In a lecture given earlier this year in Sydney, Philip Mirowski described the use by university administrators of citation indices like Thomson Reuters’s Web of Knowledge and Elsevier’s Scopus.
These have, he said, become ‘a sharp-edged audit device wielded by bureaucracies uninterested in the shape of actual knowledge and its elusive character’:
Bibliometrics gain power and salience by allying itself to the commercialization of research. The so-called rationalization of the university through research commodification requires more and more metrics to feed the bureaucracy, and provide short-term indicators of performance, since science has itself previously resisted quantification and has in the past proven recalcitrant to Taylorist techniques of micromanagement.
The providers of indices of scholarly ‘output’ (i.e. publication counts), claiming to measure the quantitative output of science, have deliberately ‘misrepresented the growth rate of science as part of [their] business plan.’
University administrators, serving their own purposes, have joined in with this deception. All parties are content to ‘play fast and loose with the meaning of knowledge… where intellectual debility is trumpeted as health’.
Note that, once it’s entered as intellectual property in the books of a firm, university or research institute, ‘knowledge’ acquires many of the characteristics of any ordinary financial asset.
It can, for example, be used as collateral for borrowing. An owner of IP (e.g. the university ‘technology transfer’ office or patent-holding company) can use it to raise funds either through bank lending or by issuing debt securities (e.g. so-called Bowie bonds).
Credit is backed by title to the asset or by a claim to its associated future revenue stream (e.g. the lump-sum fees or flow of royalties received as part of licensing agreements regarding copyright, trademark, patent, etc.).
In June 2000 a securitization deal involving an HIV drug (the reverse-transcriptase inhibitor Zerit) licensed to pharmaceutical firm Bristol-Myers Squibb allowed Yale University to raise $115 million in debt financing. The issue was underwritten by Royalty Pharma and Yale reportedly used part of the proceeds to fund on-campus capital improvements, including a $180 million new medical building. (Zerit later turned out to generate less revenue for Bristol-Myers, and thus lower royalty payments for the patent holder, than had been estimated. Sales projections, which were the basis for Yale’s upfront payment, were off by $400 million.)
In 2007 a similar ‘IP monetization’ deal allowed Northwestern University to raise $700 million.
Like with other secured borrowing (e.g. real estate), both the borrower and the lender have a vested interest in appreciation of the underlying asset’s price.
For the borrower (the IP owner) inflation means that debt can be written off against prospective capital gains. And, for the creditor, asset inflation improves the quality (value and liquidity) of loan collateral.
All parties therefore seek to preserve, and if possible to increase, the paper value of proprietary ‘knowledge’ (i.e. valuation of the IP based on the present value of the projected royalty stream).
As with other financial assets (e.g. equities, real estate), price inflation of ‘knowledge’ follows when there is an inflow of funds to the market without a corresponding outflow. The more the price of proprietary ‘knowledge’ rises, the more credit flows into the market seeking speculative gains, leading to a generalized appreciation of prices, and so on.
Thus the efforts, described above by Mirowski, to deliberately misrepresent the growth rate of knowledge and the quantity of declared ‘inventions’. This is a confidence trick.
Over the past three decades, many large pharmaceutical and biotech corporations have reduced their levels of in-house research.
These outsourced R&D projects are promoted as ‘business incubators’ of startup firms. They duly receive generous funding from state governments, which together with local business groups hype the prospect of a local Silicon Valley, Boston or North Carolina ‘research cluster’ or precinct.
Yet, as Mirowski observes, ‘the stark truth is that most biotechs never produce a drug or other final product; they are just pursuing commercial science, which almost never makes a profit.’
[Once] you take the full costs of TTOs [technology transfer offices] into account, very few universities make any money whatsoever, much less serious revenue, from management of their IP assets… It is common knowledge that few university TTOs manage to cover their current bureaucratic expenses with their license revenues; beyond that, they are distinctly loath to admit they have been suing other universities or even their own students over some crass IP disputes, and rarely report either their court awards or their spiraling attorney fees as part of the commercialization calculus. This is indeed one major factor behind the inexorable proportionate rise of administrative employees to the detriment of faculty employment in the modern American university. Yet few are willing to enter that administrative bloat on the liabilities side of the commodification ledger.
Mirowski therefore says that ‘a wide array of phenomena lumped together under the rubric of the “commercialization of science”, the “commodification of research”, and the “marketplace of ideas” are both figuratively and literally Ponzi schemes.’
Yet strictly speaking a Ponzi financing structure doesn’t exist so long as borrowing can be hedged by rising asset values.
