The Corporate University: Recent Developments

Frank Pasquale

There are many memorable images in Rob Nixon's book Slow Violence and the Environmentalism of the Poor. Describing the "risk relocation" that is a prime function of the global economy, he offers this vision of Nigeria:

Often, as a community contends with attritional assaults on its ecological networks, it isn't granted equitable access (or any access at all) to modernity's basic infrastructural networks . . . . Like those Niger Delta villages where children for decades had no access to electricity for studying at night, while above their communities Shell's gas flares created toxic nocturnal illumination. Too dark for education, too bright for sleep: modernity's false dawn. (42)

Exxon is now "a corporation so large and powerful — operating in some 200 nations and territories — that it really has its own foreign policy." As Steve Coll observes, the US "gives Chad only a few millions dollars a year in aid, while Exxon's taxes and royalties can be worth as much as $500 million." Had Exxon directed only 10% of its 2008 profits to political expenditures that year, it would have spent "more than every candidate for President and every candidate for Senate spent at the last election." In a surprising number of contexts, corporations enjoy far more freedom of action, and secrecy, than states.

Is it any wonder, then, that universities are beginning to shift allegiance, to pursue the agenda of corporate donors instead of public values? Conferences like EduFactory have chronicled the long history of the corporate university; Philip Mirowski has critiqued it in books and edited collections. But it feels like we are on the verge of a phase change, an irreversible acceleration of dynamics once muted and slowed by the ancient cultural identity of the university. Consider these developments:

1) Martha McCluskey has described "economics scholars simultaneously acting as academic experts on the public interest and as sellers of this expertise to the highest private bidder." She has chronicled a number of troubling aspects of a recent report on fracking issued by the “Shale Resources and Society Institute” (SRSI) of SUNY Buffalo:

[T]his report proves . . . the power of fracking industry money to weaken both regulation and academic integrity. The University at Buffalo (UB) first falsely publicized the report as a peer reviewed study, even though the study had gone through no formal academic review or publication process. . . .

A critical analysis of the UB Report by the Public Accountability Initiative (PAI) reveals a host of problems of fact, logic, and integrity. The UB report does not acknowledge that it copies large sections word-for-word, along with much of its basic substantive analysis, from a 2011 Manhattan Institute report by three of the UB report’s four authors. . . . Moreover, neither the UB report, the UB Institute, nor the UB press release disclose the extensive industry ties of the report’s authors. . . . [Finally, the] study not only contradicts or misreports its own analysis and data, but also fails to examine the obvious problems in the study’s underlying logic.

I recall hearing about this report on New York media outlets, without any of the qualifiers or clarifications that McCluskey offers.

2) On the other side of New York, Columbia University is coming under scrutiny for its ties to high finance. Charles Ferguson's film Inside Job harshly highlighted the shadowy ties between Columbia Business School professor Glenn Hubbard and the finance industry. Ferguson's book, Predator Nation, updates the film and alleges that, as of February, 2012, Hubbard's Columbia web page failed to "list his paid speaking engagements" (248), an "apparent violation[] of the new disclosure requirements established by Columbia Business School after the release" of Inside Job. Perhaps the university as a whole should consider stricter disclosure requirements in light of this Simon Johnson post on governance issues at the New York Fed:

Treasury Secretary Timothy F. Geithner [has] indicated that the continued presence of Jamie Dimon, the chief executive of JPMorgan Chase, on the board on the Federal Reserve Bank of New York created a perception problem that should be addressed. . . .Mr. Dimon has been an effective opponent of financial reform over the past four years. . . . [He] now finds himself at the center of a number of official investigations into how his bank could have lost so much money so quickly in its London-based trading operation – including whether adverse material information was disclosed to regulators and to markets in a timely manner. . .

[Last] Monday, Lee C. Bollinger, chairman of the board of the New York Fed and president of Columbia University, weighed in to contradict Mr. Geithner in no uncertain terms. The Wall Street Journal reported Mr. Bollinger’s view: Mr. Dimon should stay on the New York Fed’s board, and critics attacking the Fed have a “false understanding” of how it works. This is a remarkable statement in part because Mr. Geithner is himself a former president of the New York Fed, so it is hard to see how he would have a false understanding of how the Fed works.

More generally, however, Mr. Bollinger’s intervention is inadvertently helpful, as it opens the door to a more productive conversation about the exact nature of the institutional weakness that lurks at the heart of the Federal Reserve System and that threatens our financial stability more broadly. . . . According to a statement reported on Tuesday by The Guardian, a British newspaper, the JPMorgan Chase Foundation donated about $2 million to Columbia University in recent years.

Bollinger is not an isolated case. Some corporate directors lead institutions that benefit from the largesse of the management that the directors are ostensibly supposed to help oversee. These relationships raise deep and troubling issues. Johnson argues that "Columbia University should return the donations it received from JPMorgan and the JPMorgan Chase Foundation while Mr. Bollinger was a Class C director. And Mr. Dimon should resign from the board of the New York Fed."

