Can Labour De-Commodify Higher Education? It has a Minor Problem | Guy Standing

labourhub.org | Guy Standing

The educational commons has been shredded. The next Labour government must fix it, argues Guy Standing, in a Labour Hub long read.

“The final purpose of education… is liberation and the struggle for higher education still” – Hegel, 1820

The education system in Britain is in the mud. That is scarcely news. But would Labour have the courage and values needed to revive it? The trouble they would have if they win the next General Election is due partly to their Party’s legacy and partly to a personal problem.

Education is, or should be, a commons. It belongs to all of us equally, in the sense that whatever counts as knowledge and learning cannot morally be made the property of anybody or any interest. It is a natural public good. If preserved as a commons, education is a superior public good, in that if everybody has good education, we all gain. A public good is one that is non-competitive, in that if one person has it, that does not or should not deprive others of it. So, denying it to some people, as when the price mechanism is used, is a denial of common rights.

In the past 50 years, the educational commons has been shredded. Instead of education as liberating, as a public good and as a means of developing cultured citizens, it has been commodified to the point where education is the largest ‘industry’ in the economy, after finance. A progressive government will have to confront a systemic collapse that is far more than a matter of more public funding or one capable of being rescued by the sensible fiscal measures so far announced by the Labour leadership.

To appreciate the scale of the challenge, and its economic aspects, we must recall what education is all about. In ancient Greece, education was depicted as a means by which people became civilised. But a struggle evolved between the ‘authoritarian’ approach, in which wise elites conveyed truth to the masses, and the ‘liberal’ Socratic approach, in which teachers and students learned from each other, in common pursuit of truth.

The latter was the model for university education from the 12th century onwards, crystallising in the views expressed by Hegel, Cardinal John Newman and J.S. Mill in the 19th century. As Newman famously stated in 1875, “A university training is the great ordinary means to a great but ordinary end; it aims at raising the intellectual tone of society.”

In the UK, this liberal view was extended to workers in the early 20th century with the formation in 1903 of what became the Workers’ Education Association, set up by moderate reformists to broaden knowledge of society and politics. Seen as diverting energies from revolutionary Marxism, the WEA received the approval of the Conservative Balfour government and the likes of Winston Churchill.

Nevertheless, it advanced the liberating effects of education, conveyed in lectures and classes on the arts, social sciences, reading groups and nature study rambles. In 2003, in a book celebrating its centenary, Tony Blair wrote a Foreword. One abiding aspect of the WEA is a vision of education as a two-way process between lecturer and student. Among its formative lecturers were R.H. Tawney and Karl Polanyi.

However, it was the two World Wars that advanced the liberal model most emphatically. In 1919, a monumental statement was the Report of the Adult Educational Committee of the Ministry of Reconstruction, known ever since simply as the 1919 Report. In his covering letter to the Prime Minister, the Chair wrote that the “goal of all education” should be citizenship, “that is, the rights and duties of each individual as a member of the community; and the whole process must be the development of the individual in relation to the community.” It stated that the objective of adult education should be the strengthening of democratic society, geared towards shared civic, social and economic values. Put bluntly, adult education should not be about just preparing workers for jobs.

As the Second World War approached its end, as politicians considered a new post-war social compact, the liberal Conservative ‘Rab’ Butler steered through the 1944 Education Act, which shaped state schooling for the next 44 years. Albeit in a segregated way, and with a foolish streaming through the 11+ exam, it established free secondary schooling for all. In doing so, it reiterated education as a commons, as a public good.

The zenith of the liberal perspective came in 1963 with the Robbins Report on higher education. It was chaired by Lionel Robbins, a right-wing economist at the LSE and a founding member of the Mont Pelerin Society in 1947, a society that was to produce all the economists who forged the neoliberal economics revolution in the 1970s and 1980s. The irony lay in the fact that the Robbins Report was an eloquent restatement of the classical view. It depicted the university as a public good that should be accessible to everybody able to qualify to enter it. It was firmly in the tradition of Cardinal Newman and John Stuart Mill. This is captured in three statements in the Report:

“Excellence is not something that can be bought any day in the market.”

“The essential aim of a first degree should be to teach the student how to think.”

