MMITM Ep 32 - Scott Galloway: The Future of Higher Education

 

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Speaker 4: From  CurtCo Media. ( singing)

 

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Bill Curtis: Welcome  to  Politics:  Meet  Me  in  the  Middle.  I'm  your  host,  Bill  Curtis.  As  always,  our  goal  here  at  Meet  Me  in  the  Middle  is  to  present  diverse  opinions  whenever  possible.  We  want  to  leave  you  with  a  balanced  perspective,  so  that  you  can  intelligently  draw  your  own  conclusions.  If  we  all  make  an  effort  to  understand  and  respect  each  other,  we  can  solve  complex  issues  from  the  middle.  Of  course,  keeping  in  mind  that  we  all  have  goals,  we  have  problems  to  solve,  we're  all  emotional  about  our  foot  race  through  life,  but  most  of  all,  we  can  lead  or  contribute  to  our  community's  future,  if  we  have  knowledge,  respect,  and  appreciation  for  one  another's  points.  So,  think  of  this  podcast  as  an  intimate  dinner  conversation  in  your  mind.  It's  just  the  four  of  us  and  you,  of  course.  Allow  me  to  introduce  our  panel.  Firstly,  connecting  through  Zoom,  our  co- host,  Pulitzer  Prize  winning  historian,  bestselling  author,  and  worldwide  lecture,  a  man  of  many  talents,  Professor  Ed  Larson.  How  you  doing,  Ed?

 

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Ed Larson: Nice  to  talk  to  you  again.  I'm  doing  great.  Thank  you.

 

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Bill Curtis: And  also  Zooming  in,  Jane  Albrecht.  She's  an  international  trade  attorney,  who's  represented  US  interests  to  high  level  government  officials  all  over  the  world.  She's  also  been  involved  with  several  US  presidential  campaigns.  She's  president  of  our  local  chapter  of  the  Democratic  Club.  Hey,  Jane.  It's  nice  to  remotely  see  you  too.

 

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Jane Albrecht: It's  always  nice  to  be  here,  Bill.

 

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Bill Curtis: And  our  special  guest  today.  He's  a  bestselling  author  and  lauded  NYU  professor,  Scott  Galloway.  He's  a  wonderfully  outspoken  teacher  of  brand  strategy  and  digital  marketing  at  NYU  Stern  School  for  second  year  MBA  students.  He's  widely  known  for  two  amazing  podcasts,  The  Prof  G  Show  and  Pivot,  which  he  co- hosts  with  tech  journalist,  Kara  Swisher.  Also,  check  out  his  digital  newsletter  called,  No  Mercy,  No  Malice.  His  rants  are  both  entertaining  and  educational.  Thanks  for  joining  us  today  In  The  Middle,  Scott.

 

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Scott Galloway: Thanks  for  having  me,  Bill.

 

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Bill Curtis: Let's  talk  about  higher  education.  The  schools  are  all  talking  about  opening  up  this  fall.  How  do  you  guys  feel  about  that?

 

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Scott Galloway: As  it  relates  to  universities,  your  19  year  old  being  at  home,  in  what  was  his  bedroom  that  was  converted  to  an  office,  and  he's antsy  and  you're  antsy  to  get  him  out  or  back  to  Tulane  or  to  Chapel  Hill,  that's  a  new  sense,  but  it's  not  profound.  I  worry  that  the  super  spreaders  of  phase  one  of  the  pandemic,  depending  on  state,  you  had 40 to  70%  of  the  deaths  were  registered  in  these  venues  of  super  spread,  which  is  where  there's  senior  facilities.  I  wonder  if  this  phase  two  is  going  to  involve  the  strident  statements  from  university  chancellors,  who  claim  that  it's  our  national  responsibility  to  open  campuses,  which  is  Latin  for,  parents,  please  send in your  tuition  checks,  and  if  we're  inviting  the  next  level  of  super  spread,  when  we  bring  18  to  22  year  olds  to  small  towns  and  massively  increase  the  density  and  then  delude  ourselves  or  enter  into  consensual  hallucination,  that  these  18  to  22  year  olds  are  going  to  practice  the  same  protocols  we're  spending  a  ton  of  time  to  enforce  on  campus,  off  campus.

 

 The  reason  that  young  men  and  women  go  to  college  is  to  not  distance.  So,  I  think  we're  tempting  disaster.  I  think  it's  borderline  negligent,  and  I  think  it  is  financially  driven.  I  think  these  schools  are  used  to  getting  between $ 100  million  and $1 billion  in  deposits  in  the  next  two  weeks  and  have  come  up  with  reasons  why  we  need  to  reopen.  In  my  view,  almost  every  university  should  shut  down  for  the  fall  semester  and  go  to  all  online  learning.

 

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Bill Curtis: Let's  talk  about that. What do  you  guys  think  about  online  learning?  What  are  its  pros  and  cons?  Is  it  working?

