Category Archives: University fees

Education in the Classics: An All-singing, All-dancing Discussion of Student Debt and Higher Learning

“And I’m Javert! Do not forget my name. Do not forget me, 24601.”

Inspector Javert introducing himself in the Prologue to the musical version of Les Miserables

Much like the brooding Inspector in Victor Hugo’s classic story, Andrew Norton – Higher Education Program Director at public policy think tank the Grattan Institute – is deeply concerned about people paying their debt to society. Where Javert’s focus is the reform of paroled prisoners however, and in particular the story’s central protagonist Jean Valjean – the prisoner 24601 of the opening line above – Norton’s issue in the 21st century is the financial debt of University graduates.

The ballooning level of ‘bad debt’ in the Australian student loan system – and particularly the projected increase in this figure if the Federal government’s plans for ‘de-regulated University funding’ finally pass the Senate – has Norton thoroughly exercised. The key problem, he would have us believe, is the earnings threshold to repayments. Under the Australian student loan system, debtors don’t have to start paying back their loans until after they graduate and are earning more than $54,000 – not exactly a high bar, given the average national wage, according to 2014 Australian Bureau of Statistics figures, is $58,000. Norton though would have it that this threshold is actually too high – with those darned freeloading students apparently racking up education debts like nobody’s business, safe in the knowledge that they’ll never beat the criterion to trigger their loan repayments. To give the man his own voice on this point:

“If we keep the current [repayment] threshold, increasing numbers of students will not repay their debt and the taxpayers will have to pay the cost of their education. It ends up being a very generous scheme for people who have gone to university compared to other people from the social security system”

Andrew Norton quoted by Higher Education Editor Julie Hare in The Australian.

Well, obviously I for one am completely behind Mr Norton on this one, and stand shocked that…wait…what’s that you say? Actually, now that you mention it, yes, I do seem to recall that Norton is also on record in his 2012 report ‘Graduate Winners: Assessing the public and private benefits of higher education’ as advocating increased University fees on the basis that graduates enjoy a substantial advantage in earnings over their non-matriculating counterparts.

Now, to be fair, if you read between the lines, what Norton seems to actually be saying – with admirable consistency – is that he believes in market deregulation, and that the Government should minimize its involvement in higher education funding. Unfortunately, if you read what is actually ON the lines, his attempts to stitch economic statistics into two opposing arguments do leave him looking a bit exposed to accusations of doublespeak.

Even if your underlying philosophy is consistent, it pays to consider the compatibility of the messages you put out. Reproduced from Scott Adams' Dilbert cartoon, first published 1995.

Even if your underlying philosophy is consistent, it pays to consider the compatibility of the messages you put out. Reproduced from Scott Adams’ Dilbert cartoon, first published 1995.

But back to those freeloading students and their persistent attempts to get out of paying their dues. Not satisfied with pushing down the repayment threshold, Norton would also like to see student debt passed on to next of kin in the event of a debtor’s premature (by which he means “while the little scallywag still owes us for their education”) death.

This would seem a bit over the top in an unpleasant workhouse overseer springing from the pen of Dickens. To hear it coming from a seriously regarded 21st century social policy advocate is, to my mind, stunning.

Indeed, returning to the musical reflection on debt and forgiveness with which I started this essay, Norton’s suggestion might not look out of place in an updated Les Mis. Picture it – as the plaintive refrains of Fantine’s show-stopping death fade and the audience mop their tears, Javert and Valjean begin their baritone confrontation, mano-a-mano, hope against despair, redemption juxtaposed against punishment. After he sneers that “Monsieur le Mayor” – the former convict 24601 – can never change his innate criminality, the French policeman could throw in that the good mayor’s new adopted daughter Cosette owes the state 1000 Francs for the night courses in accountancy her mother had been taking to work her way out of the life of prostitution she’d been forced into by an uncaring society.

Okay, I may be paraphrasing Norton slightly on that one, but I think it basically works.

“Look Javert – I think the study debt thing is way out of line. Isn’t it enough that our society’s uncaring Economic Rationalist policies pushed her into prostitution and a pitiful early death?”
Still image taken from Tom Hooper’s 2012 cinematic adaptation of Les Miserables.

What the headline-catching issue of fees and loans is all about though is how we pay for our University system, and ultimately – although this point seems to be sadly neglected on the intellectual battlefield of the moment – what purpose Universities serve in our society. The fundamental policy dilemma Norton and others are seeking to address is that our public Universities – which are both a substantial industry bringing in foreign exchange to Australia and, we are told, the engines of our own future national economic prosperity – are significantly under funded, and the current political landscape is very much against changing that any time soon.