“We should deplore any artificial stimulus to research.”

The Report stated that universities had four tasks: “the promotion of the general process of the mind so as to produce not mere specialists but rather cultivated men and women”, “the search for truth”, “instruction in skills”, and the transmission of culture and common standards of citizenship.

The liberal tradition was extended in the Open University, set up by Harold Wilson in 1969, overcoming scepticism from Anthony Crosland among other Labour politicians. To this day, the Open University remains the largest university in terms of student enrolments, despite going through a difficult period after the sharp rise in student fees in 2012. A benign offshoot has been the U3A, the University of the Third Age.

However, the establishment of the Open University marked the zenith of the liberal tradition. The erosion began with the arrival of Margaret Thatcher on the scene, as Secretary of State for Education, known as ‘the milk snatcher’ for ending free school milk for 7-11 year olds. Her lasting legacy came during her Prime Ministership. It began with her vandalism in selling off state school playgrounds, clearly an illegitimate theft from the educational commons. But the attack on higher education was more strategically ideological.

In 1985, at the height of the neoliberal economics revolution, a new report was published, the brainchild of Keith Joseph, Thatcher’s political mentor. Known as the Jarratt Report, after its chair Alex Jarratt, it was drawn up by a committee biased towards financial interests, with the directors of finance of Ford and of an arms company among its members. The report recommended that universities be run like businesses, stating that “universities are first and foremost corporate enterprises”, to which academic departments owed their allegiance. Vice-chancellors, rather than being ‘scholars first’, should act like chief executives, with management, finance and business skills taking primacy.

The government’s adoption of the Report’s recommendations effectively ended the academic independence of British universities. Among the reforms were abolition of academic tenure, beginning the commodification of academics, the introduction of managerialism, with a dictate to earn from university assets, and an emphasis on ‘competitiveness’ as the guide to ‘the education industry’.

The Jarratt Report was followed by the 1988 Education Reform Act, a remarkably ‘regulatory’ measure for a government claiming to favour ‘de-regulation’. Its main features were: first, introduction of a national school curriculum combined with more use of exams to make sure more children left school with qualifications for the labour market; second, removal of control over schooling by local authorities, allowing individual schools to opt out and receive funding from central government instead; and third, a declared attempt to raise standards by giving parents more choice over where to send their children to school.

The 1988 Act was an act of enclosure, centralising control over content and choice, and preparing the ground for privatisation and commodification. For state schools, Thatcher herself wanted a national curriculum that was very narrow, leaving out all artistic and creative subjects as not functionally useful.

Since then, commodification, privatisation and financialisation have detonated what was left of the educational commons and the liberal tradition. Higher education became a zone of rentier capitalism. Students and degrees became commodities. Maintenance grants were replaced by student loans in 1990 and New Labour introduced fees in 1998. Government grants were formally ended in 2015. These measures turned students into instruments of the new debt-driven economy. Students were required to take loans to pay ‘tuition fees’, which rose from £1,000 in 1998 to £9,250 in 2018 (still that in 2023). On a per capita basis, student debt in the UK is easily the highest in the world.

Universities have been turned into corporate entities plunged into market competition, with each other, with foreign universities and with other emerging purveyors of adult education. The government has steadily cut funding for universities, meaning that they must mobilise more money themselves, primarily by expanding the number of students, a tendency unleashed by the removal of the cap on numbers after 2012. The fetish of promoting economic growth was extended to universities, frontline of the ‘education industry’.

Universities began to sell themselves as ‘brands’, and accordingly devote more of the financial resources they could mobilise to selling themselves. Four developments stand out. First, they devoted more resources to making their ‘product’ an attractive package, with more lavish amenities and entertainment facilities. Second, they sought to sell their packaged product abroad by expensive sales campaigns and recruitment drives. Third, some opened up foreign campuses.

As a result of the second and third activities, today over three-quarters of a million students of British universities are studying outside Britain, and the total number of foreign students has grown to about 40% of the total. But it is the fourth outcome that implies fraud. As a result of devoting more financial resources to selling activities, much less than half the income from tuition fees is actually spent on tuition. Students are being cheated.