That may be a start, but I think we should be even more interested in how Bollinger (and other representatives of the public) conceive of and discharge their duties. As Johnson observers, "Bollinger heads not just the board but also its management and budget committee (MBC), which has specific oversight functions that are made quite clear on the New York Fed’s Web site." Does Bollinger believe that interests of banks like JP Morgan and the public interest can conflict? Can he name such conflicts, and how he acted in response to them as a board member? Has he considered the arguments of experts like Matt Yglesias and Timothy Canova about Fed governance and policies? It is critical for a leader of Bollinger's stature to answer questions like these, lest cynical observers presume that he is merely on the board to rubber stamp business as usual and to cultivate contacts for the development office.

3) Fundraising concerns also appear to have contributed to the power of UVA board members who engineered the ouster of the university's extraordinarily popular President, Teresa Sullivan. Their "action against Sullivan is unusual in that it unfolded without a vote of the full board, without participation of several campus constituencies and without public evidence of blatant wrongdoing." Wealthy donors appeared to be the key catalysts. Siva Vaidhyanathan explains how some members of UVA's governing board gained their power:

The reason folks such as Dragas [a wealthy real estate developer] and Kiernan [a financier and author of Becoming China’s Bitch] get to call the shots at major universities is that they write huge, tax-deductible checks to them. They buy influence and we subsidize their purchases. So too often an institution that is supposed to set its priorities based on the needs of a state or the needs of the planet instead alters its profile and curriculum to reflect the whims of the wealthy. Fortunately this does not happen often, and the vast majority of donors simply want to give back to the institutions that gave them so much. They ask nothing in return and admire the work we do. But it happens often enough to significantly undermine any sense of democratic accountability for public institutions.

The biggest challenge facing higher education is market-based myopia. Wealthy board members, echoing the politicians who appointed them (after massive campaign donations) too often believe that universities should be run like businesses, despite the poor record of most actual businesses in human history.

Universities do not have “business models.” They have complementary missions of teaching, research, and public service. Yet such leaders think of universities as a collection of market transactions, instead of a . . . tapestry of creativity, experimentation, rigorous thought, preservation, recreation, vision, critical debate, contemplative spaces, powerful information sources, invention, and immeasurable human capital.

Vaidhyanathan is one of the US's leading public intellectuals on the sociology of knowledge. UVA ignores his advice at its peril. According to the WaPo, "David Leblang, chairman of the U-Va. politics department, said Saturday that he has heard from multiple department heads that they are losing faculty."

4) Students at the University of California have been among the most vocal protesters against the corporatization and privatization of public university systems. Authorities have, in turn, met their protests with force. Some reports on this force condemn it. For example, the Reynoso/Kroll reports on the pepper spraying at UC Davis paint a portrait of "malice, incompetence, and immaturity," according to ReclaimUC. Others are more measured. Here are two sentences from the report on Occupy Cal:

Some members of the committee do not think that pulling protestors by their hair is consistent with campus norms; others believe it is effective and creates little risk of permanent injury.

The vigor of these baton thrusts is most distressing and should not be repeated.

Aaron Bady offers this gloss:

I think this really crystallizes the mindset of the committee, because it shows that A. we have replaced “legality” with “norms,” and B. when the committee to review police behavior can’t decide if pulling protesters by their hair is okay or not, it should be clear that there are no norms. It isn’t even that some people think it’s okay to do so, in other words; it’s that when some people think its fine and some people don’t, the end result is: the police will do whatever they want. If they want to grab a non-resisting protester by her hair and throw her to the ground — this time, next time, every time — they will. The norm is that they can do whatever they want, and the administration will back them up, and the Police Review Board (chaired by law professor Jesse Choper) will ratify that non-existence of oversight. Rinse and repeat.

Bady and ReclaimUC describe a university administration with little interest in dialogue about its mission. The administration is troubled, but ultimately unwilling to do much of anything concretely, to constrain delegations of authority to police to maintain order (however that may be defined). Like the Supreme Court's strip search majority, the administration worries about force, but ultimately can't be bothered to invest much (if anything) to assure that future violence will be limited and commensurate with the "threat" it targets.
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In his book Twilight of the Elites, Chris Hayes ties the declining authority of state, corporate, and civil society leaders to a fractal (and autocatalytic) inequality. For decades, extractive industries like finance and energy have enjoyed excess returns that fund campaign contributions and lobbyists dedicated to reducing taxes on and regulation of future windfall profits. But that conversion of money into power, and back into money, can't buy its beneficiaries love, or legitimacy. For that, extractive industries have turned to the higher education sector almost as an afterthought. As universities seek charity from some of the few thriving sectors in a declining American economy, they should zealously guard against any actual or apparent conflicts of interest. Generating both heat and light, the gifts mentioned above are eerily reminiscent of the "toxic nocturnal illumination" of the Niger Delta's nights.

Simulposted: Concurring Opinions.
Posted 10:36 AM by Frank Pasquale [link]