Yesterday, Steven Krause wrote about the Inside Higher Ed article on top tier schools losing their edge and his own experience at non top tier schools (both for graduate school and in his current position). When I receive my PhD, it will be from a third tier state school. Many of my colleagues who received their degrees there have gone on to teach at branch state schools or private high schools or community colleges. In my mind, they're all successful and the ones I'm in touch with seem to be satisfied with their work.
My third tier school has been a wonderful experience for me. The department is small enough that you get to know most of the faculty even if you don't take classes with them. When I got my master's degree, nearly the entire class studied together over beer and/or coffee at the local coffee shop. We all showed up for each other's exams, standing outside the door to await the results and to console or congratulate as necessary (we all were congratulated!). After we'd all passed our exams, we had a party for the 10 or so of us who'd been through the ordeal and I still remember it as one of the most fun events I've ever been to.
Most of those students either took their masters and went on to a job or on to another (better) Ph.D. program. I stayed and was welcomed by the few other Ph.D. students in the department. There was no real competition. We all helped and supported each other as much as we could.
The faculty are also extremely supportive. Most of them have degrees from excellent schools--Harvard, Berkeley, Indiana U, etc. They are accessible and provide mentoring and support at a level one would not receive at the schools they themselves attended. For example, I just received the kind of feedback everyone wants to receive on their dissertation from my advisor--thoughtful, kind but critical where it needs to be, constructive and instructive. If I'd been writing it, I think I would have been more harsh. :)
Even though my degree may not gain me that much in terms of my career, I am not just glad I got it for the three extra letters. I'm glad I got it for all the people I've met and been able to spend time with. It has been not just a memorable experience, but one that has shaped the way I think about the academy. It reminds me of the positive side of the academy.
At my current institution, my impression is that it's all about the hierarchy. It matters where you got your degree. It matters what your position is (full professor, continuing non-tenure track, etc.). Not everyone cares about those things, of course, but many do. One can feel pretty beaten down by being made to feel like Pip all the time. ("Oh, you don't have a degree?" Or just the glance around the room for someone else to talk to.) I try to keep that stuff at bay and remind myself that good work is important to me and to many others, and that many people do see their work as more than just climbing the academic hierarchy. They see ways that everyone contributes to the overall mission of the institution, regardless of where their degree is from or where they are on the organizational chart. It's those people whose company I most try to keep.