Meanwhile, a new trend is taking shape, which is predictable when a public good is commodified. Substitute competitors emerge to take, share and expand the market. In the UK, these are mainly MOOCs and educational brokers, both thriving with the aid of electronic technology and predatory financial capital.

MOOCs

MOOCs are Massive Online Open Courses. Politically, they have been given an easy ride so far. Increasingly, courses and bits of schooling are being packaged and sold to universities and schools instead of, or in addition to, teacher training in classes. There are now degrees based entirely on MOOCs.

Unsurprisingly, they tend to be cheaper than teacher-taught degrees. But to any progressive they should be concerning. They risk minimising the essence of liberal, dialogical education; they risk standardising learning and becoming instruments for indoctrinating millions in a hegemonic way of thinking. And they tend to be acquired by Big Tech and Big Finance, dominated by a few corporate giants able to extract rental profits.

MOOCs were expected to be disruptive of university education, but have proved to be mainly complementary, because as The Economist noted, students ‘are not buying education for its own sake, but rather a certificate from a respected institution.’ What has boomed most is a broker system, through ‘Online Programme Managers’, led by the firm 2U. They have gained from an increase in online second degrees. Around one third of graduate education in the USA is online, reflecting the high wage premium associated with such degrees. One can predict that MOOCs will burrow away at taking profits from universities in Britain, further eroding the liberal tradition.

Education Brokers

However, it is another commodifying trend that should be given priority by an incoming progressive government. Generically, it may be called the ‘education disruptor’. If politicians forge an education ‘industry’ geared to preparing children and adults for jobs and for earning more, then it is likely that companies will emerge promising to do that more efficiently than universities. This is made more likely if the commodities produced by universities become ‘credentials’ rather than signals of occupational prowess. That makes it easier for competitors to offer near substitutes.

Enter the self-styled ‘education provider’. In April 2017, the government introduced the Apprenticeship Levy to boost apprenticeships. For large firms, this involves a 0.5% levy on the annual wage bill if it is over £3 million, with smaller firms paying just 5% of the cost of any apprenticeships, the government paying the remainder.

Just beforehand, a young employee in J.P. Morgan teamed up with a colleague to set up a company that has been able to take advantage of the scheme. It became Multiverse, in effect a labour broker. It places young jobseekers in firms as apprentices. The jobseekers do not pay anything directly, while the firms pay Multiverse for finding trainees. The business model is simple and risk-free. The firms that would have to pay the Apprenticeship Levy anyway can divert that to paying Multiverse, which undertook to provide nominally apprenticeship training, all online, for about 12 to 15 months.

Over six years, Multiverse has placed about 8,000 ‘apprentices’, bringing in a remarkable amount of revenue, declared to be £27 million for 2021-22 alone. Somehow, it has managed to declare a loss every year, leading to the firm receiving from the government millions of pounds of tax credits (£2.7 million in 2022). The head of Multiverse is Euan Blair, elder son of Tony Blair. At the age of 38, he was awarded an MBE for ‘Services to Education’, although it is unclear what services he has provided.

Despite his company apparently making consistently large losses, Blair flaunted his plutocrat status when he splashed out over £22 million on a luxurious five-storey west London town house, with seven bedrooms, a two-storey ‘iceberg’ basement with an indoor pool, gym and multi-car garage. In 2022 as well, financial capital poured money into his company, turning it into a unicorn, valued at £1.7 billion; Blair apparently has a 50% stake.

There is an irony in that while universities have become more like job preparation factories, the son of the Prime Minister who promoted ‘Education, education, education’ as Labour’s mantra dismisses the relevance of university education for job markets. Blair told the digital media platform UNLEASH that “a university degree has become a stamp in the passport for young people seeking access to the best careers. But, more often than not, the education they’re getting at university isn’t relevant to the jobs they’re going for.”

Blair was quoted in the Financial Times as saying: “One of the things that’s so broken about the current system is it tries to pretend a three- or four-year undergraduate degree is enough to see you through a multi-decade career. We won’t make the same mistake with apprenticeships. Our vision is for a system in which people can return to apprenticeships whenever they need to, to level-up their career.” There is no evidence that anybody does ‘pretend’ any such thing. But this disparaging of university education comes from a neoliberal perspective that sees universities as simply preparing people for careers.