Only when the IP (the ‘knowledge’ that has served as collateral for borrowing) has been shown (as with Zerit) to generate less cash flow than advertised, and its price falls, must debts then be serviced by drawing in credulous suckers. Until then, prices will continue to appreciate so long as market liquidity is maintained by funds pouring in.
This means that, every phase of the cycle, the university has need of the boosterism of ‘promoters and spinmeisters’.
When it comes to biopharmaceutical research, publications in academic journals regularly serve as ‘infomercials’, promoting the marketization or commercial application of the drug, clinical treatment, product or discovery. It is widely acknowledged that many such articles are ‘ghost authored’ by a corporate client and attributed to ‘honorary’ academic authors, usually including a head of department or senior professors along with more junior scholars.
Presented with a draft manuscript prepared for them by a drug company, and with career advancement depending on the number of published journal papers listed on their CV, who among academic researchers is any position to demur?
In the natural sciences, the ‘technology transfer’ business model of higher education is based on exaggerated bluster about the commercial value of ‘discoveries’ and ‘inventions’ that result from proprietary research.
This, which Mirowski calls ‘epistemic Ponzi’, is a more lucrative version of a practice that is common across the humanities and social sciences.
Throughout these academic disciplines, from economics to sociology and ‘continental philosophy’, can be found grandiosely inflated claims to novelty and generality of ‘knowledge, used in a kind of intellectual arbitrage or carry trade.
Scholarly conclusions won cheaply in one field may be sold dearly to audiences at other institutional ‘price points’, i.e. in other academic disciplines, or in journalism and the media world:
Intellectual arbitrage has proven, and surely will remain, a relatively easy route to the academic coin of the realm – namely distinguished publications and large numbers of citations.
Intellectual fashionability – recognition by journalists as someone ‘interesting’, and acknowledgement by colleagues and admirers as a rising authority, a guru and seer with his own unique brush stroke, a visionary with a subversive or challenging new ‘theory’ and an idiosyncratic lexicon distinct from those of his peers, a future grandee - can be leveraged to gain external rewards from a wider audience.
Such spillover into the public domain usually involves niche success in a corner of the publishing world (e.g. among salon leftists). But it may extend to lecture tours or TV appearances, and even to massively successful mainstream products like Freakonomics. In some academic fields (economics, management, ‘public policy’) professional advancement can bring well-paid consulting gigs or a position in the state bureaucracy.
The term ‘intellectual arbitrage’, originally used dismissively as above, later acquired a positive meaning after it was picked up for use in organization and management theory. There it is used to laud a type of ‘engaged scholarship’ (note the Sartrean echoes) or ‘knowledge transfer’ across institutional boundaries.
As the vacuous verbiage attests, the result is a serious loss of intellectual probity: ambitions become unmoored from any methodological commitment towards reasoning from evidence, high inferential standards or deductive rigour (c.f. Hardt and Negri’s Empire. This bestselling book was described in New Left Review as ‘the Lexus and the Olive Tree of the Far Left’ – though written, of course, ‘from an incomparably higher cultural level’).
Once again, what is involved is a straightforward confidence trick, in which the level of scholarly ‘output’ is deliberately overstated, its worth is exaggerated, or its intellectual penury is obscured by clever marketing.
All this must be understood as a response to incentives rather than as the personal failure of individual academics.
It’s therefore possible, as Mirowski does elsewhere, to link the commercialization of universities to a broader but related phenomenon, ‘the intentional production and promotion of ignorance’:
Whether it be in the context of global warming, oil depletion, ‘fracking’ for natural gas, denial of Darwinism, disparagement of vaccination, or derangement of the conceptual content of Keynesianism, one unprecedented outcome of the Great Recession has been the redoubled efforts to pump massive amounts of noise into the mass media in order to discombobulate an already angry and restive populace. The techniques range from alignment of artificial echo chambers and special Potemkin research units, to co-opting the names of the famous for semi-submerged political agendas; from setting up astroturfed organizations, to misrepresenting the shape and character of orthodox discourse within various academic disciplines.
Agnotology takes many forms. One of the major techniques of agnotology is to simultaneously fund both ‘legitimate’ and illegitimate research out of the same pot, in order to expand the palette of explanations as a preliminary to downplaying the particular subset of causes which are damning for your client.
Like the Great Recession itself, the ‘production of ignorance’, that boom industry of today, is generated by systemic causes. Its origin and mainspring is deeper and more obstinate than the ready culprits with obvious moral failings (e.g. the Koch brothers) who serve as handy scapegoats subject to easy denunciation.
