A Harvard degree isn't the status symbol it used to be--and that goes for Yale and Princeton, too. It seems impossible. After all, the crush to get into elite schools has never been greater, and in general the number of slots hasn't risen. For the class of 2008, Harvard received 19,712 applications and admitted 2,029 for 1,650 places. People lust for these spots. They couldn't have lost prestige.

Well, they have.

One reason is that college by itself isn't so important. More Americans now go to graduate school--and graduate degrees count heavily in the job market and the status derby. Consider: in 1960, 392,000 Americans got bachelor's degrees and about 100,000 got graduate and professional degrees. By 2001 the numbers were 1.2 million and 600,000. So, if you go to Podunk and then to Harvard for graduate work, your Podunk degree is enhanced. Conversely, Harvard grads attending Podunk for graduate school may find their college degrees diminished. Of course, many Harvard alumni go to fine graduate schools, but there's much mixing. In 2003 only 15 percent of the incoming class at Harvard Law had been Harvard undergraduates.

But something else, perhaps more telling, is also happening. Frustrated at not getting their children into elite schools, Americans are creating more elite schools. If the demand for status increases, so will the supply. Three decades ago there were only a few luxury cars (Cadillac, Lincoln, Mercedes). Now there are many more (Lexus, Acura, Infiniti). If the local country club rejects too many people, the victims form their own club.

Higher education is no different. Schools that once had regional--or simply mediocre--reputations are slowly acquiring star quality. Three decades ago Duke wasn't classed with the Ivies; today it is. Of course, schools like Duke have spent heavily to improve their faculties and their buildings. But interestingly, those oft-reviled rankings, most prominently from U.S. News & World Report, also aid the social climbing. Schools that rise in the rankings acquire more prestige than falling schools lose. The result is more "elite" schools--old elite plus new. Duke didn't make the first U.S. News ranking in 1983 of 13 top universities. Now it's tied for fifth.

The struggle to move up the rankings is ferocious. In his book "Tuition Rising," Cornell economist Ronald Ehrenberg explains how Cornell improved its rank by persuading U.S. News to alter some calculations. The change was legitimate. It adjusted educational spending for cost-of-living differences. But the very effort showed how much schools care about the rankings. Schools flood attractive students with promotional literature. Among private schools, 70 percent spend $1,000 or more on recruiting for each entering freshman, reports the National Association for College Admission Counseling. Even Harvard sends out 70,000 letters. (Public schools are stingier; only 10 percent reach $1,000.)

There are some spectacular leaps. Washington University in St. Louis didn't make the U.S. News list until 1987, at 23rd; in 2003 it was tied with Dartmouth for ninth and was ahead of Columbia, Cornell and Brown. Even when schools don't rise, they benefit by proximity to "old elite" schools. On the 2003 list, Vanderbilt and Notre Dame (tied at 19) are just ahead of the University of California, Berkeley (21). Gee, they must be good if they rank with Berkeley.

Critics contend the rankings are arbitrary. True. Differences of five or six spots are probably meaningless. But the larger truth is that folklore is giving way to objective indicators (test scores, faculty salaries, acceptance rates). It's a leveling process.

In one sense, the revolt against privilege is thoroughly American. But the old elite also suffer because they can't accommodate everyone who's qualified--it's a matter of simple demographics. More good students and faculty must go elsewhere. In 1994 about 60 percent of Washington University's freshmen were in the top 10 percent of their high-school class; by 2003, that was more than 90 percent. The new elite have gained more than the old have slipped. Ivy League schools, for example, still dominate Rhodes scholarships, but less so. In the 1960s, their students won 39 percent; in this decade, that share is 27 percent.

There's a convergence of interests. Ambitious schools crave better students, while more students who once might have attended the old elite can't. They, and their parents, then become a social force to broaden the elite. Their cheering and careers confer new respectability on formerly "second tier" schools. What makes new Harvards is envy and emulation of the old.