According to the national peak industry body Universities Australia, our wide and sunburned land ranks a not-so-proud 30th out of the 31 OECD countries for public investment in higher education as a percentage of GDP. Taking that figure as their inspiration, Universities Australia – led by the ‘Group of 8’ coalition of Australia’s top Tertiary institutions – has spent the past couple of years demanding fee deregulation as a way of raising more funding to support their activities.

The response to this from Education Minister Christopher Pyne was to say “Absolutely, let’s bring on the Free Market.”

Yes, said Mr Pyne, university fees should absolutely be de-regulated, with institutions free to charge what they considered appropriate for the education they provided. Fees could go up, or they could go down. Entirely up to the Universities.

Oh, and by the way, we’re also going to cut 20% from the Government’s bulk funding for student places.

This is pretty much a policy equivalent of James Wan’s cult classic 2004 horror movie Saw: Yes, Vice Chancellor, you can get your institution out of the funding bind I have trapped you in, but only if you use the sharpened blade of deregulated fees we’ll leave in the room with you to carve an extra pound of flesh from your students.

As you might have gathered, I’m not a fan of user-pays in higher education. I can accept though that there is a need for debate, and ultimately a new social contract around how our society can support the education system we need.

Loans, unfortunately, skew this debate by softening the intellectual battle ground. “Sure your education will cost you,” says the Government “But we’ll loan you the money, so even the most under-privileged can afford it.”

The essential problem with this premise that tends to get skipped over is that in the Australian education system, most matriculating students still come straight to University from high school. In essence we’re talking about a demographic group which is barely, if at all, old enough to legally consume alcohol. And Pyne expects them to do a cost-benefit analysis and long term financial modeling on the value proposition of a loan? Was he ever 18?

Yes, of course it would be eminently wise for any young (or even middle-aged) scholar contemplating taking on education debt to carefully consider the benefits they will accrue from that education, and whether they are worth the opportunity cost of the discounted future income – sacrificing three, or four, or five years of wages now (and taking on that debt) for the promise of higher wages and greater career opportunity in the future.

It would also – in my admittedly out-of-touch estimations – be smart for my 17 year old daughter to finish her Psychology homework before she turns on Facebook and starts watching YouTube clips of amusing animals. Curiously, she seems resistant to the logic of this position. And yet Norton, Pyne, and others like them would have us believe she is ready to accept the reality of taking on $100,000 of debt before she’s even encountered the reality of significant work and managing a household budget.

Sure, there are some incredibly clued up young people out there with vision and drive who have their lives together and their futures mapped out, and see a carefully targeted education loan as a key step toward realizing their strategic career plan. But if you’re engaging your joined-up-policy-thinking and pushing this down to the government’s target of 40% participation in higher education, you’re crossing deep into a cohort whose idea of financial planning is likely to be more along the lines of “Daddy, can I borrow $400 to get a tattoo of Grumpy Cat? It would be so funny and I’d never get tired of it.”

Basically, I’m not convinced young adults sit down and complete a full cost-benefit analysis before lining up tequila shots in Bali or hooking up on schoolies week.

Or taking on a student loan.

The money changes hands above your head and out of your sight, with the actual amounts vastly out of proportion to the everyday experience of most applicants. For the prospective student, ticking a box to take on a debt of more money than they’ve earned, handled, or even seen in their entire life is typically so abstracted from everyday reality as to be essentially meaningless. More damagingly too, the temporal distance of the loans – exciting education today for money in the distant future – like all offers of seductive credit – is all about lowering your mental barriers to the true cost of what you’re buying.

In effect, student loans are the gateway drug to excessive charges and a privatized education system.

Indeed, I’m falling into another little trap of Pyne’s rhetoric myself here – I’ve spent this entire essay so far countering the mechanics of the proposed loan system, when my fundamental problem with student debt (as you may have gathered if you’ve gotten this far) is a philosophical one. Student loans and education debt undermine the effectiveness of education as a tool of social mobility – the opposite of what we need to do to work against the natural tendency of wealth disparity to increase.

