Daily Archives: June 16, 2012

extraction economy

[aerial image of wastes from Moncks, S.C. coal power plant, 2009, from J. Henry Fair, Industrial Scars; for more info, visit jhenryfair.com/aerial/index.html.]

As I was reading about the UVA debacle over President Teresa Sullivan’s firing, which apparently involved a “hostile takeover” of the university by its business school, its Board, and Goldman Sachs, I kept thinking that we are reaching (have reached?) the limits of the one-time alliance between financial elites and public universities.

Once upon a time, universities could view (or depict) these relationships as at least an exchange in which the legitimacy of cultural capital was bestowed upon donors for their philanthropic, disinterested, financial support.  And to the extent that boards and their members allowed universities, their administrations and faculty, the independence to pursue their mission, this arrangement could work, in many institutions (including my own).

In the wake of continued state and federal disinvestment in public higher ed, however, the smiles and handshakes have faded away at certain schools, and it now seems that at least some of these boards, and some portion of the bankers and businessmen and -women who populate them– consider our public universities their property, or better yet, another group of businesses for them to take over, extract the value, and discard. (And we should not neglect the role of state governors in promoting this kind of cronyism between university boards and the corporate community)

An exasperated UVA professor attempts to spell out the consequences of this university-as-business metaphor:

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 dynamic (I said it) tapestry of creativity, experimentation, rigorous thought, preservation, recreation, vision, critical debate, contemplative spaces, powerful information sources, invention, and immeasurable human capital.

One of the details that has slipped out from the post-mortems for Sullivan was that she was unwilling to make certain changes related to online education.  My suspicion, which is echoed by a historian and alumna who has done her own investigations, is that the distance ed issue is not just about eliminating tenure and the normative classroom-based, face to face model for instruction, though those clearly align nicely with other right-wing prescriptions for higher ed.

No, the management jargon of “strategic dynamism” may very well simply describe how private companies (perhaps even Goldman Sachs’ own Education Management Corporation) plan to capture public instructional funds that otherwise would have gone to teachers and students and face to face instruction.  It is just another form of asset-stripping.  This is the beauty of the instructional outsourcing model that many lower-tier schools have already adopted, and which flagship schools like UVA, Berkeley are now getting pressured to adopt.  And this is the Extraction Economy as it works in the field of public higher education.

I’ll leave the final word to blogger Atrios, who introduced me (far too late, I admit) to the very useful concept of the extraction economy a few months ago:

We’re basically in an extraction economy right now, where the real money is in finding points to siphon off all of the income that people generate. Unregulated utility monopolies, rapacious health insurance companies and the medical industry generally, and of course Big Finance, are all devoted to increasing the slice of your life that they can steal from you, fair and square.

So here we are.  What shall we do about it?

DM

[thanks to RS for the links]

UPDATE: The WaPo has published an anonymously sourced piece that explains the rationale used by Rector Dragas to fire Sullivan, which focuses solely on Sullivan’s refusal to eliminate departments like German and the Classics.  This seems farfetched to me, but no matter.  No one who thought this might be a bad idea, or a violation of existing governance or state law, was quoted.