In a Globe and Mail article published last month, University of Alberta president Indira Samarasekera lamented the abandonment of the University of Saskatche­wan’s budget review process. She seemingly wants to ensure the recent controversy at the neighbouring campus that led to several highly-placed administrators losing their positions and the end of the TransformUS process doesn’t stall the required momentum to raise tuition and cut programs at other Canadian universities.

For Canadian universities, “The only way to succeed,” according to Samarasekera, is to specialize in some programs and cut others. “We have a perverse system where we’ve kept tuition low for everyone,” she said. “As a result, we are restricting our ability to increase the quality of the programs.”

She bemoans the University of Saskatche­wan “set themselves back and potentially affected the ability of other university presidents and administrations to take risks, because they took some risks and they got slapped down,” which she worries may be especially true for less experienced, insecure, recently appointed university presidents.

The controversy at the University of Saskatchewan, she warns, will deter restructuring efforts like those initiated by her administration. She asks “how else to compete internationally for students and faculty.”

According to the Globe, “provincial budget cuts in the spring of 2013 led to the suspension of 20 U of A arts programs with low enrolment and the cutting of hundreds of first-year spots in science. Nevertheless, the government held universities to inflationary increases, preaching the gospel of increasing efficiency.”

Samarasekera begins her argument by invoking the neoliberal austerity nostrum that for Canadian universities “governments can no longer afford to give them generous, above-inflation increases in funding.” If she were the only Canadian university president having internalized this myth we might be able to dismiss it as a symptom of inhabiting Alberta.

Economic reality

Enthusiastic acceptance of the fable that austerity is inevitable and necessary is common-place among Canadian university presidents. An open letter entitled “Encouraging charitable giving while reducing the deficit: facilitating gifts of private company shares and real estate” was published as a full-page ad in the Winnipeg Free Press on Feb. 10, 2011. The letter was addressed to Prime Minister Stephen Harper and Finance Minister Jim Flaherty, and copied to their Liberal, New Democrat and Bloc counterparts. The signatories to the letter, which included the presidents of the universities of Calgary, Dalhousie, Manitoba, Montreal, Toronto and Western Ontario, supported an uncritical neo-liberal approach to the current fiscal situation and placed themselves publicly on the side of those who want to cut taxes and reduce public expenditures on education.

The idea that Canadian university presidents would support austerity and beg for charitable donations from the private sector instead of calling for governments to provide adequate funding suggests they have chosen to ignore a large body of contrary evidence.

It is arguable that Canada as well as the United States have never in their histories been in a better position to lower or eliminate tuition, expand programs and improve university infrastructure.

According to a July 2012 report in the Guardian, drawing on research by tax expert James Henry for the campaign group Tax Justice Network, “the world’s super-rich have taken advantage of lax tax rules to siphon off at least $21 trillion, and possibly as much as $32 trillion, from their home countries and hide it abroad — a sum larger than the entire American economy.”

“This offshore economy is large enough to have a major impact on estimates of inequality of wealth and income; on estimates of national income and debt ratios; and — most importantly — to have very significant negative impacts on the domestic tax bases of ‘source’ countries,” Henry says.

The Atlantic also reported the same month that American non-financial corporations have nearly $5 trillion sitting on their balance sheets. This money is circulating in the financial stratosphere, rather than being productively invested. If it were taxed and reinvested in education, a green economy, and research and development, economic growth would actually increase.

Through two other economic reports this spring we learn that Canadian firms have been accumulating “dead money” — cash sitting idle in bank accounts — faster than any other country in the G7. According to Statistics Canada, private non-financial corporations increased their cash holdings to an extraordinary $630 billion (or nearly one-third of Canada’s GDP) in the first quarter of this year — up from $621 billion at the end of 2013.

The results of Canadian union economist Jim Stanford’s 2011 study of historical data on business investment and cash flow from 1961 to 2010 suggest “the federal government would have a far more powerful impact on both public and private investment by investing directly in public infrastructure, rather than providing additional tax reductions for businesses.”

