Learning Differently

A pediatric patient with a heart valve problem receives an MRI in Columbus, Georgia. The image is read using tele-radiology technology by an expert in neonatal cardiology in Atlanta, 250 miles away.

A 63-year old man presents with stroke symptoms to a Knoxville hospital emergency room at 2 a.m. The neurologist on call is at home, sensibly asleep, and 45 minutes away. Time is everything with a stroke. The neurologist is phoned, he orders a CT scan, and the neurologist, still in his pajamas, reads the scan on his secure laptop using a tele-neurology software application. There is no stroke. The patient is ordered to be held in an observation bed overnight and the neurologist returns to bed. The patient will be released the next morning if he remains asymptomatic.

A primary care doctor seeing a diabetic patient senses she is anxious and possibly depressed. In times past he would hand her off to an assistant to schedule an appointment with a psychiatrist. Most patients never keep such appointments. This doctor, however, has a special tele-video room with a secure link that allows her to receive a remote psychiatric examination on demand with the assistance of a local nurse. The video camera, operated remotely by the psychiatrist, can zoom in on the patient’s pupils or any other body feature.

These three examples of the growing use of telemedicine are important trends in healthcare. They admit the fact that medical expertise and medical need are not always required to be in the same place. With the proper access points, medical expertise can be exported anywhere, bringing healthcare to people who would otherwise be deprived of it, or who need it immediately. The tele-video room mentioned above was used earlier in the day to allow a cross-town dermatologist to examine a lesion discovered during a routine physical exam of a patient and suspected to be melanoma.

Virtual places and remote presence applications are spreading to other industries as well like security, manufacturing, and education. It could potentially revolutionize the delivery of educational content around the world, reaching the poorest and most educationally deprived places on the planet.

One of the most recent innovations in educational content delivery is Massive Open Online Course (MOOCs). They are massive because there’s no limit to how many students can concurrently take a course. Often students are scattered around the world. They are open because anyone with browser access can enroll in the course, most of which are free at this time. Obviously they are online and the courses I’ve taken follow a curriculum. Many of the courses are archived, so a person could take a course that has been completed and closed and go through it at his own pace.

With college tuitions rising faster than inflation, innovations like these are sorely needed. Teaching pedagogy hasn’t changed since the beginning of time and we need to find ways to make students smarter faster and at less cost. Reducing the number of years required to obtain a college degree would reduce the cost. There’s nothing magic about four years, and if colleges operated year-round, it would be possible to graduate in three years. A number of colleges now do that.

Moving courses online that don’t receive a benefit from classroom delivery is another way to cut cost. Faculties howl at this idea, predictably refusing to be insignificant in all content delivery. But it’s hard to make a case that a classroom and professor add much to courses like introductory statistics, basic economics, math, and computer programming whose “learning” mostly involves the mastery of fundamentals.

Online course-taking can be self-paced – a big plus, since the pace of traditional classroom teaching is pitched to the average student, meaning half of them struggle to keep up. Mini-exams could be inserted after each online learning unit, which are computer graded with prompts that help students understand their errors. Until a unit is mastered, the student would not be allowed to proceed. And teaching assistants would be available to help students who need it either in special chat rooms or face-to-face remedial classroom sessions.

MOOC providers like Coursera and Udacity offer these kinds of courses online and free. Students who take them and master the content should be allowed to take comprehensive exams that exempt them from taking the college’s traditionally taught course offering. Some colleges already allow exemption exams. Others, protective of turf and brand, don’t. But the fact is about half of the first two years of college could easily go online.

The curriculum of a college was once a unique differentiator among competitive colleges. No more. Curricula are becoming commoditized and delivery methodology will become the future differentiator. Computer simulation now allows students to experience content impossible with a chalkboard or PowerPoint presentation. In the “old days” the jaw-dropper for an Excel spreadsheet was its ability to show how a model responded to changes in inputs – immediately. With enough computer horsepower, online simulation allows an even more robust demonstration of complex model behavior. Crowd panic behavior, weather patterns, engineering failure analysis – any rule-based model can be integrated into online studies – a functionality unknown in traditional classrooms a decade or two ago.

Open online course critics like to point out that online courses don’t allow the professor-student interaction possible in a classroom. Well, yes. And a person would have a hard time cutting down a tree with a nail file. It’s the wrong tool. Online courses won’t replace every college course taught. Those requiring Socratic give and take are an obvious example. But many courses can be a blend of online and classroom.

An online lecture offers students in colleges too small to attract a faculty steeped in, say, Greek literature of the third century to hear one of the premier lecturers in subject matter speak as a “guest lecturer” via an online presentation, after which the class would discuss the material facilitated by the professor or instructor. An entire semester of guest lecturers could be cobbled together in a course that some colleges wouldn’t otherwise be able to offer.

The main obstacle preventing open online courses from being more of a threat to traditional classroom content delivery is the inability to get transferable college credits for courses taken online. Students would like to take and transfer inexpensive online courses, but college faculties are a hurdle. They assert their resistance is based on quality concerns, but exemption exams are a way around that objection. The real issue is turf and a concern that faculty positions would shrink if more courses went online. The rising cost of college and the crippling debt students or their families must underwrite never rise to the same level of concern among these faculties. Interestingly, their college-age children don’t worry about rising tuitions. If they choose, they may attend the college employing their parent tuition-free or at a substantial discount. That’s a nice bonus in after-tax dollars.

