The capitalist university: Built on admissions scandals

Apr 23, 2019

On March 12, 2019, the public learned that several prominent U.S. universities had admitted at least 50 students based solely on bribes made by their parents. A seven-year investigation by the FBI nicknamed “Operation Varsity Blues” concluded that well-respected institutions such as Yale, Harvard, Stanford, and the University of Southern California all participated in fraudulent admissions actives. More than a dozen administrators and coaches have since been fired and indicted, while high-profile parents such as Lori Loughlin, Felicity Huffman, and Jane Buckingham face indictments and other legal actions (1).

The blatant illegality of the scandal is shocking. Yet the crimes also speak to the larger and systemic issues of inequality and exclusion that lie at the base of higher education in the United States, which has always favored the wealthy and elite. The U.S.’s post-secondary institutions are riddled with corruption, racism, and practices that benefit the super-rich and the ruling class. Like so many institutions in the U.S., higher education has a long and complex history of serving the interests of the rich. At the same time, a history of curricular and pedagogical subversion and resistance that accompanied the expansion of the university system.

Many of the first colleges founded in the U.S. in the 16th & 17th centuries evolved into today’s Ivy League schools, like Harvard, Yale, and Princeton. Originally created as monastery schools, they soon grew to include programs in law and medicine after the American Revolution. These institutions were of course limited to wealthy, white men for centuries. Although women attended “normal schools,” a type of university focused on preparing teachers, it wasn’t until the early 1900s that women’s institutions were founded and wealthy white women were allowed to earn degrees. High tuition and donors funded these schools as state universities and colleges were extremely few and far between.

This only started to change after the passage of the Morrill Land-Grant Acts of 1862 and 1890, which allowed for the creation of state colleges using proceeds of federal land sales (2). This expansion of higher education coincided with the emergence of the machine factory around the early to mid-19th century. What the machine factory era refers to is the replacement of human power with coal, steam, and electric power, and the transference of human intelligence and skill to machines. That is, with the machine factory, fully grown adults with the strength and knowledge of how to wield tools were no longer needed. Now children and unskilled adults, men and women, could be employed as minders of the machines. Consequently, the pool of potential labor-power more than tripled, leading to the dramatic expansion of production. At the same time, this revolution in production increased capital’s demand for highly skilled workers such as engineers, managers, accountants, architects, chemists, and so on. Many universities were founded to respond to this demand.

In the mid-late 19th century, Black churches and Freedman Bureaus established what we know of today as Historically Black Colleges and Universities. Land grants were another source of funding for HBCUs. While most HBCUs were created after the Civil War in the South, a few were created before. Cheyney University, for example, was founded in 1837 in Pennsylvania as a result of a $10,000 donation by a wealthy Quaker, Richard Humphreys. Cheyney was established as a teacher college to train people of African descent for teaching. The first of the Morrill Acts became law after the secession of the Southern States. After the Civil War when the Confederate states were readmitted to the U.S., they were permitted to establish Land Grant universities but were required to be integrated. If integration was not permitted, then separate HBCUs would have to be created. Consequently, the deeply racist power structure in the South preferred to take on the additional expenses of establishing completely separate institutions rather than integrate. The teacher education component of HBCUs were extremely important in the post-Civil War era, since mandatory laws during slavery had kept roughly 95% of African Americans illiterate.

After World War II, state universities and colleges expanded again to meet capital’s growing need for highly educated workers. It is also important to note that higher education opportunities for people of color continued to be limited despite the establishment of a handful of HBCUs, many of which, such as Howard University, are among the most respected universities in the country. While many of these institutions were founded in the latter half of the 19th century, it wasn’t until the mid 20th century that higher education became integrated as a result of the Civil Rights movement (3). In addition to the pressure of the Civil Rights movement, the U.S. capitalist-class political establishment desired the end of racial apartheid and overt racial persecution in the U.S. because it was a bad public relations image in the global competition with communism and its record of anti-racism. In is no wonder that after the U.S. Supreme Court delivered its famous Brown v. Board of Education ruling in 1956, which declared segregated schools to be unconstitutional, newspapers across the country celebrated it as a major blow to communism.

Much more could be written about this history, but it is clear that higher education in the United States was founded upon exclusivity and privilege. This is the primary reason why higher education continues to be elitist, favoring and benefiting those who already have the most. This applies to everything from the way in which a student is accepted to a school, to how their education is paid, as well as those who run institutions, particularly as they apply to the newer beast that is the for-profit school model, which we’ll return to later.

