Modern universities are a mix of two contradictory ideas. It's a place for "higher learning"; trying to fit the same role as institutions from hundreds of years ago where academic learning was much rarer and was fitted for the aristocracy. While simultaneously being something that you need for a job to make money. Oh, and also the people doing the teaching are more interested in their research than actually teaching. Forget teachers putting in 100% of their effort into teaching and making sure people really get the material (here's some slides the T.A. made, deal with it), you're lucky if a professor is a half-way decent orator.
There are so many better ways to get different kinds of education, particularly for humanities. There are books, online videos, etc. that provide a better education on writing, philosophy, etc. than what a single professor charging thousands of dollars can provide.
This works out to roughly $250 per student per semester. It's difficult to price the work of T.As as they are often students themselves, but assuming each student requires an average of 2 hours per week of dedicated grading/tutoring time, then at $20/hr the total cost of providing a first tier class should be $730 dollars.
This number is roughly 1/3rd to 1/2 the cost of a class at a community college, 1/6th of the effective cost per class for UMass Amherst, and roughly 1/10th the effective price per class of MIT.
I can assure you that the lecturer at your community college is not making 300k either. But this calculation does show that most of the tuition costs do not end up in the hands of the teaching staff, and that providing a first rate education could be done for an order of magnitude lower cost than current first tier universities charge.
Or hell, offer professors 1 million per year and still charge 1/3rd the price of MIT.
This epiphany acted as a catalyst for me to leave academia.
The ideal business is then one that actively inflates the credential's value while lowering the difficulty of achieving it. The best way to do this is to increase selectivity/restrict supply, raise prices, lower difficulty (grade inflation), and increase the time required to get the credential, while providing alternate activities for those who are inclined to do something other than receiving an education.
Heck you can get degree credit by virtue of living in a foreign country via a study abroad program.
The other activities a university may participate in like research, or educating only matter to the extent they enhance the "prestige" of the credential or to benefit the minority of students who value academic rigor more so than the credential.
A mission that the Ivies are well on their way with. The average grade at Harvard is a 3.67 (as of a 2013 source) and the prices have never been higher (though that's an individual thing, what with scholarships). They only need to make it a 5 year program with a MA/MS tagged in to get really going; degree-inflation hopped onto grade-inflation and dollar-inflation.
Somehow, you then have to work Ultimate Frisbee or chess in there too, an athletics-inflation and club-inflation (?), so to speak. Kinda like Laurie Laughlin's daughter did with the varsity-blues scandal for admissions. I'd guess that's already happened then.
What do you end up with besides an empty savings account? A 22 years old with a very good resume and a very bad taste in beer and jazz.
https://www.thecrimson.com/article/2013/12/9/stats-grade-inf...