Well, all of the faculty resistance may be changing. Online courses are politically popular because they allow legislators to switch money from college subsidies to other state programs. Governor Rick Scott of Florida signed a bill this past July that originally would have expanded the implementation of MOOCs in the state’s primary, secondary, and college educational systems.

The primary and secondary teacher unions were able to reduce the scope of the original bill and the college faculty union was able to delay it – at least for a while.

The United Faculty of Florida were quoted as mounting an “intense and feverish” opposition to a generation of “cheap and dirty” online courses offered to students before they entered college. “No matter how many times they use ‘quality,’ this is a cheapening of what higher education is all about.” Luddite leaders probably said something similar.

But Florida college leaders have been given two years in the bill to come up with rules to grant credit for online courses, and K-12 students are required to use open online courses in four subject areas beginning the next academic year.

This past May, Georgia Tech announced it would get in front of the MOOC movement rather than fight it. Next year it will begin offering an online Master of Computer Science degree in partnership with AT&T, which ponied up $2 million for the project. Those who don’t want to earn the degree may take the MOOC Master of Computer Science courses free. For those who want a degree, the cost will be $6,600 compared with the $45,000 price tag for the on-campus model. AT&T will use the course to train employees and recruit candidates for its jobs.

Initially, enrollment will be a few hundred. But it’s expected to expand to over 10,000 annually, many of them students in other countries who can get a graduate degree but don’t need a visa to attend. Degree candidates will take proctored exams. Tutoring will be available as well as online office hours and other help.

An estimated three million STEM (science, technology, engineering, math) positions must be filled in the next half dozen years in this country. It’s hard enough to find STEM graduates because of the poor job public education does in preparing high school graduates for college in STEM curricula. Therefore, it’s stupid to throw cost obstacles in the way of students who are qualified to enroll in STEM degrees but can’t afford them. Georgia Tech has shown itself to be a leader in solving the cost barrier problem, while other college leaders and faculties are more concerned about college revenues and job security trotted out under the red herring of “quality.”

Last November Clay Shirky, an NYU professor, issued a warning to his colleagues in a blog entitled “Napster, Udacity, and the Academy.” He said it was fish or cut bait time for faculties to get onboard with online education. They had best take a lesson from Napster, which proved that music file sharing was a big market to Steve Jobs who developed iTunes to legitmize it. The music industry previously forced consumers to buy CD-based music they didn’t want in order to get the one or two tracks they did want. Along comes iTunes and cuts a pay-by-the-song deal with the record industry, which received two-thirds of 99¢ price of a song. A two-thirds cut is better than nothing, but the music industry could have owned the download business if they had only gotten out in front of the 10X trend driving file sharing instead of fighting it. The same thing will happen to traditional universities which fight online course offerings instead of adapting.

I’ll add my own two cents worth to Shirky’s warning.

A surprising number of innovations in business come from outside an industry. That’s because the industry is so wedded to its current business model that it considers everything that threatens it “the enemy” instead of “the future.” If the new business model cannibalizes the current one it’s bad. Or so the traditional thinking goes.

Example.

The music industry was wedded to vinyl records, which went through a succession of improvements from 78 rpm to 33 rpm and from high fidelity to stereo. You’d have expected the compact laser disc would have come from the vinyl record industry’s search to put more music on a smaller medium with better fidelity. It didn’t. The CD came out of the computer industry which stored data in digits. The record industry, preoccupied with vinyl, was replaced almost overnight.

Another example.

Nortel and Lucent were the leaders in the voice communications where parties spoke with each other through a telecommunication network that connected them via a sequence of switches. Once connected, the hook-up of phone lines and switches was “in use” until the call ended. Reliability was everything – telecom engineers spoke of “five nines” meaning 99.999% of the time, everything worked perfectly.

Data was a different matter. Users don’t connect to each other. They connect to a network through which data is broken up into packets and sent. These packets get mixed up with packets of other people’s data messages, but each packet has an address that allows the data message to be reassembled at its destination. Speed and the capacity to handle high volumes of data traffic are more important in data transmission than the reliability so important in voice transmission.

Data, however, was the red-headed stepchild of the telecommunications industry in its early years and voice was king. Then a little company, Cisco, came along. Their router wasn’t good enough for voice so they staked out territory on the data end of the market and continued to improve their product’s performance and quality.

Then the Internet became mainstream. The world of communications changed forever. No longer were users pushing data through private corporate networks within their building or to the building next door. They were pushing data to a computer on the opposite coast through the worldwide web, a network of servers connected through public telephone lines and switches. The telecommunications system – designed to handle an average voice call of three minutes – was paralyzed by long Internet data sessions.

Telephone networks began carrying more data than voice traffic. In time it was discovered that voice could be broken into packets like data. The quality was not as good as the traditional telephone voice call, but that would come with technical progress. Nortel and Lucent refused to play the data game. They chose to fight it. Cisco continued to improve to the point that voice-over-Internet Protocol (VoIP) became free phone service.

