The Oncoming Credentialing Crisis, or, First Thing, Let's Kill All the Lawyers

The thesis of this essay is that our higher education system is approaching a "credentialing crisis". In order to defend this statement, it is first necessary to explain it. We shall begin with the phrase, 'credentialing crisis'.

A credentialing crisis happens when a society uses some sort of credential in order to gain admission to a ruling class, and this credential is overproduced. In some societies, this credential is genetic; for example, descent from a long-deceased ruler. It can also be something like the ancient Chinese system of tests on Confucian and other classical literature. It can be ownership of a title of nobility. The only real requirement is that it be valued by the society in question, and that it be difficult to acquire.

If it is too difficult, then the ruling class will become too small eventually, and unable to maintain control of the society at large. It is one thing to have a single, central ruler such as an Emperor (or Chancellor or President), but there must be a substantially larger group that surrounds and supports this single ruler. This larger group will have access to privileges and favors which most members of the society do not have, and that is the real reason why they will support and maintain the status quo. There may be a religious ("God wills it") or other rationale ("if the lower classes are not held in check there will be chaos") given, but the true underlying cause is the identification of the members of the ruling class with the system as it exists. If this group becomes too small, it will eventually be vulnerable to being overturned by another group.

With each passing generation, there will be some change in the population (size) of the group, call it R. For example, if it grows by 3% per generation, R=1.03. There will also be a change in the population of the society at large, call it S. The ratio R/S, then, must not be less than 1, or eventually the ruling class will no longer be a large enough group (relative to the society it is ruling) to maintain power. Even if R/S = 0.99, over time this would make the ruling class too small compared to the society it rules.

But, all human institutions being imperfect, it is guaranteed that if R/S cannot be less than 1, it must of necessity be greater than 1. R/S = 1 (exactly) is probably impossible using any system which does not explicitly state a ratio to be maintained, and in any event no historical credentialing system (of which I am aware) ever achieved such a ratio. Thus, if (R/S greater than or equal to 1), then (R/S greater than 1).

This, however, has its own problems. Ultimately, the increase of the population of the ruling class will outstrip that of the society it is living off of. One example would be a case in which the males of the ruling class are allowed to keep multiple wives, or in which the children of mistresses are credentialed along with the children of wives. Another would be a society in which all of the children of the ruling class are well-fed, and the children of the society at large often starve, so that the ruling class increases in numbers faster than the society at large. A third example could be one in which any child of a credentialed member of the ruling class is credentialed, but there is also some method available for non-credentialed people to become credentialed, perhaps by passing a test of some sort or demonstrating heroism in battle. In any of these cases, the ratio R/S will be greater than 1, and over time the percentage of the society which is credentialed will approach a critical threshold.

This threshold, is the point at which there is no longer enough surplus to support it. More or less by definition, the ruling class will consume more than it produces. In theory, this could be untrue, but in practice conspicuous consumption becomes a way of advertising your status as a member of the ruling class. Also, since in the society at large (among the non-credentialed) any who consume more than they produce will be soon cut away (starve, executed as a thief, etc.), it is only in the ruling class that overconsumption (defined here as consuming more than you produce) will be tolerated. This means that the ruling class, if it produces anything at all, will be in any event less productive than the society it rules.

They may not believe this to be the case at all, of course. In particular, since membership in the ruling class is itself valued, the monetary signals may seem to indicate that the ruling class is very productive. For example, if those who aspire to membership in the ruling class are paying money to those already credentialed in order to try to acquire the status (e.g. rich merchants buying titles of nobility from the king), then their balance of payments (relative to the society at large) may appear positive. Such delusions of value may deceive everyone in the society, ruling class or not, but they do not change the underlying reality of what is actually being produced. The ruling class will live off the surplus generated by the ruled. More reasons why this is so could be given, but perhaps the best proof that the ruling class will consume more than it produces is that it will, because it can, while the rest of the society will not, because they cannot.

In our own time, there are many well-compensated and high prestige jobs, which do not contribute to the society's overall productivity (even indirectly). Some of them may even subtract from the society's overall productivity. I leave it to you to think of what professions might fit this description in a modern society, but the important point is that they may well consider themselves to be quite productive, because they have a reasonable (or even large) income. Monetary income, however, is not a great test of real productivity; a casino for example may have a large income without affecting the productivity of the society at all (except perhaps in a negative way). The test of real value is whether or not a profession increases (either directly or indirectly) the overall productivity (of real value like food, shelter, tools, and so forth).

