College Inc.

The PBS series Frontline aired a deep investigation of for-profit higher education last May, called College Inc. The tagline from the website gives an accurate hint of the show: "Investigating how Wall Street and a new breed of for-profit universities are transforming the way we think about college in America..."

An important element of capitalism always has been the hunt for new sources of profit. The confluence of many factors (economically necessary, technologically feasible) has driven capitalism-in-the-age-of-electronics to gnaw at the public sector, to pull previously public activities into the Value relationship. That is, to turn it into a Commodity in the Marxist sense, of something exchanged in the market on the basis of the socially necessary labor it took to produce it, and therefore a new source of profit. In the process of becoming a commodity, the Law of Value kicks in, which precipitates the necessity of driving down production costs or extending the market or ... to maximize profitability. That's something of how a Marxist analysis would go, and, well, the shoe seems to fit very well in this case. (For definitions, etc. see this exploration on Value)

The sketchy steps:

1. The massive transitions in production, in the economy, obsolesce old skills and old activities. Workers are driven to develop new skills to continue to participate in the economy (i.e., to survive).
2. Workers must work on one job while trying to train for something better; or feel compelled to re-tool on their own dime to keep the job they have. This means going to school after work or on weekends.
3. Starve the public sector. The existing non-profit, state-supported institutions, particularly community colleges, cannot meet the needs of everyone who wants an education.
4. New technologies arise that make distance learning and online learning a practical possibility.
5. Wall Street (or investors or finance capital) is always on the lookout for new sources of profit.
6. Entrepreneurs sort out the details: snatch up accreditations from struggling non-profit schools to provide a veneer of respectability, install sophisticated data centers and hire cheap adjunct faculty to deliver instruction, aggressively market their services to a desperate market, charge almost six times the tuition of a community college, and get federal government to subsidize student loans.

Students become debt-slaves in yet another way, and the loans become another large pool of debt ripe for securitization. It feeds speculative capital. Total outstanding federal loans are over $500 billion, with an additional estimated $125 billion in loans from the private sector, and the private sector role is growing much much faster (see CNBC, America's Biggest Types of Personal Debt).

The Frontline show covers all this, not exactly in the same way, but in a much more entertaining way.

jd