer to 99 percent. Virtually everyone is capable of learning to read. But if I ask you today how many people are smart enough to study quantum physics, you might say only 2 or 3 percent. This is as shortsighted as the monks were in the Middle Ages. We are just scratching the surface of how smart people can become if we give them the proper tools to learn. In the years ahead, we will find that people are capable of much more than we can imagine.”

            Sal’s speech received a rousing ovation. It was an exhilarating vision. Technology and universally accessible, low-cost education materials would accelerate a new age of smarter human beings. Presumably, these new smarter human beings would innovate and create new jobs and businesses.

            As we walked away, I found myself asking, “Is he right?”

            At least here in the United States, it’s very hard to say that he is. The Internet became widely available and adopted in 2002. A majority of American households have had broadband Internet at home for more than 10 years now, and 85 percent today have either a broadband home connection or a smartphone. We have years of information about how unlimited access to materials like Khan Academy has influenced learners around the country. Unfortunately, SAT scores have declined significantly in the last 10 years. High school graduation rates have edged upward. College readiness is generally down. We don’t seem to be getting any more enlightened despite ubiquitous online lessons.

            It’s impossible not to love Khan Academy. I fully intend to strap my kids in as soon as they’re ready for it, and I fantasize about coming home and having them say things like, “I learned thermodynamics today!” But if one gives a 12-year-old access to high-speed Internet, they are infinitely more likely to chat with their friends, play video games, or watch the latest Honest Trailers video than delve into a deep, thought-provoking discussion of War and Peace. Among the biggest gainers from Khan Academy are people abroad and learners like Bill Gates’s kids, who already had some things going for them.

            The clearest impact of technology on teen development to date has been starkly negative. According to psychologist Jean Twenge’s 2017 book, iGen, smartphone use has caused a spike in depression and anxiety among people born from 1995 on, and a diminution in sociability and independence. An excerpt of her book in The Atlantic was aptly titled, “Have Smartphones Destroyed a Generation?” They are not using their smartphones to learn calculus, but they are trying to keep their Snapstreaks going.

            In 2011, everyone began taking about massive open online courses (MOOCs), and many believed they were going to revolutionize education. In 2013, Udacity rolled out the core coursework of Stanford and MIT in topics like artificial intelligence. Tens of thousands of students around the world enrolled. Pundits and experts predicted the disruption of college as an institution. Instead, these MOOCs kind of flopped. Only about 4 percent of students completed the average course, with many quitting after only one or two sessions. In one case, an online math course was found to be less effective than a remedial college class in person and scaled back. Though these online courses continue to improve, college applications remain higher than ever.

 PEOPLE (STILL) LEARN FROM OTHER PEOPLE

 

            Too often people mistake content for education and vice versa. We act as if we can take a textbook or lesson online and make it interactive, and then that will educate someone. But no one would consider putting a child in an empty classroom with a textbook “education.” We would call that reading or maybe punishment. Max Ventilla, the founder and CEO of AltSchool, has said that “the worst use of software in [education] is in replacement of humans… that’s craziness… It’s about the relationship that kids have with their peers, with adults. That’s what creates the motivation that creates the learning.” AltSchool is a company founded in 2014 to personalize education for all children across the country. AltSchool has raised over $175 million from Mark Zuckerberg, Emerson Collective, and others. It has opened six schools that collectively serve hundreds of elementary school students in San Francisco and New York. It employs more than 50 engineers who are developing tools each day that teachers request. The school uses video cameras to monitor tiny student interactions for playback.

            “We believe that the vast majority of the learning should happen non-digitally,” Max explains. He is the former head of personalization at Google and parent to three young children, and he wants to build schools that prepare children for the future. “In any AltSchool classroom, most of what a kid is doing is not on a screen, but for every kid, we have a digital representation of the important things that relate to that child’s learning, not just their academic learning but also their non-academic learning. [They learn] that their character skills matter, that their grit, their perseverance, that their experience with being successful after failing a bunch of times is as much a part of the education as… learning history facts and knowing how to multiply two numbers.”

