ACADEMICALLY SPEAKING: Universities only engage with capitalism when it’s convenient for them

Speculation about the tuition bubble is not new, but years of warnings are not deterring universities from jacking up costs to fund a bloating bureaucracy of administrators and non-academic services.

”Academically Speaking” is a series by Campus Reform Editor in Chief Zachary Marschall that, drawing on his firsthand experience working with other scholars across the globe, reveals how radical ideas originating in academia impact Americans’ daily lives. 

Marschall holds a Ph.D. in Cultural Studies and is an adjunct professor at the University of Kentucky. His research investigates the intersections of democratic political systems, free market economies, and technological innovation in the production of national and cultural identities, as well as the exchange of cultural goods, services, and practices.

Hereditary ailments are a useful comparison to understand the current problems with American higher education. Doctors can trace patients’ family medical histories to approximate higher risks for diabetes, cancer, and Alzheimer’s. A patient’s genealogy impacts how that individual lives today. 

Similarly, the genealogy of the university, as a Western social institution, helps explain how colleges came to be disposed to structural ailments. 

From a genealogical perspective, the institutional liberal bias that Campus Reform covers is in large part due to higher education’s historically complex, often love-hate relationship with capitalism. Universities have come to love the free market when alumni donations, football franchises, and new flagship buildings suit them. But in many ways, they also refuse to operate as a business – even a non-profit one – and posture that responding to market forces is beneath them when either popular criticism or overspending hit.

The bottom line: American colleges and universities have a relationship of convenience to free market capitalism because they are genealogically pre-capitalist institutions. And that historical legacy accounts for how they indoctrinate students with leftist ideologies. 

[RELATED: MARSCHALL: Liberal bias on campus does not just happen]

The oldest European university is the University of Bologna. Founded in 1088, the institution is so old that it precedes the designation of “time immemorial” in English law by 101 years. Founded more recently in 1636, Harvard University is the oldest American higher education institution, but still predates modern capitalism. 

During the 17th century, mercantilism predominated in Europe and its colonies. In many ways, mercantilism operated as a precursor to capitalism. Trade between countries operated via markets and exchanges – an economic advancement on pre-modern bartering economies that typified the Middle Ages. However, the state-regulated and conditioned international trade and markets under mercantilism. Economic arrangements were outgrowths of state-sanctioned imperialism during the Age of Exploration. 

In 1776, capitalism was emerging as an economic system when Adam Smith wrote about the “invisible hand” of the market, but free market capitalism still had not yet fully replaced mercantilism. 

American expansion during the Industrial Revolution led to the creation of new universities, many via public land grants. Although these new institutions started during free market capitalism’s ascendance, they opened and operated as extensions of their forebears. Capitalism did not change the operational mode of the university. Like immovable boulders unyielding against the rushing tide, these institutions have a 1,000-year genealogy that is too entrenched to be altered fundamentally by the latest economic system. 

Rising tuition prices are proof of that intransigence. 

Many experts think that the tuition bubble is about to pop. There is a point at which college will become so unaffordable that most American families will elect not to attend or be unable to pay even with savings, loans, and scholarships. 

Speculation about the tuition bubble is not new, but years of warnings are not deterring colleges and universities from jacking up costs to fund a bloating bureaucracy of administrators and non-academic services. 

The inefficiencies that come with administrative glut compound the learning loss college students recently experienced during the COVID-19 pandemic. The value of an undergraduate degree is worth less [CR1] than previous years, according to recent hiring trends. Surely these market forces incentivize colleges and universities to correct the price of attendance.  

No. Instead, higher education raises rates with impunity. 

Campus Reform has found correlations between rising public university tuition prices and increases in Diversity, Equity, and Inclusion (DEI) spending. Public universities have simultaneously de-prioritized liberal arts education and thrown more money at new DEI offices, officers, initiatives, and programming that peddle far-left policies and viewpoints on campuses. 

[RELATED: REPORT: Inflation, tuition hike make life unaffordable for these students]

Arizona State University is an example of how revenue and spending trends affect campus environments. Since 2013, ASU has experienced a 68% increase in “private and capital gifts” and currently has as many DEI officers as history professors. Additionally, the National Association of Scholars accuses the school of failing to meet state standards for civics education because it chooses to prioritize DEI spending.

Universities have learned to adapt to market forces but consider themselves apart from the capitalist system. They champion new investments and rely on profitable endowments but continue to hike up tuition rates without trying to cut costs. 

American colleges and universities keep one foot in the market and one foot outside of it, as is convenient for them. Students are their revenue source, and much of their spending responds to undergraduate and applicant demands for an equitable and inclusive campus. But the free market also incentivizes cost-cutting measures to reduce overhead costs that would make goods otherwise prohibitively expensive. Smaller food packaging, discontinued travel perks, and outsourced call centers are examples of these measures.  

Campuses are not doing that. Practically no one in higher education is saying no to another diversity or sexuality center, or at least demanding curtailed in exchange for leftist initiatives. Operating in that liminal space between a business and a truly isolated ivory tower, universities can evade accountability for their political and fiscal misdeeds.  

The result is a focus on leftist initiatives, usually under the guise of DEI, which are detrimental to the student experience because they detract from education and add to the cost of attendance. 

Students have lost positions at campus newspapers for expressing conservative beliefs. University administrations cancel guest speaking engagements in response to protesting students who use harassment to try and keep conservative or libertarian figures off their campus. At the University of Florida, 300 student protesters drowned out a hearing with Ben Sasse, who was under consideration to be the school’s president.

Students would rather shout and demand than learn from people who think differently because higher education does not balance liberal and conservative views in the curriculum or among faculty. Consequently, students see conservative viewpoints as alien and react to them as an invasive species breaching their safe spaces.

Ilana Redstone is a University of Illinois Urbana-Champaign professor and critic of my publication, Campus Reform. But she has also written that students at her public university “are rarely exposed to ways of understanding the world that don’t align with a politically progressive worldview.”

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Some readers may draw comparisons to the student protests in the 1960s and think this simply is what students do. However, these recent examples are the result of hyper-political activism on campus that is emboldened by administrations that throw millions of dollars at Diversity, Equity, and Inclusion (DEI) initiatives.

These DEI initiatives enable and perpetuate the intolerance we see coming from hyper-political college campuses, where far-left activism, not scholarly inquiry, reigns.

“Most college administrators seem reluctant to criticize left-liberal activists or coalitions of minority students, whatever they may do or say,” Johns Hopkins Professor and Governmental Studies Chair Ben Ginsberg wrote in 2017.

Public universities are social institutions that are not living up to their core missions because they lack accountability. DEI offices add to universities’ rising operating costs and are hyper-partisan in their regulation of students’ speech and behavior. 

But more fundamentally, these DEI offices are symptomatic of universities’ chronic arrogance to reap the profits of free-enterprise while considering themselves above – if not removed – from how the real world works.  

Editorials and op-eds reflect the opinion of the authors and not necessarily that of Campus Reform or the Leadership Institute.