What is college worth?

President Obama has cranked up the volume on the age-old discussion about college costs. He proposes tying federal tuition aid to a new system for rating how effectively colleges do their basic job.

I'd define that job as graduating well-educated adults who aren't saddled with so much debt that it distorts their path in life.

The cost of college has risen relentlessly for decades, far outpacing the rise in middle-class incomes. The resulting debt burden has robbed our society of a lot of great teachers and social workers, while creating a pretty large pool of unhappy young lawyers.

Any economist can tell you that federal student aid plays a role in insulating colleges from marketplace consequences for their soaring prices.  If aid fills in some of the gaps for students when tuition rises, then high-cost colleges pay less of a penalty for their sticker prices.

Does that make federal aid a bad idea? Nope. But it needs to be done in a way that doesn't encourage the upward tuition spiral.  Which is easier to say than to do.

That's the Rubik's Cube the Obama administration proposes to solve with a new rating system.  Colleges that do a better job of doing their core job at affordable cost (according to the ratings) would get more aid, while ones that deliver weak results at a high cost would get less. 

Predictably, Obama's partisan foes splutter about this rating idea as damaging federal overreach.

Fact is, a college rating system already exists - the famous U.S. News rankings. Ample evidence suggests that colleges have worked very hard over the years to game those rankings - leading to practices and decisions that distorted the applications and aid playing field, leading to harm for some students.

So if the feds can come up with a sounder rating system, one that pushes colleges to do the right thing, no thte distorting thing, that would be great.

But the biggest change has to happen in hearts and minds – of students and their parents.

Elite colleges, which benchmark tuitions for the rest, have felt scant pressure to limit costs. Why is that?

Federal policy is only a small factor there.

The big reason: So many middle-class parents have bought deeply into the college prestige game. They will pay any price – whether affordable or not – to drive around for four years with the "right" college sticker on their car window.

Whenever I get the chance, this is the message I give to high schoolers caught up in the admissions arms race:

Neither you nor your parents can know what you'll be doing in the world 10 years from now, or what the world will be doing around you. Things change too fast.

So don't buy into the hype. Don't obsess endlessly about which college will accept you, or what major to pick in your freshman year.  An amazing percentage of you will graduate from a college other than your first one.  Most of you will change majors at least once.   Spend more time figuring what you need to learn in life than in fixating on where you'll learn it.

Satisfaction in life doesn't hinge on achieving a particular degree, credential or income. It's about being prepared to find and do something you love, no matter what it pays.

Even with a glossy degree, that task gets harder to achieve when you're six digits in hock.