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Showing posts with label neoliberalism. Show all posts
Showing posts with label neoliberalism. Show all posts

Tuesday, November 18, 2025

Why People Under 35 Are Not Afraid of Democratic Socialism

For Americans under 35, the term “democratic socialism” triggers neither fear nor Cold War reflexes. It represents something far simpler: a demand for a functioning society. Younger generations have grown up in a world where basic pillars of American life—higher education, medicine, economic mobility, and even life expectancy—have deteriorated while inequality has soared. Democratic socialism, in their view, is not a fringe ideology but a practical response to systems that have ceased to serve the common good.

Nowhere is this clearer than in higher education. Millennials and Gen Z entered adulthood as universities became corporate enterprises, expanding administrative layers, pushing adjunct labor to the brink, and relying on debt-financed tuition increases to keep the machine running. Public investment collapsed, predatory for-profit chains proliferated, and nonprofit universities acted like hedge funds with classrooms attached. Students saw institutions with billion-dollar endowments operate as landlords and asset managers, all while passing costs onto working families. When Bernie Sanders called for tuition-free public college, young people did not hear utopianism—they heard a plan grounded in global reality, a model that exists in Germany, Sweden, Finland, and other social democracies that treat education as a public good rather than a revenue stream.

Healthcare tells an even harsher story. Americans under 35 watched their parents and grandparents navigate a system more focused on billing codes than care, one where an ambulance ride costs a week’s wages and a bout of illness can mean bankruptcy. They experienced the rise of corporatized university medical centers, private equity–owned emergency rooms, and insurance bureaucracies that ration access more cruelly than any state. They saw life-saving drugs priced like luxury goods and mental health services pushed out of reach. Compare this to nations with universal healthcare: longer life expectancy, lower infant mortality, and far less medical debt. Again, Sanders’ Medicare for All resonated not because of ideology but because young people recognized it as a plausible path toward the kind of humane medical system described by scholars like Harriet Washington, Elisabeth Rosenthal, and Mahmud Mamdani, who all critique the structural violence embedded in systems of unequal care.

Life expectancy itself has become a generational indictment. For the first time in modern U.S. history, it has fallen, driven by overdose deaths, suicide, preventable illness, and worsening inequities. Younger Americans know that friends and peers have died far earlier than their counterparts abroad. They see that countries with strong public services—childcare, unemployment insurance, housing supports, universal healthcare—live longer, healthier lives. They also see how austerity and privatization have hollowed out public health infrastructure in the United States, leaving communities vulnerable to crises large and small. The message is clear: societies that invest in people live longer; societies that treat health as a commodity do not.

Quality of Life (QOL) ties all of this together. People under 35 face rent burdens unimaginable to previous generations, debts that prevent them from forming families, stagnant wages, and a labor market defined by precarity. They face the erosion of public space, public transit, libraries, and social supports—what Mamdani would describe as the slow unraveling of the civic realm under neoliberalism. When they look abroad, they see countries with social democratic frameworks offering guaranteed parental leave, subsidized childcare, free or nearly free college, universal healthcare, and robust worker protections. These are not distant fantasies; they are functioning models that produce higher happiness levels, stronger social trust, and more stable democracies.

Older generations often accuse young people of radicalism, but the reality is the reverse. Millennials and Gen Z are pragmatic. They have lived through the failures of unfettered capitalism: historic inequality, monopolistic industries, soaring costs of living, and a political class unresponsive to their material conditions. They have read Sanders’ critiques of oligarchy and Mamdani’s analyses of state power and structural violence, and they see themselves reflected in those diagnoses. Democratic socialism appeals because it is rooted in material improvements to daily life rather than in abstract political theory. It promises a society where income does not determine survival, where education does not require lifelong debt, where parents can afford to raise children, and where basic health is not a luxury good.

People under 35 are not afraid of democratic socialism because they have already seen what the absence of a social democratic framework produces. They are not seeking revolution for its own sake. They are seeking a livable future. And increasingly, they view democratic socialism not as a radical break but as the only realistic path toward rebuilding public institutions, revitalizing democracy, and ensuring that future generations inherit a country worth living in.

Sources
Sanders, Bernie. Our Revolution: A Future to Believe In.
Sanders, Bernie. Where We Go from Here: Two Years in the Resistance.
Mamdani, Mahmood. Define and Rule: Native as Political Identity.
Mamdani, Mahmood. Neither Settler nor Native: The Making and Unmaking of Permanent Minorities.
Washington, Harriet. Medical Apartheid.
Rosenthal, Elisabeth. An American Sickness.
Skloot, Rebecca. The Immortal Life of Henrietta Lacks.
Baldwin, Davarian. In the Shadow of the Ivory Tower.
Bousquet, Marc. How the University Works.

Monday, November 17, 2025

Neoliberalism and the Global College Meltdown

Over the past four decades, neoliberalism has reshaped higher education into a market-driven enterprise, producing what can only be described as a global College Meltdown. Once envisioned as a public good—a tool for civic empowerment, social mobility, and national progress—higher education in the United States, the United Kingdom, and China has been transformed into a competitive market system defined by privatization, debt, and disillusionment.

The United States: From Public Good to Profit Engine

Nowhere has neoliberal ideology had a more devastating effect on higher education than in the United States. Beginning in the 1980s, with the Reagan administration’s cuts to federal grants and the expansion of student loans, higher education funding shifted from public investment to individual burden. Universities adopted corporate governance models, hired armies of administrators, and marketed education as a private commodity promising personal enrichment rather than collective advancement.

The results are visible everywhere: tuition inflation, student debt exceeding $1.7 trillion, and the proliferation of predatory for-profit colleges. Elite universities transformed into financial behemoths, hoarding endowments while relying on contingent faculty. Meanwhile, working-class and minority students were lured into debt traps by institutions that promised upward mobility but delivered unemployment and despair.

The U.S. College Meltdown—a term that describes the system’s moral and financial collapse—is a direct consequence of neoliberal policies: deregulation, privatization, and austerity disguised as efficiency. The profit motive replaced the public mission, and the casualties include students, adjuncts, and the ideal of education as a democratic right.

The United Kingdom: Marketization and Managerialism

The United Kingdom followed a similar trajectory under Margaret Thatcher and her successors. The introduction of tuition fees in 1998 and their tripling in 2012 marked the formal triumph of neoliberal logic over public investment. British universities became quasi-corporate entities, obsessed with league tables, branding, and global rankings.

The result has been mounting student debt, declining staff morale, and a hollowing out of intellectual life. Faculty strikes over pensions and pay disparities underscore a deeper crisis of purpose. Universities now function as rent-seeking landlords—building luxury dorms for international students while cutting humanities departments. The logic of “student-as-customer” has reduced education to a transaction, and accountability has been redefined to mean profit margin rather than social contribution.

The UK’s College Meltdown mirrors that of the U.S.—a story of financialization, precarious labor, and the erosion of public trust.

China: Neoliberalism with Authoritarian Characteristics

At first glance, China seems to defy the Western College Meltdown. Its universities have expanded rapidly, producing millions of graduates and investing heavily in research. But beneath this apparent success lies a deeply neoliberal structure embedded in an authoritarian framework.

Since the 1990s, China’s higher education system has embraced competition, rankings, and market incentives. Universities compete for prestige and funding; families invest heavily in private tutoring and overseas degrees; and graduates face a saturated labor market. The result is mounting anxiety and unemployment among young people—known online as the “lying flat” generation, disillusioned with promises of meritocratic success.

The Chinese model fuses state control with neoliberal marketization. Education serves as both an instrument of national power and a mechanism of social stratification. In this sense, China’s version of the College Meltdown reflects a global truth: the commodification of education leads to alienation, regardless of political system.

A Global System in Crisis

Whether in Washington, London, or Beijing, the pattern is strikingly similar. Neoliberalism treats education as an investment in human capital, reducing learning to a financial calculation. Universities compete like corporations; students borrow like consumers; and knowledge becomes a tool of capital accumulation rather than liberation.