Then, in the 2000s, cell phones became mainstream and today half of the homes have no landline – the once rich domain of Nortel and Lucent. Lucent, a shell of its past glory, was acquired by a Canadian company. Nortel filed for bankruptcy and was disassembled for parts.

Oh, how the mighty have fallen.

In 1975 Theodore Levitt published an article in the Harvard Business Review entitled Marketing Myopia. It was profound for its time, and some of his ideas still are. The railroads, Levitt observed, were replaced by airlines because the former saw themselves in the “railroad” business rather than the transportation business.

Nothing prevented newspapers from creating eBay or Craigslist, which gutted their classified sales. But they saw themselves as being in the newspaper business. There is no reason that Wikipedia couldn’t have been created by Encyclopedia Britannica, which is no more, except the way Britannica defined itself.

Universities had best take note that history shows disruptive innovations almost always come from other industries. They blindside unsuspecting industries wedded to old business models and who have defined themselves too narrowly. And they usually win

University faculties should be asking themselves what business they are in.

Debt Default Lies

A liar is a person who makes a statement knowing that it’s not true. Simple enough.

How about a person who makes a statement that is superficially or partially true but made in the spirit of misleading others to believe something not true? Well, I’ll let God sort that one out.

The good book says that liars have their place in Hell so there should be a lot of politicians there.

Obama, Reid, Pelosi, Treasury Secretary Lew, and the media have been a Greek chorus of late, warning of the perils ahead if the limit on Congress’ credit card is not immediately and unconditionally raised. They falsely claim that the federal government will default on its debt unless the debt ceiling is raised, they falsely claim that King Obama can raise the debt ceiling on his own authority if he chooses, and they falsely claim that entitlement programs are constitutionally protected. All lies.

Let’s take them in order.

A debt default means that a contractual obligation to service a debt was not performed at the time required. If the debt ceiling isn’t raised, it means our government, which borrows 40¢ of every dollar spent is going to have to make some choices. But servicing the national debt is not one of them. The revenues taken in as taxes are ten times the interest on the national debt – ten times! About $250 billion per month is received as government revenue and about $23 billion in interest is paid to the holders of the national debt. Maturing obligations that require the redemption of debt principal are simply rolled over into new debt using the proceeds to redeem the maturing debt without a net increase (or decrease) in debt.

The assertion that a debt default will occur unless the debt ceiling is raised is laughable. The money is there and there’s no choice – payment of national debt obligation is a constitutional compulsion. It’s called the 14th Amendment, Section 4.

Let’s just check that Section out for the benefit of the Greek chorus, shall we?

The validity of the public debt of the United States, authorized by law, including debts incurred for payment of pensions and bounties for services in suppressing insurrection or rebellion, shall not be questioned …

Hmm. Not a lot of wiggle room there.

The 14th Amendment was adopted in 1868 as part of post-Civil War Reconstruction. The “debt shall not be questioned” clause was put in to assure that if the new Southern members of Congress were to gain a majority, they couldn’t repudiate the Northern war debt. In other words, “shall not be questioned” meant a Southern legislator couldn’t challenge that his constituents shouldn’t be paying taxes to reduce a debt that was created to defeat the South, kill Southerners, and destroy their property. Taken as a generalization, it means debts must be paid.

So, why do you think the Greek chorus is lying, claiming that a failure to raise the debt ceiling is tantamount to a debt default? I’ll give you three guesses and the first three don’t count. To scare the pants off of a public that is marginally literate in how its government works – of course!

Conceivably, the debt ceiling might have to be raised in the future to pay obligations on the national debt. Let’s hope that day never comes. The country would be in economically sad shape. Thankfully that isn’t the case today because there is sufficient cash coming in to pay the debt with a lot left over. But not enough is left over to pay all of the obligations at the current level of spending. So, excluding debt payments, spending obligations must be prioritized. Gee. Isn’t that what families do until they can reduce their spending to align it with income?

Establishing a debt ceiling was one of the few intelligent things Congress has done. It forces the issue to the forefront periodically, usually grabbing the headlines for a few weeks and rousing the public from its slumber. The people’s representatives are forced to do combat over what price will be exacted and how much will the ceiling be raised. But the ceiling always gets raised.

Raising the debt ceiling simply allows Congress on both sides of the aisle to run up new debt, which lately they’ve been able to do pretty quickly, and then the hogs are back at the trough and locked in another debt ceiling fight. But eliminating the debt ceiling altogether and allowing Congress to spend as it wishes, which some have suggested, is sheer folly. There are no adults in Washington and giving kids a credit card with no limit is stupidity on stilts.

As much as I hate this periodic kabuki theater of closing public parks and pretending the economic sky is falling, it fills a useful purpose. Who knows? Maybe one day the public will wake up, realize debt default isn’t possible, and that spending reductions are a more sensible way to reduce the frequency of these charades. The Left is terrorized that this might happen.

And the Left says, “Well, if you're going to get “constitutional” about this, show me where in the Constitution a debt ceiling is established.” Can’t. It’s not in there. The debt ceiling is a congressional procedure, not a Constitutional provision.

