Education

The educational bubble: It is being driven by the government. As I said in my post the other day, Abraham Lincoln passed the bar with less than a third grade education. It could be argued that the government requiring a competency exam is in place to protect the public, but to me the argument that the only place to gain competency is in a government approved college educational program is hogwash. Of course, by passing the bar exam on his third try, Frank Abagnale showed that competency examinations are no guarantee of competency, either.

In order to attend medical school as either a Physician Assistant (Master's Degree) or as a Doctor (MD or DO), one is required to have a Bachelor's Degree. It doesn't matter what you major in for the initial 4 year degree: I know Doctors with a BA in film, and I attended a PA program with a degree in EMS administration.

The problem here is that requirements for education are increasing costs.Let me explain: In the United States, to be a Doctor requires a 4 year degree to attend Medical School, followed by three years of medical school, followed by a three to seven year (depending on specialty) residency program. In all, the new Doctor now has a student loan debt of  $250-500 thousand. Our new Doctor has had no (or virtually no) income for a decade, and has incurred a quarter million in debt.

Considering that the young doctor could have earned anywhere from $160-400 thousand in that same time period, our young doctor is $300-900 thousand and 10- 14 years in the hole before he has made any money. If we assume that a person has an average working life of 47 years (between the ages of 18 and 65), he is going to have to make a hefty salary to pay back his student debt, and still make up for the years that he wasn't working, and his non-educated contemporaries were.

For example:  a person gets a job in a fast food joint making a starting wage of $5 at age 18, and tops out at $50,000 a year before retiring at age 65. Over the course of his career flipping burgers, he makes an average wage of $22,000 a year. Over his lifetime as a burger flipper, he makes about a million bucks.

Now consider the doctor: he only has a working life of about 35 years, and over that time must make that same million, plus the cost of the quarter to half million in loans to break even with burger flipping. This means that the doctor must earn more than double what the fast food worker does, JUST TO BREAK EVEN. If we cut out the requirement for the 4 year degree, and instead made medical school a 4 year program, the meat of the doctor's education is still there, but we have reduced the costs of becoming a doctor by four years and $150K. This means that the doctor can make less and still earn what he needs to earn, meaning that medical care just became cheaper, and also more accessible for the poor.