Privatising the intellectual commons

 

This weekend we read in the Guardian of the confidential report prepared by Rothschild investment bank that indicates proposals to sell off the student loan book.

Its financial value lies mainly in the student loans issued after the introduction of tuition fees in 1998. Initiated by the Blair government, these fees were initially set at £1,000 per year. But in 2004 the rate was lifted to £3,000 and by 2010 the maximum fee was as much as £3,290. Together the value of this 1998-2012 student debt is reputed to be worth as much as £45 billion.

At the moment the interest on all pre-2012 student loans is capped either at the rate of inflation or the bank’s base rate plus 1% – whichever is lower. This rate-cap has until now acted as a deterrent to private entities, who are worried about the security of their investment given the risk of rising inflation.

To make the loans more attractive for sale, the Rothschild report recommends either that the risks be underwritten by government, or that the rates of interest be fully liberalised.

But both these proposals have serious negative implications.

Universities and their patrons

This month we read of students and alumni of the University of Oxford protesting the opening of a new Earth Sciences laboratory funded by the oil company Shell. And this is by no means the only instance in which private corporations are supporting academic research.

At the University of Manchester BP is funding a new multi-million pound energy research centre, and in 2003 the research group Corporate Watch published a report on the oil industry and university funding that identified partnerships between oil companies and Cambridge, Aberdeen, Imperial College London, Herriot-Watt and Dundee universities. In 2000 Nottingham University faced a storm of protest over its decision to accept £3.8 million from British American Tobacco, while at Oxford Rupert Murdoch funds a Chair in Language and Communication.

These universities all maintain that accepting this money brings with it no external conditions, and that scholars funded by such endowments retain full academic freedom and independence (see for example Nottingham University’s memorandum of understanding with British American Tobacco).

But it is not coincidental that this growth in the corporate backing of university research comes at a time when the government is making historic cuts to its funding of higher education. To survive the stormy seas of shifting government regulation and global competition, universities are being forced to look for new patrons.

Alumni relations

In the face of limited financial resources, universities across the world are increasingly seeking new ways of cultivating the loyalties – and the donations – of their alumni. By employing social media, offering ongoing careers services, organising social events, and even selling coffins, universities hope to build a relationship with their students that will last a lifetime.

But how far are universities really prepared to go? The relationship between Dalhousie University and its alumni in the nineteenth century points to an intimate embrace that many of today’s vice-chancellors might be less than willing to countenance … read the rest of this post at guardian.co.uk