A system built on admissions scandals

There are three ways students are accepted into universities. The first is the “front door,” where merit and prior achievement justify admittance. This sounds innocent enough, but this again speaks to a long history that has always placed wealthy white men in a position of immense privilege. Even with affirmative action policies on the books, white people still have a greater chance of attending a good primary and secondary school (4), therefore allowing them to statistically attain better grades and extra-curricular experience. The ability to successfully attend an elite university also increases if one’s parents can afford to send their child to private primary and secondary schools, which are predominantly white (5).

Furthermore, if a marginalized working-class student works hard enough to make their way into an elite institute, they continue to be marginalized there. Students who don’t come from a wealthy background are often ostracized or at least have a difficult time navigating a place built and populated by the elite. Many Ivy League schools have built-in cultural exclusion due to their histories. This may include the inability to buy tickets to school functions and participate in extra-curriculars or travel abroad, or struggling to find food during school breaks when the campus dining halls close and wealthy students are able to travel (6).

The second path for one to enter higher education is often called the “back door,” which is only open to those with incredible wealth. This door is technically not an illegal entryway, and it opens as students are given extra admissions ‘points’ if their parents make large donations or happen to be respected alums. This is how C student George W. Bush (7) was able to attend his father’s alma-matters Yale and Harvard, and what allowed Jared Kushner to also attend Harvard after his father donated a sizable sum to the university (8). These are somehow seen as respectable ways in which the rich and powerful are granted an elite education.

Door number three is not often discussed, but is at the root of the current admissions scandal. This is referred to as the “side door” and consists of bribery and other shady dealings and nepotistic practices. Such criminal behaviors are nothing new and have likely been taking place for decades if not the entire history of higher education in the United States (9). As capitalism and the profit motive have continued to drive the success of these institutions, they have to conduct themselves like capitalist enterprises. University of Southern California student Kameron Hurt said, “The bribery and inappropriate student-trustee connections are further proof that this school is more a corporation than a university.”

The commodification of “public” higher education

No matter the door one uses to enter a post-secondary school, there is always the matter of payment. The U.S. has held the top place for most expensive average tuition for quite some time, currently averaging between $8-$9 thousand per year (10). While a state resident may only pay $10,000 for a four-year degree at a state school, the average private school runs over triple that amount at $35,000 (11). Both continue to grow much faster than the cost of living and minimum wage. According to the U.S. Bureau of Labor Statistics, prices for college tuition and fees were 1,332.8% higher in 2019 than in 1978. That’s an annual increase of 6.7% compared to the average annual inflation rate of 3.4% in the same period of time (12).

Large tuition hikes at private institutions are commonplace. It was announced during the Spring 2019 semester that tuition at California Institute of the Arts (CalArts) would be raised the next school year from $46,830 to $50,850 (13). Just 15 prior, the cost was roughly $24,000 (14). This is not unusual and the price of tuition at many elite private institutions has more than doubled since the turn of the century. Meanwhile, instructor salaries have not seen the same dramatic hikes as school administrators claim that they have to keep up with ‘operational costs’ and ‘be competitive with similar private schools.’ High tuition at these high-profile schools can only result in the narrowing of diversity as the cost becomes less attainable to people of color and working-class folks in general.

Student activists at CalArts have been organizing with a new group called “CalArts Without,” which aims to draw awareness that the student body at the institute needs to remain diverse and therefore as affordable as possible. One anonymous student activist noted, “CalArts’ rising cost of tuition is a threat to the values of our institution, namely, socio-economic diversity and accessibility. We believe that being an artist is not just about the art we make. It’s about how we vote, how treat each other and how we stand up for what we believe in. We are organizing and speak up to protect our friends and colleagues from nearly 50 countries around the world, many of whom give a voice and a face to marginalized communities.”

Taiwanese animation student Cindy Yang added, “It’s sad to see the tuition raising every year. It seems like it’s never going to stop. As an international student, I can’t really start working until I get my degree – so I’m stuck in the four-year payment agreement. The tuition hike will kill our diversity. If tuition keeps going up, CalArts is going to receive more students from similar backgrounds, and in that case, it’s going to effect where the animation industry will be proceeding in the future. Education shouldn’t be the privilege of the rich.”

Yang rightly points out that ever-increasing tuition doesn’t impact the wealthy whatsoever. No matter how the children of the super rich make their way into a college or university, ethical or not, one fact always remains: they can easily pay for it. They graduate without a massive amount of debt and are able to carry on post-graduation without financial burdens, quite likely also aided by some type of substantial cash flow from their parents as they navigate their careers. Meanwhile, the vast majority of working-class graduates continue to add to the already out-of-control amount of student debt in the United States. This debt follows many working people around for the majority of their lives and cannot be erased, even in the case of declaring bankruptcy (15).