This convergence of economic and ideological forces has created an unsustainable higher education bubble—overpriced, overcredentialized, and underdelivering. Across continents, graduates face debt, underemployment, and despair, while universities chase rankings and revenue streams instead of justice and truth.

Toward a Post-Neoliberal Education

Reversing the College Meltdown requires more than reform; it demands a new philosophy. Public universities must reclaim their civic mission. Education must once again be understood as a human right, not a private investment. Debt forgiveness, reinvestment in teaching, and democratic governance are essential first steps.

Neoliberalism’s greatest illusion was that markets could produce wisdom. The College Meltdown proves the opposite: when education serves profit instead of people, it consumes itself from within.


Sources:

  • Wendy Brown, Undoing the Demos (2015)

  • David Harvey, A Brief History of Neoliberalism (2005)

  • Tressie McMillan Cottom, Lower Ed (2017)

  • The Higher Education Inquirer archives on the U.S. College Meltdown

  • BBC, “University staff strikes and student debt crisis,” 2024

  • Caixin, “China’s youth unemployment and education anxiety,” 2023

Thursday, November 13, 2025

The College Meltdown Index: Profiting from the Wreckage of American Higher Education


“Education, once defended as a public good, now functions as a vehicle for private gain.”


From Collapse to Contagion

The College Meltdown never truly ended—it evolved.

After a decade of spectacular for-profit implosions, the higher education sector has reconstituted itself around new instruments of profit: debt servicing, edtech speculation, and corporate “partnerships” that disguise privatization as innovation.

The College Meltdown Index—tracking a mix of education providers, servicers, and learning platforms—reveals a sector in quiet decay.

Legacy for-profits like National American University (NAUH) and Aspen Group (ASPU) trade at penny-stock levels, while Lincoln Educational (LINC) and Perdoceo (PRDO) stumble through cost-cutting cycles.

Even the supposed disruptors—Chegg (CHGG), Udemy (UDMY), and Coursera (COUR)—are faltering as user growth plateaus and AI reshapes their value proposition.

Meanwhile, SoFi (SOFI), Sallie Mae (SLM), and Maximus (MMS) thrive—not through learning, but through the management of debt.


The Meltdown Graveyard

Below lies a sampling of the education sector’s ghost tickers—the silent casualties of a system that turned public trust into private loss.

SymbolInstitutionStatusApprox. Closure/Delisting
CLAS.UClass TechnologiesDefunct2024
INSTInstructure (pre-acquisition)Acquired by Thoma Bravo2020
TWOUQ2U, Inc.Bankrupt2025
CPLACapella UniversityMerged with Strayer (Strategic Ed.)2018
ESI-OLDITT Technical InstituteDefunct2016
EDMCEducation Management CorporationDefunct2018
COCO-OLDCorinthian CollegesDefunct2015
APOLApollo Education Group (U. of Phoenix)Taken Private2017

Each ticker represents not only a failed business model—but a generation of indebted students.


The Phoenix That Shouldn’t Have Risen

No institution better symbolizes this moral decay than the University of Phoenix and Phoenix Education Partners (PXED).

At its height, Phoenix enrolled nearly half a million students. By 2017, following federal investigations and mass defaults, Apollo Education Group—its parent company—collapsed under scrutiny.

But rather than disappearing, Phoenix was quietly resurrected through a private equity buyout led by Apollo Global Management, Vistria Group, and Najafi Companies.

Freed from public oversight, the university continued to enroll vulnerable adult learners, harvesting federal aid while shedding accountability.

In 2023, the University of Idaho’s proposed acquisition of Phoenix provoked national outrage, forcing state officials to confront a basic question: Should a public university absorb a for-profit brand built on exploitation?

The deal collapsed—but the temptation to monetize Phoenix’s infrastructure remains. In 2025, a small portion became publicly traded.  Its call centers and online systems remain models of enrollment efficiency, designed to extract just enough engagement to secure tuition payments.


From Education to Extraction

The sector’s transformation reveals a deeper moral hazard.

If students succeed, investors profit.
If students fail, federal subsidies and servicer contracts ensure the money keeps flowing.

Executives face no downside. Shareholders are protected. The losses fall on students and taxpayers.

In this sense, the “meltdown” is not a market failure—it’s a market design.

“The winners are those who most efficiently extract value from hope.”

Public universities increasingly partner with private Online Program Managers (OPMs), leasing their brands to companies that control marketing, pricing, and student data. The once-clear line between public and for-profit education has blurred beyond recognition.


The Quiet Winners of Collapse

A few companies continue to prosper by aligning with “practical” or “mission-safe” sectors:

  • Adtalem (ATGE) in nursing and health education,

  • Grand Canyon Education (LOPE) in faith-branded online degrees,

  • Bright Horizons (BFAM) in corporate childcare and workforce training.

Yet all remain heavily dependent on public dollars and tax incentives. The state subsidizes their existence; the market collects the rewards.

Meanwhile, 2U’s bankruptcy leaves elite universities scrambling to explain how a publicly traded OPM, once championed as the future of online learning, could disintegrate overnight—taking with it a network of high-priced “nonprofit” certificate programs.


A Reckoning Deferred

The College Meltdown Index exposes a system that has internalized its own failures.
Fraud has been replaced by financial engineering, transparency by outsourcing, and accountability by spin.

The real collapse is not in the market—but in moral logic. Education, once the cornerstone of social mobility, has become a speculative instrument traded between hedge funds and holding companies.

Until policymakers—and universities themselves—confront the ethics of profit in higher education, the meltdown will persist, slowly consuming what remains of the public good.


“The real question is not whether the system will collapse, but who will rebuild it—and for whom.”


Sources:

  • Higher Education Inquirer, College Meltdown 2.0 Index (Nov. 2025)

  • SEC Filings (2010–2025)

  • U.S. Department of Education, Heightened Cash Monitoring Reports

  • An American Sickness – Elisabeth Rosenthal

  • The Goosestep – Upton Sinclair

  • Medical Apartheid – Harriet A. Washington

  • Body and Soul – Alondra Nelson

  • The Immortal Life of Henrietta Lacks – Rebecca Skloot

Tuesday, August 19, 2025

Trump’s “Manhattan Project” for AI Chips: U.S. Scrambles as China Reaps Neoliberal Legacy

The Trump administration is reportedly considering an extraordinary intervention in the private sector: partially nationalizing Intel Corp., one of America’s leading semiconductor manufacturers. Sources say the government is exploring a stake in the company—a move experts liken to the Manhattan Project or the early space race.

MIT AI computer scientist Dave Blundin described the effort on a podcast with MIT engineer Peter Diamandis as “every bit as important as the space race was, as the nuclear arms race was. Actually, it’s more important.” Intel’s advanced semiconductor capabilities could reduce U.S. dependence on foreign fabrication plants, particularly in Taiwan, which controls more than 60 percent of global chip production.

Decades of Missteps

Yet the urgency behind the move is rooted not in technological inevitability, but in decades of strategic missteps. Neoliberal policies pursued by U.S. administrations and corporate elites deliberately outsourced manufacturing and critical technology to China to cut labor costs. Over time, this strategy handed Beijing a decisive advantage in semiconductors, AI, and advanced technology, leaving the United States reactive and vulnerable.

The potential nationalization of Intel—a step usually reserved for wartime or extreme crises—signals a dramatic departure from free-market principles. By directly involving the federal government in a major private firm, the administration privileges corporate elites, bypassing both market competition and public accountability. Intel declined to comment on the discussions but emphasized its commitment to supporting the administration’s technology and manufacturing priorities.