As explained by economist Thomas Piketty in his 2013 book ‘Capital in the Twenty-first century’ – it is the natural order of the capitalist economic system for wealth inequality to grow. Capital makes money. If you have money, it can be made to work for you and bring in more money. That is the simple brilliance of the system – you do not need breeding, or training, or other exclusionary characteristics – all you need is money. But the flip side of that, as unionists and youthful agitators have been protesting since the day Adam Smith’s first treatise rolled off the printing press, is that those who do not have access to capital are excluded – the rich will get richer, the poor will not. A rising tide may float all boats, as they say, but if you’re not one of the lucky few to own a yacht, things get increasingly uncomfortable as the water rises.

It’s hard to swim against the flow of capital, and education stands almost alone as a non-disruptive engine for social mobility to counter that trend – providing a means for motivated and gifted individuals to access careers, networks, and opportunities that allow them to change their place in the social and economic order.

In this context, the expectation of debt becomes highly regressive – substantially reducing the redistributive potential of education. Loans simply do not work as a way of equalising social access to the benefits of education. A student who can pay (or whose family will pay) fees up-front leaves the education system with no debt – affording them an immediate advantage in wealth accrual over a student who takes on debt to fund their education, so that there is still a widening gap between rich and poor built into that system.

So, on to act three of our education song-and-dance. If I’m so dead set against the concept of increased student fees and loans, how are we supposed to fix the looming funding hole in our education system? I suspect the keen eyed among you may already have identified an alternative solution framed by the discussion up to this point – as a society, we could simply choose to spend MORE on higher education.

There is no sense in which the Australian taxpayer is being milked by the national University system. 30th place in terms of relative funding, let’s remember, out of the 31 nations in the OECD – and “well at least we aren’t last” is hardly a point of national pride to cling to. It’s like turning up at your child’s school swim carnival and watching them touch the wall just ahead of the asthmatic foreign exchange student who had never been in a body of water deeper than their knees until they arrived in the country this term. Yes, it could still be worse, but you’re not exactly going to raise the achievement around the water cooler at work the next day bursting with parental pride.

As Steven Parker – Vice Chancellor of the University of Canberra – observes, we don’t even need to be world leaders in the progressive funding stakes here. If, instead of manufacturing a funding crisis by imposing an arbitrary 20% cut on an already strained system, we instead upped our funding input to the OECD average, all projected funding issues for Universities in this country go away, and the strength of the sector would be assured for a generation. Parker, sadly, is pretty much a lone voice against de-regulation among Australian Vice Chancellors, speaking out stridently and consistently against the Pyne proposal.

His willingness to buck the consensus of his peers and put his counter-arguments on record though does give me hope for the continued intellectual relevance of the University sector. If there was a Council of Elrond to decide who should carry the Ring of Power to Canberra and toss it in the Captain Cook Water Spout to end the hold of Economic Rationalism over higher education in this country (if only it were that easy!), Parker would have my vote.

All well and good then, I hear you say, but where does the money come from to pay for such largesse? Well, if Norton was anywhere close to correct in his ‘Graduate Winners’ report and there is actually a link between University education and career financial success, then a mechanism that could cover the cost of the higher education system already exists. The positive news for the Government on this score gets even better too – because this funding mechanism operates on a sliding scale finely tuned to the success of an individual – so those who benefit most from their education will pay the most. Hoorah – the Liberal ideal! Christopher Pyne must be dancing in his office to hear such news.

So what is this magical financial saviour? It’s called income tax.

If Norton is right and graduates obtain an earnings advantage from their degree – money they would not otherwise have made without that degree – then it follows absolutely and immediately from this that they will also pay more tax – tax they would not otherwise have paid – over the course of their working life.

Let’s just assume for a second that the Grattan institute calculations are valid and that the average University graduate enjoys something like a lifetime $600,000 earnings advantage over their compatriots without degrees – with Norton’s dodgy extension from here being that 90% ($540,000) of this is attributable to the University education our graduate received. As I’ve discussed before, the assumptions behind these numbers actually make them fairly unreliable – but as they’re Norton’s figures I think it’s intellectually reasonable to turn them back on him here. Okay – so lets assume this $540,000 is at the top marginal tax rate of 47% – and throw in the 2% medicare levy as well. That would come out as the government collecting up to $265,000 in extra tax from that individual that they wouldn’t otherwise have received. By Norton’s logic, the government could eliminate fees, bring back student grants, and STILL come out ahead of the game.

And hey, if you want to look at the large scale implications of this kind of policy, having fully state funded University education doesn’t exactly seem to have crippled the German economy.

So, as we come to the finale of our theatrical review and the music rises to its triumphant crescendo, how do you in the audience want things to finish up for our student protagonist? Would you have them meekly accept Javert’s label as loan account number 24601 and get back to work? Or are you rooting for them to stand up, bare their chest, and declaim to the world:

“Who am I? Who am I? I am Jean Valjean!”