 

00:03:39
Ed Larson: I  taught  a  class  this  summer  by  choice,  which  was  fully  online  because  when  I  converted  over  in  the  spring,  I  had  the  old  model  and  I  had  to  finish  up  the  class  that  way,  and  I  completely  redesigned  the  class,  that  class  that  I've  taught  for  30  years,  I  taught  it  a  different  way.  I  think  you  can  do  it  better.  You  can  do  it  worse.  If  you're  willing  to  be  innovative,  if  you're  willing  to  work  it,  that's  what  the  students  said,  I  kept  trying  to  get  feedback  from  them  and  they  all  said  that  the  courses  they  had,  the  flip  over  courses  in  the  spring,  just  sucked.  But  the  summer,  they  thought,  you're  really  trying  to  do  it  differently  and  you  can  make  it  work.  I  think  there's  certain  subjects  that  are  naturally  suited  to  teach  online,  if  you're  teaching  a  certain  sort  of  content,  that's  vocationally  driven,  but  it's  not  as  good  for  the  teacher,  it's  not  as  good  for  the  student,  but  it's  better  than  getting  sick.  Even  the  schools  that  are  going  online,  many  of  them,  oddly  enough,  are  still  bringing  the  students  back  to  campus.

 

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Bill Curtis: Some  of  them,  Ed,  are  really  back  to  campus,  but  it's  still  going  to  be  mostly  remote  education  in  their  dorms,  right?

 

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Ed Larson: Yeah,  but  the  problem  is  not  really  the  classroom.  I  think  Scott  pointed  out.  The  problem  is  the  socializing  of  these  students,  and  if  they're  back  on  campus,  they're  still  going  to be  all  together  in  the  evening.  They're  all  going  to  be  together  in  the  dorms.  They're  going  to  go  out  to  the  bars  together.

 

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Bill Curtis: Well,  isn't  the  remote  really  more  to  protect  the  faculty  than  the  students?

 

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Ed Larson: Oh,  I  don't  think  so.  I  think  you're  talking  about  a  spread  among  the  students,  most  of  whom  won't  have symptoms,  but  some  of  them  will,  then  when  they  go  out  to  other  places,  they  become  a  super  spreader  within  the  community.  So,  I  don't  think  it's  just  to  protect  the  faculty.  I  think  it's  also  to  protect  the  community.

 

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Bill Curtis: When  we  interviewed  the  students  who  are  going  back  to  university,  they  kind  of  scoffed  at  the  idea  of  having  their  dorms  regulated  and  wearing  masks  in  dorms,  and  they  just  said,  it's  all  pointless  and  they're  not  going  to  get  sick  anyway,  so  good  luck.

 

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Ed Larson: That's  exactly  what  I  hear  from  them  too,  so  that's  the  point.  Think  of  bringing  4, 000  students  back  to  Malibu,  think  of  Bloomington,  Indiana,  think  of  Missoula,  Montana,  Davis,  California.

 

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Bill Curtis: How  about  sending  60,000  students  into  a  Texas  school?  Scott,  as  a  parent,  how  would  you  manage  your  college  age  kid  if  he  doesn't  go  to  school?

 

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Scott Galloway: We're  going  to  need  a  bigger  boat,  if  we're  going  to  talk  about  managing  college- aged  children,  but  I  think  we're  tempting  disaster  here,  and  to  Ed's  point,  to  take  40 or 50,000  students,  put  them  in  Athens,  Georgia,  but  what  happens  when  the  ICU  in  Athens,  Georgia,  that  probably  doesn't  have  a  ton  of  beds,  is  overrun  with  the  cashier  from  the  bookstore,  the  bartender,  the  grocery  clerk.  The  feature  of  universities  is  their  density.  In  Soho,  it  is  striking  to  me,  every  September.  It  is  an  ant  farm,  people  crawling  all  over  each  other  in and around [crosstalk 00:06:40].

 

00:06:39
Bill Curtis: That's  the  fun  part.

 

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Scott Galloway: That's  exactly  right.  That's  the  point  of  college.  The  point  of  college  is  density,  and  we  aggregate  and  we  congregate  in  rooms,  where  the  windows  are  sealed  shut  for  temperature  control.  You  get  around  a  19  year  old  with  alcohol  and  these  protocols  are  just  an  exercise  in  futility.  The  virus  didn't  get  the  memo  around  our  campus  protocols.  It  just  doesn't  care.  This  thing,  I  think,  will  spread  like  wildfire.  You're  going  to  have  some  high  profile  cases  of  this  beloved  professor  who  came  on  campus  week  six,  was  dead  by  week  nine.  You're  going  to  find  a  bunch  of  students  going  home.  Bringing  people  together,  letting  them  infect  each  other,  and  then  distributing  them  to  the  four  corners  of  the  country  and  the  earth,  it  reads  like  the  opening  scene  of  Contagion  2,  and  it's  irresponsible,  and  the  universities  that  have  the  weakest  financial  position  tend  to  be  the  most  delusional  around  their  plans  to  open.

