The University, Capital, and Crisis

The University, Capital, and Crisis

La Ventana Collective

Last year’s struggles in the universities of California spawned a number of debates on the origins of the crisis they face and on how to best defend public higher education. We do not wish to engage with these but rather to provide a look into the formation of the public university, from its origins to the present. The following then is written for the current struggles in California and around the world, in hopes that it will be of use for those who seek ways to free themselves of capitalism’s shackles both from within the university and from without.

A widely held belief is that the public university is an untouchable institution, that it is immutable and timeless—even from economic conditions. It is from this perspective that much discourse on the budget cuts has been created, from which the strategy of unions and lobbying organizations has been based upon. These ideas have developed with no consideration for the current form of capital in the United States; they have developed from the perspective that the university’s function in society is static, a monument to a moment of capitalism long passed. The university must be understood, or at least acknowledged, to exist in relation to capitalist development and its need for profit, with its ever changing form, and the larger socio-cultural context by which the university is given meaning. The university in the United States is not separate from capital. It was at one time but since 1860 it has been used more and more for economic ends. The university over the last 150 or so years has played an essential part in the transformation and reproduction of capitalism.

The Unity of the University and Capital

The university cannot be viewed as a singularity, separate from the economic and social forces of society. To speak of the crisis of the university—as a problem to be confronted on its own—is to misunderstand the function of the education system.

The university’s function is related to and subjugated by the economy, by the strategic needs of capital. Though, the university’s function is not limited to the sphere of the reproduction of workers. Its role in the production of knowledge extends its use to almost all parts of social life.

The perception that the university exists for the advancement of human knowledge, for the bettering of humanity, that it is a neutral institution of learning separate from the outside world, needs only to be refuted by the history of the university itself. If we are to put forward the argument that the public university’s function is one linked to capital’s development, then we must trace its transformation in relation to capital from its beginnings to the present. This task though is much too large for what space will allow, so we will instead focus on the two different eras of great importance for capital and consequently for the university—the first of these being the Civil War and Reconstruction periods in which the idea of the public university first emerged, and the second being the Reconversion period after World War II in which public education became generalized.

The Reconstruction Period

1862. The year that the Land Grant College Act was enacted marked the first time the federal government had made a major effort to create a public university system. The Reconstruction period that followed saw significant economic and social transformations leading the country toward a fully industrial capitalist economy. In this era there was major growth as the result of industrialization and urbanization that in turn relied on the creation of scientific knowledge in industrial production and social organization. The university began to be understood as the institution that could fulfill this role.

The discourse among academics and industrialists reflected the emerging view that the university could and should be used as a tool of economic development. F.H. Stoddard, a New York University professor, remarked in a speech in 1890, “The college years are no longer conceived as a period set apart from life… the college has ceased to become a cloister and has become a workshop.”1 The industrialist Carnegie remarked, “While the college student has been learning a little about the barbarous and petty squabbles of a far distant past, or trying to master languages which are dead, such knowledge seems adapted for life upon another planet than this as far as business is concerned, the future captain of industry is hotly engaged in the school of experience, obtaining the very knowledge required for his future triumphs.” These statements made by Carnegie and Stoddard show the kind of ideas that began to take shape among elites and scholars alike concerning the university’s role in society. If the university existed before this time as a kind of separate social institution that had little connection to the needs of the economy, it appears that at this point it began to be utilized by economic forces if only marginally.

It is in the context of these economic and social developments of capitalism that the state took the first steps to create a public university. The Land Grant College Act allocated millions of acres in hopes of aiding the founding institutions of learning capable of fulfilling the needs of the economy.2 The university before this time educated only the elites and the land grant university in this sense was in many ways undistinguishable from its predecessor. The role of the university of the 19th century was not to educate the working class or to provide them with skills but, on the contrary, to provide the movers of capital—managers, industrialists, politicians, etc.—with the knowledge and technology required for developing an industrial capitalist economy in the United States. Its role was to help create the conditions under which a large industrial working class could be realized.

Reconversion Period and Fordism

We now move to the period of Reconversion after WWII, where the industrial working class had long been realized, having shaped the very form of American capitalism through 90 years of class struggle and crisis. The rise of fascism was largely a result democracy’s inability to deal with this crisis. The democracies that rejected the path of fascism with its repression and irrational ultra-nationalism—as the United States did—had to find a way to deal with the inherent contradictions of capital that also avoided the Soviet model. The solution to this problem lay in an alteration of state and economic relations that sought to regulate capitalism with state controls and discipline of the working class, an alteration that forged a new relation to work that was conducive to the new regime of production.