But what’s it for? An alternative to the monetarist valuation of University education

When an academic starts talking about the University system, you know straight away that there is a risk of the discussion becoming so self referential a reader would need an endoscope to appreciate the arguments. Having last week laid out a critique of the statistical underpinning of the recent Grattan Institute report on University funding (More Pennies for your thoughts – 28/09/12), however, I find myself compelled to do just that, in the spirit of addressing the essayist’s dilemma of “well its all very well to criticise, but what’s your alternative?”

So if I would pull down the monetarist temple that Andrew Norton, higher education programme director at the Grattan Institute, wants to build on the foundations of our Universities, what would I have us put in its place, and why?

Norton argues that fee increases would not impact on the decisions of individuals to attend University because:

“…a financially-based motivation cannot explain why so many students with good ATARs [scores in Australia’s University entrance examinations] choose humanities and performing arts, which have relatively poor employment and income outcomes.”

I suspect the inference drawn here is correct – University students in Australia, including the more intellectually gifted among them, often choose courses on the basis of personal interest or intellectual curiosity. Personally I hope this long continues…but I don’t think Norton sees things the same way. Rather, he seems to see this as an anathema – clever students with the potential to make money for themselves choosing to do something without an obvious net cash benefit? Like a Vulcan anthropologist on Star Trek, unable to understand this strange propensity of humans to undertake study that is not in some way to their immediate and personal financial advantage, Norton effectively proposes an experiment whereby we massively increase the economic cost on the individual, and then see how many people still behave ‘inefficiently’ in choosing to study on the basis of silly little things like social conscience or a desire to broaden themselves intellectually.

I have a number of intelligent and talented friends who have chosen to attend University later in life for reasons other than economic enrichment. One, after a youth spent traveling and teaching in Asia, chose to study for an education degree so he could apply his acquired wisdom to the inspiration and development of Australian school students. Another, a recent arrival in this country herself, is completing a degree in social work because she wants to help the disadvantaged and disenfranchised in our society. Would we really be better off as a nation if these people were to take courses in business management instead? Or give up their dreams of study to work waiting tables in a cafe?

Entangled with this question of why we undertake University education is the issue of exactly what the benefit is that we take from the experience. Norton argues that the value derived from a University degree arises from the combination of training – extra capacities graduates gain at university that they could not otherwise obtain – and signaling – in the form of a credential that distinguishes them in the labour market.

The concept here of being ‘distinguished’ in the labour market is particularly interesting in the context of drives to increase the uptake of tertiary education in our already relatively educated and well-trained population. It may have been true that a university degree was a significant badge of merit – a ticket, perhaps, to the inner circle of a stratified meritocracy – at the time of Australian Federation, when the 2,652 University students in the country represented around 0.2% of the young adult population. Or even on the eve of World War 2, when 14,000 students accounted for around 1% of the equivalent group. That badge begins to lose its lustre though as the University participation figure nudges 30% in the first decade of the 21st century (on the back of 757,000 students), and the Australian government is targeting 40% degree qualification in the adult workforce by 2015.

If you’re at the bottom end of that 30-40%, its unlikely you’re going to see much of a premium on your employment worth from that particular line in your CV. In the comically evil words of Buddy Pine/Syndrome in the Pixar movie ‘The Incredibles’ – “When everyone’s super – no-one will be”.

So what of training? Does university make people smarter? I would say no – it certainly gives an opportunity to apply intellect, but I doubt a graduate is any more gifted in terms of naked intelligence than they were the day they matriculated. Does it provide skills that will be useful in the workplace? Sure – but wouldn’t working for three to five years do that too? Or job-specific training? Seriously, if your primary interest is a desire to develop work skills and business acumen – and I can’t stress this enough – the best path I could recommend would be to get a job, apply yourself with rigor and passion, and seek guidance and advice from figures in the industry who you respect and admire.

Outside of the handful of specific professional University degrees (we’re talking law, medicine and their ilk, and perhaps technical science fields to some extent), I seriously doubt there are many learning experiences at University that could not be replicated – even bettered – through professional experience and mentoring. Major companies routinely employ top graduates as the core talent of their future workforce – and then what? They don’t say “right graduate boy (or girl), off you go to work”. No, they induct their new hires, retrain them, and teach them how to do a job – sometimes over a course of years.

