Louis Menand has a must-read article on what's wrong with graduate education in the Harvard Magazine:
Lives are warped because of the length and uncertainty of the doctoral education process. Many people drop in and drop out and then drop in again; a large proportion of students never finish; and some people have to retool at relatively advanced ages. Put in less personal terms, there is a huge social inefficiency in taking people of high intelligence and devoting resources to training them in programs that half will never complete and for jobs that most will not get. Unfortunately, there is an institutional efficiency, which is that graduate students constitute a cheap labor force. There are not even search costs involved in appointing a graduate student to teach. . .
But the main reason for academics to be concerned about the time it takes to get a degree has to do with the barrier this represents to admission to the profession. The obstacles to entering the academic profession are now so well known that the students who brave them are already self-sorted before they apply to graduate school. A college student who has some interest in further education, but who is unsure whether she wants a career as a professor, is not going to risk investing eight or more years finding out. The result is a narrowing of the intellectual range and diversity of those entering the field, and a widening of the philosophical and attitudinal gap that separates academic from non-academic intellectuals. Students who go to graduate school already talk the talk, and they learn to walk the walk as well. There is less ferment from the bottom than is healthy in a field of intellectual inquiry. Liberalism needs conservatism, and orthodoxy needs heterodoxy, if only in order to keep on its toes.
While I've seen all the humanitarian and efficiency arguments against churning out exhausted, embittered PhDs who can't find jobs, I hadn't seen such a great linkage of the problem to the growing gulf the public perceives between "real people" and the academy. Anti-intellectualism is on the rise, as we all know, and in the meanwhile we're forcing everyone with any affinity for alternative careers, the people most likely to be interdisciplinary and out-of-the-box, out of the ivory tower. It's an academic ossification that makes no sense.
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In the bits of Europe I've worked in, the aim is for a PhD to take 3 or 4 years, and the is more pressure to get students defending in time. I suspect it's all part of the process of professionalisation of science, and the US will have to follow suit. Which should be good for the students.
If we want to head off anti-intellectualism, we have two basic options
1) Make schools less oppressive
2) Do a better job separating schooling and education
But then, I don't know if the way grad ed is functioning is 'self-defeating'. Who said the purpose of the academe is to educate? I think it's historically closer to an artificial barrier between a self-selected elite and everyone else. Education as a great equalizer is the greatest myth of all.
That article really hit one of my biggest pet peeve. The one "true" profession for PhDs is a tenure-track job in academia. He threw some lip service in that perhaps we should change this, but when he's calling PhDs who don't get these jobs failures instead of making an effort to figure out what they are doing and if they think their PhDs are giving them value to their current work, he's writing complete garbage. He also repeated tries to universalize the problems in English or humanities PhDs to all PhDs. There is commonality, but there are many differences and it's amateur to brush over those differences.
If people want big changes (particularly in science) we need to be clear that there is value to science PhDs in an academic support/mentorship roles, in companies, in law school, etc. This needs to be drilled into the professors who are mentoring these students and they need to understand all their options from when they enter grad school. I think engineering PhD programs are leading the way in this (particularly regarding industry jobs) and some science programs are getting on board. The 10+ year PhD programs in humanities where a Harvard professor who has spent years thinking about these issues and still seems clueless is a really bad sign from the future of graduate education in humanities.
He also plays a bit fast and loose with numbers. He tries to say this is a problem beyond English by noting that the number of statistics and mathematics bachelors degrees has plummeted since the 70's, he seems to ignore that the growth of related fields like computer science and engineering specialties have taken some of these students. From my understanding, there's a total decrease in the numbers of humanities majors, making it a real problem.