The demise of the millennium-old scholarly project (the university as community of scholars, with its own internal standards of quality control, peer review, discipline and legitimacy, free to some extent from ecclesiastic or commercial judgement) is a product of a particular stage in the development of capitalism.
The privatization of education is part of the post-1980 search for profit in low-capital intensity sectors with large workforces, where provision was formerly undertaken by the state. (In the United States, the Bayh-Dole Act and the Supreme Court’s Diamond v. Chakrabarty decision both arrived in 1980.)
The role of higher education (of instruction and the awarding of degrees, as distinct from research) is no longer to produce a labour force with the widespread technical and general knowledge necessary for growth in real capital assets (as distinct from monetary profit).
With the state’s gradual withdrawal from education provision, and the increasingly unproductive and parasitic nature of the advanced economies, the purpose of universities has become:
- Rationing entry to the professional middle classes, upper salariat, and corporate and state leadership. Degrees in law, finance, management etc., are today’s patents of nobility. Marked with the necessary seal from a prestigious university, they entitle the bearer to high earnings that include a share of the surplus product;
- Extracting revenue from maintenance of the great mass of the population at subsistence levels of learning.
In 1998, in an article on ‘digital diploma mills’, David F. Noble described the ‘new age of higher education’ pitting on ‘the one side university administrators and their myriad commercial partners, on the other those who constitute the core relation of education: students and teachers’.
Over the previous two decades, he said, the campus had become a ‘significant site of capital accumulation’, in which a ‘systematic conversion of intellectual activity into intellectual capital and, hence, intellectual property’ had taken place:
There have been two general phases of this transformation. The first, which began twenty years ago and is still underway, entailed the commoditization of the research function of the university, transforming scientific and engineering knowledge into commercially viable proprietary products that could be owned and bought and sold in the market. The second, which we are now witnessing, entails the commoditization of the educational function of the university, transforming courses into courseware, the activity of instruction itself into commercially viable proprietary products that can be owned and bought and sold in the market. In the first phase the universities became the site of production and sale of patents and exclusive licenses. In the second, they are becoming the site of production of — as well as the chief market for — copyrighted videos, courseware, CD–ROMs, and Web sites.
The initial step created bloated, high-cost administrative apparatuses. These included offices of ‘technology transfer’, touts who solicited corporate links, patent-holding companies living off royalty payments, legal crafters of patent applications and Materials Transfer Agreements, ethics officers and other managerial overseers who micromanaged research agendas, etc.:
The result of this first phase of university commoditization was a wholesale reallocation of university resources toward its research function at the expense of its educational function.
Class sizes swelled, teaching staffs and instructional resources were reduced, salaries were frozen, and curricular offerings were cut to the bone. At the same time, tuition soared to subsidize the creation and maintenance of the commercial infrastructure (and correspondingly bloated administration) that has never really paid off.
The second phase of the commercialization of academia, the commoditization of instruction, is touted as the solution to the crisis engendered by the first.
Universities, in league with publishing companies like Elsevier, Wiley-Blackwell and Springer, and together with media firms like Pearson, CBS, Disney and Microsoft, thus became vendors of course material and educational software:
With the commoditization of instruction, teachers as labor are drawn into a production process designed for the efficient creation of instructional commodities, and hence become subject to all the pressures that have befallen production workers in other industries undergoing rapid technological transformation from above…
The administration is now in a position to hire less skilled, and hence cheaper, workers to deliver the technologically prepackaged course. It also allows the administration, which claims ownership of this commodity, to peddle the course elsewhere without the original designer’s involvement or even knowledge, much less financial interest. The buyers of this packaged commodity, meanwhile, other academic institutions, are able thereby to contract out, and hence outsource, the work of their own employees and thus reduce their reliance upon their in–house teaching staff.
As Noble showed, due to a change in technical conditions and the labour processes entailed by them, academics are losing their traditionally privileged social position. This, in see-sawing fashion, is destroying the university’s capacity for scholarly research, as the proportion of tenured staff falls and they are replaced by teaching adjuncts, sporadically employed or subject to contingent renewal.
Academics, like other ‘skilled professional’ occupations (certified architects, lawyers, accountants and similar qualified practitioners) earn relatively higher salaries and wages due to their relatively stronger bargaining position in the labour market. (Of course, upper levels of the liberal professions take much of their earnings as capital income, partnership income, or from self-employment in sole proprietorship.) This stronger bargaining position and consequently higher income is due to relative scarcity of specialized skills. The shortage of professionally accredited individuals (sustained by high training costs or restricted guilds) allows the lucky few to earn scarcity rents.
