Ludwig von Mises called the universities of his day “nurseries of socialism” because of the inevitable socialist bias of all government-funded universities. He also said that there is always a remnant of students, however, that does not buy into the endless drumbeat about the alleged wonders of socialism and the “imperfections” of free-market capitalism. It is this remnant that the Mises Institute devotes so much effort to educating and inspiring in the Misesian/Rothbardian tradition.
The vast majority of today’s American universities have become incubators of socialism to a far greater extent than anything Mises experienced. They have produced generations of students who are well versed in all the left-wing platitudes about just about everything even if they lack the most elementary critical thinking skills. (So-called “critical theory,” invented by Marxist law professors, is not about critical thinking but criticizing the critics of socialism and all the institutions of Western civilization). The unique incentive systems in American universities have made this possible.
Almost all universities are either government funded state universities, or private nonprofit sector universities that receive significant amounts of government subsidies, making them de facto state universities. (Remember: He who takes the king’s shilling becomes the king’s man). As such, they have no real customers in a business sense. Students do not think of themselves as customers in the sense that they are customers of say, Starbucks or a pizza joint. They rarely pay the tuition bills for one thing; mom and dad or the taxpayers do, or the banks that extend to them student loans. Parents may pay the tuition bills but it is the children who receive the primary benefits of higher education, if such benefits even exist. Thus, consumer pressure that leads to consumer sovereignty is very weak.
There are no stockholders in government or private, nonprofit universities, so neither is there stockholder pressure as with private competitive businesses. On top of that there is supercharged rational ignorance. When we acquire information during the course of our lives it is mostly to get through school, get and keep a job, raise a family, buy houses and cars, etc. Private affairs. We spend relatively little informing ourselves about government policy. Besides, government at all levels is so gargantuan that no human mind could possibly comprehend a tiny fraction of one percent of what governments do. We are rationally ignorant of it for the most part. Universities are the same way, but in addition, many people are intimidated by people with Ph.D. degrees in the same sense they are somewhat worshipful and intimidated by medical doctors. So they don’t question them very often. Rational ignorance is supercharged when it comes to universities and doctors.
The boards of directors of universities are primarily composed of yes men and women who rubber stamp the decisions of the administrators for the most part. To oppose them might jeopardize the main reasons they are on the board of trustees in the first place: to improve their social lives, local reputations, and business connections. University boards were easily intimidated into acquiescing in the latest synonym for socialism, “diversity, equity, and inclusion,” with its threats of calling critics racists or sexists.
At some universities the university president can fire board members rather than the other way around. When yours truly first arrived at Loyola University Maryland in the early 90s a senior faculty member recalled how Loyola alumnus Tom Clancey, the famous author, was not invited back to the board after he complained too much that the son of a mail man like himself could no longer afford the tuition.
So-called peer-reviewed research is not all that it is made out to be. So much university research is government funded, that “peer reviewers” are often very careful not to allow the publication of much literature (if any) that criticizes the state. Try having a career as an environmental scientist who criticizes the EPA, or as an agricultural economist who criticizes the massive interventionism of the Department of Agriculture. Even modern physics is almost entirely devoted to military applications. Economist Larry White published a research article that revealed that almost three fourths of all peer reviewed articles in monetary economics were authored by economists with some connection to the Fed. As Milton Friedman once said, if one wants a career as a monetary economist, it is best not to criticize the major employer in your field.
Let’s not forget also that the Italian communist Antonio Gramsci’s theory about “the long march through the institutions” to turn a country communist was first spread in universities, and is still metastasizing there. The extreme left-wing bias among university faculty is proof, moreover, that most faculties are enemies of academic freedom despite all their false claims otherwise.
Because of the near absence of customer and stockholder pressures – or even elections as with government – university administrators often behave like dictatorial tyrants who answer to no one. This causes younger conservative or libertarian faculty members to cower in fear that the university administrators might discover that they have politically unacceptable ideas like respect for property rights, the rule of law, or God forbid, free enterprise.
University faculties are mostly paid like government bureaucrats with rigid pay scales that go by seniority rather than merit. Faculty committees are typically controlled by the least scholarly faculty members due to the fact that to the more productive scholars the opportunity cost of spending endless hours sitting in unproductive committee meetings is too high. It’s the low opportunity cost faculty who make university policy by committee.
Ever since the American economy moved from being dominated by sole proprietorships to corporations the Left has complained about the separation of ownership from control. In corporations the stockholders are the owners and management is composed of their agents who are entrusted to earn profits for them. Who, but the taxpayers, are the “owners” of a state-funded university? And what control do they have over what goes on?
Universities are incubators of socialism because they are themselves socialist institutions funded by taxpayers with Rube Goldberg style incentive systems.
This article is adapted from a talk delivered at Educating for Liberty: Mises Circle in Tampa.