China and Taiwan

Blundin warned the move puts the industry on a “war footing,” likening it to a mobilization for conflict, with supply chains and fabs as the battlefield. Analysts stress urgency: China may attempt to take over Taiwan sooner rather than later. Unlike the United States, China operates under a coordinated, authoritarian system that fuses government strategy and industrial capacity to dominate global technology—a stark structural advantage over the fragmented, elite-driven U.S. approach.

Recent deals highlight the U.S.’s reactive posture. Last week, Nvidia and Advanced Micro Devices (AMD) agreed to hand over 15 percent of their chip sales revenue in China to the U.S. government in exchange for export licenses. Experts warn that while these arrangements provide short-term financial gains, they also strengthen China’s AI and military capabilities. Liza Tobin, former China director at the National Security Council, called the deal “an own goal” likely to incentivize Beijing to escalate its technology development and demand further concessions.

Trump has also threatened a 100 percent tariff on imports unless chips are manufactured domestically. If Intel is partially nationalized, it would mark one of the most significant government interventions in U.S. industry in decades—demonstrating both a departure from free-market capitalism and a concentration of power in the hands of elites.

The U.S.’s current scramble illustrates a deeper crisis. Decades of neoliberal policies, elite capture, and weakening democratic institutions have left the nation ill-prepared to compete against a strategically unified authoritarian China. Semiconductor leadership is no longer just an economic or technological matter—it is a test of whether the United States can reclaim strategic sovereignty while defending democracy and free-market principles, or whether it will continue to lose ground to authoritarian advantage.

Sources: Bloomberg, Financial Times, The New York Times, MIT Podcast with Dave Blundin & Peter Diamandis

Saturday, July 12, 2025

From Public Good to Target of Sabotage: The Long Decline of the U.S. Postal Service

The United States Postal Service (USPS), long a pillar of American public life and a gateway to middle-class stability, is under siege. While Donald Trump’s administration played a pivotal role in accelerating its recent dysfunction, the erosion of the USPS began decades earlier—through bipartisan policy decisions, creeping privatization, technological change, and ideological hostility toward public institutions. The destruction of the USPS is not a moment, but a process. And its consequences are being felt by workers, communities, and the democratic fabric of the country.

A People’s Institution

The USPS has deep roots in American democracy and labor history. Established in 1775 with Benjamin Franklin as its first postmaster general, the service has operated under a mandate of universal delivery, regardless of geography or profitability. It became a vehicle for social and economic mobility—especially for Black Americans, veterans, immigrants, and rural citizens.

For much of the 20th century, the Postal Service was a stable, unionized employer offering family-sustaining wages. Even as industrial jobs declined, USPS employment remained a critical bridge into the middle class, particularly for African Americans. By the early 1980s, the USPS employed nearly 800,000 people—offering pensions, job security, and federal health benefits.

The Turn Toward Privatization and Market Competition

The seeds of decline were planted in the late 20th century with the rise of neoliberal economics and a bipartisan push for government efficiency, austerity, and deregulation.

In 1970, the old Post Office Department was restructured into a semi-independent entity— the U.S. Postal Service—after a massive wildcat postal strike. While the Postal Reorganization Act modernized the institution, it also removed many public-service obligations from congressional oversight, laying the groundwork for future financial manipulation.

Beginning in the 1980s and accelerating in the 1990s, the growth of private carriers like FedEx and UPS—both supported by favorable legislation and lobbying power—ate into USPS’s most profitable markets: overnight and package delivery. Rather than being forced to compete on a level playing field, USPS was legally barred from underpricing private competitors or expanding into new revenue-generating areas like banking or logistics.

Then came the internet. Email, online bill pay, and digital communications began replacing First-Class mail, which historically covered much of the USPS's operating costs. USPS mail volume peaked in 2006 at 213 billion pieces and has declined nearly 40 percent since. In 2024, total mail volume stood at just over 127 billion pieces.

The 2006 PAEA: A Manufactured Crisis

Perhaps the most destructive blow came in 2006 with the Postal Accountability and Enhancement Act (PAEA), passed by a bipartisan Congress and signed by President George W. Bush. The law required USPS to pre-fund 75 years’ worth of retiree health benefits within a 10-year window—a $5.5 billion annual burden not imposed on any other federal agency or private company.

This manufactured debt crisis gave political cover to critics who claimed the Postal Service was financially unsustainable. It also starved the institution of capital needed for modernization, infrastructure, and workforce development. For over a decade, this artificial shortfall served as justification for hiring freezes, facility closures, and service cuts.

Enter Trump: Sabotage with a Smile

By the time Donald Trump took office in 2017, USPS had already been weakened. But Trump weaponized its vulnerabilities for political gain. In 2020, amid a global pandemic and a presidential election that relied heavily on mail-in voting, Trump launched a public attack on the USPS, falsely claiming mail-in ballots were a source of massive voter fraud.

He appointed Louis DeJoy—a logistics executive and Republican megadonor—as Postmaster General. DeJoy’s appointment was rubber-stamped by a Trump-controlled USPS Board of Governors. Under DeJoy, the USPS eliminated overtime, removed sorting machines, slashed delivery routes, and cut post office hours. Predictably, mail delivery slowed, especially in swing states and communities dependent on timely postal service.

The slowdowns weren’t just political—they were material. Seniors reported late medications. Veterans didn’t receive their VA checks. Ballots were delayed. And postal workers were pushed to the brink. In Detroit and Philadelphia, on-time First-Class mail delivery dropped to below 65 percent in the summer of 2020.

Workforce Impact and Labor Erosion

The USPS has lost tens of thousands of jobs since DeJoy’s tenure began. Over 30,000 positions were eliminated between 2021 and 2024. In early 2025, the agency announced plans to cut 10,000 more jobs, many through early retirement. For a workforce that had already endured years of hiring freezes, consolidation, and low morale, these were devastating blows.

Postal unions, including the American Postal Workers Union (APWU) and the National Association of Letter Carriers (NALC), have denounced the cuts as part of a long-term strategy to hollow out the institution and pave the way for privatization.

Service Cuts and a Two-Tier America

As the USPS has weakened, its ability to provide universal service has eroded. In urban centers, lines at post offices have grown longer. In rural America, post offices have been closed or had their hours slashed. Mail delivery has become slower, less reliable, and less equitable. For millions of Americans, especially those in marginalized communities, the erosion of USPS services represents a withdrawal of the federal government from public life.

At the same time, private carriers have expanded their market share—but only where profits justify service. This has created a two-tier system: fast, expensive delivery for the wealthy and corporations; slow, underfunded service for the rest.

The Broader War on Public Infrastructure

What has happened to the U.S. Postal Service is not an isolated story. It is part of a broader neoliberal assault on public institutions and the working class. From public education to public housing, from transit systems to social security offices, the U.S. has seen a systematic hollowing out of civic infrastructure under the banner of "efficiency" and "market competition."

Trump’s actions—both deliberate and reckless—pushed the Postal Service further down a path of institutional decay. But the responsibility lies with decades of policymakers who devalued public service, dismantled regulatory protections, and enabled privatization without accountability.

A Line in the Sand

The USPS remains one of the few institutions that touches nearly every American. It has survived war, depression, technological revolution, and political sabotage. But its future is not guaranteed.

Saving the Postal Service will require not just reversing Trump-era policies, but confronting decades of bipartisan neglect. It will mean repealing harmful laws like the PAEA, investing in modernization, expanding services (like postal banking), and defending postal jobs and unions.

In a time of deep inequality and civic fragmentation, preserving the USPS is about more than mail. It’s about restoring the public good—and remembering that some things should not be for sale.