So, why can’t King Obama raise the debt ceiling on his own authority, the Left whines? Because he doesn’t have the Constitutional authority. The power of the purse resides exclusively in the House – not the President, not the Senate. The power to tax the credit of the United States with debt was meant by the Founders to rest with the people’s representatives, who could throw those representatives out of office every two years if they disagreed with the Representative. (Oh, that we might have an electorate so informed.)

The debt ceiling is the step-child of a bygone era in which every issuance of public debt had to be voted on and its purpose challenged. Laziness and expediency have rolled the individual obligations into a general “debt ceiling” number that gets fought over when Congress spends itself to the limit. We would be better off if every bill funded by debt had to be fought out on its merits. The fact that we have to raise the debt ceiling so often suggests rolling all borrowing into one ball isn’t working.

King Obama apparently looked into the possibilities of by-passing Congress on the debt ceiling debate several years ago. His lawyers told him that taking over the role of Congress wasn’t a winning play. Hmm. Just when he was considering Congress irrelevant.

This brings us to the third false claim by the Greek chorus – that entitlements are Constitutionally protected, presumably under the 14th Amendment mandate to service the public debt. Ahh. Nice try. But the Constitutional wording says “debts” not obligations. The original draft of the Amendment used the word “obligations,” but an astute Congressman replaced it with “debts” which not only zeroed in on the real intent of Article 4, but also narrowed the focus specifically to debts – transactions that involved borrowing and repayment.

Entitlements never involved borrowing and are not debts. They represent a future liability – unfunded mostly, such as Social Security, Medicare, and Medicaid – but never transactions with Constitutional protection. The debts incurred by one Congress bind future Congresses under the 14th Amendment. Not so with entitlements, which are political programs. Entitlements passed by one Congress can be repealed by a future Congress, defunded, expanded, or modified in scope. Each Congress may have its way with entitlements because they aren’t debts, even though they are implicit promises.

FDR knew Social Security lacked Constitutional protection and he may have had enough foresight to know future Congresses would try to repeal or diminish the program. Responding to a critic who questioned the economic soundness of the program, he said,

I guess you’re right on the economics, but those taxes were never a problem of economics. They are politics all the way through. We put those payroll contributions there so as to give the contributors a legal, moral, and political right to collect their pensions … With those taxes in there, no damn politician can ever scrap my social security program.

Well, notwithstanding the fact that payment on the national debt was never in doubt by the shutdown, the Republicans led by McConnell the Dinosaur and Boehner the Weak caved and gave the Democrats a new credit card until early next year. They are busy running up its balance to the limit.

Twenty-seven Republicans signed the surrender document in the Senate along with 87 House members. I hope they can explain their perfidy to the folks back home. Of course, all House and Senate Democrats voted “aye” before rushing for their Committee checkbooks.

Not so subtly hidden in the voting stats is this: 40% of McConnell’s caucus and 62% of Boehner’s voted against their leader. I’d say both have cause to worry when they stand for reelection as the Senate and House leaders – assuming they have the gall to run.

Oskar Schindler Remembered

Oskar Schindler could well be called an accidental hero. A petty scoundrel, a chronically unfaithful husband, and consistently unsuccessful in every business venture he undertook, something happened to him while he lived in German-occupied Poland during World War II. Whatever it was, it briefly redeemed his flawed life until the end of the war, when he resumed being the pre-war Schindler. His momentary transformation redeemed the lives of 1,200 Jews, one of whom made it his mission to tell Schindler’s story to the world.

This week is the 39th anniversary of Oskar Schindler’s death.

He was born in the Sudeten region of Czechoslovakia where German was the lingua franca. Expelled from secondary school for forging his report card, Schindler was allowed to reenroll and graduate. He married and pursued several vocational trades. His personal life was as unremarkable as his business life – several arrests for public drunkenness and an affair with a school friend who bore him a daughter and son. He was always in debt.

Hitler’s invasion of Poland was bad news for Polish business owners but good news for German carpetbaggers eager to appropriate their companies and properties. Schindler arrived in Krakow, Poland the month following the invasion and acquired the rights to an enamelware factory, complete with inventory and workforce – the latter mostly Jewish slaves who, according to Nazi provisional law, could not be paid.

Beginning with about 45,000 sq. ft. of production space and a hundred workers, Schindler scaled up operations to almost 500,000 sq. ft. and 800 workers half of whom were Jews. The nearby Krakow Jewish ghetto would in time provide all of the workers that Deutsche Emaillewaren-Fabrik would need, helped by Itzhak Stern, Schindler’s Jewish accountant and manager who doubled as his workforce recruiter.

Schindler lived lavishly in Krakow in an apartment appropriated from a Jewish family. Mila Pfefferberg, one of Schindler’s Jewish workers, redecorated it to his tastes. Her husband, Poldek, also a worker, would become Schindler’s chief scrounger among the Jewish black market for bribe merchandise. Poldek would also become his patron’s lifelong friend and the person determined that the world would know Schindler’s one bright shining moment. With Schindler’s wife Emilie remaining in Czechoslovakia, he was able to have active extramarital affairs with his Polish secretary and with a woman who merchandised the company’s products.

