Penelope Trunk's recent blog entry lists seven reasons why graduate school is outdated.
As someone who invested considerable money and most of his 20's in graduate school, I was a bit miffed at the article. I think it grossly oversimplifies things and has a narrow focus masquerading behind a broad pronouncement that looks good as a headline. In short, it's a perfect blog entry :)
One big issue is that it seems she is defining "graduate school" in terms of law school and MBA programs. In those contexts, her advice makes a lot more sense. But even law school evades most of her advice, because there is simply no way to become a lawyer without going to graduate school. Just like there is simply no way to become a college professor or doctor without going to graduate school. So if you want to be one of those things, graduate school is necessary, not outdated.
Really, the good advice contained in the article is don't depend on graduate school to solve your problems. Grad school is a bad place to figure out what you want to do in life or to take refuge from poor job options. That's good advice. Grad school (of any kind) is too hard and too expensive to do it just because you can't think of anything better to do. I tell my students who are struggling with figuring out their path that all they really need to do is find someway to support themselves while the figure it out. There are plenty of opportunities to take advantage of later, when the direction has become clearer.