            AltSchool represents a sophisticated blend of using software to do the things that technology is excellent at—recording and synthesizing large amounts of data over a growing number of people and making recommendations—while retaining the essence of how people learn: from other people. I had dinner with Max and his wife, Jenny, in San Francisco last year. I could see how AltSchool raised $175 million; Max is an exceptional guy and completely sincere in his mission of furthering how our children learn. He’s in it for the long term. It probably helps that his mother and sister are teachers.

            Perhaps the best thing about AltSchool is that it focuses on character skills. In an age with less and less employment, the abilities to self-manage and socialize will become the new keys to success in life. We should recognize that the majority of high school students will not go to college, and that their ability to function should be independent of further education. Grit, persistence, adaptability, financial literacy, interview skills, human relationships, conversation, communication, managing technology, navigating conflicts, preparing healthy food, physical fitness, resilience, self-regulation, time management, basic psychology and mental health practices, arts, and music—all of these would help students and also make school seem much more relevant. Our fixation on college readiness leads our high school curricula toward purely academic subjects and away from life skills. The purpose of education should be to enable a citizen to live a good, positive, socially productive life independent of work.

 EDUCATION STARTS AT HOME

 

            One enormous favor we could do for teachers would be to try to keep parents together. Children raised in two-parent households have better outcomes by most dimensions. Technology could potentially help here—one can imagine an AI life coach with the voice of Morgan Freeman trying to help people manage their differences. The government should provide or subsidize marriage counseling to essentially anyone who wants it. If you have kids and you want to stay together, we should help you do it. Even successful married couples shudder if you bring up the early years when their children were first born. Any marriage or relationship that remains whole is a win for the next generation.

            We should also make sure that parents have ample time to spend time with their children. Our lack of family leave for new parents is barbaric, antifamily, sexist, regressive, economically irrational, and just plain stupid. Studies have shown that robust family leave policies improve children’s health and heighten women’s employment rates because they don’t feel they need to leave work entirely in order to be successful. The United States is one of only four out of 196 countries in the world—and the only industrialized country—that does not have federally mandated time off from work for new mothers. The other three are Lesotho, Swaziland, and Papua New Guinea—not exactly a list of world beaters. We’re in the bottom 2 percent of recognizing that new parents might need to spend time with their new baby—it’s the most obvious example of our prioritizing capital in a misguided way over humanity. In contrast, Denmark gives parents 52 weeks of paid leave they can split between them, with a minimum of 18 weeks of full pay for the mother.

            If current trends continue, there are going to be many more single moms in the years ahead; there are already 11.4 million single mothers raising 17.2 million children in the United States, 40 percent of whom live in poverty. Single mothers make up more than 82 percent of single parents, and 40 percent of them work in low-wage jobs, one of the highest proportions in the world. Ideally we would create communal living arrangements specifically for single moms to be able to pool resources, cooking time, and babysitting, and to be able to put their kids down without worry. The trend of cohousing is increasingly popular among millennials, and there are already 150 cohousing communities in the United States. Communal living arrangements have been shown to increase social cohesion, which is very helpful for children, parents, and older people alike.

            We also should start school earlier. The benefits to children, particularly those most in need, are massive and clear. There is a movement toward pre-kindergarten offerings in New York, San Antonio, and other cities. The United Kingdom now offers universal pre-kindergarten options for all three-and four-year-olds, and China and India are undergoing massive expansions.

            When children get to school, there are a few things that have been shown to be helpful and effective. Unfortunately, additions like laptops and software have thus far been shown to be largely unhelpful in making poor schools better. Technology is additive to existing environments; in a strong school with good teachers, it’s helpful. In a low-performing school, it doesn’t really solve anything. We know what works—better teachers, better cultures, teamwork, and individualized attention. We’re just not very good at delivering these things. We fall in love with scale and solutions that promise more for less.