This regime, known as Fordist-Keynesianism, was based on a compromise of organized labor, corporate capital, and the state.3 This compromise is based on the defeat of militant working class movements after WWII. Over 5 million workers in 1946 were on strike at some point. The most menacing of these to the state was the 1946-47 wave of general strikes in response to the rolling back of wartime gains which started in Connecticut and spread to Pennsylvania, Texas, New York and came to a climax in Oakland, California. The general strikes, in which workers often faced off against union leadership, embodied precisely the type of behavior that Fordism sought to overcome. The bureaucratic unions, fortified by the Taft-Hartley Act, diffused conflict by absorbing labor into the state institutions of the Fordist-Keynesian period. How workers were disciplined into the Fordist production system is best understood through the concept of disciplinary government developed by Michel Foucault.

It is important to first look at the operation of Fordist production and the techniques of disciplinary government in order to understand why and how the university became transformed and became so important during this period to capital’s development.

The Fordist economic practice first emerged in 1914 when Henry Ford introduced five dollars pay for eight hours’ work in his automated car assembly plant. The generalization of this practice came about after WWII. What made Henry Ford’s style of industrial organization unique was not so much the fact that he utilized the Taylorist division of labor and deskilling, nor that he paid a high wage for an eight hour day, but rather that he understood that mass production also necessitated mass consumption by the working class.4 By allowing leisure time and an income sufficient to buy commodities, Ford hoped to produce the disciplined workers necessary for intensive assembly line production and also the consumers of mass-produced products that Fordist production perfected. Antonio Gramsci, in his Prison Notebooks, saw Fordism as having “amounted to the biggest collective effort to date to create, with unprecedented speed, and with a consciousness of purpose, unmatched in history, a new type of worker and a new type of man.” Gramsci saw this new organization of work as “inseparable from a specific mode of living, and of thinking, and of living life.”5 This practice of having work and all social life unified into the capitalist process is what made Fordist-Keynesianism different from those forms of social organization before it. Once it reached a compromise with the state, the organization of labor in the Fordist factory, which has the whole social life of the worker in mind, laid the foundation for disciplinary society.

The work of Foucault around the concept of power, when used in the investigation of the Fordist-Keynesian regime of production and governing, is useful for understanding how social life becomes completely subsumed by capital. Foucault explained power as such: “The characteristic feature of power is that some men can more or less entirely determine other men’s conduct—but never exhaustively or coercively. A man who is chained and beaten is subject to force being exerted over him, not power. But if he can be induced to speak, when his ultimate recourse could have been to hold his tongue, preferring death, then he has been caused to behave in a certain way. His freedom has been subject to power.”6 Foucault saw the utilization of power as a means of governing that induced behavior of individuals from within by imposing a hegemonic knowledge or truths by which they understand the world and act. Power is not repressive but acts in a positive or productive fashion where it operates. This does not mean that repression is replaced in a disciplinary society—it is always present—but rather pure state violence is obsolete for maintaining the economic order and therefore only utilized in the last instance. This clarification of power by Foucault identifies a type of governing that until the Fordist era was not coherent or developed enough to be named.

If power is present in all areas of social life—from the family to institutions—then the practices of Fordism/Keynesianism, with its project of absorbing all aspects of this social life into the productive processes in conjunction with the centralized and expanding institutional influence of the welfare state in the lives of the populace, are none other than the perfection of power in the service of capital. The university of the Fordist era, institutionalized by the state, opened up to a significantly larger percentage of the population and increasingly important to business, exemplifies the process by which a once autonomous point of power in society comes to the service of capital.

The University under Fordism

The university of the Fordist period (1940-1973) was transformed drastically from its post-war existence in a number of ways. For the first time in its history, the American university was established as an institution of the state and attended by an increasingly larger segment of the population, particularly among the white working class, with an increase in attendance of over 500 percent from 1945 to 1975.7 This era of mass education was necessitated by two related factors: the global struggles of the Cold War and the internal economic changes of the United States. Though it must be stressed that what occurred globally in this era had equal consequences for the economic situation nationally and vice versa.

Globally, the United States was in a state of self-conscious national panic from 1950 to 1958. The Soviets during these years had made great gains in both their economy and military technology. The Soviet gross national product had risen by 7.1 percent in 1956 and their industrial production rose by almost 11 percent.8 These economic gains were in conjunction with the launching of the Sputnik satellite, giving the Soviets superiority in space technology, and followed by the leaking of the Gaither Report by the Washington Post which revealed the innovations the Soviets had made in missile technology—presumably surpassing those of the United States.9 The President’s Committee on Education beyond High School wrote in its 1957 report, “America would be heedless if she closed her eyes to the dramatic strides being taken by the Soviet Union in post-high education, particularly in the development of scientists, engineers, and technicians.”10 The report expresses the fear of technological inferiority in the United States stemming from a weak higher education system. The answer to this fear came in the form of the Defense Act of 1958 which provided billions of dollars in funding to universities.