Itzhak Stern was initially circumspect about his German employer. But Schindler treated his workers as well as possible under wartime circumstances. In time workers pressed Stern to let their families join them in the factory labor force, which not only got them out of the ghetto during working hours, but also made them less likely to be deported to death camps as was happening to those who were unemployed.

Deutsche Emaillewaren-Fabrik in time became a sought-after haven among the ghetto Jews, and Schindler helped his workers by doctoring the worker records to show the youngest as older workers and the oldest as younger in order to fool periodic German inspections. Trained professionals – doctors, lawyers, engineers, musicians, and professors – were shown in the records as pre-war blue-collar laborers and tradesmen. Trade skills, essential to the war effort, shielded them from extermination.

Had they known, it might have alarmed Schindler’s Jews that their charming boss spent his evenings socializing with German officers and political technocrats to curry their influence and burnish his. He grew popular among the Krakow Nazis, greasing those with influence to help him sell products to the German war machine while corrupting them with bribes. The factory door swung from morning to evening as Wehrmacht, SS, and civilian bureaucrats visited Schindler to booze and trade. Claiming he knew how to get Jews to work harder than other carpetbaggers, the Germans were not suspicious of the growing Jewish workforce at Emaillewaren-Fabrik.

In March 1943 the Germans launched a horrific liquidation of the Krakow ghetto. Hundreds were killed as they were relocated to a nearby concentration camp, Plaszow, or to Auschwitz for extermination of the sick, young, and elderly. Schindler’s connections allowed him to learn of the German ghetto plans in advance. Therefore, he kept his workers at the factory, out of harm’s way during the initial sweep. But he couldn’t keep them out of the Plaszow labor camp. Conditions were awful and many workers suffered and died.

Learning that other Polish labor camps in the region were being shut down and their inmates were being shipped west to death camps, it was obvious that the same fate was inevitable for Plaszow. Stern and other leading Jews persuaded Schindler to lean on his contacts in the German military war materiel command structure and get Plaszow converted from its current mission as a uniform repair work camp to a war materiel work camp. A high-ranking German general got behind the idea allowing Plaszow to escape closure and making its inmates essential workers in the war effort.

The Plaszow camp commander was Hauptsturmfuhrer (Captain) Amon Goeth, a sadistic killer who shot camp inmates for recreation. The conversion of the camp to an essential materiel work camp had elevated Goeth’s status in the command ranks, and Schindler’s influence among generals elevated his status with Goeth. The original plan was to move all local essential factories into Plaszow. But Schindler’s charm, bribes, and diplomatic wrangling allowed him to persuade Goeth to let him build a sub-camp for his Jews so they wouldn’t have as far to walk and could begin the work day earlier. The sub-camp, completed near Emaillewaren-Fabrik at company expense, allowed Schindler to house his workers as well as house 450 additional ones from nearby factories whose owners held anti-fascist views similar to Schindler’s. With a sub-camp sufficiently distant from Plaszow, it became possible to smuggle food and medicine into the barracks without Goeth ever suspecting the true motive for constructing it.

By the spring of 1944 the Germans were soundly losing the war on the Eastern Front. All Polish camps were ordered closed including Plaszow. Inmates were to be shipped west to certain death. Schindler had to call upon all of his skills in negotiating, bribing, charming, begging, and even some threatening to prevent a human tragedy – at least among his workers. Protesting that his ability to “win the war” on the industrial front was being hamstrung by German liquidation orders, he asked to relocate his factory south of Poland in Sudeten Czechoslovakia where it would be out of the path of the retreating Germans and advancing Russians.

Failing to persuade officials in Krakow and Warsaw, he took a train and his proposal to Berlin. There he worked connections in the German command hierarchy. Possibly because the German High Command was so distracted by its collapsing war machine, someone with sufficient authority gave Schindler orders to transfer a thousand workers out of Plaszow to a new plant location no doubt believing it was a fool’s errand. Except for these select few, all others were loaded into locked trains and sent 30 miles west to Auschwitz and the certain death that millions had found there.

Four months following the D-Day invasion, Schindler began preparing his famous list helped by Goeth’s secretary, Mietek Pemper. A list of 1,200 Jews was compiled, 1,000 of whom were Schindlerjugen – Schlinder’s Jews – plus 200 from a nearby textile factory owned by another sympathetic German. German bureaucracy and arcane logistics caused a train that left on October 15, 1944 with all male inmates to be rerouted to a Polish concentration camp. There the inmates remained a week before being sent to the new plant location. Another train with females was sent to Auchwitz where they were in daily danger of being gassed. Schindler dispatched his secretary with black market bribes of food, goods, and diamonds to secure their release. It would be November before all Schindlerjuden were united in Czechoslovakia.

The region in which the new plant was located was in German hands and German officers were in and out daily. While the purpose of the factory was to make German war munitions, it made nothing. When the factory’s paltry output came to the attention of German officials, Schindler spent his dwindling resources to buy munitions on the open market and fobbed them off as his own. Until the war ended, Schindler and his Jews were in daily danger.