            I ran an education company, Manhattan Prep, that started as a solo tutoring shop and eventually grew to serve tens of thousands of students per year. We used current technology, but we became the industry leader primarily by finding the best teachers, compensating them more, and then empowering them to teach their classes how they saw fit. People teach other people. If you want to teach thousands of students well, you teach one student well. Then you do it thousands of times.

 COLLEGE ISN’T ALWAYS THE ANSWER

 

            Starting at the grade school level, we overemphasize college readiness and stigmatize vocational training. Only 6 percent of American high school students were enrolled in a vocational course of study in 2013, compared to 42 percent in the United Kingdom, 59 percent in Germany, and 67 percent in the Netherlands. Many available categories of employment will fall into nonroutine middle-skill jobs of welding, glass installation, electricians, machinists, maintenance, line repair, technicians, and the like even as the economy changes. A Georgetown center estimated that there are 30 million good-paying jobs that don’t require a college degree, many of which need some specialized training. A few summers ago my office’s air conditioning system broke and we had to pay a couple thousand to get it repaired as fast as possible. There are going to be old air conditioning systems in the United States for decades to come.

            College is being dramatically overprescribed and oversold as the answer to all of our job-related economic problems. The most recent graduation rate for first-time, full-time undergraduate students who began seeking a bachelor’s degree was 59 percent after six years. That is, only 59 percent of students who started college in 2009 had completed a bachelor’s degree by 2015, and this level has been more or less consistent the past number of years. For those who attended private, selective colleges, this number will seem jarringly low; the same number at selective schools is 88 percent. Among schools with open admissions policies the rate is only 32 percent, and among for-profit universities the six-year graduation rate is 23 percent. Similarly, the graduation rate from two-year associate’s degree programs within three years is only 29.1 percent. College, more than high school, is America’s true dropout factory.

            The main reasons cited for dropping out are being unprepared for the rigors of academic work; inability to cope with the competing demands of study, family, and jobs; and cost. The worst part is that no school will refund you your tuition if you don’t get your degree. Millions of high school graduates show up to college or community college, rack up significant debt, and then don’t graduate. We are up to a record $1.4 trillion in educational debt that serves as an anchor on the futures of many of our young people.

            Meanwhile, the New York Federal Reserve estimated the underemployment rate of college graduates to be as high as 44 percent for recent grads and 34 percent overall. One-third of college graduates are working in jobs that don’t require a degree. We pretend that a college degree will prepare one for the future and ensure gainful opportunities when that’s often not the case.

 WHY IS COLLEGE SO EXPENSIVE?

 

            This raises a central question: Why is college so expensive? There is no real measure of the effectiveness of college; it’s not like they give you the SAT again and see how much better you got at it. And yet, college tuition has risen at several times the rate of inflation the past 20 years, more dramatically than all other costs, including health care. Thousands of parents right now are sitting there thinking, “Gosh, sending two kids to college might cost half a million dollars.” The real income received by college graduates has declined even as the cost of a degree has gone through the roof.

         Private university tuition is up to $50K per year at some schools, with public university fees rising to about $10K for in-state residents and $25K for out-of-state students, all before living expenses. Average college tuition has risen as much as 440 percent in the last 25 years. It’s little wonder that students are being forced to load up on government-provided loans to go to college.

            It’s not that professors are getting paid more. It’s not even all the new buildings and facilities. It’s that universities have become more bureaucratic and added layers of administrators. According to the Department of Education and Bloomberg, administrative positions at colleges and universities grew by 60 percent between 1993 and 2009, 10 times the rate of tenured faculty positions during the same period. An analysis of a university system in California showed a 221 percent increase in administrators over a multiyear period even as the number of full-time faculty members only grew 5 percent. One report observed that “America’s universities now have more full-time employees devoted to administration than to instruction, research and service combined.”