So what am I saying here – is University a waste of time and money we should be steering kids away from? No – on the contrary, I see university education as a huge and life enhancing benefit to the individual that everyone should aspire to undertake at some point in their lives. With my heart on my sleeve I say that this experience should be freely available to anyone on the basis of their intellectual and emotional readiness to benefit from it – but with an economic realist hat on (albeit one tilted at a deliberately subversive angle), if society cannot afford the luxury of free education, the individual should pay, and should value and appreciate the opportunity their money is buying. So far I suspect Norton is nodding his head in agreement and mumbling “that’s what I said” – but where I think our perspectives really start to diverge is that I am not convinced that the benefits derived from University education are financial, and I think to sell it as such is dishonest and degrades the university experience.

“But…but…” stutters my inner Norton, his eyes widening in incredulous disbelief, “If you discount the economic benefits of a degree, what are you left with? Three (or four, or five) years of lost earnings and opportunity for career progression. Why on Earth would anybody choose to do that?”

University education is a sensational opportunity if – and this is the critical caveat – if you want to learn and to invest of yourself (your time, your energy, your intellectual capital) in doing that. It’s an opportunity to interact with and benefit from the wisdom and experience of brilliant and creative people, a chance to get exposed to new and challenging ideas. A chance to think deeply about who you are, who you can be, and how our society operates – what our values are, and what they should be. Yes, I’m approaching this from a biased perspective in that I would happily admit to valuing philosophical novelty and intellectual discourse above a newer car and a designer watch. But as long as I’m open about that perspective – and don’t try to pretend my views are some kind of universal truth you’d be crazy not to appreciate – you can judge for yourself the validity and relevance of my comments.

When it comes down to it, how many graduates in my own field of geology does does society ‘need’? The current situation in Australia is somewhat anomalous – with a rampant resource sector almost desperate enough to hire anyone able to differentiate a rock from a hard place – but any reader with the barest grasp of history should appreciate that this white-hot demand is a temporary aberration. Here’s the thing though, I still think more people – as many as possible – should study geology. Fundamentally, I’m not training people to log drillcore, or even to design mineral exploration programmes – although my teaching will place you in an intellectual space where both of these things will be supported – I’m trying to engage people in understanding the processes that shape the Earth.

At the recent quadrennial International Geological Congress meeting in Brisbane, I attended a public forum in which mining and resource ministers from several countries – including our own – were addressing the future resource needs of a growing global population. We shouldn’t lose sight of the fact that decisions – important, far-reaching decisions – are being made by governments all around the world today about this sort of issue – how to balance economic and social needs against environmental quality, traditional land use, and other amenity values. These decisions will affect you, me, our kids – all of us – long into the future. Do you really want to base your views on these issues on what Alan Jones says? Or Tony Abbott? Or Bob Brown for that matter? Seriously, if you want to engage in these debates and hold the decision makers to account, understanding the function of Earth systems should concern you deeply. I want to see an educated population able to, in that finest of Australian political traditions, “keep the bastards honest”.

Therein lies the true benefit of University education to an open and democratic society – producing an intellectually engaged, thoughtful populace ready and able to debate values and issues of significance from myriad perspectives, and contribute the societal wisdom needed to steer our nation, and indeed our planet, through the challenges of the future.

More pennies for your thoughts? University fees and the Grattan report

“Graduates…have attractive jobs, above-average pay and status. They take interesting courses and enjoy student life. I think they are getting a bargain compared with their lifetime earnings potential.”

So says Andrew Norton, higher education programme director at the Grattan Institute, in his recent report ‘Graduate Winners: Assessing the public and private benefits of higher education’. Norton’s principle thesis is that graduates, rather than society as a whole, are the beneficiaries of higher education – and should therefore pay more, potentially much more, of the true costs involved in providing that education.

Discussion around the funding of higher education is important. Indeed, I would agree with Norton that a university education provides graduates (and even those students who do not graduate) with significant opportunities and benefits, so it is fair to question the degree to which an individual should contribute to the costs of that educational experience. But to follow the accounting approach laid out in the Grattan report is to cede an argument that should be philosophical and sociological to the realm of economics. It’s like the old logical fallacy “So have you stopped beating your wife yet?” By adopting the neat rhetorical device of comparative earnings, Norton and others like him are attempting to make the debate about quantifying the benefits graduates accrue, rather than what a University education is really for.