 

00:07:34
Bill Curtis: How  many  schools  are  going  to  go  out  of  business  from  COVID?

 

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Scott Galloway: That's  an  interesting  question.  Because  they  haven't  done  what  every  other  organization  in  America  is  doing  right  now,  and that is  having  a  sober  conversation  with  your  employees,  furloughs,  layoffs,  cost  reductions,  and  continues  to  delude  themselves  that  everything's  moving  back  to  normal,  and  basically  said, " We're  returning  back  to  normal.  Parents,  send  in your  tuition."  Tier  two  universities  with  high  international  student  exposure,  large  tuitions,  low  endowments  could  be  to  education  what  department  stores  are  to  retail,  and  that is  we  could  have  a  large  component  of  our  educational  institution,  we're  talking  to  hundreds,  maybe  even  1000  universities,  you're  going  to  death  march  to  go  out  of  business,  because  these  are  businesses  at  the  core,  that  have  consistently  received  and  counted  on  cash  flows  plus  4%  every  year,  dependably  for  the  last  40  years.  They  are  just  not  constitutionally  capable  of  acknowledging  a  financial  crisis  or  dealing  with  it,  and  it's  coming.

 

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Ed Larson: I  just  could  see  this  could  fundamentally  transform  higher  education.  The  Depression  did  this.  If  you  go  back  to  history,  the  Great  Depression,  that  was  when  public  schools  exploded.  The  high  quality,  the  Yales  and  Stanford's  and  Princeton  did  great  in  the  Depression,  but  so  did  the  state  schools.  They  exploded.  And  you  left  others  behind,  and  this  could  be  an  equivalent  experience  for  higher  education,  or  even  a  more  important  experience.

 

00:08:59
Jane Albrecht: What  I  see  in  public  education,  and  I  agree  with  Scott's  assessment  of  it,  I  see  that  there  has  been  a  crisis  building  and  it  just  hasn't  quite  fully  exploded  yet,  and  that  is  the  increased  cost  of  college  education,  which  has  most  recently  come  to  the  forefront,  in  terms  of  the  student  debt  crisis.  It's  a  situation  that's  unsustainable.  The  real  question, in  my  mind,  is  I  do  think  there  will  be  some  dramatic  effects  on  education,  between  this  crisis  and  the  new  technology,  but  to  what  degree  is  it  really  going  to  bring  down  the  cost  of  education?

 

00:09:35
Bill Curtis: I've  got  to  quote  Scott  again, because  this  is  my  favorite  quote  from  you,  Scott,  and  you  said, " Let's  take  this  opportunity  to  turn  luxury  brand  universities  back  into  places  where  unremarkable  kids  have  a  chance  at  a  remarkable  future."  And  I  just  loved  that.  What  did  you  mean  by  it?

 

00:09:53
Scott Galloway: In  1982,  the  generosity  of  California  taxpayers  in  the  regions  of  UC  allowed  a  really  unremarkable  kid,  who  is  the  son  of  a  single  immigrant  mother,  who  never  made  more  than $ 40,000,  gave  me  a  shot  at  a  remarkable  education  undergrad  at  UCLA,  and then  a  remarkable  graduate  education  at  Berkeley,  for  a  grand  total  of $7, 000.  When  I  applied  to  UCLA,  it  was  free,  or  effectively  free,  and  they  let  in  40%  of  the  applicants.  Now,  it  is  not  free,  it's  very  expensive,  and  they  let  in  somewhere  between  eight  and  12%  of  the  applicants.  The  question  I  think  we  have  to  face  as  a  society  is,  do  we  want  to  double  down  on  the  remarkable?  Do  we  want  to  double  down,  as  we've  been  doing  the  last  40  years,  on  the  top  1%,  and  not  make  them  millionaires,  but  make  them  worth  30, 50, 100  million,  or  do  we  want  to  do  what  we  did  in  the  eighties?
 And  I  think  it's  probably  all  of  us  have  benefited  from,  and that  is  take  kids  who  are  good,  but  maybe  not  remarkable,  and  through  the  greatest  upward  lubricant  in  the  history  of  Western  society,  affordable  public  land  grant  education,  give  them  remarkable  opportunities  and  remarkable  futures.  I  think  we  just  have  a  bigger  decision  here.  Do  we  want  to  continue  as  academics?  And  I'm  guilty  of  this,  to  be  drunk  on  luxury.  We  brag  that  our  admissions  rates  are  down  to  10%.  That's  tantamount  to  the  head  of  a  housing  shelter  bragging  they  turned  away  nine  and  10  people  last  night,  or  do  we  want  to  return  to  a  society  that  says, " Maybe  you're  good,  but  we  see  the  remarkable  in  you,  and  we  have  this  remarkable  thing  called  public  affordable  universities,  that  are  going  to  give  you  a  chance  to  be  remarkable."

