Graduate students also provide a pool of cheap labor for university departments: they work as research assistants, teaching assistants, instructors for entry-level classes.
Getting a PhD is a lot like an old-fashioned apprenticeship. It’s not just harder classes, it’s also on-the-job training for being an independent researcher or professor. Who you work with is more important than the material itself, and I think it would be very difficult to get the same results with an on-line program.
I’m sorry, but I unequivocally dispute this - its an oft-repeated meme but in many places it has no basis in reality. Graduate students are anything but cheap. For my students, I pay their stipend (~$27K/year), half their tuition (~$20K/year) and their medical and dental insurance (~$3K per year). So a grad student costs me about $50,000 per year and they are useless for at least the first year until they are trained, and they take classes for an additional year where they can only focus on research part-time.
A technician is cheaper than this by about 5-10 thousand dollars per year. But I like having grad students so I don’t mind the cost. But they ain’t cheap.
This is truth.
But some fields don’t have “technicians”. My wife teaches music history at UCLA. For a big undergrad class she might have two graduate student TAs to help with grading and running discussion sections outside of normal class hours. She’s also used grant money to hire grad student research assistants to handle some of the grunt work on her research (like sifting through a lot of source material looking for particular compositional details.) For work like that you need someone who knows the subject matter, but there’s no way the music department could justify hiring a full-time assistant for my wife.
I agree, however, with your assessment for technical subjects. When I was in grad school in computer science the department employed a number of full-time techs in addition to the part-time work done by the grad students. It was understood that we were quasi-charity cases – they expected us to work for the department, but they always emphasized that our own education and research should come first.
I would like to emphasize the apprenticeship aspect. Having acquired a PhD and supervised 8 of them, I feel that one of the most important parts of the PhD process is the day-to-day contact with your supervisor (and others, including fellow students). I cannot imagine supervising a student at a distance.
There are exceptions. I have a close friend who arrived in Princeton with his thesis essentially written and was out in two years, his supervisor not having really read it (or so he claims). But he had a reputation even before he arrived and that story is not typical.
I’d like to second/third this. I (for example, just to provide a boogieman anecdote to scare young children) just FINALLY got a TT job at a middlin-sized regional state school in a geographic area that wouldn’t have been at the top of my list, and it took me 5 years on the market to do so, as I am damned with a phd from one of the better schools in my (humanities) discipline which happens to be a… prepare yourself for the shock… a STATE SCHOOL. Oh, the abject horror and shame. But I know of people who are having a harder time. The market is simply like that these days in a lot of fields.
Stink Fish Pot,
Where do you live?
What subject do you want to get a Ph.D. in?
What sort of family obligations do you have that would prevent you from moving to somewhere closer to a university with a Ph.D. program in this subject?
Please, you haven’t been very forthcoming in this thread. If you give us more details, we might be able to work out something. Perhaps there is a Ph.D. program that’s close enough. Perhaps we can figure out a way to arrange your family obligations. Until we get more details, we can do nothing to help you though.
Incidentally, if your family obligations are such that you can’t move no matter what, it doesn’t matter if there is a university that you can study at which will give you a Ph.D. which will be good enough to allow you to teach. You would almost certainly have to move (and possibly a long way away) to find a teaching job.
And it’s also possible that you’ll have to move multiple times, in short succession, before landing a long-term position (let alone getting tenure). I’ve seen a lot of faculty that will start as a “visiting professor”, typically a 1 or 2 year position. Then they’ll go to another institution (halfway across the country) for a tenure track position, but they’ll be turned down for tenure after another three or four years. After that, it’s another big move for the hope of landing tenure.
Outside of that, there are a lot of instructor level positions, but these guys aren’t paid well, and are often treated as disposable by the institution they work for. When the big universities around here were hit by budget shortfalls recently, a lot of instructors were tossed aside or could only teach part time.
They are cheap compared to what we’d have to pay someone with equivalent ability in industry - loaded rates are really high. But I’ve read enough grant budgets so I understand where you are coming from.
BTW, what’s the deal with grad students looking for funding? My daughter is a grad student, and part of her fellowship is the expectation that she gets her own money, which is she is hard at work at. (She’s in Psychology.) When I was in grad school they wouldn’t have let us near a grant proposal. I think it is a great idea, since you could argue the ability to get money is a better indicator of success in academia than the ability to teach, but I wonder when this started.
It varies by field and program. In my program, everyone gets funding through the department in the form of TAships, but people do look for external funding anyway.
Yeah, PhDs are very cheap really. Doubly so because it’s a lot easier to get a nascent superstar PhD than a superstar postdoc IME.
Funding must vary a lot between disciplines - you obviously wouldn’t let a PhD student near a proper grant proposal because it would stick out like a sore thumb. I find the fundamental quality of science I review in proposals to be mixed, but the standard of general proposal writing - in terms of communicating ideas, is high. It takes a few years, and a few failures, to get good at this.
Your daughter is no doubt applying for ring-fenced stuff where she is competing against other PhDs? The thing to establish is if this is grant proposal by proxy, whereby the PI supplies a masterpiece that your daughter can work up, or whether it really needs to be something original. I funded my postdoc through a fellowship competition and wrote something entirely on my own. The idea actually wasn’t bad, although the proposal was fairly shite as written, but I think I carried the interview because it was clearly my own work. It might be standard to come up with new research areas as a PhD student in some disciplines, but in a venerable subject like organic chemistry this is really tough to do. So even something half-decent will be impressive if it’s genuinely come from the student.
They probably expect a business plan already turning over $10 million for a CS proposal 
Like I said, she has a fellowship, but part of it is looking for even more money. In fact they had a seminar teaching grant writing. When I went to grad school I was funded mostly with RA ships, but nobody looked for more money. I knew students from enough disciplines so that I don’t think this was unique to CS and EE.
They are ring-fenced, one step down from the kind of NSF young investigator grants new faculty apply for. She has no problem writing (she’d done freelance technical work) or idea generation. She’s published a bit already. I just wonder at the interaction with the university bureaucracy. She does have her own undergrad assistant already. Anyhow I know her writing, and I’ve read plenty of grant proposals, and she is better than average already.
Don’t laugh. I review NSF small business grants (now there’s a waste of government money) and they all come with business plans. In fact the review panel consists of people from academia and people from business. I’m officially from business, but my career has been doing research and passing it off as useful stuff, so I’m misclassified. I think I’m off the list for the sin of not wanting to be in charge of reviewing proposals in areas I know nothing about.