Then came the potential bombshell. In September 2022, Blair’s firm was granted a licence to award degrees without the need for a university or college, a huge break with historical tradition, marking a new phase in commodification and privatisation, the apprenticeship degree or ‘degree apprenticeship’. It is moot whether a 12-15 month on-the-job training course, done entirely virtually, would have passed muster as an apprenticeship at any previous time in history. It is even more dubious to call what Multiverse is offering a ‘degree’, entitling successful apprentices to the degree of B.Sc.

Although its growth has been rapid and its completion rate has been remarkably high, the scale of this education disruption is still modest. But financial capital and the Office for Students, the government regulator that approved Blair’s ‘degree’, have clearly decided that it is a model for the future on a grand scale. But it raises many ethical and economic issues. The most obvious is that it is an abuse of the idea of a degree as the embodiment of the liberal view of education. It is also a further move towards a ‘modular’ approach to skill and training, undermining the apprenticeship traditions. It is also further shredding the idea of adult education as a commons, a public good.

Euan Blair’s disruption model (as he describes it) will pose a delicate challenge for Labour if elected as the next government. Labour’s Deputy Leader, Angela Rayner, has said: “Education is a public good and should be treated as such.” Blair’s model is the opposite, as is the licence to issue degrees given by the Office for Students to James Dyson, the billionaire Brexit backer who promptly moved his headquarters to Singapore after the Brexit vote. They epitomise today’s rentier capitalism.

They also raise numerous questions. Should a commercial company be raking in millions of pounds by dispensing with ‘degrees’? Should firms be able to divert the Apprenticeship Levy to pay a corporation to recruit workers for apprenticeships paid for by the tax? Should Blair’s lightly regulated company, valued at nearly £2 billion, be receiving millions of pounds each year in tax credits, paid by the taxpaying public? Should Blair’s ‘degree’ be half the duration of a normal university degree? If Blair’s firm is allowed to issue degrees, should all its competitor online platforms be allowed to do so? The awkward questions can be multiplied.

However, there are crucial societal questions that Labour should pose. First, should the education system be an ‘industry’ driven by the perceived demands of the labour market? The current commodifying trends are destroying a broad-based liberal education. Second, how can a progressive government restore the foundational principle of education, that of developing critical minds and citizens driven by values of empathy, altruism, ethics, creativity and social solidarity, rather than by competitiveness, narcissism and personal aggrandisement? Third: Given the trends towards superficiality and commodification, at what point will a degree from a British university not be recognised as a credible degree abroad because it has been so devalued? Alarm bells should be ringing.

Following previous traumatic transformational national events, such as the two World Wars, there were radical reappraisals of the role of education. Whatever the political hue of the next government, it should set up a high-powered Commission to map out how to recover the soul of the educational commons.

Guy Standing is Professorial Research Fellow, SOAS University of London and a Council member of the Progressive Economy Forum. He is author of various books, including The Precariat: The New Dangerous Class and The Corruption of Capitalism: Why Rentiers Thrive and Work Does Not Pay.

Guy Standing is a member of mέta’s Advisory Board., Professorial Research Associate, SOAS University of London, and an honorary professor at the University of Sydney. An economist with a PhD from the University of Cambridge, he is a Fellow of the British Academy of Social Sciences, a Fellow of the Royal Society of Arts, co-founder and honorary co-president of the Basic Income Earth Network (BIEN), and member of the Progressive Economy Forum. In 2016-19, he was adviser to Shadow Chancellor of the Exchequer, John McDonnell.

He was professor in SOAS, Bath and Monash Universities, and Director of the ILO’s Socio-Economic Security Programme. He has been a consultant for many international bodies, was Research Director for President Mandela’s Labour Market Policy Commission, and has implemented several basic income pilots. His books include The Precariat: The New Dangerous Class, published in 23 languages (fourth edition, 2021); The Corruption of Capitalism (third edition, 2021); Basic Income: And how we can make it happen (2017); and Plunder of the Commons (2019). In 2020, he collaborated with Massive Attack in a video based on his book, Battling Eight Giants: Basic Income Now (2020).