The war ended in May 1945 and Schindler and his Jews heard Churchill announce it via a radio on the factory floor. All area German troops fled west to escape the advancing Russians, who arrived two days after war’s end. Schindler also escaped west with his wife and a small company of Jews who went with him to corroborate his story when he surrendered to the Allies. Months afer leaving Czechoslovakia the Schindler party surfaced in Austria in Allied hands.

The Schindlerjuden adjusted to post-war life and scattered throughout Europe, with those who could returning to Poland. For Schindler, the transition to post-war life was difficult. He was penniless and a former German employer of slave labor. Moreover, he informed on his former army drinking companions and industrialists who had abused their Jews, making him a pariah among Germans who might have been inclined to help him.

Schindler’s main source of financial help became the Jews he had saved. Individual Jews and a post-war Jewish organization provided the charity he needed to emigrate to Argentina with his wife. There he attempted to farm and raise animals for their fur. But as had happened so often before the war, his attempts at business were failures. In 1957 Schindler left his wife for the final time. She continued living in Argentina and he returned to Germany. Yet, they remained married, never divorcing, although they would not see each other again. When he died, they had been married for 46 years.

Schindler’s economic fortunes were no better once back in Germany, now booming in its post-war years. Several businesses failed as did his health, suffering a heart attack in 1964. He was reduced to living off of handouts from his appreciative Jewish survivors – the Schindlerjuden – now scattered throughout the world. The post-war Israeli government, settled almost two decades in its ancestral homeland, declared Oskar Schindler “Righteous Among the Nations” and after he died, the government paid to have his body reinterred in a Catholic cemetery on Mount Zion in Jerusalem.

Despite the fame among the Jews for his efforts during the war, Schindler’s exploits were relatively unknown among the non-Jewish world. Poldek Pfefferberg made several attempts to have film producers turn the Schindler story into a motion picture. He had no success, since there was little post-war interest in “good German” stories.

Mila and Poldek Pfefferberg emigrated to California where he established a luggage shop. Quite by accident in 1980 an Australian author, Thomas Keneally, stopped in the shop as he returned home from a European trip. Pfefferberg regaled Keneally with the Oskar Schindler story, giving him copies of papers he had compiled to preserve the details. Keneally did his own research, interviewed survivors, and satisfied that the story was true, decided to write a fictionalized account of it so that he could put it in the form of a novel with dialog. It was published in 1982 under the title Schlinder’s Ark. In the US the book title was Schindler’s List. Steven Spielberg acquired the screen rights and produced the Academy Award-winning motion picture Schindler’s List. The film was released in November 1993 – 20 years ago next month.

In the final months before his death 39 years ago this week, Schindler had stayed with friends in their house in Hildesheim, Lower Saxony. A suitcase containing papers and photos remained after his death. In 2000 it passed into the hands of a Stuttgart couple who were relatives of Schindler’s Hildesheim friends. The suitcase was discovered to contain the original Schindler’s list on Emaillewaren-Fabrik letterhead with the names of the 1,200 Schindlerjuden.

Another list was drawn up by Schindler a month before the war ended. He used it to persuade the Czechoslovakian SS that the names on the list were vital to the war effort. The job listed next to each name was fictitious.

In 2009, among the work papers of Thomas Keneally on file in the State Library of New South Wales, was found a faded carbon copy of a Schindler’s list. It was in the document file Poldek Pfefferberg gave Keneally as background for the Schindler story. Thirteen pages long, this list contains 801 names and is dated April 18, 1945. It is Schindler’s Czechoslovakian list or a copy of it.

Two other copies of Schindler’s list are known to exist, one in a private collector’s hands. It had been kept by Itzhak Stern, the Jewish factory manager shown typing it in the film, Schindler’s List.

Is College Worth It?

Failure to Launch, a report just out from the Georgetown University Center on Education and the Workforce, is worthwhile reading for parents and grandparents whose children and grandchildren are facing critical decisions about college and careers.

Among its several observations, the report quotes a shift in an important statistic. The median income, the division of the upper and lower halves of American incomes, is a major milestone marker for young people to pass in their march toward financial independence. But they aren’t reaching it until age 30 now compared with age 26 three decades ago when the data point was first tracked.

So what? This shift is important for several reasons. Passing the median income later reduces lifetime income which can only be made up by working for more years than past generations. It also means that at any year during a person’s income-earning years consumption is likely to be less. On a broader front it means a smaller future economy.

Arriving late to financial independence has no doubt been impacted by the recession and tepid recovery. But the labor participation rate for 20 to 24 year olds has been falling since the mid-1980s and is now at a level not seen since 1971. Over that 40-year period the number of jobs requiring more education than high school has grown from 28% to 59% and is projected to grow to 65% by the end of this decade. And while more people as a percent of population are in college than 40 years ago, they aren’t graduating fast enough to keep up with the demand as evidenced by the growing wage premium paid to undergraduate and graduate degree-holders – now 80% more than high school diploma-holders, double the figure 40 years ago.

Notwithstanding these long term trends, many college graduates currently have difficulty finding good paying jobs and are underemployed in jobs that don’t require college degrees. Whether it is true or not, it’s commonly asserted that 80,000 bartenders, waiters, and cab drivers and an additional 155,000 janitors have college degrees. Never mentioned is how many of them are educated in science, technology, engineering, or math. Still, the careers for which they were educated, whatever they are, remain on hold but their education loans aren’t.