This means, however, that as time goes by and the Pr/Ps (ruling class population relative to the society's population) gets higher (though still less than 1, obviously, and probably still much less than 0.5), the productive surplus of the society as a whole will diminish. If Pr is the ruling class population, and Yr is the productivity of the ruling class, and Pp and Yp are the population and productivity of the rest of the society ("p" for "proletariat"), then Ys = ( (Pr/Ps)*Yr ) + ( (Pp/Ps) * Yp ). Since Yr is less than Yp (i.e. the ruling class has lower productivity than the rest of society), as Pr/Ps gets larger (i.e. the ruling class becomes a bigger and bigger portion of the overall population), the overall society's productivity will decrease.

At first, all the pain of this will be felt by those NOT in the ruling class, and will not necessarily have any obvious consequences. In the extreme, it could result in an uprising of some sort, but true peasant uprisings (whatever the equivalent of "peasant" is in any place and time) rarely accomplish much. What appears to be successful lower class uprisings, almost inevitably have some significant numbers of the lower elite on their side. The ability to do things like organize, lead, and manage large amounts of information (necessary for effective military action) are not things the human mind is naturally good at, and only members of the ruling class receive any training in them.

More dangerous to the ruling elite, then, is what happens when the diminished surplus begins to endanger the marginal members of the ruling class. Not all members of the ruling class, whether they are nobility or tycoons or imperial bureaucrats, will have equal status. Those who are credentialed, but less powerful relative to others in the ruling class, will be the ones among the ruling class to first feel the pinch of the shrinking surplus. More to the point, it is the ones at the very top who will feel it last.

When the status quo is not working well, which is to say its productivity is declining, there may be for a long time people speaking out about the matter without any chance of it being changed significantly. This is because change is difficult and fraught with danger, and few will be willing to chance it while there is an alternative.

However, once there IS no safe alternative, the cautious calculation of each individual may shift, and it may do so quite radically and swiftly. As one example, one can point out that most successful revolutions in history began at a time of high food prices. By "high", of course, we mean higher than that particular generation of people had become accustomed to. There are many risks to revolution, and there are few cases when sticking with the status quo will seem just as risky. However, one such case is when purchasing enough food to remain healthy becomes difficult (perhaps because of an absolute shortage of food, perhaps because of insufficient income to purchase food, perhaps because of too much debt relative to income to purchase food).

The relative risks of revolution vs. quiescence, however, can shift very suddenly. For a long time, Risk(q) (the risk of remaining quiescent) can be rising (in other words the declining productivity of the society is pushing people closer and closer to the edge of the cliff), but still less than Risk(r) (the risk of revolution). So long as Risk(q) less than Risk(r) for everyone, the fact that the ratio was once 1:100 and now is only 99:100 will not result in much except a rise in grumbling.

There will always be a few people, of course, for who this ratio of risks is somewhat different than it is for everyone else. Some people do better than others, in any society, even within the same class or subclass. Whether because of a deficiency of talent or any other reason, some may choose lawlessness when everyone else chooses to remain quiescent. Such a person, in a normal time, simply is caught by the Law and imprisoned, executed, or otherwise dealt with.

It is the case, however, that once someone else has chosen lawlessness, the risk to yourself of doing so is ever so slightly less. It is well documented that even in normal times, crime can take on the nature of an epidemic, and at least part of the reason is that people make the (perhaps accurate) estimate that their chance of being apprehended by the Powers That Be is less when there are already others breaking the law. In normal times, however, the people best trained at organization and leadership are rarely the ones to decide to take advantage of this, and with sufficient will, the society (in particular, the ruling class of the society) can exert its powers and halt the epidemic of crime.

Imagine, though, the situation when there is a large number of people for whom Risk(q):Risk(r) = 99:100, barely in favor of remaining quiescent. The mere news that others have begun to rise up can shift this calculation, and if it moves even slightly (perhaps to 99:98), then suddenly large numbers of people may decide to rise up against the ruling class. To put it in non-mathematical terms, their patience was already at the breaking point, barely held back by the fear of being caught and punished, and the news of others rising up pushes them into action.

In such a struggle, it is usually the case that the ruling class has, surprisingly, fewer resources than the masses. This is because most of what the ruling class theoretically owns, is in fact as a day to day matter in the hands of the ruled (there are some modern-day exceptions, but we will address that elsewhere). The noble lord may in theory own all the land, all the farm implements, perhaps even in theory the serfs themselves, but in practice if the serfs rise up he will find that he only really controls a much smaller amount of resources. Also, for obvious reasons, once the revolution has achieved any scale at all the masses will have numerical superiority.

