The Closing of the University Commons

The closing of the university commons should come as no surprise.  Instead, we might do better to consider the brief opening in the 1960s as a dramatic break with a less pleasant but long-standing tradition — one in which higher education in the United States was a site of intolerance rather than openness.  Historically, the controlling forces of colleges and education were first the church and then wealthy individuals.  Under their watch, dissent was effectively snuffed out.  Universities were largely the domain of well-to-do students, often even in the land grant colleges, which were initially supposed to train people for the agrarian sector.

A series of fortuitous events disturbed this equilibrium.  First, the Great Depression undermined faith in the market, while planning during World War II suggested an alternative to laissez-faire.  Then the G.I. Bill opened up the universities to ordinary people to an unprecedented extent.  Soon afterwards, universities were growing rapidly to accommodate a huge influx of baby boomers.  Finally, the discrediting of McCarthyism briefly subdued the frequent witch hunts that traditionally maintained ideological purity on campus.  A relative shortage of candidates for teaching positions made universities less careful about the political leanings of those whom they hired.

The early decades of the postwar period enjoyed one of the most prosperous periods in U.S. history — so much so that economists typically refer to this time as the Golden Age.  Profits were very high even though unemployment was low and union power was at its peak.  Finally, vigorous economic activity meant that governments could afford to be relatively generous to higher education — often in the name of national security.

These happy circumstances were not destined to last.  By the late 1960s, the usually high profit rate was beginning to sag, marking the end of the Golden age.  Activism seemed to be reaching epidemic proportions.

People in high places were beginning to panic.  In 1974 and 1975, the Conference Board held a series of meetings for CEOs, which gave a window into the corporate mindset of the time.  The participants expressed grave fears for the future of capitalism in the United States.  One warned: “The American capitalist system is confronting its darkest hour” (Vogel and Silk 1976, p. 71).  The participants voiced their skepticism for democratic solutions.  One executive warned that “the dolts have taken over the power structure and the capacity of the nation in the US” (Vogel and Silk 1976, p. 189).  Another asked, “Can we still afford one man, one vote?  We are tumbling on the brink.”  Still another warned: “One man, one vote has undermined the power of business in all capitalist countries since World War II” (Vogel and Silk 1976, p. 75).  Ominously, a number of the assembled executives spoke vaguely of the need for “war-time discipline” and “a more controlled society” (Vogel and Silk 1976, p. 76).

The most effective call to arms came from Lewis Powell, then a little-known corporate attorney, who was destined to be nominated for a Supreme Court position a few months later.  Powell’s famous memo helped to spark the erection of a complex network of activist think tanks and pro-corporate legal groups, which were central to the right-wing revolution that was to follow.

Interestingly, much of Powell’s polemic was directed toward Ralph Nader, whom he regarded as the greatest threat to democracy, at least as Powell imagined it.

Powell’s memo was brief in discussing the campuses, but it was also very clear.  He complained: “The campuses from which much of the criticism emanates are supported by (i) tax funds generated largely from American business, and (ii) contributions from capital funds controlled or generated by American business.  The boards of trustees of our universities overwhelmingly are composed of men and women who are leaders in the system.”  Powell expected these men and women to act more decisively in supporting their class interests.

Powell and his followers knew that tightening the financial screws on the universities would serve to make the higher education fall into line.  This tactic dovetailed with another major goal of the right wing: lowering taxes, which became especially pressing since market forces were not offering much hope for returning profit rates back to their Golden Age peaks.

By the late 1960s, business became alarmed by the fact that the United States was running a deficit in its balance of trade for the first time since World War I.

Here intellectual property came into play.  Since United States business presumably had an insurmountable lead in intellectual property, domestic business could gain significant advantages relative to the rest of world.

Since the late 19th century, corporations have regularly turned to the strengthening of intellectual property whenever market forces created crises.

The recent episode of ratcheting up of intellectual property came at a time when universities were strapped for funds.  Large universities with cutting-edge science were quick to realize that intellectual property represented a source of money that could help to substitute for rapidly shrinking state support.  Areas of study that promise to bring in corporate money prosper, while other areas suffer neglect.  You can see the effect of this emphasis on intellectual property by walking up a few blocks to the campus to compare the facilities of the BioScience Library with those of the Public Health Library.

Alas, today we are left with a highly corporatized form of higher education.  Administrators now operate their colleges and universities in terms of fiscal results, leaving the academic mission to wither, except in so far as they serve the needs of the corporations to have the appropriately trained personnel.  For example, higher tuition may serve fiscal purposes by bringing in more money, but it threatens to exclude many deserving potential students or undermine their education by making them work too many hours to effectively follow their studies.

In this environment, administrations reflexively take care to weed out critical voices — not only those who might have radical ideas, but also those whose research questions the value of particular corporate objectives, such as the production of genetically modified crops.  Had this administrative mindset been in place a few decades ago, the University of California might not have played as important a role in shining a bright light on the tobacco industry.

In the process, academic research into science and technology has become narrower, targeted to serve short-term fiscal objectives.  The consequences of this concentration on applied research are an inadequate attention to more basic research — the kind of science that does not pay dividends for several decades.  Yet basic research is just the kind of science that eventually made possible the sort of breakthroughs in applied research we have seen in recent years.  Already, alarming signs of the consequences of this shift in emphasis are appearing.  For example, patent applications are citing university research less frequently — and not because of an upsurge in corporate research.

The emphasis on intellectual property also creates an atmosphere of secrecy, which creates a further barrier to future technological and scientific progress.

The corrosive effects of the shortsighted restructuring of higher education have largely gone unnoticed.  Administrators compete with each other in bidding away academic stars, building huge edifices, and padding each other’s pockets.


Vogel, David, and Leonard Solomon Silk.  1976.  Ethics and Profits: The Crisis of Confidence in American Business.  New York: Simon and Schuster.

Michael Perelman is professor of economics at California State University at Chico, and the author of fifteen books, including Steal This Idea: Intellectual Property Rights and the Corporate Confiscation of Creativity, The Perverse Economy: The Impact of Markets on People and the Environment, and Railroading Economics: The Creation of the Free Market Mythology.  This is the text of a talk that Perelman gave at a conference in Berkeley on 28 April 2007 on the corporatization of the university. Visit his blog Unsettling Economics: A Progressive Look at Economics and the Rest of the Screwed-up World at <>.

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