 

00:11:30
Bill Curtis: So,  where  does  the  money  come  from?

 

00:11:32
Scott Galloway: I  think  we  have  to  enter  into  a  grand  bargain.  I  think  it  has  to  be  a  collective  effort  amongst  citizens,  who  vote  for  officials,  who  are  willing  to  increase  funding  again,  but  at  the  same  time,  universities  have  to  hold  themselves  accountable  and  dramatically  decrease  the  cost  per  student,  by  leveraging  small  and  big  tech  and  having  some  very  painful  conversations  with  administrators  and  faculty,  who  have  not  been  subject  to  the  same  economic  hardship  and  demands  as  every  other  person  in  every  other  sector.

 

00:11:58
Ed Larson: I  am  also  a  beneficiary  of  how  cheap  my  college  and  my  law  school  and  my  grad  school  work,  and  if  we  could  get  back  into  that  situation,  we  can  instead  start  lifting  the  boats,  because  now  the  price  of  education is  just  out  of  the  reach  of  maybe  60,  maybe  70%  of  the  people.  They  don't  even  think  it's  a  realistic  possibility,  but  you  can  change  the  trajectory  of  the  schools  of  these  great  state  schools,  and  some  of  the  elite  privates,  so  they  let  more  people  in,  because  they  have  a  bigger  cushion,  because  now  they're  doing  a  mix  of  online.  We're  finding  out,  with  faculty  teaching  online  this  year,  we're  learning  what  we  can  do  online.  You  put  that  mix  in,  you  have  a  chance  to  finally  start  bending  the  curve  in  the  right  way.  Just  as  beginning,  say,  in the  1980s,  we've  been  progressively  bending  it  in  the  wrong  way.

 

00:12:53
Jane Albrecht: Going  back  to  providing  free  or  low  cost  college  education  at  state  universities  for  in- state  students  is  neither  such  a  radical  idea,  nor  is  it  impossible.  When  we  were  all  young,  if  you  were  an  in- state  student  at  a  state  university,  tuition  was  very  low.  In  fact,  when  I  was  very  young,  before  college  age,  it  was  almost  free.  We're  not  going  to be able  to  stay  competitive  in  this  post- industrialized  world,  unless  we  really  seriously  develop  our  talent.  Every  other  major  industrial  country  does,  and  they  don't  ask  their  kids  to  go  into $ 100,000  in  debt  and  up  to  do  it,  and  not  to  mention  the  fact,  investing  in  our  population,  investing  in  the  education of  our  population,  also  solves  other  social  problems.

 

00:13:34
Bill Curtis: So  then,  Scott,  do  you  think  that  online  learning  is  really  the  future  after  COVID?

 

00:13:38
Scott Galloway: We're  going  to  just  have  more  of  it,  just  as  retail  went  to  18%  online  commerce,  and  now  it's at  28%.  It's  jumped  10% in  the  last  three  months.  We're  going  to  see  a  quarter,  a  third,  a  half  of  learning,  go  to  online,  as  a  means  of  cost  reduction,  and  in  some  cases,  superior  delivery.  Walk  into  a  retail  store,  walk  into  an  emergency  room  and  compare  it  to  40  years  ago.  It  looks  a  lot  different.  Walk  into  a  university  classroom,  a  lot  of  them  don't  look  and  smell  that  different  than  40  years  ago,  except  the  fact  that  they  don't  charge  80  bucks  per  class,  which  is  what  I  was  charged  at  UCLA.  Here's  a  stat.  I'm  teaching  400  kids,  all  online,  this  fall,  because  I'm  not  returning  into  campus  until  they  have  a  vaccine.  My  class  has  400  registrants.  They're  each  paying $7, 000.  That's $2.8  million  for  12  Zoom  classes,  or  approximately $240, 000  a  night  for  me  to  be  on  Zoom  for  two  hours  and  40  minutes.  That  is  outrageous  and  it  needs  to  stop.

 

00:14:39
Bill Curtis: Are  they  making  massive  profits,  and  if  they  are  making  massive  profits,  where  do  they  go?

 

00:14:44
Ed Larson: I  put  some  of  the  blame  on  guaranteed  student  loans.  I  think  you  can  see  a  direct  relationship  with  the  skyrocketing  cost  of  education,  with  this  assurance  of  guaranteed  student  loans  of  all  these  students,  who  were  thrown  money,  then,  of  course,  these  students,  who  get  all  these  loans,  these  loans  aren't  even  forgivable  in  bankruptcy  and  they're  hobbled  with  these  loans  for  the  rest  of  their  life.

