You would be unfair to not acknowledge that the United States of America has weaved a neat story of admiration. I deeply admired this country (I still do), was fascinated by its people, its identity and its place in the global landscape. However, in 2008 two irreconcilable events took place and convincingly disarranged my neat, naïve and fond story. A campaign of one son of a Kenyan diplomatic (so fresh and new that the world involuntarily felt part of it or should I say part of him), and an economic meltdown so non viscous (its river almost flattened world economies and its tributaries defiled even periphery economies). We were perplexed, on one hand we screamed back YES WE CAN (mostly to our TVs) while on the other hand we asked ‘What does banks over there got to do with our rural SACCOs over here?’
You may know these two events as the Obama Effect and The 2008-09 Global Financial crisis; both of epic proportions and defiant in their own nature – one a triumph of audacious hope and the other a triumph of unrelenting human greed. Someone great was coming in but an even greater value (that of not preying on fellow humanity) had been lost (probably forever).
“I felt torn apart like a master of ceremony in an event of twins; on one hand leading a birthday bash while on the other eulogizing the death of the other twin all in the same room”
Eight years later, as Obama exits the White House, Kenya’s higher education is in a crisis, and I am again torn apart – torn between celebrating the progress made in education attainment (specifically in higher education) or moaning the disdain with which we treat holders of this attainment. I say higher education because it is the most prominent pathway to a career that is seemingly unable to facilitate transition to work. Is the university to blame? If not, who pulled this heist on our children, made them run, celebrated them as they crossed the finish line and now look perplexed that they cannot find the promised trophy? I don’t know but today I will share my thoughts on the university as a key player in this. I believe the unfortunate events of the Global Financial crisis bear some semblance to the higher education crisis we are in.
To make my case indulge me in exploring what this Global Financial Crisis was all about. It is widely accepted that the bedrock of the financial crisis was mortgage lending. Imagine you want to own a home so you borrow from a bank in exchange of a paper called a mortgage; you promise to repay whoever holds that paper the amount plus interest. The bank loans more borrowers and then sells the mortgage papers to third parties called international investors. These global investors have an insatiable appetite because the returns are high and they pressure banks to look for more borrowers like you (called Prime Borrowers).
Banks realize they will not find people like you who can meet their standards, so they relax their requirements, and people who should not qualify for loans (called Sub-prime borrowers) get mortgages and became your neighbors. Soon your neighbors, in their hundreds, cannot afford to repay the mortgage and their houses are foreclosed. But all good borrowers like you have homes so no one is buying – since supply outstrips demand house prices decrease dramatically. Your house is now worth 30% of what you are paying and your neighborhood is ghost silent. You reckon it is foolish to pay for a worthless house and you default too by choice. Banks panic (they have worthless houses as security), global investors want their money, security exchanges collapse, banks go bankrupt, thousands are laid off, and the off we are in a global meltdown.
Having said that, you can agree that this article cannot be popular even to the writer because you only say some things if you must. I reckon that no one would like to be compared to such a crisis, but like it or not is is so easy to draw parallels with our higher education as it operates today. Let us try:
First, the only reason people borrowed was because credit was available and owning a house was necessary just like we are pumping students into universities because our parents can (though at pains) access SACCO loans or dispose a household’s fondly loved cow to see us through a semester. I make no attempt to argue that owning a home or having an education is not desirable, I am only pointing to similar cases in which the process of doing that is packaged deceptively and erroneously marketed. I am even more concerned at how delinked the cost, promise and yield of higher education is loosely assessed and thus less is demanded of its output. Lesson: Access should not be enough in justifying sign up!
Secondly, the global investors’ capital was too enticing for banks to resist; they decided to relax the lending requirements opening floodgates and taking leave of business ethics. Our universities in equal measure, specifically in East Africa have been on a deregulation spree marked by privatization and self-sponsored models. I am sure you note that banks made an ethical call, regulators were probably having faith in the markets while borrowers were counting their blessings one by one. One then wonders how commercial interest can be structured without diluting the quality of our higher education?
Of course, it is not illegal to have a class of 500 students who finish a course having never heard of the lecturer’s name – BUT is it right or moral?
It should not be lost on us that in the US estates you could no longer tell which house had belonged to a prime borrower and which one to a sub-prime borrower. Is it a wonder that we now have blanket skepticism of graduate skill quality where we dismissively call them ‘half-baked’? To be fair to employers, it is true they can barely spot an interesting application in a heap of a thousand resumes – is this not a situation where we treat all graduates like sub-prime borrowers i.e. SUB-PRIME GRADUATES? Notably though, banks could have offered other instruments for the less able borrowers. So while I champion better education attainment I encourage us to appreciate that this may not be the most appropriate strategy to educate all youths. We should ask louder – education for what purpose?
In addition to universities, there are governments, businesses and individual consumers on this issue too whose roles I will explore in subsequent articles. As I conclude I must confess it is not easy to compare esteemed institutions to histories dark chapters, that is not to say that silence was an option either. But as I did this article, I was not hoping to end with a ruling on who is more wrong but rather to spark a conversation about who can and should do more about this. What lifts my spirit is my intentions, that I am not anti-university, or anti-deregulation I am simply anti-the status quo. That is why I started The Bridge Africa to be a multi-sector graduate skill partnership of players in workforce development to address this. I know Americans could still have owned homes in better structured and ethical process – I believe even more that if the university assisted us in rethinking how it will invest the talent of the future prosperity will be ours to find. We must not lose our ability to keep the promise of the returns of higher education to the African child.