Are the ‘Hidden Ivies’ a good investment?

If your kid wants to be a pharmacist in Missouri, that's fantastic news. [Bloomberg]( This is Bloomberg Opinion Today, a poor return on investment for Bloomberg Opinion’s opinions. On Sundays, we look at the major themes of the week past and how they will define the week ahead. Sign up for the daily newsletter [here](. [Pay It Back]( Why do we send our children to college? Every case is individual of course. I, [like]( Allison Schrager, am all for the liberal arts, and think their decline is not only bad “for our culture and democracy” but “leaves students less able to manage a changing economy.” The [boom in STEM majors]( I suppose bodes well for the nation in an world where tech is the future. The [rise in business majors]( may [not be as beneficial]( to the republic, or the students themselves, as parents may wish. [Matthew Yglesias]( and [Tyler Cowen]( point out the twin scourges of credentialism and networking. The Bloomberg Opinion editors, perhaps [channeling]( a now-canceled college president, [think]( that four-year college isn’t the only path to success (and anybody looking for [a good plumber or electrician]( these days understands why). One former New York City mayor, who also happens to be my boss, [advocates]( the high-school-to-health-care pipeline. And then there is … ROI? “A Bloomberg News analysis of more than 1,500 nonprofit four-year colleges shows the return on investment at many elite private institutions outside the eight Ivies is no better than far-less selective public universities,” [reads]( Bloomberg’s News’s Big Take. “In fact, the typical 10-year return on investment of the so-called ‘Hidden Ivies’ — a list of 63 top private colleges — is about 49% less than the official Ivies and 9% less than states’ most prominent universities, known as public flagships.”[1](#footnote-1) The analysis includes an interactive graphic showing where hundreds of US colleges and universities fall on the ROI vs tuition and cost of living scale. You may find it helpful. Or you may end up depriving your kids of the chance to follow their star. What to make of a chart showing that the Juilliard School, with its 10% acceptance rate and gaggle of the world’s finest musicians, is somehow a poor decision? So too Bennington, Oberlin, RISD. Yes, they are expensive schools and nobody wants their children saddled with loans,[2](#footnote-2) but they tend to have generous aid packages of mostly grants, and the republic also needs a few creative writers, illustrators and, gasp, interpretive dancers.[3](#footnote-3) So, terrible news: Your kid is a musical prodigy. Source: Bloomberg Fantastic news: Your kid wants to be a pharmacist in Missouri! Source: Bloomberg Erin Lowry made a financially prudent choice that also helped her chase her dreams. “At the tender age of 18, I made the decision to attend the university that offered me the largest financial aid package, through academic scholarships,” Erin [writes](. “If I had stuck with my first-choice school, I would have been saddled with nearly $75,000 in student loans by graduation, even after factoring in the university’s financial aid offer and what my parents were willing and able to contribute. My decision to follow the money put me in the position to graduate debt-free and allowed me to take bigger risks earlier in my career.” Having gone through this process twice, I know all the [acronymic hurdles](: SAT, GPA, ED, RD, EFC — and the worst of them all, FAFSA. The Free Application for Federal Student Aid used to be an absolute beast, requiring days of digging into family financials to answer more than 100 questions demanding more data than a tax return. Fortunately, this was *all fixed* with the introduction of a new, easy-peasy FAFSA for this year’s applicants. Unfortunately, the debut has been, well, let’s let the Editors [sum it up](: “President Joe Biden’s botched rollout of a revamped financial aid form reveals a stunning lack of managerial competence … The work took more than three years and cost $336 million — and the results have been disastrous. Launch [delays]( and various technical [snafus]( caused FAFSA completion [rates]( to plummet by 40%. Despite having only half as many questions, the shorter [form]( has somehow managed to be even more confusing. College counseling groups [say]( it’s taking applicants twice as long to fill out.” And then there’s the overdue assignment: Because the government is months behind in sending student records to schools and state financial aid agencies, many colleges won’t be able to offer their aid packages until the summer, far too late to let many students shop around for the best deal. “At this point, the schools are the only ones in the position to help,” Erin points out. “They could start by pushing off their decision deadlines by at least two weeks, if not a month, to enable more applicants to receive all their financial aid offers and make a fully informed decision.” Of course, before parents can even enter this cycle of despair, their kids need to be well-educated enough to have a chance in college. We all know about