To take Adam Smith’s famous eighteenth-century example of the philosopher and the street porter, in today’s United States a post-secondary philosophy teacher receives a mean annual salary of $69 000, while the all-occupations mean is $44 000, and the annual average for a baggage porter or bellhop is $21 000, with a median hourly wage of under $10.
This skilled layer has, moreover, a degree of autonomy in that sometimes it can control part of its production process, e.g. routines, effort, intensity etc. These working conditions may not be contractually stipulated, nor directly monitored or overseen, nor dictated (as with much unskilled work) by technical conditions of production. Senior incumbents, long attached to their employer and holding security of tenure, are also free from the threat of termination without cause.
University academics have held this relatively privileged social position until now, preserving a degree of scholarly freedom, collegial autonomy and faculty self-direction. As mentioned earlier, their contemporary subordination to the market, involving oversight by a managerial caste, is an epochal event.
The urban efflorescence of eleventh-century Europe, centred on Italy and Flanders, and which birthed the university, was founded on a simple division of labour with the countryside. Agricultural surpluses, extracted as rent from the peasantry, were exchanged by lords for armaments and luxury textiles from the towns. This trade formed the basis for the towns’ mercantile and artisan culture.
From it also emerged Europe’s first non-monastic institutions of higher learning since the fall of the Western Empire.
The university as autonomous community of scholars subsequently survived through peasant revolts, plague and demographic collapse, Reformation, the absolutist state, revolution and intra-European warfare, the solvent of capitalism, transplantation to other continents, and so on.
Today’s sudden transformation of the university, in the space of a few decades, should alert us to the fundamental shifts going on beneath us, of geological significance but occurring on the timescale of a human lifespan.
Since these developments originated off-campus, no adequate response to them has been forthcoming, nor can any be expected, from within academia itself.
Especially in its higher echelons, the professional setting is designed, ever more deliberately, to reward conformity and herding. Before the superintendence of the bureaucracy has even been applied, a self-selection filter reliably deters many socially critical and intellectually honest recruits from choosing an academic career, let alone pursuing the professional heights.
Worse still, over the past thirty years, the nominally ‘left wing’ or ‘radical’ remnants of the intelligentsia have succumbed en masse to demoralization, political despair and various associated forms of theoretical obscurantism and inanity (this includes Mirowski himself). Principles have been renounced and critical antennae impaired or crippled.
The more conscious apostates have met with candid enthusiasm the new regime of hucksterism, which blurs the line between scholarship and advertising.
For the fortunate and ambitious, the latter development promises new sources of earnings, commercial opportunities and perks. These range from the modest to the exorbitant, e.g. research papers to be presented alongside exciting new products during all-expenses-paid academic conferences in tourist destinations.
But straightforward corruption in pursuit of money, professional status, etc. seems less prevalent than an instinct for self-preservation, of bowing to exigency in the name of dissonance reduction, with the impotent yet consoling feeling that this is all really someone else’s problem.
Raising the foregoing matters too persistently in such circles provokes the accusation of ‘Cassandraism’, of conservatism or exaggerated negativity, even an unwillingness to recognize that it has always been necessary for academics to ‘pay the piper’. (Several of these retorts, as mentioned previously, are standard Whiggish lines, used habitually by those committed to a Panglossian accommodation with present conditions.)
Yet a sturdier defence of the university against the meddling of bureaucrats and the intrusion of commerce has been heard before, in other historical circumstances.
Back then, in-house corporate research labs (General Electric, DuPont, etc.) were set up in the US to emulate the practice of German competitors (BASF, Bayer) and their private research institutes, which were linked to state-funded technical schools (the ‘Prussian model’ developed following Humboldt’s reforms).
Both countries were rising industrial powers with imperial ambitions. R&D provided the basis for military technology: Germany’s lead in the chemical industry laid the foundation for the ‘chemists’ war’ in 1914, the Farben monopoly and the Nazi machinery of death.
Meanwhile, in the US, the example of private and government R&D led increasingly to universities operating according to business principles.
In 1918 the economist Thorstein Veblen, ‘at the risk of a certain appearance of dispraise’, took aim at the ‘bureaucratic officialism and accountancy’ taking over US universities, especially ‘those chiefs of clerical bureau called “deans,” together with the many committees-for-the-sifting-of-sawdust into which the faculty of a well-administered university is organized.’