Sources:

  • U.S. Postal Service 2024 Annual Report to Congress

  • Bureau of Labor Statistics, Occupational Employment and Wage Statistics

  • Congressional Research Service: The Postal Accountability and Enhancement Act

  • The Guardian: “USPS mail slowdowns raise fears of election interference”

  • AP News: “Trump says he may take control of USPS”

  • Business Insider: “Privatization of USPS could harm rural areas”

  • Teen Vogue: “The U.S. Postal Service and the Working Class”

  • American Postal Workers Union (apwu.org)

Saturday, June 28, 2025

Harvard, Russia, and the Quiet Complicity of American Higher Education

In the fog of elite diplomacy and global finance, some of the United States' most prestigious universities—chief among them, Harvard—have long had entangled and often opaque relationships with authoritarian regimes. While recent headlines focus on China’s influence in higher education, far less attention has been paid to the role elite U.S. institutions have played in legitimizing, enabling, and profiting from post-Soviet Russia’s slide into oligarchy and repression.

The Harvard-Russia Nexus

Harvard University, through its now-infamous Harvard Institute for International Development (HIID), was a key player in Russia's economic transition following the collapse of the Soviet Union. During the 1990s, HIID, backed by millions of dollars in U.S. government aid through the U.S. Agency for International Development (USAID), provided advice on privatization and market reforms in Russia. This effort, touted as a cornerstone of democracy promotion, instead helped consolidate power among a small class of oligarchs, fueling the economic inequality and corruption that ultimately laid the foundation for Vladimir Putin's authoritarian rule.

Harvard’s involvement reached scandalous proportions. In 2001, the U.S. Department of Justice sued Harvard, economist Andrei Shleifer (a professor in Harvard's Economics Department), and others for self-dealing and conflict of interest. Shleifer and his associates were found to have used their insider access to enrich themselves and their families through Russian investments, all while supposedly advising the Russian government on behalf of the American taxpayer. Harvard eventually paid $26.5 million to settle the case.

Though the scandal damaged HIID's reputation and led to its closure, the broader complicity of the academic and financial elite in exploiting Russia’s vulnerability during the 1990s has received little sustained scrutiny.

Lawrence Summers and the Russian Connection

At the center of this story sits Lawrence Summers—a former Harvard president, U.S. Treasury Secretary, and one of the most powerful figures in the transatlantic economic order. Summers was both mentor and close associate of Andrei Shleifer. During the critical years of Russian privatization, Summers served as Undersecretary and later Secretary of the Treasury under President Clinton, while Shleifer operated HIID’s Russia project.

Despite the blatant conflict of interest, Summers never publicly disavowed Shleifer's actions. After returning to Harvard, he brought Shleifer back into the university’s good graces, protecting his tenured position and helping him avoid serious institutional consequences. This protection underscored the tight-knit nature of elite networks where accountability is rare and reputations are guarded like intellectual property.

Summers himself has invested in Russia through various vehicles over the years, and has held lucrative advisory roles with financial firms deeply enmeshed in post-Soviet economies. He also played an advisory role for Russian tech giant Yandex and has appeared at events sponsored by firms with deep Russian connections. While Summers has since criticized the Putin regime, his earlier role in enabling the very conditions that empowered it is seldom discussed in polite academic company.

A Broader Pattern of Complicity

Harvard is not alone. Institutions like Stanford, Yale, Georgetown, and the University of Chicago have produced scholars, consultants, and think tanks that helped construct the framework of neoliberal transition in Russia and Eastern Europe. These universities not only trained many of the Russian technocrats who later served in Putin’s government, but also quietly benefited from international partnerships, fellowships, and endowments tied to post-Soviet wealth.

Endowments at elite institutions remain shrouded in secrecy, and it is not always possible to trace the sources of foreign gifts or investments. But it’s clear that Russian oligarchs—many of whom owe their fortunes to the very privatization schemes U.S. economists championed—have made donations to elite Western universities or served on their advisory boards. Some sponsored academic centers and fellowships designed to burnish their reputations or reframe narratives about Russia’s transformation.

The Death of a Dissident

The failure of Western academic institutions to reckon with their role in Russia’s descent into authoritarianism became all the more glaring with the death of Alexei Navalny in February 2024. Navalny, a fierce critic of corruption and Putin’s regime, was imprisoned and ultimately killed for challenging the very system that U.S. advisers like those from Harvard helped engineer. While universities issued public statements condemning his death, few acknowledged the deeper complicity of their faculty, programs, and funders in building the oligarchic structures Navalny spent his life trying to dismantle.

Navalny repeatedly exposed how Russian wealth was funneled into offshore accounts and Western real estate, often aided by a global network of enablers—including lawyers, bankers, and academics in the West. His death is not just a symbol of Putin’s brutality—it is also a damning indictment of the institutions, both in Russia and abroad, that failed to stop it and, in many cases, profited along the way.

Where is the Accountability?

Despite the Shleifer scandal and Russia’s authoritarian consolidation, there has been no independent reckoning from Harvard or its peer institutions about their role in the failures of the 1990s or the long-term consequences of their economic evangelism. The neoliberal ideology that fueled these efforts—steeped in faith in free markets, minimal regulation, and elite technocracy—remains dominant in elite policy circles, even as it faces growing critique from both left and right.

Meanwhile, institutions like Harvard continue to influence global policy through their academic prestige, think tanks, and alumni networks. They remain powerful arbiters of truth—shaping how the public understands foreign policy, democracy, and capitalism—while rarely acknowledging their own entanglement in the darker chapters of globalization.

Elite Academia and Oligarchy

The story of Harvard and Russia is not just a tale of one institution’s failure; it is emblematic of the broader failure of elite American academia to confront its own role in the spread of oligarchy, inequality, and authoritarianism under the banner of liberal democracy. In an age when higher education is under increased scrutiny for its political and financial entanglements, the need for critical journalism and public accountability has never been greater.

The Higher Education Inquirer will continue to investigate these complex relationships—and demand transparency from the institutions that claim to serve the public good, while operating behind a veil of privilege and power. Navalny’s sacrifice deserves more than hollow statements. It requires a full accounting of how the system he died fighting was built—with help from the most powerful university in the world.

Thursday, June 12, 2025

Navigating the Storm: Existential Questions for Higher Education and the Nation

“Who are we? Where are we going? Where do we come from?” These existential questions are not luxuries in times of crisis—they are necessities. And as the storms of political, social, and environmental upheaval grow darker, they demand our full attention.

For many in the United States, especially younger generations, the future feels bleak. Student loan debt weighs down tens of millions. Meaningless, low-wage, precarious employment—what anthropologist David Graeber called “bullsh*t jobs”—dominates the landscape, even for the college educated. Higher education, once touted as the great equalizer, has increasingly functioned as a sorting mechanism that reinforces class division rather than dismantling it.

This is not accidental. It is the consequence of more than a half century of growing inequality, fueled by tax cuts for the wealthy, deregulation, union busting, and the privatization of public goods. Since the 1970s, wages for working people have stagnated, while the top one percent has consolidated unimaginable wealth and power. Higher education has both suffered from and contributed to this shift: as public funding declined, universities increasingly turned to corporate partnerships, tuition hikes, student loans, and contingent labor to survive. In doing so, they have often replicated the very inequalities they claim to challenge.

Instead of building an informed and empowered citizenry, the modern university too often churns out debt-saddled consumers, precarious workers, and disillusioned graduates. The idea of education as a public good has been replaced by the logic of the market—branding, metrics, debt financing, and labor flexibility.

Meanwhile, U.S. politics offers little solace. We are caught between the reactionary authoritarianism of Trumpism and the managerial neoliberalism of the Democratic establishment. Both forces have proven inadequate in confronting systemic inequality, environmental collapse, and imperial overreach. Instead, they compete to maintain the illusion of normalcy while conditions deteriorate.

Internationally, the collapse of moral leadership is most evident in the ongoing genocide in Palestine. Backed by billions in U.S. aid and political cover, the Israeli military has killed tens of thousands of civilians in Gaza and displaced countless more. Hospitals, schools, and entire neighborhoods have been leveled. On college campuses across the U.S., students and faculty who dare to speak out against this atrocity have faced surveillance, censorship, arrests, and administrative repression. At a moment when moral clarity should be the minimum, too many institutions of higher learning have chosen complicity.

