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I can't speak for the rest of the world but a significant factor in England's current problem was the abolition of the grants scheme in 1999. Students paid nothing but were far more rigorously vetted. What replaced it was a market system where if you were willing to pay (via a loan), you were pretty much guaranteed a place. This inflated the number of students going into higher education but could be seen as marking a certain level of dumbing down, as universities had to accomodate a far more mixed level of ability. This problem was further compunded by New Labour's silly idea of putting 50% of the population into higher education regardless of whether they'd benefit from it from a vocational point of view or would actually be able to deal with it on an intellectual level. I work in a university and I can honestly say that a large percentage if people there simply shouldn't be. Universities do need downscaling but it should be done in such a way that doesn't compromise their availability to those who can cope with its demands. In essence, bring back university grants.
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