Veblen’s book, The Higher Learning in America: A Memorandum on the Conduct of Universities by Business Men, is typically forthright and perceptive, and deserves to be quoted at length:
The salesmanlike abilities and the men of affairs that so are drawn into the academic personnel are, presumably, somewhat under grade in their kind; since the pecuniary inducement offered by the schools is rather low as compared with the remuneration for office work of a similar character in the common run of business occupations, and since businesslike employees of this kind may fairly be presumed to go unreservedly to the highest bidder. Yet these more unscholarly members of the staff will necessarily be assigned the more responsible and discretionary positions in the academic organization; since under such a scheme of standardization, accountancy and control, the school becomes primarily a bureaucratic organization, and the first and unremitting duties of the staff are those of official management and accountancy. The further qualifications requisite in the members of the academic staff will be such as make for vendibility, – volubility, tactful effrontery, conspicuous conformity to the popular taste in all matters of opinion, usage and conventions.
Veblen goes on his familiar tart style. He explains why expenditure of resources on advertising is a zero-sum game, an aggregate wash for the university sector that ‘has no substantial value to the corporation of learning; nor, indeed, to any one but the university executive by whose management it is achieved.’ He describes the cowardice and cynicism of academic careerists. And he notes, in amusing fashion, how the superficial trappings and old emblems of the scholarly enterprise are retained in the interests of business.
Finally, Veblen states his advice for ‘rehabilitation for the higher learning in the universities’:
All that is required is the abolition of the academic executive and of the governing board. Anything short of this heroic remedy is bound to fail, because the evils sought to be remedied are inherent in these organs, and intrinsic to their functioning.
It should be plain, on reflection, to any one familiar with academic matters that neither of these official bodies serves any useful purpose in the university, in so far as bears in any way on the pursuit of knowledge. They may conceivably both be useful for some other purpose, foreign or alien to the quest of learning; but within the lines of the university’s legitimate interest both are wholly detrimental, and very wastefully so. They are needless, except to take care of needs and emergencies to which their own presence gratuitously gives rise. In so far as these needs and difficulties that require executive surveillance are not simply and flagrantly factitious, – as, e.g., the onerous duties of publicity – they are altogether such needs as arise out of an excessive size and a gratuitously complex administrative organization; both of which characteristics of the American university are created by the governing boards and their executive officers, for no better purpose than a vainglorious self-complacency, and with no better justification than an uncritical prepossession to the effect that large size, complex organization, and authoritative control necessarily make for efficiency; whereas, in point of fact, in the affairs of learning these things unavoidably make for defeat.
The duties of the executive – aside from the calls of publicity and self-aggrandizement – are in the main administrative duties that have to do with the interstitial adjustments of the composite establishment. These resolve themselves into a co-ordinated standardization of the several constituent schools and divisions, on a mechanically specified routine and scale, which commonly does violence to the efficient working of all these diverse and incommensurable elements; with no gain at any point, excepting a gain in the facility of control control for control’s sake, at the best. Much of the official apparatus and routine office-work is taken up with this futile control. Beyond this, and requisite to the due working of this control and standardization, there is the control of the personnel and the checking-up of their task work; together with the disciplining of such as do not sufficiently conform to the resulting schedule of uniformity and mediocrity.
These duties are, all and several, created by the imposition of a central control, and in the absence of such control the need of them would not arise. They are essentially extraneous to the work on which each and several of the constituent schools are engaged, and their only substantial effect on that work is to force it into certain extraneous formalities of routine and accountancy, such as to divert and retard the work in hand. So also the control exercised more at large by the governing board; except in so far as it is the mere mischief-making interference of ignorant outsiders, it is likewise directed to the keeping of a balance between units that need no balancing as against one another; except for the need which so is gratuitously induced by drawing these units into an incongruous coalition under the control of such a board; whose duties of office in this way arise wholly out of the creation of their office.
Apart from such loss of “prestige value” in the eyes of those whose pride centres on magnitude, the move in question would involve no substantial loss. The chief direct and tangible effect would be a considerable saving in “overhead charges,” in that the greater part of the present volume of administrative work would fall away. The greater part – say, three-fourths – of the present officers of administration, with their clerical staff, would be lost; under the present system these are chiefly occupied with the correlation and control of matters that need correlation and control only with a view to centralized management.
All that is here intended to be said is nothing more than the obiter dictum that, as seen from the point of view of the higher learning, the academic executive and all his works are anathema, and should be discontinued by the simple expedient of wiping him off the slate; and that the governing board, in so far as it presumes to exercise any other than vacantly perfunctory duties, has the same value and should with advantage be lost in the same shuffle.
Tags: academic freedom, administrative bloat, bibliometrics, ghost authorship, higher education, institutional economics, intellectual property, IP monetization, IP securitization, knowledge transfer, postmodernism, technology transfer, Thorstein Veblen