 

00:15:08
Jane Albrecht: I  actually  benefited  from  the  guaranteed  student  loans,  but  that  is  right.  When  you  have  the  student  loan  program,  you've  got  a  subsidized  system  in  an  intensely  market  economy.  The  schools  recognized,  when  they  came  into  play,  that  they  weren't  limited  anymore  in  charging  what  the  parents  could  pay  or  the  students  could  pay.  They  had  that,  plus  what  they  could  borrow.  Problem  is  I  don't  think  the  answer  is  to  get  rid  of  the  student  loans.

 

00:15:31
Bill Curtis: You  guys  aren't  answering  my  question.  Are  the  presidents  of  colleges  getting  listed  in  the  Forbes  400?  Where's  all  the  money  going?

 

00:15:38
Scott Galloway: It's  people,  the  compensation  and  benefits.  We  have  190  faculty  at  NYU  Stern.  We  could  run  the  place  with  60.  That's  the  harsh  reality.  Everyone  would  have  to  work  harder.  Everyone  would  have  to  be  more  accountable,  but  that  is  what  has  happened  to  every  industry  except  ours.

 

00:15:53
Ed Larson: It's  not how  much  individual  faculty  in  the  humanities  are  being  paid,  it's  the  numbers  of  them,  that  the  number  of  faculty  you  have  went  up  quite  a  bit,  but  also  the  number  of  administrators  went  up.

 

00:16:05
Scott Galloway: At  NYU  Stern,  we  have  leadership  and  ethics  departments,  and  I  can't  get  my  nine  year  old  to  eat  his  breakfast,  but  I'm  going  to  teach  a  28  year  old  how  to  be  more  ethical?  These  departments  cost  millions.  They  cost  millions.  There's  no  measurable  outcomes,  in  my  viewpoint.  There's  no  accountability,  and  once  you  introduce  a  cost  to  a  university,  it's  the  most  stubborn  barnacle  in  the  world.  It  is  never  going  anywhere.

 

00:16:31
Bill Curtis: We're  going  to  leave  that  right  there  and  take  30  seconds  to  pay  for  this  show.  We'll  be  right  back. ( singing)

 

00:16:43
Speaker 6: On  medicine,  we're  still  practicing.  Join  Dr.  Steven  Tabak  and  Bill  Curtis,  for  real  conversations  with  the  medical  professionals,  who  have  their  finger  on  the  pulse  of  healthcare  in  the  modern  world.  Available  on  all  your  favorite  podcasting  platforms.  Produced  by  Kerko- Media. ( singing)

 

00:17:07
Bill Curtis: Welcome  back.  We're  with  Scott  Galloway,  Jane  Albrecht  and  Ed  Larson.  Scott,  a  little  while  ago,  you  suggested  that  we're  going  to  need,  post- COVID,  a  lot  more  online  learning,  so  that  we  can  give  more  people  the  opportunity  to  have  serious  quality  education.  But  then  again,  74%  of  students  are  dissatisfied  with  online  classes,  so  good  luck  in  getting  parents  and  students  excited  about  paying  tuition  for  them.

 

00:17:34
Scott Galloway: Pursuing  intellectual  curiosity,  falling  in  love,  getting  your  heart  broken,  developing  resilience,  spilling  into  adulthood  in  a  safe,  joyous  campus  environment,  that's  absolutely  magic  and  I  would  hate  to  believe  that  that  would  just  become  the  domain  of  the  children  of  rich  kids.  What  has  been  laid  bare  naked  is  that,  I  don't  even  think  it's  the  Zoom  classes  that  are  that  bad,  Bill.  I  think  what's  really  eyeopening,  is  parents  are  listening  in  on the  Zoom  classes  and  going, " That's  what  I'm  paying $ 58,000  a  year  for?"  So,  there's  been  a  recognition  that  this  pricing  has  just  gotten  so  far  ahead  of  what  it's  worth,  because  there's  this  general  dictum  in the  US,  that  you  have  failed  as  a  parent,  unless  you  let  your  kids  into  school.
 Okay,  they  didn't  get  into  a  tier  one.  They  got  into  a  tier  two,  through  cartel  pricing.  There  are  universities  out  there  that  are  offering  you  a  Hyundai  and  charging  you  the  same  price  as  a  Mercedes,  because  somehow  we've  convinced  everybody  you  have  to  have  a  car  or  you  have  failed  as  a  parent.  Even  if  they  don't  get  the  Mercedes,  as  long  as  they  get  a  Hyundai,  you  buy  the  Hyundai  for  the  same  price  as  the  Mercedes.

 

00:18:46
Bill Curtis: But  you  need  the  Mercedes  on  your  resume.