Consistent with Stanford’s ana­lysis, corporate-friendly Moody’s 2008 Fiscal Econo­mic Bang for the Buck estimates that government spending on consumption and investment has a far greater positive impact on the economy than do tax cuts for corporations. For example, infrastructure investment would have five times the positive impact on gross domestic product as would corporate income tax cuts. Capital gains tax cuts would have less than one-quarter of the positive effect on GDP than government spending on infrastructure would have.

Whither students, faculty
& the labour market

Higher tuition means more university access for the well to do and less for those with lower income, independent of merit. According to the Canadian Medical Association, higher tuition fueled debt drives physicians to choose higher paid specialties when the system needs more general practitioners. Student debt means more corporate lawyers and accountants and fewer working for environmental NGOs and legal aid. Differential and higher tuition fees feed corporate interests not citizen’s interests.

As for faculty, austerity means more highly-qualified PhDs become itinerants working for low wages with large teaching loads, leaving no time for research without the security necessary to protect their acade­mic freedom. Highly-qualified, committed individuals are consigned to a reserve army of the underemployed to serve the reallo­cation project.

Meanwhile, those of us in tenured and tenure-track jobs find ourselves facing new forms of bureaucracy that create new kinds of vulnerabi­lity and heightened anxiety, isolation and passivity.

As author Mark Fisher¹ and others have argued, neoliberalism rather than reducing bureaucracy has expanded it into new forms in order that institutions and workers in education, for example, can be seen to be competing with one another. In order to do so it is necessary to produce all kinds of “spurious quan­tificatory data,” not to measure the worker’s ability to perform their job, but their ability to perform bureau­cratic tasks effectively.

This makes Tim Birkhead’s and Bob Montgomerie’s September 2014 Bulletin report of a 10-fold increase in the incidence of scientific misconduct since the mid-1970s less surprising. They suspect an interrelated combination of competition and cynicism as the cause in a context of government-sponsored performance assessment and tight research funding. They cite the UK’s research excellence framework as an example of the problem.

Neoliberal efficiency

The lessons president Samarasekera took from the University of Saskat­chewan TransformUS debacle and those she has internalized from the neoliberal version of fiscal reality reflect a growing mindset among university presidents in Canada and beyond.

According to a June 2014 Edmon­ton Journal story, Samarasekera, who ends her term next year, earned nearly $1.2 million in salary and benefits in 2013. The headline for the article tells us a group of four academics have applied to share the presidency “in an effort to bring awareness to the disconnect between academics and administrators, and the exorbitant salary differences between the two sides.” Their hope is that their willingness to job share (indeed they make the claim they would be able to do a better job than any one person could do) and to each take only a fair and reasonable salary will get people talking about what they really want out of our universities, and thinking about where we want our money to go. Using the neoliberal calculus, however, four for the price of one won’t add up if they aren’t committed to the “Transformation of US.”

---------------------------------------------------------------
Robert Chernomas is a professor of econo­micsat the University of Manitoba.

¹ Fisher, M. and Gilbert, J. (2013) Capitalist realism and neoliberal hegemony: A dialogue. New Formations 80/81:89–101.

The views expressed are those of the author and not necessarily CAUT.

Comment
CAUT welcomes articles between 800 and 1,500 words on contemporary issues directly related to post-secondary education. Articles should not deal with personal grievance cases nor with purely local issues. They should not be libellous or defamatory, abusive of individuals or groups, and should not make unsubstantiated allegations. They should be objective and on a political rather than a personal subject. A commentary is an opinion and not a “life story.” First person is not normally used. Articles may be in English or French, but will not be translated. Publication is at the sole discretion of CAUT. Commentary authors will be contacted only if their articles are accepted for publication. Commentary submissions should be sent to Liza Duhaime.