the [learning loss]( caused by the pandemic, but Michael R. Bloomberg, the founder and majority owner of Bloomberg LP, finds that US K-12 schools are suffering from a mysterious form of long Covid. “According to the Department of Education, 72% of schools report that teacher absentee rates are higher than they were before the pandemic,” he [writes]( (free read). “In Michigan, teacher absences are 50% above pre-pandemic levels. In Chicago, 43% of teachers were chronically absent last school year ... Just as the pandemic loosened attendance norms for students, it has done so for teachers, too. It’s become more acceptable to be absent a lot — and students are paying the price.” Mike, who knows a [thing]( or [two]( about public schools, has some prescriptions: - Districts that gave teachers additional sick or personal days during the pandemic should return to their pre-pandemic levels. - Agreements to raise salaries should be conditioned on policies that withhold pay for chronically absent teachers and administrators. - Expanding public-school choice, particularly through high-quality charter schools, would give more students the ability to switch to schools where teachers consistently show up to work. - Districts should offer merit pay and bonuses for those who improve student performance, which would boost incentives for teachers to be present. Merit pay and bonuses? That might bring a bit of ROI, indeed. Bonus [School]( Reading: - Angel Reese Is a Black Woman in America. [Remember That](. — Ajhanai Keaton - Say It Loud, Say It Proud, [I’m a Neoliberal]( — Clive Crook [What’s the World Got in Store](? - Trump “hush money” trial set to begin, April 15: [Silencing Trump]( With a Gag Order Is Hopeless — Stephen L. Carter - Eurozone CPI, April 17: Lagarde [Declares Independence]( From the Fed — John Authers - TSMC earnings, April 18: China and Taiwan Would Make an [Unhappy Family](— Karishma Vaswani [Electioneering]( Quick, what’s the most important college in America? If you said Harvard, you probably didn’t get into Harvard. The answer is, of course, the Electoral College. While most of us can agree that the Founding Fathers did a pretty swell job laying down US democracy, they left some troublesome loose ends. Patricia Lopez [points out]( how a couple of unforeseen consequences might bring chaos to class. One was spelled out to her by Rita Palma, Robert F. Kennedy Jr.’s New York campaign director. “The Kennedy campaign could deprive Biden of victory by eating away at his electoral vote totals,” Patricia writes. “If blue states such as New York went for Kennedy, [Palma] said, Biden would fall short of the 270 Electoral College votes needed. If Trump also fell short, the contest would be thrown to the GOP House, which, she predicted, would choose Trump.” The other is political tit-for-tat. “Election officials [in Ohio]( and [Alabama]( warned President Joe Biden that he might be left off their ballots in November because the Democrats’ mid-August nominating convention is past their deadlines,” Patricia [explains]( in another column. “Even though both Biden and Donald Trump have secured enough delegates for their parties’ nomination, it doesn’t become official until the nominating conventions this summer. The Democratic National Convention, which begins Aug. 19, means Biden would miss the Ohio deadline by 12 days and the Alabama one by about a week. In this day and age, there is no need for a state to demand 89 days advance notice— or even 82 days — to include a candidate on a ballot.” In this day and age, there is no reason to have a Kennedy on the ballot, either. Palma called President Joe Biden the “mutual enemy” of both Kennedy and Donald Trump voters. So, yeah, Team Kennedy isn’t playing to win — they just want to spoil college for all of us. Notes: Please send debt relief and feedback to Tobin Harshaw at tharshaw@bloomberg.net. [1] There is a major caveat that I hope readers don't miss: the study "relied on publicly available tuition and earnings data of graduates who accepted federal financial aid, meaning the analysis doesn’t include information on those who paid out of pocket." [2] For those curious about the math: The [average debt]( among those who took out loans and received bachelor's degrees in 2021-22 was $29,000. While millennials tend to dominate the conversation around student loans, the [vast plurality]( of debt is still held by Gen X, which faced massive [drops in financial aid]( in the 1980s. [3] As my loyal readers know, my mother, daughter and I were all art history majors, so take my thoughts on this subject with one of those grains of salt Judas Iscariot is spilling in Leonardo's [Last Supper](. Follow Us Like getting this newsletter? [Subscribe to Bloomberg.com]( for unlimited access to trusted, data-driven journalism and subscriber-only insights. Before it’s here, it’s on the Bloomberg Terminal. Find out more about how the Terminal delivers information and analysis that financial professionals can’t find anywhere else. [Learn more](. Want to sponsor this newsletter? [Get in touch here](. 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