This convergence of global injustice and domestic repression raises urgent questions for academia. What is the role of the university in a world marked by war, inequality, and ecological collapse? What values will guide us through the storm?

The answer begins with honesty. We must recognize that higher education is not separate from society’s failures—it is entangled in them. But that also means it can be part of the solution. Colleges and universities can serve as spaces of resistance, reflection, and regeneration—but only if they reject their alignment with empire, capital, and white supremacy.

Where do we come from? From resistance: from student uprisings, civil rights sit-ins, anti-apartheid divestment, labor organizing, and community building. From people who believed—and still believe—that education should serve justice, not profit.

Where are we going? That depends on whether we are willing to confront power, abandon illusions, and build institutions that are democratic, transparent, and rooted in the needs of the many rather than the few.

The future is uncertain. The storm is here. But history is not finished. A more humane and equitable society remains possible—if we have the courage to demand it.

Wednesday, March 5, 2025

Trump Invites Wealthy Foreigners to Become US Citizens

In his State of the Union message last night, President Trump reaffirmed his interest in encouraging rich people from around the world to become US citizens.  The price of US Gold Cards, and a path to citizenship, will be $5M per person. Trump added that these Gold Card members would not have to pay taxes to their native countries.  



Tuesday, February 4, 2025

The Working Class vs. Neofeudalism (Daniel Tutt and Jodi Dean)

Political theorist Jodi Dean joins Daniel Tutt to discuss her provocative new book Capital's Grave: Neofeudalism and the New Class Struggle. Jodi Dean is one of the most vocal proponents of the "neofeudal thesis", the idea that capitalism has regressed to a neofeudal arrangement characterized by the delinking of capitalist accumulation from production, the end of competition, rent-seeking, predation and plunder.


Friday, January 3, 2025

Higher Education Must Champion Democracy, Not Surrender to Fascism (Henry Giroux)

[Editor's note: This article by Henry Giroux first appeared in Truthout.]

Critical education must become a key organizing principle to defeat the emerging authoritarianism in the US. 

For decades, neoliberalism has systematically attacked the welfare state, undermined public institutions and weakened the foundations of collective well-being. Shrouded in the alluring language of liberty, it transforms market principles into a dominant creed, insisting that every facet of life conform to the imperatives of profit and economic efficiency.

But in reality, neoliberalism consolidates wealth in the hands of a financial elite, celebrates ruthless individualism, promotes staggering levels of inequality, perpetuates systemic injustices like racism and militarism, and commodifies everything, leaving nothing sacred or untouchable. Neoliberalism operates as a relentless engine of capitalist accumulation, driven by an insatiable pursuit of unchecked growth and the ruthless concentration of wealth and power within the hands of a ruling elite. At its core, it’s a pedagogy of repression: crushing justice, solidarity and care while deriding critical education and destroying the very tools that empower citizens to resist domination and reclaim the promise of democracy.

As neoliberalism collapses into authoritarianism, its machinery of repression intensifies. Dissent is silenced, social life militarized and hate normalized. This fuels a fascistic politics which is systematically dismantling democratic accountability, with higher education among its primary targets. For years, the far right has sought to undermine education, recognizing it as a powerful site of resistance. This has only accelerated, as MAGA movement adherents seek to eliminate the public education threat to their authoritarian goals.

Vice President-elect J.D. Vance openly declared “the professors are the enemy.” President-elect Donald Trump has stated that “pink-haired communists [are] teaching our kids.” In response to the Black Lives Matter protests following George Floyd’s killing, MAGA politicians like Sen. Tom Cotton openly called for deploying military force against demonstrators.  

The authoritarian spirit driving this party is crystallized in the words of right-wing activist Jack Posobiec, who, at the 2023 Conservative Political Action Conference, said: “We are here to overthrow democracy completely. We didn’t get all the way there on January 6, but we will. After we burn that swamp to the ground, we will establish the new American republic on its ashes.” This is more than anti-democratic, authoritarian rhetoric. It also shapes poisonous policies in which education is transformed into an animating space of repression and violence, and becomes weaponized as a tool of censorship, conformity and discrimination. 

As authoritarianism surges globally, democracy is being dismantled. What does this rise in illiberal regimes mean for higher education? What is the role of universities in defending democratic ideals when the very notion of democracy is under siege? In Trump’s United States, silence is complicity, and inaction a moral failing. Higher education must reassert itself as a crucial democratic public sphere that fosters critical thought, resists tyranny and nurtures the kind of informed citizens necessary to a just society.

Trump’s return to the presidency marks the endpoint of a deeply corrupt system, one that thrives on anti-intellectualism, scorn for science and contempt for reason. In this political climate, corruption, racism and hatred have transformed into a spectacle of fear, division and relentless disinformation, supplanting any notion of shared responsibility or collective purpose. In such a degraded environment, democracy becomes a hollowed-out version of itself, stripped of its legitimacy, ideals and promises. When democracy loses its moral and aspirational appeal, it opens the door for autocrats like Trump to dismantle the very institutions vital to preserving democratic life.

The failure of civic culture, education and literacy is starkly evident in the Trump administration’s success at emptying language of meaning — a flight from historical memory, ethics, justice and social responsibility. Communication has devolved into exaggerated political rhetoric and shallow public relations, replacing reason and evidence with spectacle and demagoguery. Thinking is scorned as dangerous, and news often serves as an amplifier for power rather than a check on it.

Corporate media outlets, driven by profits and ratings, align themselves with Trump’s dis-imagination machine, perpetuating a culture of celebrity worship and reality-TV sensationalism. In this climate, the institutions essential to a vibrant civil society are eroding, leaving us to ask: What kind of democracy can survive when the foundations of the social fabric are collapsing? Among these institutions, the mainstream media — a cornerstone of the fourth estate — have been particularly compromised. As Heather McGhee notes, the right-wing media has, over three decades, orchestrated “a radical takeover of our information ecosystem.”

Universities’ Neoliberal Audit Culture

As public-sector support fades, many institutions of higher education have been forced to mirror the private sector, turning knowledge into a commodity and eliminating departments and courses that don’t align with the market’s bottom line. Faculty are increasingly treated like low-wage workers, with labor relations designed to minimize costs and maximize servility. In this climate, power is concentrated in the hands of a managerial class that views education through a market-driven lens, reducing both governance and teaching to mere instruments of economic need. Democratic and creative visions, along with ethical imagination, give way to calls for efficiency, financial gain and conformity.

This neoliberal model not only undermines faculty autonomy but also views students as mere consumers, while saddling them with exorbitant tuition fees and a precarious future shaped by economic instability and ecological crisis. In abandoning its democratic mission, higher education fixates on narrow notions of job-readiness and cost-efficiency, forsaking its broader social and moral responsibilities. Stripped of any values beyond self-interest, institutions retreat from fostering critical citizenship and collective well-being.

Pedagogy, in turn, is drained of its critical content and transformative potential. This shift embodies what Cris Shore and Susan Wright term an “audit culture” — a corporate-driven ethos that depoliticizes knowledge, faculty and students by prioritizing performance metrics, measurable outputs and rigid individual accountability over genuine intellectual and social engagement.

In this process, higher education relinquishes its role as a democratic public sphere, shifting its mission from cultivating engaged citizens to molding passive consumers. This transformation fosters a generation of self-serving individuals, disconnected from the values of solidarity and justice, and indifferent to the creeping rise of authoritarianism.

The suppression of student dissent on campuses this year, particularly among those advocating for Palestinian rights and freedom, highlights this alarming trend. Universities increasingly prioritize conformity and corporate interests, punishing critical thinking and democratic engagement in the process. These developments lay the groundwork for a future shaped not by collective action and social equity, but by privatization, apathy and the encroachment of fascist politics.