The only advantage that the ruling class will typically possess, then, once a revolution is in fact underway, is that they are better organized and in part because of this better disciplined. The reason most revolutions fail, is that this single advantage is enough. Put any number of advantages on the other side: numerical advantage, courage, desperation, resources, tactical position at the outset of the battle, still it will not be enough if they are disorganized, and unable to rectify this against a disciplined and determined foe.

This is the reason most revolutions start, then, and also fail. There are two scenarios in which things may run otherwise. First, the ruling class may have a leader who vacillates, or they may be riven by internal divisions. The French monarch Louis XVI lost his life, more than anything else, because he was not a decisive leader. Had he been a decisive leader, or even a decisive but monstrous tyrant, things might have gone otherwise.

Second, the oppressed may overcome their lack of organization, owing to a strata of the ruling class (those nearest to poverty) throwing their lot in with the rebels. They may genuinely feel themselves to be acting out of patriotism or idealism, but the only time that significant numbers will do so is when they find their positions (as credentialed members of the ruling class) to be threatened by the declining productivity of the nation as a whole. When it comes time to make cuts in the expenses of the ruling class, they know who will be cut first, and they therefore find it preferable to throw their lot in with an attempt to overturn the regime entirely. It is still risky, but there were marginal members of the ruling class in the Russian Revolutions of the early and late 20th century who managed to make the leap nimbly from pre- to post-revolutionary member of the ruling class. There were also members of the ruling class in Revolutionary France who THOUGHT they would be able to do so.

There is also one scenario in which an uprising that otherwise should have succeeded, will fail. The ruling class, if it is able to sell resources to a more technologically advanced market elsewhere, may actually possess greater resources than those who are ruled. This is a mostly 20th (and 21st) century phenomenon, in which the advanced weaponry (and transportation and communications and etc.) of a 1st World economy can be purchased in exchange for letting them (the 1st World) have their fill of the nation's natural resources (metal ores, timber, especially fossil fuels). In this case, relatively few material items can have a decisive effect on the military balance, since they will be more than usually beyond the military capabilities of the rest of the society (since these items DO NOT COME FROM THAT SOCIETY).

This is the origin of the so-called "resource curse", which keeps African and Middle Eastern nations with great natural resources oppressed, without causing any such problem to nations such as Norway, Canada, or the United States. If the ruling class of Scandinavia and North America could sell their nations' natural resources to aliens from outer space in exchange for death ray guns and teleporting troop transports, these nations would fall to the resource curse in short order.

What, then, does all this have to do with our higher education system?

It is clear that the college diploma is primarily a credential in 21st century America. The actual content of what is learned is less important than the fact that having a diploma is necessary for a wide range of upper middle class jobs. Moreover, the more elite universities are places to meet other members of the ruling class, which is necessary to establish one's position. Few graduates use a great deal of what they learned in school, as part of their job; the purpose of getting a diploma is to get access to the lower levels of the ruling class (usually described as "a good job").

What is equally clear, is that this credential is in a state of oversupply. There are far more people with diplomas than there are positions available which these graduates can fill. Moreover, the amount of debt which college students take on, in order to acquire the credential, is now so large that this results in more than mere disappointment.

Consider for a moment the logic of student loans. If the primary reason for going to college were for any reason other than financial, it would make more sense to save up money in advance. Like houses, diplomas are purchased on credit because it is thought that making the payments (with interest) afterwards will be easier than saving up beforehand.

In the case of houses, this is only true if the value of the house goes up at a rate higher than the interest rate, and it can be sold later for enough money to pay off the loan, a strategy that once worked well. Once it is no longer at all certain that a house's value will go up instead of down, the logic of buying it with borrowed money is not nearly so clear.

In the case of diplomas, this logic only works well if the diploma itself allows one to acquire a better-paying job than before, and moreover enough better to make up for the interest on the debt as well as the principal. If not, then there will be a large number of people who have acquired the credential, but find themselves in increasingly desperate financial straits.

In the case of college degrees, the theory was that their education made them capable of doing jobs they otherwise would not be able to do (or not as well, anyway). In practice, this has rarely been the case in most fields. Even in very technical fields such as engineering, it is often the case that the actual work done is something the employee will have to be trained to do by their first employer, not something which their college education will have taught them to do. Why, then have so many employers required college degrees for jobs in which they will regardless have to train the new employee in everything they need to do?