Others in college saw the career fates their friends were experiencing and dropped out to get a job and begin to pay down college debt. About 40% of college students fail to get a four-year degree even in six years. While graduation rates are highest at private colleges, still a third of those students fail to graduate. The dropout rate is 45% at public colleges. And it is almost 80% at for-profit colleges like University of Phoenix, DeVry, and Strayer which cater to working adults you’d expect are motivated to complete.

Dropouts often get on with their lives, marry, have children, and find it difficult to later resume their education. Yet we know from experience that families whose breadwinner is less educated are also less mobile, less stable, and may perpetuate under-education to later generations.

Despite the short term outlook for college graduates, tuition has continued to rise faster than the general inflation rate and faster than beginning salaries, forcing students or their families to go into debt. If student debt at the time of graduation were rank ordered, the lower two-thirds would owe $25,000 or less. Since the top third has no cap it contains figures from $25,000 up, and “up” can be some truly astronomical six figures. The amount owed by all students for college loans totals $1 trillion.

The cost for attending a public college in real (inflation-adjusted) dollars is twice what it cost since data began being kept 45 years ago. The cost for attending a private college is more – up 137%. Nevertheless, college enrollment as a percentage of the population has grown during the period from 2.2% to 3.7%.

What’s going on here? Shouldn’t enrollment be going down? Should we be questioning whether college is worth the time and money it consumes? Some critics are. But if the jobs of the future will require college and perhaps post-graduate education, what can be done to control cost and access? Should colleges be required to inform students their job prospects if they major in, say, sociology? Those are the questions students, parents, and grandparents should be considering as they go on the hook for the expense of college education.

Historically, education has been a good investment. The average college graduate today will earn $600,000 more than a high school graduate over a typical career. The ROI on an investment in a college education beats the ROI of most financial investments – about 15% over the past 40 years.

But there’s little evidence to substantiate that the added cost of top brand schools is returned in career earnings. Obviously, the field of study is more important than the college that granted it. And any attendance in college study helps. People with some college earn more than those with none and people with advanced and professional degrees earn more than those with only undergraduate degrees.

If history is an indication a college degree will continue to be a good investment of time and money. And it’s a given that complexity has a bright future in the world and will require bright people to solve the problems it creates.

What, then, can be done to control the cost of college so that it is accessible to qualified students, not just those who can afford it? And what is driving up the cost of college?

The main public college cost driver is state budgets. As they are squeezed, less money is available to subsidize the state’s public colleges and more cost is shifted to students. Private colleges are subsidized by endowment income, which suffers in slow economic times.

Costs and cost shifting are different depending on the tier in which a college is classified – private, public, and community. Additionally private and public colleges are either research-focused or teaching-focused. Private colleges are usually more expensive than public; research-focused (about a third of colleges) are more expensive than teaching-focused (about two-thirds of colleges). Community colleges are often the least cost but not always the best value in terms of cost and quality. In the competition for students, more than a small percentage of spending by college administrators in all tiers is for resources that don’t improve education quality – amenities, sports, and dorms, to mention a few.

The fact that college costs have exceeded the general inflation rates has been blamed by college dons on the formidably-sounding affliction known as Baumol's cost disease. Proponents argue that teaching is labor-intensive and therefore not amenable to productivity improvements that leverage skills and know-how and reduce cost. Professors who have become brand names in academic circles are sought after by competitive colleges anxious to have the brand associated with their institution. Competition bids up salaries and perks, at least for the brand names, increasing education cost. This, it’s argued, is truer in research colleges than teaching colleges.

It’s a nice theory but largely specious because, as anyone who has taught in college or university knows, big brand professors spend most of the time in research and publication and use teaching assistants to meet their classes. Oh, sure, a doctoral class may see the old prof in class occasionally but rarely the undergrad students. The big brand professors can’t burnish their brands in the classrooms. They burnish them in the refereed academic journals. Journals are where research findings are reported and are the arena of big brand competitors and big brand wannabees. And they are not a bad place to market themselves to potential colleagues who can prevail upon their department chairman to put a bid in for a big brand and lure Professor Whatzizname away from the current employer.

Baumol’s notwithstanding, big brand professors are not the cause of tuition cost inflation. There aren’t enough of them. But there’s a glut of Ph.Ds chasing a limited number of tenure slots, which has driven down their salaries and forced many into adjunct instructor roles, lower tier colleges, and private prep schools. Moreover, the cost of instruction delivery is only about 15% of college spending.

Two Wall Street Journal reporters last year published an eye-opener about where the costs are in college spending – administrators. While the article focused on the University of Minnesota – a public research-focused university – as a former university professor, I can attest to the fact that Minnesota is not an outlier. There are too many deans, assistant deans, directors, and non-teaching staff, mostly Ph.Ds who don’t want to teach. Minnesota has one employee for each 3 ½ students – 19,000 employees in all. The growth in administrative staff outstripped the growth of faculty there by 51% over the previous decade. 

