Pennsylvania is an industrial state with plenty of unions. We remember visiting our Pennsylvania cousins in the '50s. They worked in the steel mills south of Pittsburgh and enjoyed a lifestyle that seemed luxurious compared to our own. At the age of 10, it appeared to us that there was a lot more money in factory work in Pennsylvania than there was in the tobacco fields of Maryland.

But factory work peaked out in the late '70s...says the New York Times, when an hourly manufacturing worker could expect a wage of $20 an hour (adjusted to '07 dollars). Ever since, factory wages have been going down. So have hourly wages generally. Now, a factory worker cannot really expect to live a middle class life, reports the NYT, unless he brings home $41,600 (about $20 an hour). But fewer than 20% of them do.

*** Seeing the handwriting on the wall, people flooded the colleges and universities in the last half of the 20th century. If you got a degree, you wouldn't have to work in the mills, threatened parents. You could go to work in the office - where it was air-conditioned and you got to flirt with the secretaries. But now comes news that even people with four years of college often do not earn enough for middle-class status. And worse - a study reported in the NYT says that even a degree from an elite college is no guarantee of higher wages.

Which raises a good question - why bother to pay for an expensive college...or even, why bother to go to college at all?

We raised the issue with Henry - our 17-year-old.

"What would I do if I didn't go to college?" he answered. "And besides, if I want to be a doctor, I have to go to college. And if I do go to college and discover I don't want to be a doctor, at least I'll have the choice to not become a doctor. But if I don't go to college I won't have the choice to become a doctor."

Good point.

But what about the people who have to scrimp and save to send their children to college? Student lenders are becoming tight, say the papers. And the old Bank of Home Equity has closed its doors.

Wherever they get the money, there will surely be some disappointments in the results. The New York Times mentions a couple whose boy wanted to go to a private college rather than the State U., because the private school had a "good pre-law program." For that, the family was willing to pay an extra $80,000 - over the four-year program.

We don't know what they think they got for their money. But we have a strong hunch it was - zero. We spent three years in law school. As far as we can tell, there is no such thing as "pre-law." In the beginning it's all reading, writing and thinking - which any education should prepare you for - then, you move on to advanced hoodwinking, contractual obfuscation and ambulance chasing.

"Do you deny the allegations?" the judge once asked The Kingfish in an episode of the '50s TV show, 'Amos & Andy.'

'Not only does I deny the allegations," replied The Kingfish. "I resents the alligator."

Bill Bonner
The Daily Reckoning Australia

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