Selling the Cow to Buy the Milk (Keiser, M; 2013)

In Uncategorized on July 22, 2014 by chr1sr0berts Tagged: , , , , ,

Imagine a university funding policy so ineptly crafted, so short-sighted, so rooted in short-term “thinking” that a mere 3 years after its inception, it is already collapsing

Much of this was predictable and predicted by many, but most of all by the person who’s done more research into this than anyone else. Andrew McGettigan‘s book “The Great University Gamble” is essential reading in this respect. In fact, so essential is it, that I have sent a copy of it to our new Minister for Universities [and my own constituency MP] Mr Greg Clark.

Firstly, it does not benefit students, universities, or the much mythologised “taxpayer” [BTW, for the record, students, staff, managers are *also* “taxpayers”] Demanding that students take on enormous debts in order to fund their education is such a fundamental transformation of the[ir] relationship with and to education. It turns students from people engaged in an academic relationship, into mere “consumers of education” As a member of academic staff at a university, my “academic labour” is transformed, and I am now merely a “service provider” It imagines that students can select their “education provider” based on the habits of consumption more in-line with choosing where to do your weekly shop. University is not like this. To quote the aforementioned Andrew McGettigan: “…the endeavour (the marketisation of Higher Education) is misconceived… the government misunderstands the kind of “good” that education is. The market is being set up as if undergraduate education were a normal consumer good: it is not. For better or ill, undergraduate higher education in England is a positional good: institutions are ranked in a hierarchy, and opportunities are restricted” University is also [most frequently] a “single-purchase good” i:e one usually only does this [actually purchases] once….and not “weekly” [like your shopping] It places the onus on students to “perform” as consumers. However, the entire mechanisms for measuring value, and – as importantly – what actually constitutes value are insufficient to the task of actually measuring the values of higher education. The means of measuring the “value” of a degree is anything but consumptive/economic…but of course, the idea from Government is that this becomes the case.

The policy was able to be pushed through, in part because of the established “news values” regarding the ways in which the “£9000 tuition fees” were and are reported. I’ve written previously [in an academic paper *awaiting placement*] that a discourse of “education consumers” was established almost immediately – in November 2010. The news narrative on the day of the first protest was as follows: “1000’s of students take to the streets to protest agains the rise in tuition fees” What none of the news reports outlined, was that the rise in fees was to cover for, or replace wholesale the withdrawal of the teaching grant – in my subject area, the withdrawal was 100%. This is the most fundamental change to universities for a generation. Rather than providing contextually adequate information to include this fundamental shift, the news media instead established – very quickly – a discourse of students as disaffected and angry “education consumers”. Of course, this is all “old news” but it requires critical interrogation and scrutiny precisly because it establishes the discourse – the discursive formation if you will.

And so it was established and look where we are now. A report from May of this year was headlined “Degree Courses Not Value for Money Say Many Students”:  This is a classic “news hook”, a “value for money ‘news hook’” …Higher education is now located in the “discourse of consumption”. I should add by the way, that I do not blame students for thinking in this way, they have, after all, taken on large debts in order to fund their education so it is “natural” [or at least learned behaviour] in these circumstances to assess the value of their studies in some consumptive way, a sort of “cost/benefit analysis”. I just don’t think they should have to take on debt in order to study for a degree. Nor – sadly – do I expect more from our news media. The transformative goal of this mess of a policy – and the news media are largely willing accomplices in this – is to ask that students see a degree as a form of benefit only to the individual. Andrew McGettigan again: “Its reforms treat it as solely of benefit to the private individual, missing the associated public benefits which are now at risk”. So students are now encouraged to see their higher education as a form of ‘human capital investment’. “…by undertaking training the individual makes themselves more productive. This is evidenced by the higher salaries enjoyed by graduates – the return on investment. Education becomes recoded as a financial purchase the benefits of which will be seen later in higher income not unlike an annuity” (McGettigan, A 2013: 55) The funding policy is thus a piece of social engineering masquerading as responsible government policy. I imagine that once a large enough cohort of students have been through the system, all the while internalising the “degree as purely personal benefit” then the transformation will be complete. Higher Education simply will be a form of consumption, and many students may see themselves purely in the form of a sort of “entrepreneurial self”