To a certain degree, it is because getting a college degree has been a means of certifying that one is ABLE to learn, so that the employer knows that if hired they will be able to learn whatever is needed for that job. If you learned calculus, you can probably learn how to fill out a TPS report correctly. Also, having a college degree is evidence that one is capable of persisting with a series of boring and arbitrary tasks assigned by someone in authority, showing up nearly every day for several years to do so, and you can draw your own conclusions as to why an employer might want that in an employee.

More than anything, though, a college degree has been used by employers as a required qualification because one is on solid legal grounds when doing so. It is widely acknowledged, in many nations, that requiring a college degree is allowed, in a way that requiring a certain ethnicity or religion may not be. When faced with the task of sorting through a large stack of applications for a job, most people will look for a handy way of cutting down the numbers quickly, and concentrating their efforts on interviewing only a few candidates.

This means, though, that a college degree is a useful qualification only for those jobs where there are more candidates than openings, which will typically be for jobs which are better than average pay. Also, if a college degree becomes too common a credential, then its usefulness for this will be reduced. The content of the education was never truly relevant to the job, it was mostly just a way of cutting a large stack of applications down to a few. In this case, a particular KIND of degree (that is more scarce) may instead be required; for example, majors which are more technically demanding, or which take longer to acquire. Many people who acquired just a degree (the most common credential), will find that it no longer gets them the privileges it got the members of the previous generation who had it.

For universities, this means that, much like the home-building and home-selling industries, they are probably in a for a bumpy ride in the coming years. It is not so much that no one will want or need a degree in the future, any more than people will no longer want or need to buy and live in houses. It is that there has been for several generations a condition of ever-increasing demand and market size, and they are ill-prepared for a situation in which the number of college students goes down instead of up. Like any bubble popping, there will be some institutions which do not survive the readjustment. The more serious consequences of the current Credentialing Crisis, however, are not those which will beset the universities, however serious that may seem to the good people who have devoted their lives to it. The most significant consequences will be to the society at large.

What would a mass of college-educated, desperate (because now deeply indebted without a good salary) and perhaps also bitter people do? It seems unlikely that they would bring out the guillotine (though I suppose is also seemed unlikely to Louis XVI at first). However, they may well apply their skills at modern methods of organization and information technology to some more peaceful, but perhaps just as disruptive endeavor.

Periodically, in America (and many other democracies), there is a voter revolt against the parties in power, including the ones currently in theoretical opposition who are seen as too closely aligned with the status quo. Typically, these fare about as well as peasant revolts, and for more or less the same reason. Most voters know little about the many administrative and managerial skills necessary for maintaining a political movement, and those who do, find themselves (for that very reason) well able to influence the existing parties. If there are a limited number of people able to communicate effectively, organize the actions of themselves and others on a large scale, and learn how to navigate the labyrinth of modern electoral law, then those few people will find positions ready for them in the existing political parties.

If there are, on the other hand, more people with these skills than there are slots in the existing parties in power, they may look elsewhere. If there are a large number of the college educated who are poor (or even just financially anxious), who find their position to be gradually eroding as the productivity of the society at large declines relative to the needs of the upper ruling class, one could expect to see a "peasant revolt" that acquired that most necessary element, the disaffected credentialed. Whether they would end up behaving more like Lenin (son of a comfortable middle-class family) or Oliver Cromwell (born into the middle gentry) or Lafayette (an aristocrat), in any case they could cause an otherwise typical temporary uprising to become a truly revolutionary overthrow of the old regime.

When could we expect such a revolution, combining lower class anger with middle-class organizational skills, to occur? Looking back at successful peasant revolts, we find that they typically occur not so much when the leaders were most despotic, but rather when some outside shock increased the stress on the society. A defeat in war (Russia in 1917), a financial crisis combined with food shortage (France in 1789), a financial crisis that results in the ruling power increasing taxes (America in 1776), or a financial crisis that causes the executive power to attempt a restructuring too great for the lower credentialed to bear (Russia in 1992). In the U.S., a defeat in war appears at the moment unlikely (though again, it appeared unlikely to many others who went on to a great fall), but a financial crisis appears to be an ongoing reality. Thus far, it has not caused the mass of the credentialed to turn on the two-party system.

It will.