For all it’s careful analysis and sound-bite friendly calculations though (quotable statistics are a much easier sell than philosophical nuances, after all), when you look behind the numbers, Norton’s study is founded on what may be a less than secure foundation – the assumption that the higher lifetime earnings (and other benefits in relation to the general population) of graduates arise explicitly because of the degree they have obtained. But hang on a second, let’s unpack that assumption – because what Norton seems to be doing here is committing the schoolboy error of a equating correlation to causation.

How so? Well, are the higher earnings of graduates truly related to their University education, or are both simply related to another controlling variable? Since the 1950s, by way of analogy, both atmospheric CO2 and obesity levels in Australian society have increased sharply. To imply a causative relationship would be to suggest that in some way atmospheric CO2 causes obesity – as if we’re all just making our own carbohydrates directly through photosynthesis, perhaps – whereas in reality both are symptomatic of the common controlling variable of increased wealth.

In essence, the problem for Norton here – as he himself recognises in the inner workings of the report – is that the comparison between graduates and non-graduates is not unbiased. Yes, there are wonderful success stories of prodigiously driven, inspirational individuals who forgo the graduate path to achievement – stand up and take a bow Richard Branson and Steve Jobs – but in general, merit-based entry criteria mean that it is a brighter, more ambitious, and more self motivated cadre that undertake University education. If we also assume that career and business success correlates strongly to the same aspects of intelligence and drive, then it should not be a surprising observation that graduates are in the top bracket of career earners. How, then, do we calculate how much of the extra earning of graduates should be attributed to their University education, and how much to their innate ability?

Now here’s where I’m eternally grateful to Norton because, like a magician revealing how the illusion is performed, he tells us how it’s done. Admittedly in an appendix where an over-worked education reporter with a filing deadline to meet isn’t exactly likely to stumble across it. He assumes a number. Empirical basis? Scientific calculation? Theoretical underpinning? Nope. An arbitrary 10%. We’ll just assume University graduates enjoy a 10% earnings advantage due to their innate ability, and the rest of their career success is the result of their University experience.

Now, yes, this assumption is critical to make the calculations tractable so Norton can come up with his headline-grabbing $600,000 lifetime earnings differential…but the flip side is that the modeling is then simulating an artificial system rather than the behaviour it purports to capture. It’s like the old joke about a physicist charged with figuring out how to increase the milk production of a herd of cows, whose solution begins “First, assume a spherical cow…”

Norton does allow in the appendix for alternative calculations with an ability premium of up to 40%…but why stop there? Why not 50%? Or 100%? Or maybe they start with a premium of 150% but all that ‘student life’ they enjoy actually stunts their achievement. Okay I may be guilty of reductio ad absurdum here – but the point is that the ability premium has no innate basis – it exists only for that convenient mathematical purpose. There is no way we can resolve whether 10, or 20, or 200% is the appropriate figure to use. Like a Chinese high speed train project then – the Grattan analysis is built to look impressive and modern, but laid on potentially insecure foundations.

Why is that important? Surely the comprehensive modeling and calculations Norton undertakes are sufficiently robust that the conclusions of the report can’t be undermined by this one trivial simplification, can they? I’m not so confident on that score.

Let me illustrate by way of a detour through my own professional back yard. Physicist William Thomson (later Lord Kelvin) – a towering scientific intellect acknowledged as one of the greatest exponents of thermodynamics of the 19th Century – ‘proved’ in 1862 that the Earth was somewhere between 20 and 400 million years old. Earth scientists of the day thought that figure far too young to account for the global history evinced by the geological record, but none could fault his calculations. Indeed, Thomson’s calculations were accurate – brilliant even – and still stand as a valid construction. But they produce the wrong result. Out by a factor of at least 10, with the Earth’s actual age – should you be interested – now measured to around 4.54±0.05 billion years. How can this be? Because Thomson based his workings on the simplifying assumption that the Earth lacks an internal heat source, when in actuality radioactive decay has been continuously pumping out heat throughout geological history.

Although numbers may look good when quoted in a nice banner headline, any calculation, no matter how exquisitely conceived and accurately undertaken, is only useful if the underlying assumptions are true.

The relationship between higher education and society is a social compact that should be open for ongoing discussion, and as a part of that, we should be debating how Universities should be funded. In that context, the Grattan report should be seen as an important contribution, offering a coherent and well argued monetarist view of how the University system should operate. But it is nothing more than that. And if you think the economic modeling Norton presents should be privileged over other philosophical and sociological viewpoints in the discussion of the University system…I have a friend in Nigeria who would like to talk to you about a fortuitous windfall he’d like your help with.