Internally the United States was undergoing a transformation from a war economy to one that could fulfill the role of managing the great financial empire secured at Breton Woods. The large number of returning veterans in need of work, the loss of wartime manufacturing jobs and the increasing financialization of the global economy posed a number of problems whose solutions lay in disciplining the population into the new regimes of work. The rapid growth in the decades after WWII of the service and professional sectors would require a larger, better educated and more disciplined workforce.

The university of the post-war years was changed dramatically in order to aid in this disciplinary process. The university became increasingly dependent during WWII on government funding and in turn was depended upon by the government for technical training. After the war, the implementation of the G.I. Bill, which gave billions to educate returning veterans, was followed by a number of subsequent bills that dramatically increased university enrollment during the next two decades. This process of institutionalization—the gradual generalizing by the state of a uniform social practice throughout society—had taken hold of the university in an increasingly rapid fashion from the beginning of WWII to the 1970’s. The premise for this institutionalization fits into the larger pattern of internal post-war development.

The suburbanization that helped solve the looming crisis of capital reinvestment following the war changed not only the face of American cities but also their character. This suburbanization could not have occured without the innovation of Keynesian style debt financing. Both suburbanization and Keynesian economics relied on a population that could or rather was willing to consume at an acceptable rate.11 All of these factors worked in conjunction to facilitate the post war transformation of society. While the manufacturing sector of the economy was increasingly shrinking (or moving overseas to lower wage labor markets), the growth of employment in intellectual, service, financial and other white-collar jobs was on the rise. At the same time the state and business became increasingly involved in every aspect of higher education. The idea became so generalized that in order for one to receive well-paying employment, one must attain a college degree.12 This normalization of the university into the social life of a large segment of the working class and its importance to the continuation of capital accumulation is what differentiates this era of the university’s development from those previous one in which it played only a marginal role.

The university of the Fordist era then, in the most abstract sense, was utilized by society for the project of transforming global capital into the new forms it would take in the Fordist era of 1945-1973. Having become a more generalized and well-funded educational institution, the university allowed for the production of ideology that was needed to ensure the dominance of capital globally and of the discipline of labor locally.13 The 1957 President’s Committee Report on Education beyond High School lays out the goals of the mass university quite clearly: “She [America] would be inexcusably blind if she failed to see that the challenge of the next 20 years will require leaders not only in science and engineering, and in business and industry, but in government and politics, in foreign affairs and diplomacy, in education and civic affairs.”14 The report emphasized the university not only as a means to remain a great power globally but to maintain political and economic order internally. This function of the university, for the service of both local and global capital, follows the trend of the development of capitalism that would become more globally unified, flexible and mobile in the decades to come.

The Fordist university transformed higher education into a common institution of American society, offering an educational opportunity that was the dream of many people and expected as a guarantee by many more. Our current conception of the university as a synthesis of an autonomous space of knowledge creation and also as an economic training institution stems from this era. Though, this conception is now being challenged by a new phase of capitalist development. The Neoliberal transformation of American society has set as its goal to privatize much of what was once held to be common property in American society—i.e. the public university. This modern day expropriation of the commons by capital—what David Harvey has called accumulation by dispossession—has no doubt begun to attacking public higher education, though not without resistance.15

American society, placing a high level of importance on higher education despite the growing irrelevance of the institution in the economy, is an example of the contradictions that often exist between subjective desires in society and the needs of capital for continuing its accumulation of wealth. The university as we know it no longer has as much relevance, in relation to labor demand (which is much more flexible, information-based, and precarious) than in the rigid labor regimes of Fordism. The well-funded state university is no longer rational from the perspective of capital, yet it is highly regarded in society.

The use of crisis to justify the cutting back of university funding seems to be an ideal method to circumvent popular resistance. The blame is not placed on the capitalist state but it is instead the natural order of the market. The irrational rationalization of capitalist crisis plays a double role here: one to fix internal contradictions of capitalism—such as an expensive university that proves to return little in terms of the demand for flexible labor—and second to obscure austerity measures and dispossession to appear as the collateral damage of crisis instead of a necessary practice for continuing profits.

This essay will be continued in a future issue of La Ventana