            I understand it. I’ve run a nonprofit. If you get more resources, you hire people to work for you. Everyone is well intentioned and pleasant. You do great work. An organization’s imperative over time becomes its own growth and self-maintenance. But in this context, it’s critical to bring education costs down for the sake of the public good in the age of automation.

            At the high end, universities are spending a lot of money on making more money. In 2015, a law professor pointed out that Yale spent more the previous year on private equity managers managing its endowment—$480 million—than it spent on tuition assistance, fellowships, and prizes for students—$170 million. This led Malcolm Gladwell to joke that Yale was a $24 billion hedge fund with a university attached to it, and that it should dump its legacy business.

            Yale and all other nonprofit universities are tax-exempt and receive millions in research money from the government, which means that American taxpayers are paying for and subsidizing the accrual of billions to both the universities and their endowments. A research group documented the cost of taxpayer subsidies for a community college student as between $2,000 and $4,000 per student per year, with that figure climbing to $10,000 per student per year at a typical state university. For Harvard the taxpayer subsidy jumped up to $48,000 per year, for Yale it was $69,000 per student per year, and for Princeton it was $105,000 per student per year. Being tax-exempt is more valuable the more money you’re generating.

            This is a perverse use of taxpayer resources—it’s literally just helping rich schools get richer as opposed to spending money on education. One way to change this would be a law stipulating that any private university with an endowment over $5 billion will lose its tax-exempt status unless it spends its full endowment income from the previous year on direct educational expenses, student support, or domestic expansion. This would spur Harvard, Yale, Stanford, Princeton, MIT, Penn, Northwestern, and others to spend billions each year directly on their students and expansion within the United States. There could be a Harvard center in Ohio or Michigan as well as the new one they just opened in Shanghai. This would also induce investment from schools that approach the $5 billion threshold, such as Dartmouth and USC, who would want to stay below this level. Another possible approach would be to simply tax rich universities’ endowments and use the proceeds to subsidize students at community colleges and public schools, which has been advocated by at least one progressive group. One could also mandate that they spend a certain percentage—say 6 to 8 percent—of their endowments each year.

            The trickiest part is to introduce cost discipline and discourage administrative bloat at universities. Capping cost increases now won’t be that helpful because the horse is already out of the barn. In 1975, colleges employed one professional staffer—admissions officers, information technology specialists, and the like—for every 50 students. By 2005, the proportion had risen more than 138 percent to one for every 21 students. Media coverage calling out administrative efficiency and bloat could be a useful galvanizer. But it will likely be necessary for the government to install benchmarks around the proper ratios of administrators to students and administrators to faculty and then give institutions time to move in that direction. The government subsidizes education through research money, the tax-exempt status of universities, and the provision of hundreds of billions of dollars of school loans—it needs to help rationalize all of this spending without blindly saying “more college will fix everything.” It won’t.

            We also need to amend or ignore the U.S. News and World Report college rankings. At present, the rankings reward colleges for accepting more rich students by including measures like financial strength, student-to-teacher ratio, and alumni giving. Perhaps not surprisingly, Yale and Princeton admit more children from the top 1 percent than from the bottom 60 percent combined. Schools that admit more varied types of students or even operate more efficiently will be penalized in the rankings. Brit Kirwan, the former chancellor of the University of Maryland, said, “If some foreign power wanted to diminish higher education in America, they would have created the U.S. News and World Report rankings. You need both more college graduates in the economy and you need many more low-income students getting the benefit of higher education—and U.S. News and World Report has metrics that work directly in opposition to accomplishing those two things.” It’s insane that the rankings of a single publication shape the behavior and policies of dozens of billion-dollar organizations against the public interest.

 NEW SCHOOLS

 

            We have been grasping for more economical ways to educate people for years as the cost of college has escalated. There are high hopes for coding boot camps that can train people in coding and get them high-paying jobs in four months. Flatiron School and General Assembly took the world by storm with successful job placement rates as high as 95 percent. After some early success and an excess of investment, a number of the larger boot camps have recently closed, and the industry as a whole is consolidating. The 90 coding boot camps across the country produced about 23,000 graduates in total and have almost exclusively found success with immersive in-person programs. “Online boot camp is an oxymoron,” said Ryan Craig, an investor at University Ventures. “No one has figured out how to do that yet.”

