Peter Thiel, the cofounder of PayPal, argues that higher education is likely the next bubble that will burst all over the US economy. We take on that argument in a viewpoint article in Inside Higher Ed.

Here is our full argument: What Bubble?

Unfortunately, it’s getting increasingly difficult to have a discussion about higher education that is not a proxy for deeper political combat.

This story in the New York Times caught my eye this morning.

Top UK Academics form New University

Convinced that the maximum allowable tuition at public universities would not permit them to maintain a quality education, a group of prominent British academics are forming their own university. The new college will offer degrees in literature, history, economics, law and several other disciplines. The new school will apparently follow an American model of setting a high list price and then discounting it based on some method of determining financial need. The list price will be set at 18,000 pounds, or roughly double the maximum tuition at British public universities.

This is interesting for a number of reasons. First, it is an experiment in American-style higher education in a cultural setting where private universities are virtually unknown. As a tuition outlier, the school will have to compete with all the public universities with established reputations whose charges will be much lower. To get good students, the new school will have to do an excellent job of convincing prospective students that the quality of their offerings really will justify the price. Alternatively, they risk becoming an institution that serves predominantly wealthy families whose sons and daughters can’t quite muster an admission to Oxford , Cambridge, or St. Andrews. As the university system in Britain loudly and publicy bemoans its fate under austerity, the task of this new university actually becomes easier.

Next, this school will have to develop a system for determining need. In the US, this process is done at the national level using the FAFSA form. No individual school shoulders the administrative and security burden of acquiring sensitive financial information from families and processing it.

The new university plans to open its doors in 2012. Will it work in the UK context? It’s certainly an experiment worth watching.

Your thoughts?