And it isn’t just the number of administrators that increase tuition costs, it’s what they are paid. At Minnesota 353 administrators make over $200,000. Seventeen make over $300,000, up from just seven who earned that much in inflation-adjusted dollars a decade earlier. University of Florida executives got five-figure raises last year and the students got higher tuitions. The presidents of Ohio State University and Texas A&M earned $2 million each, even as OSU is selling off property to offset reductions in state subsidies. The former president of Penn State University, Graham Spanier, who was forced out in the Sandusky sex scandal, was the highest paid public university president last year. Spanier’s compensation for the 2011-2012 academic year was $2.9 million, including $1.2 million in severance and $1.2 million in deferred compensation.

The arcane accounting systems of universities and colleges are not structured in a manner that allows cost to be managed. Therefore, even when a reformer like Eric Kaler, who assumed the presidency of the University of Minnesota last year, attempts to rein in tuition by cutting administrative costs, he couldn’t find out what it cost to run the place.

Out of control spending is compounded by the fact that universities are non-profit organizations. There is no incentive to save; in fact there are disincentives in many cases because unspent funds are lost by public colleges and return to the funding source. Absence mechanisms for allocating costs in terms of benefits, as exists in businesses, colleges and universities are woefully inefficient in educational content delivery. They are also unlike many other labor-intensive professions – medicine, law, and accounting come to mind – in which profit motivation forces innovation into the delivery of professional skills.  Mid-level staff and technology in labor-intensive business organizations leverage highly skilled people and confine their work to activities that yield the highest value.

As the Wall Journal reporters noted in their article, hikes in tuition pose a real economic hardship on students whose parents aren’t able to help them. In 1975, a Minnesota undergraduate could work six hours a week at minimum wage throughout the year and cover tuition. Today 32 hours at minimum wage would be required to cover tuition.  That’s almost a full-time job. It explains why many university night programs are growing rapidly even as their day programs are shrinking.

I’ll mention one more dimension of a college education that makes its costs hard to contain. It’s not a “normal good.” When the price of normal goods goes up, consumption goes down. In education higher prices may actually cause increases in consumption. There is a false perception that a quality education must be expensive. Not so. But hard to prove.

Because it’s not a normal good, it’s impossible to experience an education before consuming it, and dissatisfied customers can’t return it for a refund. We can test drive multiple cars, tour multiple houses, try on multiple outfits, and then pick the one that seems to be the best value – the best quality for the price. No way to do that with education.

The way most students and their families pick a college is the way they pick a bank or lawyer – the sizzle, not the steak. Go into a bank lobby or the trappings of a law firm and what you see is the wrapper around an intangible service. If the cosmetics look good, the quality of banking or law delivered there must also be good. Or at least that’s what the consumer thinks. It’s a flawed measure, but it works. If it didn’t, profit-motivated banks and law firms wouldn’t spend money on image creation. College administrators do the same thing. More spending goes into non-educational experiential resources than into educational resources, including instruction quality and content delivery productivity.

Don’t get me wrong. I think the college experience is important – probably more so at the undergraduate level than the graduate level. I collected four degrees and attended four colleges – two traditional campuses (one private and one public) and two concrete campuses (one private and one public.) The traditional campuses were a better experience – gyms, glee clubs, sports facilities, several grills to choose from, on-campus playhouse theater, nearby parking decks almost anywhere on campus. The traditional campus colleges were also more expensive and the quality of education was no different. Was the experience worth what it apparently added in tuition cost? Not to me.

Here are suggestions I would make to the parents and grandparents facing the prospect of college choices and costs. The most important choice is to get a marketable education. That would exclude majoring in sociology, history, literature, music, philosophy and religion – even business administration. These are not rigorous disciplines. I taught graduate students in the College of Business Administration of a major university and considered undergraduate degrees in business to be useless. Harvard, which has one of the top graduate business programs in the country has no undergraduate business degree. None of the soft majors I’ve listed (and lots of others) prepares a person to do anything in the world of work. Look around at the industries that are booming. They employ people educated in rigorous disciplines – science, technology, engineering, and math – and all of their derivative subsets – healthcare, computer sciences, energy development, biochemical and biotechnology development, programming, data management.

Don’t get hung up on making the “right choice” of a major out of the gate. Most people make multiple career changes. Mine changed four times. The most important thing is to keep the most important thing the most important thing. And the most important thing is for the graduate to get started in a career. With maturity and experience he or she will see new opportunities that invariably lead in different directions and careers.

The second most important choice is the college. Don’t get snookered by brand name colleges. Very few companies recruit on the basis of undergraduate college attended. People change jobs many times. After the first one, no one really cares where the undergraduate degree was earned. I would pick a public college over private and a teaching focus over research. The cost is usually less in both cases and the education quality is no different.

These two choices have the greatest impact on getting the best value for the education dollar. If student aid – grants and scholarships – is available it could slant the public-private choice because they don’t have to be repaid. Loans do.

The third choice is this: if in doubt, start at a community college. Some people aren’t ready for college, and the best way to test the water is to get a two-year Associate degree. It’s better than no degree, it’s a mark of achievement, and it’s a ticket into a major college later if the student wants it and has the grades. And in most states, community colleges have to admit students by law. Not so with four year public state colleges.

Here’s to choosing well!