            Perhaps the most interesting application of technology in college education is the Minerva Project, a startup university now entering its fifth year. At Minerva, students take classes online, but they do so while living together in dorm-style housing. Minerva’s online interface is unusual in that the student’s face is shown the whole time, and they get called on to ensure accountability and engagement. This “facetime” is even the main performance metric—there aren’t final exams. Professors review the classes to see if individual students are demonstrating the right “habits of mind.” Minerva saves money by not investing in libraries, athletic facilities, sports teams, and the like. Students spend up to one year each in different dorms in San Francisco, Buenos Aires, Berlin, Seoul, and Istanbul. Minerva is selective—the acceptance rate for the latest class was only 1.9 percent. Students socialize and build connections because they live and travel together. Minerva delivers learning but it also delivers the credentialing, network, socialization, and identity that students crave. And it does this at $28K a year, a little more than half of what similarly selective universities charge. I met a group of Minerva students in San Francisco last year, and they struck me as unusually self-determined and thoughtful.

            One thing I love about Minerva is that it’s a new school. Ben Nelson, the founder and CEO, has made the point that if everyone wants to attend a great university, why don’t we create more of them? It’s truly odd that we’ve maintained a similar number of slots at selective schools even as admissions rates have plummeted to record lows. It may serve a school’s interest to remain small and selective, but it’s better for society if they were to try to expand. Dartmouth recently announced it may grow its entering class by as much as 25 percent, which is a step in the right direction.

 REDISCOVERING IDEALS

 

            The single best thing that universities could do would be to rediscover their original missions. What do you stand for? What should every graduate of your institution hold or believe? Teach and demonstrate some values. They’re not your customers or your reviewers or even your community members; they’re your students. They can tell if you’re primarily sitting there selecting them, trying to connect them to jobs, building your endowment for the future, and encouraging them to donate.

            Harvard was originally founded to prepare clergy for their work. Now its main purpose seems to be to make sure that at least one banker a year used to play the cello. I spoke at Princeton a while back, and the students literally laughed when someone mentioned their motto: “In the Nation’s Service and the Service of Humanity.” I’m sure if someone had said it was “For the Wealth of Princeton” or “In Service of the Markets” they would have laughed, too, for different reasons.

            In his book Self and Soul, Mark Edmundson, a University of Virginia professor, writes that Western culture historically prized three major ideals:

            • The Warrior. His or her highest quality is courage. Historical archetypes include Achilles, Hector, and Joan of Arc.

            • The Saint. His or her highest quality is compassion. Historical archetypes include Jesus Christ and Mother Theresa.

            • The Thinker. His or her highest quality is contemplation. Historical archetypes include Plato, Kant, Rousseau, and Ayn Rand.

            Edmundson mourns that these ideals today have been largely abandoned. The new ideal is what he calls “the Worldly Self of middle-class values.” To get along and get ahead. To succeed and self-replicate. The three great ideals live on in diluted form (e.g., spin classes and Spartan races for the Warrior, nonprofits and social entrepreneurship for the Saint, Ta-Nehisi Coates and the blogosphere for the Thinker). But anyone who pursues one of these ideals to their extremes in modern life would seem ridiculous, impractical, unworldly, and even unbalanced. I’m sure most college students would agree.

            Personal qualities today are increasingly marginalized in favor of technocratic, market-driven skills. Instead, finance is the new courage, branding is the new compassion, and coding is the new contemplation. Schools today don’t believe it’s their place to teach toward the big questions. They can barely remember what ideals look like. If they can remember, there will be much more hope for us all.