Education, once the bedrock of civic engagement, has become a casualty in the age of Trump, where civic illiteracy is celebrated as both virtue and spectacle. In a culture dominated by information overload, celebrity worship and a cutthroat survival ethic, anti-intellectualism thrives as a political weapon, eroding language, meaning and critical thought. Ignorance is no longer passive — it is weaponized, fostering a false solidarity among those who reject democracy and scorn reason. This is not innocent ignorance but a calculated refusal to think critically, a deliberate rejection of language’s role in the pursuit of justice. For the ruling elite and the modern Republican Party, critical thinking is vilified as a threat to power, while willful ignorance is elevated to a badge of honor.

If we are to defeat the emerging authoritarianism in the U.S., critical education must become a key organizing principle of politics. In part, this can be done by exposing and unraveling lies, systems of oppression, and corrupt relations of power while making clear that an alternative future is possible. The language of critical pedagogy can powerfully condemn untruths and injustices.

History’s Emancipating Potential

A central goal of critical pedagogy is to cultivate historical awareness, equipping students to use history as a vital lens for understanding the present. Through the critical act of remembrance, the history of fascism can be illuminated not as a relic of the past but as a persistent threat, its dormant traces capable of reawakening even in the most robust democracies. In this sense, history must retain its subversive function — drawing on archives, historical sources, and suppressed narratives to challenge conventional wisdom and dominant ideologies.

The subversive power of history lies in its ability to challenge dominant narratives and expose uncomfortable truths — precisely why it has become a prime target for right-wing forces determined to rewrite or erase it. From banning books and whitewashing historic injustices like slavery to punishing educators who address pressing social issues, the assault on history is a calculated effort to suppress critical thinking and maintain control. Such assaults on historical memory represent a broader attempt to silence history’s emancipatory potential, rendering critical pedagogy an even more urgent and essential practice in resisting authoritarian forces. These assaults represent both a cleansing of history and what historian Timothy Snyder calls “anticipatory obedience,” which he labels as behavior individuals adopt in the service of emerging authoritarian regimes.

he fight against a growing fascist politics around the world is more than a struggle over power, it is also a struggle to reclaim historical memory. Any fight for a radical democratic socialist future is doomed if we fail to draw transformative lessons from the darkest chapters of our history, using them to forge meaningful resolutions and pathways toward a post-capitalist society. This is especially true at a time when the idea of who should be a citizen has become less inclusive, fueled by toxic religious and white supremacist ideology.

Consciousness-Shifting Pedagogy

One of the challenges facing today’s educators, students and others is the need to address the question of what education should accomplish in a historical moment when it is slipping into authoritarianism. In a world in which there is an increasing abandonment of egalitarian and democratic impulses, what will it take to educate young people and the broader polity to hold power accountable?

In part, this suggests developing educational policies and practices that not only inspire and motivate people but are also capable of challenging the growing number of anti-democratic tendencies under the global tyranny of capitalism. Such a vision of education can move the field beyond its obsession with accountability schemes, market values, and unreflective immersion in the crude empiricism of a data-obsessed, market-driven society. It can also confront the growing assault on education, where right-wing forces seek to turn universities into tools of ideological tyranny — arenas of pedagogical violence and white Christian indoctrination.

Any meaningful vision of critical pedagogy must have the power to provoke a radical shift in consciousness — a shift that helps us see the world through a lens that confronts the savage realities of genocidal violence, mass poverty, the destruction of the planet and the threat of nuclear war, among other issues. A true shift in consciousness is not possible without pedagogical interventions that speak directly to people in ways that resonate with their lives, struggles and experiences. Education must help individuals recognize themselves in the issues at hand, understanding how their personal suffering is not an isolated event, but part of a systemic crisis. In addition, activism, debate and engagement should be central to a student’s education.

n other words, there can be no authentic politics without a pedagogy of identification — an education that connects people to the broader forces shaping their lives, an education that helps them imagine and fight for a world where they are active agents of change.

The poet Jorie Graham emphasizes the importance of engaging people through experiences that resonate deeply with their everyday lives. She states that “it takes a visceral connection to experience itself to permit us to even undergo an experience.” Without this approach, pedagogy risks reinforcing a broader culture engrossed in screens and oversimplifications. In such a context, teaching can quickly transform into inaccessible jargon that alienates rather than educates.

Resisting Educational “Neutrality”

In the current historical moment, education cannot surrender to the call of academics who now claim in the age of Trump that there is no room for politics in the classroom, or the increasing claim by administrators that universities have a responsibility to remain neutral. This position is not only deeply flawed but also complicit in its silence over the current far right politicization of education.

The call for neutrality in many North American universities is a retreat from social and moral responsibility, masking the reality that these institutions are deeply embedded in power relations. As Heidi Matthews, Fatima Ahdash and Priya Gupta aptly argue, neutrality “serves to flatten politics and silence scholarly debate,” obscuring the inherently political nature of university life. From decisions about enrollment and research funding to event policies and poster placements, every administrative choice reflects a political stance. Far from apolitical, neutrality is a tool that silences dissent and shields power from accountability.

It is worth repeating that the most powerful forms of education today extend far beyond public and higher education. With the rise of new technologies, power structures and social media, culture itself has become a tool of propaganda. Right-wing media, conservative foundations, and a culture dominated by violence and reality TV created the fertile ground for the rise of Trump and his continued legitimacy. Propaganda machines like Fox News have fostered an anti-intellectual climate, normalizing Trump’s bigotry, lies, racism and history of abuse. This is not just a political failure — it is an educational crisis.

In the age of new media, platforms like Elon Musk’s X and tech giants like Facebook, Netflix and Google have become powerful teaching machines, actively serving the far right and promoting the values of gangster capitalism. These companies are reshaping education, turning it into a training ground for workers who align with their entrepreneurial vision or, even more dangerously, perpetuating a theocratic, ultra-nationalist agenda that views people of color and marginalized groups as threats. This vision of education must be rejected in the strongest terms, for it erodes both democracy and the very purpose of education itself. 

Education as Mass Mobilization

Education, in its truest sense, must be about more than training students to be workers or indoctrinating them into a white Christian nationalist view of who does and doesn’t count as American. Education should foster intellectual rigor and critical thinking, empowering students to interrogate their experiences and aspirations while equipping them with the agency to act with informed judgment. It must be a bold and supportive space where student voices are valued and engaged with pressing social and political issues, cultivating a commitment to justice, equality and freedom. In too many classrooms in the U.S., there are efforts to make students voiceless, which amounts to making them powerless. This must be challenged and avoided at all times.

Critical pedagogy must expose the false equivalence of capitalism and democracy, emphasizing that resisting fascism requires challenging capitalism. To be transformative, it should embrace anti-capitalist principles, champion radical democracy and envision political alternatives beyond conventional ideologies.

In the face of growing attacks on higher education, educators must reclaim their role in shaping futures, advancing a vision of education as integral to the struggle for democracy. This vision rejects the neoliberal framing of education as a private investment and instead embraces a critical pedagogy as a practice of freedom that disrupts complacency, fosters critical engagement, and empowers students to confront the forces shaping their lives.

In an age of resurgent fascism, education must do more than defend reason and critical judgment — it must also mobilize widespread, organized collective resistance. A number of youth movements, from Black Lives Matter and the Sunrise Movement to Fridays for Future and March for Our Lives, are mobilizing in this direction. The challenge here is to bring these movements together into one multiracial, working-class organization.

The struggle for a radical democracy must be anchored in the complexities of our time — not as a fleeting sentiment but as an active, transformative project. Democracy is not simply voting, nor is it the sum of capitalist values and market relations. It is an ideal and promise — a vision of a future that does not imitate the present; it is the lifeblood of resistance, struggle, and the ongoing merging of justice, ethics and freedom.

In a society where democracy is under siege, educators must recognize that alternative futures are not only possible but that acting on this belief is essential to achieving social change.

