Universities Are a Pyramid Scheme
Universities aren't failing. They're succeeding spectacularly at their true purpose: perpetuating the most sophisticated pyramid scheme ever created.
Consider this: A PhD spends 6-8 years paying to w
Universities aren't failing. They're succeeding spectacularly at their true purpose: perpetuating the most sophisticated pyramid scheme ever created.
Consider this: A PhD spends 6-8 years paying to work (they call it "studying"), to then compete for the privilege of creating more PhDs, who will pay to create more PhDs. Each level desperately recruits the next, fueled by the myth of "academic contribution."
The numbers are staggering:
- 1.6% of PhDs will get tenure positions
- The average PhD student generates $500K+ in revenue for their university
- PhD stipends average $15-30K while generating $50-100K in research grants
- Universities profit from every layer: tuition, research grants, patents, publishing
But here's where it gets sinister:
**The Publishing Racket:**
- Academics do research for free
- Write papers for free
- Review other papers for free
- Then their institutions PAY to access these same papers
- Publishers make 35-40% profit margins (higher than Apple)
- Universities spent $10B in 2021 on journal subscriptions to access work they produced
**The Grant Pyramid:**
- Senior professors secure grants
- Graduate students do the work
- University takes 50-70% overhead
- Results get published
- Used to secure more grants
- To hire more students
- Rinse and repeat
**The Teaching Scam:**
- Professors need publications to get tenure
- Teaching quality irrelevant
- Students pay premium for "top researchers"
- Who are incentivized to avoid teaching
- So universities hire adjuncts at poverty wages
- While charging full price
**The Career Trap:**
- PhD programs accept more students than jobs exist
- Creates desperate workforce for teaching/research
- Adjuncts teach 75% of classes
- Make minimum wage equivalent
- No benefits, no job security
- While student debt compounds
This isn't market failure. It's market success. Universities have perfected a system where:
- The workers pay to work
- The product is more workers
- The profits fund administrator salaries
- The victims become recruiters
- The scheme is legally mandated
"But what about the research?" 90% of published papers are never cited. Most can't be replicated. The "contribution to knowledge" is largely illusory—a story we tell to keep the pyramid growing.By Eduarda Ferreira