Related to the “degree as human capital investment” and the “recoding” of education, is a form of individualisation perfectly in line with conservative, Conservative and neoliberal thinking. Individualisation and a form of “outsourced learning” are at the heart of the current ideological [deregulated, privatised, financialised] environment. Many years ago, graduates were in demand because having a degree demonstrated certain critical, intellectual, written, creative, and reflective abilities, skills and competencies. This is still the case but the ground has shifted beneath us. Now employers – often represented by the CBI – complain that “graduates aren’t ready for the workplace”. What they mean is that their employees still require some very specific job related training…which costs time and money. In years gone by, if and when employees required some specific vocational training, businesses would pay for training…or perhaps pay towards it…or give employees time, space and support for extra training/evening school classes. This is increasingly rare. Now many [but perhaps not all] businesses seem to demand that new graduates and employees are “job ready” When put like this, we can see it as a cost saving measure for the “business sector” or the lamentable phrase “UK PLC” to transfer “training/education” onto the state. I even – sort of – understand this from a “business perspective” [a micro-economic perspective] I understand the need for businesses, particularly SME’s, to want/need their employees to be competent and efficient, and that they might not want to – or perhaps cannot afford to – pay extra for the training that might be required. However, we, all of us, ought to expect and demand more from Government and Government policy. We should demand that they do not think on such a short-term basis – Government should not think like a business, or think only “what’s good for business”, because “what’s good for business” is not necessarily “what’s good for citizens” In short, this Government think in “micro-economic” terms….when they should be thinking in “macro-economic” terms. Or rather, perhaps this Government do think in macro-economic terms, but in a hangover from, or a continuation of the market fundamentalism of “The Chicago School” they imagine [ignoring the last 35 years worth of stagnating wages, indebted financialised personal circumstances….soaring corporate wealth] that personal and company finances, will, if left to their own devices, sort out the  rest of society. Let the market roam free – the micro – and the wider society – the macro – will be sorted. However, this latter [hopefully end of] stage of neoliberalism takes personal financialised debt even further. If you transfer all costs onto individuals and consequently financialize and impoverish your citizens, then you’re cleary unfit for office.  Responsibility for education/training has been wholly transferred – first from “businesses” to the state [Colleges, Universities]; then from the universities on to the shoulders of individuals in the form student loans to pay for increased tuition fees. It is the very apotheosis of neoliberal ideology. All training is outsourced and costs are transferred wholly onto individuals in the “competitive labour market”. Incidentally, Foucault has much to sayas does Lazzaratoon this. Lazzarato in particular – updating Foucault’s earlier work – takes into account that the “entreprenuerial individual” might be locked into a form of  quasi authoritarian neoliberalism that has debt as a form of social control.  So funding through tuition fees is the ultimate financialization of society – any notionally socially useful thing you need – education, housing, healthcare [NHS privatisation is well under way with zero political mandate; almost no critical scrutiny and certainly very little reporting in the media] will come with a heavy personal, indebted, financialised price “Ah, you need an operation I see….ah, you need some more training and education….Hmmmm, I’m afraid you’ll need to borrow…..still, not to worry, here’s a long-term loan for you” Increasing financialization and increasing personal debts sounds familiar to me. So, right at the time when we know such a “policy mix” was a major contribitory factor in the crisis of 2008….this ideologicaly driven Government decides to transfer this busted model, wholesale, onto the university sector and individual students. Call me sceptical, but this does not look like a recipe for success!


Brielfy, on the subject of increasing household and personal debt, and that this is the major contributory factor in the crisis of 2008: The repeated rhetoric from Cameron, Osborne, Danny Alexander et al has been “Clearing up the mess left by Labour” and “Pay off the nations credit card” and “We can’t borrow our way out of a debt crisis” Disregarding that the credit card analogy is either economically incompetent or disingenuous, “borrowing our way out of crisis” is exactly what they plan for the economy….it’s just they don’t want Government to do it – when they can borrow at interest rates of 2.9% over 10 years [you try getting that kind of deal from your bank] …they want “us” to do it…then keep spending. Corrected figures from the OBR released in 2011 – correcting the figures they released after Osborne’s first “Spending review” in October 2010 – indicate clearly that this is an expectation. Household debt as % of income to increase from 159% to 173% by 2015. “We [Government] won’t borrow….but you lot [the plebs], yeah, go on….borrow away!” *despite it costing much more*



To return to the student/university “funding model”. As should be clear, the model is firmly based on ever increasing levels of personal [financialized] debt. It *should* also be politically, ideologically and economically toxic. Even if we ignore the injustices of personal financialized debt [which we should not] macro-economically it fails, too. Imagine what the graduate repayment obligations – 9% of salary over £21,000 – could possibly do to levels of aggregate demand in the future. Personal debts and subsequent repayments at this level – FOR THIRTY years – must, simply must impact on people’s ability to “spend” thus demand will suffer. However, there is very little understanding, critique or contextual depth to our news reporting. I’d quite like a piece of “news” [not comment] to consider, understand, explain, contextualise and report this accordingly. That there is very little news understanding, means the policy is not really that toxic….or at least, not quite as toxic as it ought to be.

Politically it stinks – but again, they seem to be getting away with it: Selling off the student loan book – the previous plan that Vince Cable has just announced he’s shelving – is merely a trick to boost Government coffers and shift the debt off the govt balance sheet. A sort of “pre-election” boost, “Look, the public debt is down, told you we’d do it” Earlier this year George Osborne announced that selling off the student loan book would raise £12billion. This has since been downgraded, so much so that they can’t sell it. The “£12billion” from previous loans were to be used as a means of funding the next tranche of student loans… for the next few years of students. Can anyone see a problem here? Take an asset – the student loan book; sell for less than it’s “worth” – from £12b now trying to sell it for £2b – and use the money to fund another lot of debt. At the same time, deprive yourself [the Government] of a future “revenue stream” It is, in the words of Max Keiser “Selling the cow, to buy the milk” It is a *pure* [*not pure at all, it is neoliberal, finance capitalism led*] “free-market” ideology masquerading as Higher Education policy and “sound economics”.

How much hope do any of us have that the Labour opposition will be any different in Government? After all, many of the decisions that relate to Higher Education taken in the four years of this coalition Government were based on the Browne Review, a review established by the previous Labour Government under the “guidance” of Peter Mandelson. The report, with which we are all familiar, is laughably titled: “Securing a Sustainable Future for Higher Education” – Yes, you read that right….”Sustainable!”


There’s loads more of course. Obviously I recommend Andrew McGettigan’s book:


…and perhaps try [m]any of Aditya Chakraborrty’s fine articles….like this one from today’s Guardian


Twitter @chr1sr0berts

And Follow Andrew here: Twitter@amcgettigan

And Aditya here: Twitter@chakraborrty


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