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[From The Daily Reckoning]

Most of the money spent by most people is spent for reasons of vanity not necessity. Education included.

We made the point over dinner last night.

“But wait,” said Henry, “the more you know, the better off you are. That’s why people with more education earn more money.”

“That’s what all the studies show,” added his mother. “Henry, don’t pay any attention to your father. He’s just making one of his contrarian points. You’re going to college.”

“Post hoc ergo propter hoc,” we replied, delighted to have an opportunity to pull out one of the few Latin maxims we know.

“Dad…you don’t even know Latin. I know Latin…I’ve been studying it in school for the last three years.”

“Well, then you can tell us what that means…”

“It means…something like ‘after the fact…therefore causing the fact’…something like that.”

“Yes, it’s a typical logical error that people make. Just because the people who go to college earn more money, it doesn’t mean they would have earned any less if they had not gone to college. What if I drank a glass of water and then got sick. It doesn’t mean the glass of water made me sick.

“People who go to college tend to be from the middle classes and upper middle classes. People from these classes tend to get white-collar jobs, so they tend to earn more than people who get working-class jobs. As far as I know, no one has ever studied what happened to people with the same backgrounds, I.Q., family connections, ambitions, and so forth, who did not go to college. I’m just talking about liberal arts here…not about science or engineering. If you want to be a doctor, of course you have to go to school.

“But a couple of the smartest and most successful guys I ever met didn’t go to college. Actually, one of them did go and dropped out almost immediately. Of course, they’re both dead. Does that mean that if you don’t go to college you’ll die sooner? I bet the statistics show that too – but it’s nonsense.

“One of my friends started his own business and made a fortune. The other one didn’t make a lot of money, but he didn’t seem to want to. Both of them were very well read. In fact, one of them told me why he had dropped out. He said he stopped because it was interfering with his education. Those are the words he used. He wanted to read books that were important to him and instead he had to go to class and listen to lectures and so forth. Maybe he also felt he would feel compelled to participate in university life – keg parties, football games, campus rallies.”

“But all of that is important in helping to develop a young person, helping them make useful contacts, and helping them learn how to get along in the world, don’t you think?” asked Elizabeth.

We did not really have the last word in last night’s conversation; we rarely do. But at least we will have it in today’s Daily Reckoning:

“No…just the opposite. University life is a false life – massively subsidized by parents, dead alumni, and taxpayers. Real life is off campus, and students know it. That’s why they’re terrified of it. That’s why some never want to leave campus. When you’re in school, they tell you when the tests are coming. In real life, you never know when you’ll be tested…or how.”