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MIT already funds graduate education for many students via research partnerships. This is an extension of that concept outside the field of research and can be applied to any stage of a collegiate education.
I studied mechanical engineering at MIT. I wanted to go into product design and the most useful class of my undergraduate education was one in which we designed and built a desktop lathe in a group of 6. We went through the entire design and fabrication process in great detail and I learned how to repeat that process for a new product.
Immediately after school I got a job designing automotive sensors. I followed the same process we used in class to design a pressure switch for use in automotive transmissions. I already had all the skills I needed (which I thoroughly thank my professor for) and if anything, the pressure switch design was less challenging than our in class project.
The difference between these two experiences is that I was paying $30 an hour in class to work on a fabricated project with no end use, while I was getting paid $30 an hour at my job to create a product with a real world application. I think students from every major could be tackling industry's problems to help fund their education, the same way we currently do with research as graduate students. Many companies would be thrilled to have a team of MIT engineers, guided by a professor, solving their problems.
As fellow MIT students, you might be thinking that no company would take the risk of "remotely hiring" students in a classroom setting. Well, many companies are doing just that through platforms like http://www.innocentive.com/ , which solicits freelance help to solve to difficult challenges and pays for solutions. At the company I was working for, the most basic work seemed dull to a seasoned mechanical designer, but would have been a great learning experience for an MIT student, and was simple enough that it would be low risk to send it out. On the flipside, our company was passing up hundred million dollar opportunities because we didn't have the time or resources to work on designs that were outside our realm of expertise. If a company is worried about the quality of work then students can work in teams, one class could come up with multiple solutions, MIT could hire industry veterans as assistants to help student groups and assure the quality of their work, or the company could only pay upon receipt of a viable solution.
In addition to a positive learning experience, tackling real world problems also provides a great resume boost for students. In the examples given above, for the same amount of work I could come out of school saying that I designed a toy that sits on my desk at home, or I could say that I designed an automotive sensor that generates $500k per year for a company and might be used in the car you're driving.
The bottom line is, we could connect students with industry to provide a more applicable college experience that will pay for itself. Instead of fabricating problems, students can solve real ones while learning and getting paid for it.