A number of recent articles explore the growing trend among college-age people to question whether college is worth the costs -- both the direct costs in terms of tuition and opportunity costs in terms of lost time.  In other words, many more college-eligible people are now thinking outside the college box.

Three factors are impelling this widespread re-examination of the necessity of college.

First, the soaring cost of college tuition and the debt it is causing are becoming widely known.  For example, the NY Times has prominently reported that average student loan debt rose 5% from 2010 to 2011, now averaging $26,500.  Some two thirds of those receiving a bachelor's degree had student loan debt.  Student loan debt now exceeds $1 trillion; $117 billion in such debt was added last year alone.

Second, it is also coming to the public's attention that the average earnings for bachelor's-degree workers are dropping rapidly in absolute terms, and dropping in value compared to the cost of tuition at an even faster clip.  Just since 2000, tuition rates have risen nearly linearly by 72.0% (i.e., an average 5.6% annual growth rate).  But during the same period, the average earnings for baccalaureate grads dropped 14.7% (or an average drop of 1.6% yearly).  No doubt this is a major reason why the delinquency rate for student loans now exceeds that for mortgage loans, credit card loans, and indeed all other forms of consumer loans.

This drop in earnings is fairly linear, which means that the 2008-2009 recession isn't the primary reason for it.  It is more likely a result of oversaturation of the workplace by recent grads.  In turn, this oversupply is almost surely due to the moral hazard created by the nationalized government loan program -- 93% of the student loans awarded last year were government loans, and in 75% of those loans (the "Stafford loans"), there are no credit requirements.

But while the first two factors have been much commented upon, there is a third which is only now becoming salient.  I refer to the growing number of college (and even high-school) Drop-Out Masters of the Universe.

These interesting young men (for that is their usual gender) were the subject of a recent piece in (of all places) the NY Times.  Most people know of the past and now legendary billionaire Drop-Out Masters: Steve Jobs, Bill Gates, Michael Dell, and Mark Zuckerberg.  Fewer know of the more recent Drop-Out Masters such as Jack Dorsey and Evan Williams (who started Twitter), Kevin Rose (Digg), and David Karp (Tumblr).

The piece introduces us to a potential new Drop-out Master, Benjamin Goering, who has departed from the University of Kansas to join a San Francisco-based social-software firm.  As Goering so nicely put it, "Education isn't a four-year program. It's a mind-set."

Don't tell that to most professors!

The NYT article recounts another story of a future Drop-Out Master, Mark Hagen, who fled Princeton for Frisco to start a mobile app company (Undrip).

As the story notes, there is a rapidly growing number of college-age youth foregoing college and opening companies, or joining companies for whom college degrees aren't considered definitive of ability.  Many are helped by support networks such as the UnCollege movement (started by another college drop-out), Enstitute, and Zero Tuition College.

The article's author, Alex Williams, is cautious, of course.  He suggests that for professions such as law and medicine, a formal college education will still be necessary.  However, he doesn't question whether requiring the current college training program (a four-year general undergrad degree, followed by a three-year specialized curriculum) is really necessary or even desirable.  Why not just allow schools that would take high-school grads of exceptional ability and train them directly and solely in law, medicine, or whatever, and skip the "general ed" stuff?

I know what my fellow humanities profs will say: "But they wouldn't be well-rounded!"  (Translation: many of us humanities profs will be laid off!)  To which the reply is: so what?  And anyway, why not let the free market decide whether the products of a direct four-year intensive program would be inferior in any way to the traditional seven-year professionals?

And if it is true that doctors and lawyers may not need "broad humanistic education," how much less will it do for people who want to be cops, firefighters, programmers, accountants, engineers, nurses, and so on?

To their credit, a number of successful entrepreneurs are now helping bright students escape the college box.  Billionaire Peter Thiel (co-founder of PayPal) has set up a fund that awards $100,000 grants to students under 20 years old who drop out of college to start new ventures.

There is another pertinent point worth noting: there is a shortage of high-skilled trade workers.  A recent article in the WSJ points out that the value of American manufacturing output per hour is 30% higher now than a decade ago, and 125% higher than a quarter-century ago.  But this proliferation of productivity requires manufacturing workers who are trained in a post-secondary program (typically vocational training delivered at a local community college or trade school), and companies are reporting shortages of such trained personnel.

A big part of the problem lies in the fact that many high-school grads are turning their backs on skilled manufacturing programs in favor of bachelor's degrees of dubious use in finding appropriate work.

All of this suggests -- though of course doesn't prove -- that two reforms would be useful.

First, privatize the student loan program, so that it is no longer a vote-buying machine, and limit or (even better) end all government backing of student loans.  Put the burden on the student to convince a lender -- lending its own capital! -- that his course of study is likely to result in higher future income.  But make such loans dischargeable in bankruptcy (unlike the loans being granted today).

Second, encourage more private industry alternatives to college.  For example, we could confine Pell grants to just the academically accomplished, but allow those grants to be used to go to alternative training centers such as Microsoft's proprietary certificate program.  Open those private training programs to GI Bill recipients as well.

In sum, I think that what is needed to help solve the growing problems in the American system of higher education is in fact the same as what is needed to solve the crisis in the American K-12 education system: a real dose of privatization.  Harness the power of the free market in place of the clumsy and counterproductive command-and-control approach that the government takes.

Gary Jason is a senior editor of Liberty and author of the recent book Dangerous Thoughts.