Market Myths

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The US health care system is 2.5 times more expensive than the nearest competitor for inferior overall outcomes. A UK Treasury study of “private financing initiatives” showed they typically added 40% to the cost of public services. Academic publisher Elsevier’s 37% profit margins are a big reason why its articles cost 8 times more apiece than do their open source equivalents. And of course the Cameron government’s massive cut to British universities resulted in an immediate, nearly-universal tripling of fees and a likely increase of 100 billion pounds to public debt.

“MOOCs and Parking Lots: Privatization on Auto-Pilot,” Chris Newfield

As a kid, I loved the Greek Myths. I am not completely sure why– I wasn’t a natural scholar or anything, and there was nothing systematic or intellectual about my interests. I think I just liked the idea of a world that included these supernatural beings. I have the same feeling now when I watch Dr. Who. I don’t have to believe in the good Doctor– literally, as my students would say– in order to take pleasure in the idea that he exists.

I think the market has a similar role in the lives of a lot of people. If you think about it, or do some reading, you quickly find out that the market is no panacea for anything. It does some things well, but even the things it does well have very high costs, many conveniently hidden. Apple brought us the I-phone, but behind the technology lies an entire world of exploited labor and environmental damage, among other things.

At some point– reading Yeats, I think– I discovered that the Greek Myths also included the rape of Leda by Zeus in the form of a Swan. It’s a freaky and disturbing story. We need a similar sort of story for the people who believe in markets. The market is comforting because we want to live in a world that sorts itself out automatically, that settle into fairness in the way a dog settles down to sleep. The market story is pleasant and utterly impossible.

Posted in: Economics, Uncategorized, Writing

The All Too Visible Hand of the Market

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The technological transformation of education has wide-ranging political implications. Blended learning may not eliminate the need for classroom instructors, but it will reduce the numbers required. Over time, the reduction will significantly reduce the amount of dues raised by teachers unions—and therefore the influence of one of the most liberal constituencies within the Democrat Party. It will also reduce the manpower available at election time to canvass neighborhoods, cover phone banks and drive people to the voting booth in support of left-leaning candidates.

“The Hidden Revolution in Online Learning,” Lewis M. Andrews

We talk about the economy as if it were a force of nature, without any intention or direction or purpose. Jobs are “outsourced” or moved overseas and so on. In fact, the industries most impacted by these processes are by no coincidence the same industries– steel, automobiles particularly– that were most unionized. The Reagan revolution fought unions at the root: it dismantled entire industries sending everything to places where labor is cheaper.

This had horrific effects ranging from driving down wages and productivity and quality of life in the U.S. to weakening national security to the growing deficit. That was simply the price to be paid for increasing profits; capital has no morality or ethics. You can see the same sort of dynamic in the current debate over austerity: if it has any impact on the wealth of their masters the Republican right is willing to risk everything. Power is all.

The last bastion of the unionized economy is the public sector, especially the schools, which have long been under attack by the charter movement. Here, too, if the entire sector has to be dismantled to maximize profits and destroy unions, so be it. The crude economic motivations of these folks are rarely discussed as openly as Mr. Andrews does in this piece. Here we see the outlines of how online education will serve the right’s cause.

Arguably, the process is well under way in higher education, on both ideological and more practical fronts. The right is perhaps best served by a kind of ideological naiveté which believes that the liberatory potentials of online education outweigh its political import. The dismantling of higher education is well underway, too, with about 70% of the faculty now part-time adjuncts. As Andrews hints, the industry is ripe for the picking.

Posted in: Economics, Professional, Union

The Emperor Looks Increasingly Naked

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Unfortunately, Mr. Vaidhyanathan says, the discussion of college reinvention represents a watering down of higher education’s social contract—a process that has been in the works for decades. “What it is going to take to reinvigorate higher education in this country,” he says, “is a strong political movement to champion research, to champion low tuition costs as a policy goal, to stand up against the banks that have made so much money lending for student loans, and to reconnect public institutions to their sense of public mission.”

“That is going to be a long process,” he says. “It has taken 20 years to press universities down into this cowering pose, and it is going to take 20 assertive years to get back to the point where Americans view American higher education the way the rest of the world does.”

“For Whom Is College Being Reinvented?” Scott Carlson and Goldie Blumenstyk

When I lived in the Philippines as a Peace Corps Volunteer in the 1980’s, the first measure of wealth wasn’t what people owned, as it was in the U.S., it was the condition of the roads. I live in Conception, Tarlac, a few hours north of Manila, the hometown of President Aquino, and the roads were constantly under construction. Filipino’s used to joke that each region should get its own president, in turn, so that every region could be developed.

Roads are a part of the social wage, the often unspoken benefits we get simply because we are citizens. We have great roads in the U.S., at least in most places, but no national health care or pension system. It’s no coincidence that most of the stimulus money went to building roads. Other parts of the infrastructure– airports, fiber optics, sewage, garbage collection– are just as important, of course, but roads have a special place in the American heart.

In the 1950’s and 60’s the social wage grew to include a cheap college education. The Reagan Revolution changed all that; we had less and less money for roads and infrastructure and college grew increasingly expensive. The social wage stagnated, shrank; we can’t get national health care, our pension systems are in trouble. We tend to think of roads– and cheap education and good infrastructure– as our birthright but they are not.

The social wage existed and grew because we fought for it, through unions. A lot of people thought that technology was going to make this social process– grabbing our share of profits in the form of the social wage– obsolete. Let them raise tuition; we’d use the internet to make education so ubiquitous it would be nearly free. (“Virtually” free, I should say.) Perhaps 2012 is the year that we began to realize that there’s no detour around the class struggle.

Posted in: Writing