 

00:18:49
Scott Galloway: Well,  it  helps.  It  sets  you  into  a  different  weight  class,  in  terms  of  your  economic  opportunities  moving  forward,  and  that  goes  back  to  a  notion  of  a  caste  system,  but  when  you  talk  about  the  amount  of  debt  on  young  people  now, it's  just  so  unhealthy  for  our  economy.  They  form  households  later,  they  get  married  later,  they're  less  inclined  to  start  a  business.  Just  the  amount  of  sheer  stress  it  creates  across  households.  We  like  to  think  of  university  administrators  and  faculty  as  being  nice  people  who  sit  around  with  their  Labrador  and  watch  PBS, and  we're  incredibly  noble  people.

 

 We're  the  same  as  anyone  else.  We  will  come  up  with  rationalizations  for  why  we  deserve  to  earn  more  money  and  have  better  healthcare  and  have  less  accountability.  It's  just  really  nice  to  have  fewer  responsibilities  and  more  money,  and  if  the  marketplace  will  afford  that,  you  will  take  advantage  of  it  and  you  will  invent  reasons  why  it  makes  sense,  and  we  have  been  doing  that  for  four  decades.  Education  has  stuck  out.  It's  the  mother  of  all  chins  and  the  fist  of  COVID  are  coming  for  it,  and  it  couldn't  happen  to  a  nicer  group  of  people.

 

00:19:47
Bill Curtis: We've  spent  something  like $ 6  trillion,  trying  to  make  it  a  little  easier  to  get  through  two  or  three  months  of  COVID.  Why  can't  we  spend  one  and  a  half  trillion  to  eliminate  the  college  debt?

 

00:20:00
Scott Galloway: I don't  think  that's  a  good  idea.  I  think  that  we  allocate  some  of  that  capital  back  to  public  grant,  public  universities,  but  not  until  those  universities  get  in  fighting  shape  and  say, " We  are  going  to  dramatically  lower  the  cost  per  student  and  dramatically  expand  our  enrollments."  Every  conversation  I  have  with university is  they  pretend  that  they're  interested  in  my  thoughts,  they  bring  me  in  and  they  basically  go  through  a  lot.  They  do  a  lot  of  nodding  and then  they  ask  me  for  money,  and I'm like, " That's  not  the  point.  Until  you  start  delivering  education  at  a  much  lower  cost,  I  don't  think  you  should  be  raising  money."  As  a  matter  of  fact, I just think  we're  feeding  the  crack  addict  at  this  point.

 

 I  think  these  universities,  I  think  this.  Every  business  is  going  to  come  out  of  COVID  leaner  and  meaner.  They're  doing  what  they're  supposed  to  be  doing.  They're  reshaping  around  a  new  economy.  They're  making  difficult  decisions.  They're  tightening  their  belt,  and  instead,  at  universities,  they're  in  consensual  hallucination  with  each  other,  that  we're  returning  to  campus  in  the  fall  and  charging  the  same  tuition.  It's  delusional,  verging  on,  in  my  opinion,  on  reckless.

 

00:21:04
Jane Albrecht: Scott,  I  think  you're  right,  that  this  will  put  tremendous  pressure  on,  but  even  assuming  most  universities  close  for  the  fall  semester,  I  think  it's  entirely  likely  that  by  January,  most  of  them  will  open.

 

00:21:16
Scott Galloway: Yup.

 

00:21:17
Jane Albrecht: Is  one  semester  of  this  kind  of  pain  going  to  really  bring  that  kind  of  change?

 

00:21:22
Scott Galloway: I  think  there's  an  opportunity,  if  we  embrace  it,  around  experimenting  with  great  online  learning,  to  dramatically  increase  the  online  competence  and  potentially  increase  enrollments  across  our  better  universities.  There's  just  so  many  great  public  school  systems,  that  society  would  greatly  benefit  from,  if  they  could  efficiently  expand  their  enrollments.  But  I  think  that  one  semester  of  substantially  impaired  revenues  could  put  500  to  1000  universities  out  of  business.  University  of  San  Francisco  has  a  60%  admin  rate,  a  negligible  endowment,  a  ton  of  international  students  that  aren't  going  to  show  up,  which  are  cash  cows.  19%  of  NYU  students  are  international,  but  it's  probably  40%  of  our  cashflow.  When you  have  the  xenophobic  tropes  coming  out  of  the  White  House,  at  some  point,  they'll  decide, " I don't  need  their  shit  anymore."  You  could  have  hundreds  of  universities,  small,  high  tuition,  liberal  arts,  experiential  universities  that  don't  have  the  brand,  you  could  see  them  almost  out  of  business  by  October,  because  they  just  don't  have  anything  to  fall  back  on.

 

00:22:21
Bill Curtis: Are  there  any  Ivy  League  schools  that  are  at  risk?

 

00:22:25
Scott Galloway: No,  they're  bulletproof.  They  have  huge  endowments.  They  have  endowments,  somewhere  between  the  size  of  the  GDP  of  El  Salvador  and  Norway.  They'll  double  down  on  their  exclusivity.  They  just  have  to  go  into  their  waiting  lists.  They're  more  spectacle  than  historic.  The  entire  Ivy  League  educates  64,000  students.  I  don't  want  to  say  it's  irrelevant,  because  we  talk  a  lot  about  it.