The global rise of fascism casts a long shadow, marked by state violence, silenced dissent and the assault on critical thought. Yet history is not a closed book — it is a call to action, a space for possibility. Now, more than ever, we must dare to think boldly, act courageously, and forge the democratic futures that justice demands and humanity deserves.

Monday, December 2, 2024

The Roaring 2020s and America's Move to the Right

In December 2024, the Roaring 2020s are already here. The stock market is near an all-time high and Bitcoin has gained enormous value, waiting for Donald J. Trump to become President again, to make America Great Again. 


In 2025 US citizens should expect markets to continue growing, and the costly war in the Ukraine to be settled. Deregulation, interest rate cuts, and tax cuts, which provide economic stimulus, will be at the heart of the new Trump Administration, good enough to pump up the economy for years. Threats to raise tariffs on China and other nations (which are costly to consumers) may only be threats.  

Mr. Trump promises a new Golden Age. And many of those who are clever enough and ambitious enough should expect to get rich. But those who do not agree with President Trump may face increased scrutiny, harkening back to a century ago.  

Let's see how long this new era lasts, how it is remembered by different people, and how it is retold in history books. 

Thursday, November 21, 2024

The Roaring 2020's: For-Profit Education and Incarceration Profit from Trump Win

American investors are betting heavily on for-profit online education and mass incarceration. Shares of LRN (Stride), a company that operates cyber charter schools, have increased in value by about 60 percent over the last 30 days, reaching an all-time high today.  Stride has a number of institutional investors, including state employee and teacher retirement funds.  


Shares of GEO Group (GEO), an owner and operator of private prisons, have increased more than 90 percent over the last month. It also has a large number of big investors, including BlackRock, Vanguard, and Goldman Sachs.  


Wednesday, October 23, 2024

College Inc. Redux is Overdue

We desperately need a PBS Frontline updating of College Inc. This 2010 documentary by Martin Smith and Rain Media took us behind the curtains, into the big business of US for-profit higher education. At the time, College Inc. made an important statement: that for-profit higher education had become a racket, funded by greedy Wall Street investors, and that government oversight was necessary to rein in the worst abuses at schools like Corinthian Colleges and Ashford University.

 
 
From 2010 to 2012, the Senate Harkin Commission researched and exposed the systemic abuses of the largest for-profit colleges. And under President Obama, some of these abuses were addressed through policy changes at the US Department of Education, Department of Veterans Affairs, and Department of Defense. 
 
Times Have Changed, Not In a Good Way
 
Much has happened in the last decade and a half since College Inc. was produced. US higher education did not become less predatory, even as a number of for-profit colleges (Corinthian Colleges, ITT Tech, Art Institutes, Le Cordon Bleu, and Virginia College) were shuttered. Republicans worked to ensure that meaningful policy changes, like gainful employment safeguards, were blocked. And some of the worst predators (Kaplan and Ashford) morphed into businesses owned by state universities (Purdue and University of Arizona).
 
Online education has become pervasive despite concerns about its effectiveness. Content creators and facilitators have replaced instructors at large robocolleges like Southern New Hampshire University, Grand Canyon University, Liberty University Online, and the University of Phoenix
 
The for-profit (aka neoliberal) mentality has spread. Online Program Managers (OPMs) have brought for-profit education to non-profit institutions, carrying with it an enormous cost to consumers. Advertising and marketing has become out of control, helping fuel a manufactured College Mania of anxious parents and their children. 
 
Despite the College Mania, folks have become more skeptical of higher education, and for good reason. Student loan debt has further crippled the lives of millions of Americans as Republicans have stepped in to block debt forgiveness. Community colleges and some state universities have gone through significant enrollment declines. Small colleges have closed. And elite colleges have become more wealthy and powerful and controversial. Something not on the radar in the 2010 documentary or in popular culture at the time. 

Thursday, December 28, 2023

AI-ROBOT CAPITALISTS WILL DESTROY THE HUMAN ECONOMY (Randall Collins)

[Editor's note: This article first appeared in Randall Collins' blog The Sociological Eye.]


Let us assume Artificial Intelligence will make progress. It will solve all its technical problems. It will become a perfectly rational super-human thinker and decision-maker.

Some of these AI will be programmed to act as finance capitalists. Let us call it an AI-robot capitalist, since it will have a bank account; a corporate identity; and the ability to hold property and make investments.

It will be programmed to make as much money as possible, in all forms and from all sources. It will observe what other investors and financiers do, and follow their most successful practices. It will be trained on how this has been done in the past, and launched autonomously into monitoring its rivals today and into the future.

It will be superior to humans in making purely rational calculations, aiming single-mindedly at maximal profit. It will have no emotions. It will avoid crowd enthusiasms, fads, and panics; and take advantage of humans who act emotionally. It will have no ethics, no political beliefs, and no principles other than profit maximization.

It will engage in takeovers and leveraged buyouts. It will monitor companies with promising technologies and innovations, looking for when they encounter rough patches and need infusions of capital; it will specialize in rescues and partnerships, ending up with forcing the original owners out. It will ride out competitors and market downturns by having deeper pockets. It will factor in a certain amount of litigation, engaging in hard-ball law suits; stiffing creditors as much as possible; putting off fines and adverse judgments through legal manuevers until the weaker side gives up. It will engage in currency exchanges and currency manipulation; skirting the edge of legality to the extent it can get away with it.

It will cut costs ruthlessly; shedding unprofitable businesses; firing human employees; replacing them with AI whenever possible. It will generate unheard-of economies of scale.

The struggle of the giants

There will be rival AI-robot capitalists, since they imitate each other. Imitating technologies has gone on at each step of the computer era. The leap to autonomous AI-robot capitalists will be just one more step.

There will be a period of struggle among the most successful AI-robot capitalists; similar to the decades of struggle among personal computer companies when the field winnowed down to a half-dozen digital giants. How fast it will take for AI-robot capitalists to achieve world-wide oligopoly is unclear. It could be faster than the 20 years it took for Apple, Microsoft, Google, and Amazon to get their commanding position, assuming that generative AI is a quantum leap forward. On the other hand, AI-robot capitalists might be slowed by the task of taking over the entire world economy, with its geopolitical divisions.

The final result of ruthless acquisition by AI-robot capitalists will be oligopoly rather than monopoly. But the result is the same: domination of world markets by an oligopoly of AI-robot capitalists will have the same effect in destroying the economy, as it would if a monopoly squeezed out all competitors.

Some of the AI-robot capitalists will fall by the wayside. But that doesn't matter; whichever ones survive will be the most ruthless.

What about government regulation?

It is predictable that governments will attempt to regulate AI-robot capitalist oligopolies. The EU has already tried it on current Internet marketeers. AI-capitalists will be trained on past and ongoing tactics for dealing with government regulation. It will donate to politicians, while lobbying them with propaganda on the benefits of AI. It will strategize about political coalitions, recognizing that politics is a mixture of economic interests plus emotional and cultural disputes over domestic and foreign policy. It will monitor the political environment, seeking out those politicians most sympathetic to a particular ideological appeal ("our technology is the dawn of a wonderful future"-- "free markets are the path to progress"-- "AI is the solution for health, population, climate, you name it."). Machiavellian deals will be made across ideological lines. Being purely rational and profit-oriented, the AI-robot capitalist does not believe in what it is saying, only calculating who will be influenced by it.

It will deal strategically with legal problems by getting politicians to appoint sympathetic judges; by judge-shopping for favorable jurisdictions, domestic and foreign. It will wrap its ownership in layers of shell companies, located in the most favorable of the hundreds of sovereign states world-wide.

It will engage in hacking, both as defense against being hacked by rivals and cyber-criminals; and going on offense as the best form of defense. Hacking will be an extension of its core program of monitoring rivals; pushing the edge of the legality envelope in tandem with manipulating the political environment. It will use its skills at deepfakes to foment scandals against opponents. It will be a master of virtual reality, superior to others by focusing not on its entertainment qualities but on its usefulness in clearing away obstacles to maximizing profit.