 CONCLUSION: MASTERS OR SERVANTS

 

 

            I realize the vision I paint of our present and future challenges in this book has been a lot to take. The challenges of this era are massive. Automation-led job destruction has had a running start weakening our society. We feel paralyzed because we fear that our institutions and leaders are no longer able to operate and the solutions require many to act against their own immediate interests. We strive to make more people and communities capital-efficient and market-friendly even as the water level rises. The logic of the market has overtaken most of our waking lives. Normal Americans will increasingly suffer as the market grinds on and eliminates opportunities and paths to a better life.

            A majority of the technologists I speak to are already 100 percent certain that the automation wave is coming. They skip to the logical end. The time frame is unclear, but it really doesn’t matter that much if it’s 5, 10, or 15 years. They’ve already gotten there in their minds. Most are ready to head for the hills.

            I am fighting for my soul because I’m right there with them. I see it, too. I see the path from here to there filled with broken people and communities, and a society torn apart by ever-rising deprivation and disability. People will blame each other because they are locked in a fight for scarcity. Experts will squabble while the average person suffers. Families will deteriorate into dysfunction. Children will come of age with no real hope of a better life and with institutions selling them false promises.

            The age of automation will lead to many very bad things. But it will also potentially push us to delve more deeply into what makes us human.

            I spent the past six years raising a small army of idealistic entrepreneurs who have fanned out to 18 cities around the country. Dozens of our alumni have started companies ranging from a crawfish restaurant to a company connecting brand sponsors to Little Leagues to a chickpea pasta company to a company that helps make construction projects more environmentally friendly. We have helped create more than 2,500 jobs. It’s amazing. It’s inspiring.

            It won’t be nearly enough. It will be like a wall of sand before an incoming tide.

            I created a multimillion-dollar organization out of people and ideals. I have lived in Manhattan, Silicon Valley, and San Francisco while working in Providence, Detroit, New Orleans, Cincinnati, Las Vegas, Baltimore, Cleveland, Philadelphia, Pittsburgh, St. Louis, Miami, Columbus, San Antonio, Charlotte, Atlanta, Nashville, Birmingham, Denver, Kansas City, and Washington, DC.

            I have been in the room with the people who are meant to steer our society. The machinery is weak. The institutionalization is high. The things you fear to be true are generally true.

            I wrote this book because I want others to see what I see. We are capable of so much better.

            There’s a very popular notion out there that ideas change the world. That’s wrong. People change the world. People making commitments and sacrifices and doing something about the forces that are tearing our society apart. Whom do we serve, Humanity or the Market?

            Are we the opiated masses, the elites in our enclaves, careening toward a conjoined bleak destiny that we are powerless to stop?

            Is there enough character and will and confidence and independence left to build the world and do what is required? Is there enough empathy? Capital doesn’t care about us. We must evolve beyond relying upon it as the primary measurement of value. Human Capitalism will give us the chance to define what’s important and pursue it.

            I’m now a grown man with a family. I know the difference between talking about something and actually doing something about it. There is no hiding from what one knows. I even know the difference between writing a book about something and fighting for it. The choice is essentially to cut and run or to stand and fight. We must convert from a mindset of scarcity to a mindset of abundance. The revolution will happen either before or after the breakdown of society. We must choose before.

            It will not be easy. We all have dysfunction within us. Darkness and pain. Contempt and resentment. Greed and fear. Pride and self-consciousness. Even reason will hold us back.

            Through all of the doubt, the cynicism, the ridicule, the hatred and anger, we must fight for the world that is still possible. Imagine it in our minds and hearts and fight for it. With all of our hearts and spirits. As hands reach out clutching at our arms, take them and pull them along. Fight through the whipping branches of selfishness and despair and resignation. Fight for each other like our souls depend on it. Climb to the hilltop and tell others behind us what we see.

            What do you see?

            And build the society we want on the other side.

            Evelyn, thank you for all that you do for me and our boys. They will grow up to be strong and whole.

            The rest of you, get up. It’s time to go. What makes you human? The better world is still possible. Come fight with me.