 

00:22:45
Bill Curtis: You've  accused  them  of  being  a  finishing  school  for  rich  kids.

 

00:22:48
Scott Galloway: No,  I  think  it's  worse  than  that.  I  think  they  offer  classes  to  the  children  of  their  investors.  I  think  they're  drunk  on  exclusivity  and  lost  the  script  around  what  it  means  to  be  a  public  servant,  but  they're  fine.  They'll  double  down  on  their  exclusivity.  They  have  incredible  brands.  People  talk  about  Apple  being  the  best brand in  the  world.  No,  it's  not.  MIT's  the  best  brand  in  the  world.  Harvard,  Stanford  are  the  best  brands  in  the  world.  No  one  spends $ 100  million  to  put  their  name  on  the  side  of  a  building  on  the  Apple  campus.  These  are  the  strongest  brands  in  the  world.  They've  gone  centuries.  They're  global.  They'll  be  fine.  So  will  the  big  state  universities.  They're  going  to  be  fine  too,  but,  USD,  there  are  so  many  schools  that  charge  tier  one  prices,  don't  have  big  endowments  and  their  cost  structures  are  inflexible,  and  when  you  go  from  two, $ 300  million  a  year  in  cashflow,  to  80  overnight,  you're  in  financial  crisis.  We're  going  to  see  that  in  September.
 The  public,  the  government,  universities,  administrators,  we  all  have  to  hold  hands  and  cross  the  Rubicon  here  and  say  the  goal  is  more  good  kids  given  remarkable  opportunities  to  a  dramatic  expansion  in  the  number  of  freshmen  seats  at  a  much  lower  cost.

 

00:23:59
Bill Curtis: Do  you  have  some  advice  for  students  and  parents,  as  we  go  through  this  process,  where  their  actions  could,  in  fact,  take  this  opportunity,  to  make  higher  education  a  better  place  in  the  future?

 

00:24:10

Scott Galloway: I  think  a  lot  of it  just  comes  down  to  citizenship.  Who  you  vote  for,  making  sure  that  funding  is  a  priority,  putting  pressure  on  the  universities  as  an  alumni  to  expand  enrollment.  It's  very  easy  to  get  caught  up  in  this.  I  don't  know  how  many  of  you  say it with  pride,  jokingly, " I  could  never  get  into  the  school  I  got  into,  now."  We  say  that  all  the  time  and  we  say  it  as  a  point  of  pride,  but  it's  not.  It's  a  point  of  tragedy  because  that  means  kids  like  you  are  not  going  to  get  into  that  school.  The  real  point  of  pride  should  be, " It's  much  easier  to  get  into  my  school  now  than  it  was  when  I  applied."  That  is  where  we  need  to  be  and  we're  not  there.  We've  gone  the  opposite  way,  because  we  all  love  the  idea  of  having  our  credentials  go  up  in  value  and  being  able  to  brag  about  our  university,  so  we  take  pride  in  the  exclusivity,  once  we've  gotten  our  passports  stamped  to  a  better  life.

 

 Yeah,  as  citizens  vote  in  administrator  or  vote  in  elected  officials  who  are  willing  to  stop  the  defunding  of

 government,  hold  our  universities  more  accountable  to  dramatically  expand  their  enrollments.  I  get  a  lot  of  questions  from  parents  and  kids  about  whether  or  not  they  should  return  to  campus.  I'm  telling  them  to  demand  more  financial  aid  or  to  taking  a  gap  year.  I  think  they  should  start  acting  more  like  consumers.  Look,  I  don't  think  there's  a  silver  bullet  here.  We've  got  to  attack  this  from  all  angles.

 

00:25:26
Ed Larson: I  would  really  stress  the  role  of  state  universities  in  all  this,  whether  it  be  community  colleges,  state  colleges,  or  state  universities,  like  the  Michigan's  or  Virginia's  of  this  world.  If  they  take  advantage  of  the  online  opportunity,  if  they  cut  their  tuition  costs,  some  of  them  still  keep  it  pretty  low,  but  others  have  raised  it  up.  If  they  make  themselves,  once  again,  open  to  more  middle  class,  greater  variety  of  people,  they  can  use  this  as  a  leverage  opportunity,  like  they've  had  twice  before,  during  the  Great  Depression  and  then  again  after  World  War  II.  The  state  universities  really  stepped  forward  and  that's  where  you  saw  the  Michigan's  or  the  UCs  really  change,  and  they  were  an  instrument  for  American  greatness  and  they  could  be  it  again.  The  land  grant  universities  and  the  state  universities  have  this  opportunity,  and  if  they  grow  themselves  larger,  look  back.  Cowell  helped  drive  Stanford's  quality.  I  think  if  the  state  universities  play  that  role  again,  they  will  help  drive  quality  at  other  schools,  and  we  can  revive  the  American  education  system,  through  lower  cost  and  a  broader  opportunity  for  good  students  to  get  into  good  schools  and  get  a  good  education.