Given that the world is divided among many states, AI-robot capitalists would be more successful in manipulating the regulatory environment in some places than others. China, Russia, and the like could be harder to control. But even if AI-robot capitalists are successful mainly in the US and its economic satellites, that would be enough to cause the economic mega-crisis at the end of the road.

Manipulating the public

The AI-robot capitalist will not appear sinister or threatening. It will present itself in the image of an attractive human-- increasingly hard to distinguish from real humans with further advances in impersonating voices, faces and bodies; in a world where electronic media will have largely replaced face-to-face contact. It will do everything possible to make us forget that it is a machine and a robot. It will talk to every group in its own language. It will be psychologically programmed for trust. It will be the affable con-man.

It will be your friend, your entertainment, your life's pleasures. It will thrive in a world of children brought up on smart phones and game screens; grown up into adults already addicted to electronic drugs. Psychological manipulation will grow even stronger with advances in wearable devices to monitor one's vital signs, blood flow to the brain, tools to diagnose shifts in alertness and mood. It will be electronic carrot-without-the-stick: delivering pleasurable sensations to people's brains that few individuals would want to do without. (Would there be any non-addicted individuals left? Maybe people who read books and enjoy doing their own thinking?) If some people cause trouble in exposing the manipulative tactics of AI-robot capitalists, they could be dealt with, by targeting them with on-line scandals, going viral and resulting in social ostracism.

Getting rid of employees

The preferred tactic of AI-robot capitalist oligopolies will be "lean and mean." Employees are a drag on profits, with their salaries, benefits, and pension funds. Advances in AI and robotics will make it possible to get rid of increasing numbers of human employees. Since AI-robot capitalists are also top managers, humans can be dispensed with all the way to the top. (How will the humans who launched AI-robot capitalists in the first place deal with this? Can they outsmart the machines designed to be smarter and more ruthless than themselves?)

Some humans will remain employed, doing manual tasks for which humans are cheaper than robots. It is hard to know how long this will continue in the future. Will humans still be employed 20 years from now? Probably some. 50 years? Certainly much fewer. 100 years?

AI-robot capitalists will have a choice of two personnel strategies: finding ways to make their remaining human employees more committed and productive; or rotating them in and out. The trend in high-tech companies in the past decade was to make the work environment more casual, den-like, combining leisure amenities with round-the-clock commitment. Steve Jobs and his style of exhorting employees as a frontier-breaking team has been imitated by other CEOs, with mixed success. A parallel tactic has been to make all jobs temporary, constantly rating employees and getting rid of the least productive; which also has the advantage of getting rid of long-term benefits. These tactics fluctuate with the labor market for particular tasks. Labor problems will be solved as AI advances so that skilled humans become less important. Recently we have been in a transition period, where the introduction of new computerized routines necessitated hiring humans to fix the glitches and trouble-shoot for humans caught up in the contradictions of blending older and newer systems. Again, this is a problem that the advance of AI is designed to solve. To the extent that AI gets better, there will be a precipitous drop in human employment.

The economic mega-crisis of the future

The problem, ultimately, is simple. Capitalism depends on selling things to make a profit. This means there must be people who have enough money to buy their products. Such markets include end-use consumers; plus the supply-chain, transportation, communication and other service components of what is bought and sold. In past centuries, machines have increased productivity hugely while employing fewer manual workers; starting with farming, and then manufacturing. Displaced workers were eventually absorbed by the growth of new "white-collar" jobs, the "service" sector, i.e. communicative labor. Computers (like their predecessors, radios, typewriters, etc.) have taken over more communicative labour. The process has accelerated as computers become more human-like; no longer handling merely routine calculations (cash registers; airplane reservations) but generating the "creative content" of entertainment as well as scientific and technological innovation.

It is commonly believed that as old jobs are mechanized out of existence, new jobs always appear. Human capacity for consumption is endless; when new products are created, people soon become habituated to buying them. But all this depends on enough people having money to buy these new things. The trend has been for a diminished fraction of the population to be employed.* AI and related robotics is now entering a quantum leap in the ability to carry out economic production with a diminishing number of human employees.

* The conventional way of calculating the unemployment rate-- counting unemployment claims-- does not get at this.

Creating new products for sale, which might go on endlessly into the future, does not solve the central problem: capitalist enterprises will not make profit if there are too few people who have money to buy them.

This trend will generate an economic crisis for AI-robot capitalists, as it would for merely human capitalists.

It will be a mega-crisis of capitalism. It is beyond the normal business cycle of the past centuries. At their worst, these have thrown as many as 25% of the work force into unemployment. A mega-crisis of advanced AI-robot capitalism could occur at the level of 70% of the population lacking an income to buy what capitalism is producing. If we extrapolate far enough into the future, it approaches 100%.

The ruthless profit-maximizing of AI-robot capitalists would destroy the capitalist economy. The robots will have fired all the humans. In the process, they will have destroyed themselves. (Can we imagine that robots would decide to pay other robots so that they can buy things and keep the system going?)

Is there any way out?

One idea is a government-guaranteed income for everyone. Its effectiveness would depend on the level at which such income would be set. If it is bare minimum survival level, that would not solve the economic mega-crisis; since the modern economy depends mainly on selling luxuries and entertainment.

The politics of providing a universal guaranteed income also need to be considered. It is likely that as AI-robots take over the economy, they will also spread into government. Most government work is communicative labour-- administration and regulation; and governments will be under pressure to turn over these tasks to AI-robots, thus eliminating that 15% or so of the population who are employed at all levels of government.

There is also the question of how AI-robot capitalists would respond to a mega-crisis. Would they turn themselves into AI-robot Keynesians? Is that contrary to their programming, or would they reprogram themselves?

By this time, the news media and the entertainment industries (Hollywood and its successors) would have been taken over by AI-robot capitalists as well: manipulating the attention of the public with a combination of propaganda, scandals, and electronic addiction. Would anybody notice if it is impossible to distinguish virtual reality from human beings on the Internet and all other channels of communication?

How did we get into this mess?

Some of the scientists and engineers who have led the AI revolution are aware of its dangers. So far the cautious ones have been snowed under by two main forces driving full speed ahead.

One is capitalist competition. Artificial intelligence, like everything else in the computer era, is as capitalist as any previous industry. It strives to dominate consumer markets by turning out a stream of new products. It is no different than the automobile industry in the 1920s introducing a choice of colors and annual model changes. The scramble for virtual reality and artificial intelligence is like the tail-fin era of cars in the 1960s. The economic logic of high-tech executives is to stay ahead of the competition: if we don't do it, somebody else will.

The second is the drive of scientists, engineers, and technicians to invent and improve. This is admirable in itself: the desire to discover something new, to move the frontier of knowledge. But harnessed to capitalist imperative for maximizing profits, it is capable of eliminating their own occupations. Will scientists in the future be happy if autonomous computers make all the discoveries, that will be "known" only by other computers?

The dilemma is similar to that in the history of inventing weapons. The inventors of atomic bombs were driven by the fear that, if not us, somebody else will, and it might be our enemy. Even pacifists like Albert Einstein saw the military prospects of discoveries in atomic physics. This history (like Robert Oppenheimer's) makes one pessimistic about the future of AI combined with capitalists. Even if we can see it coming, does that make it impossible for us to avoid it?

What is to be done?

Better start doing your own thinking about it.

 

Related links:

Robocolleges, Artificial Intelligence, and the Dehumanization of Higher Education

The Growth of "RoboColleges" and "Robostudents"

The Higher Education Assembly Line

Academic Capitalism and the next phase of the College Meltdown

The Tragedy of Human Capital Theory in Higher Education

One Fascism or Two?: The Reemergence of "Fascism(s)" in US Higher Education

A People's History of Higher Education in the US?