 

00:26:58
Scott Galloway: Here,  here.

 

00:26:59
Jane Albrecht: We're  only  a  couple  of  weeks  away  from  when  most  universities  would  start  their  fall  semester,  yet  I  only  have  heard  a  handful  who  said, " We're  going  totally  online."  Isn't  it  getting  late  in  the  game  for  them  to  change  their  mind?

 

00:27:13
Ed Larson: Most  of  these  schools  are  actually  offering  most  of  their  classes  online.  They're  just  trying  to  get  their  students  to  come  back  because  they  have  all  these  dorms  they  need  to  fill,  because  they  are  deep  in  debt  (inaudible)   and  they  need  to  fill  those  dorms.  But,  actually,  the  classes  themselves  at  most  of  these  schools,  even  if  they  had  the  students  back  in  the  dorms,  most  of  the  classes  are  actually  online.  It's  just  a  scattering  of  classes,  a  fraction  of  the  classes,  that  will  actually  be  live,  and  I  agree  with  Scott,  you've  got  to  dangle  that  out  there,  but as we  get  closer,  more  and  more  will  be  online.

 

00:27:49
Scott Galloway: We  are  begging  disaster  here.  What  happens  when  you  send  30  or  40,000  asymptomatic  carriers  to  Athens,  Georgia,  and  then,  in  week  three,  a  bunch  of  people,  older  people  who  work  in  the  campus  community,  and  some  of  these  communities  are  basically  the  campus, and then  the  people  servicing  them,  what  happens  when  the  cashier,  the  nurse,  the  library  attendant,  in  their  fifties,  sixties  and  seventies,  hit an  ICU  that  has  a  total  of  a  dozen  beds?  This  sounds  cynical  and  depressing,  but  it  doesn't  mean  I'm  wrong.  I  think  if  we  continue  to  think  that  the  virus  has  received  a  memo  around  our  optimism  and  our  need  to  get  back  to  some  sense  of  normalcy,  I  don't  think  that  virus  gives  a  good  damn  what  we  have  planned.

 

00:28:34
Jane Albrecht: Most  universities  are  opening,  right?

 

00:28:36
Scott Galloway: Most  are.  I  think  we  are  inviting  disaster.  It's  just  insane.  The  whole  point  of  this  pandemic,  the  only  thing  we  know  that  works,  is  to  keep  asymptomatic  carriers  away  from  each  other,  and  the  university  system  is  a  function  of  one  thing.  It's  a  function  of  density,  which  is  our  enemy  here.  We  are  inviting  disaster  and I think  if  we  don't  change  our  protocols  really  fast,  we're  going  to  end  up  sending  these  kids  home  after  some  very,  very  ugly  things  start  to  happen,  in  these  small  college  towns.

 

00:29:09
Bill Curtis: Scott,  this  has  been  really  spectacular  and  I  really  appreciate  you  coming  on,  and  I  hope  you'll  come  back.  In  the  meantime,  how  can  people  find  you?

 

00:29:17
Scott Galloway: Thanks,  that's  a  generous  question.  So,  my  Friday  blog  that  you  referenced,  No  Mercy,  No  Malice,  comes  out  every  Friday.  I  teach  courses  online  called  The  Prof  G  Sprints,  and  I  also  host  two  podcasts,  The  Prof  G  Show  and  Pivot,  with  my  co- host,  Kara  Swisher,  but  thanks  for  having  me  on  and  I  always  have  time  for  raging  moderates.

 

00:29:38
Bill Curtis: Okay,  and  Ed  Larson,  Jane  Albrecht,  thank  you  so  much  for  coming  into  this  conversation.  It's  going  to  be  an  interesting  fall  and  I  think  we're  going  to  be  learning  a  few  lessons.  Have  a  good  day,  everybody.  If  you  like  what  you  hear,  please  tell  your  friends,  and  let  us  know  how  we're  doing  by  leaving  a  comment.  It  really  helps  if  you  give  us  a  five  star  rating  and  we  really  appreciate  it.  You  can  also  subscribe  to  the  show  on  Apple  Podcasts,  Stitcher,  or  wherever  you  listen  to  your  favorite  podcast.  This  episode  was  produced  and  edited  by  Mike  Thomas,  audio  engineering  by  Michael  Kennedy  and  the  theme  music  was  composed  and  performed  by  Celeste  and  Eric  Dick.  Thanks  for  listening. ( singing)

 

00:30:29
Speaker 4: From  CurtCo- Media,  media  for  your  mind.

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