The for-profit college scandal

It’s surely a crime for the super rich to bribe their child’s way into higher education, but the financial cost of higher education should also be a crime.

It is worth pointing out that even all is said and done, most of the alleged criminals will likely merely have to pay more money in fines and penalties. At most, they may face jail time of less than a year. For example, Felicity Huffman simply posted a $250 thousand signature bond after being taken into custody by the FBI, a mere drop in the bucket for someone like her (16). Prosecutors are aiming to send her to prison for 12-18 months, but the sentencing remains to be seen as of this writing as none of the parents responsible have yet to even go to trail (17).

Less than a week prior that this admissions scandal was flooding the headlines of every major news outlet, an even greater catastrophe was playing out across the country as it was announced that Argosy University, a for-profit higher education chain would be closing the doors of 22 campuses across the nation. While the criminal activity of this high-profile Ivy League debacle may have affected up to 100 prospective students, this massive closure immediately changed the lives of tens of thousands of students, along with hundreds of faculty and staff who worked at these schools (18).

Unlike well-established state and private institutions, these newer for-profit schools don’t shy away from the fact that they are simply another business working within the capitalist system, doing whatever they can to increase their profit margin. Argosy University was a subsidiary of the giant for-profit holding company Education Management Corporation (EDMC), which once boasted over one hundred campuses across the country, which included the Brown Mackie technology and heath colleges and the Art Institute art colleges (19). Though EDMC claimed its number one priority was education, it is clear that those at the top were only concerned about what any capitalist is focused upon – profit.

Executives at EDMC made the decision to vastly expand its number of campuses between 2000-2010. It took on piles of money during the recession as many unemployed made their way back to school to learn a new trade, a standard side effect of an economic down period under capitalism (20). These schools had virtually no acceptance standards, taking advantage of students who had little to no other options for higher education, many of which weren’t prepared or even suited for college. Thousands of students would spend a year or less at these schools, as retention rates were almost always chronically fewer than 50%. Most of these dropouts went into debt less than $20 thousand, but that’s not an amount to scoff at from the perspective of a working class family. These thousands of dollars also really added up for those at the top at EDMC.

By 2010, the company had accumulated more than $400 million in reserves. Instead of re-investing this money in their campuses, those at the top began buying back its own stock, taking a giant cash out of $250 million and began announcing the first of what would continue to be years of layoffs and campus closures. This also came after a slew of lawsuits against EDMC’s illegal recruitment tactics. The company had not only preyed on the poorest and most disadvantaged, but admissions officers at certain campuses had been directed to aggressively give them false promises of gainful employment (21).

EDMC eventually went belly-up and sold its remaining Argosy University campuses, which included the Art Institutes in 2015 to the so-called non-profit Dream Center (22). By this time, those who ran the company had jumped ship and made out like bandits. For example, former Maine governor John McKernan, who was CEO from 2003-2007, reportedly walked away with $14 million. It should also be noted that McKernan also ran a non-profit arm of EDMC with his wife U.S. Senator Olympia Snowe. This other so-called charitable non-profit was set up as a scholarship provider for EDMC’s students, but how they distributed those donated funds were questionable to say the least (23).

A former instructor at one of the campuses who wished to remain anonymous wasn’t surprised by the revelations that recently came to light. “Something was amiss at the top of this corporate school, which is probably an oxymoron. There was some radical dishonesty and corruptness at this place at the top corporate levels. The whole mess that culminated in a brutal closing of a school before the end of a term feels like corruption and lies played a huge part in what transpired.”

The Dream Center only made matters worse, running the campuses into the ground even further. Amid financial troubles, Dream Center Education Holdings (DCEH – Dream Center’s education arm) went into receivership in January 2019 (24). In late February of 2019 the company was found to have been misappropriating the funds collected from student financial aid, and the government swiftly pulled the plug on their Title IV funding, effectively killing all but a few of Argosy’s remaining campuses that were being sold to other entities (25). More than 80 federal legislators also called the Department of Education complicit in the DCEH collapse stating, “The Ed Department should not have allowed Dream Center to buy the financially troubled for-profit Argosy University” (26).

Overnight, tens of thousands of students and workers lost their school and place of employment. Full-time teachers and staff members who had been employed at the various institutions for many years were let go without severance. All employees have yet to receive their final paycheck as of this writing. The receiver has calculated a total sum of nearly $2.5 million still owed to the employees of DCEH (27). Meanwhile, students were left to scramble to find a way to finish their education at another school with limited resources. Art Institute – Hollywood student Cheryl Nathan said, “I think that what happened was awful and it definitely put a strain on everyone involved. I was already three years into my program when school suddenly closed. As an international student, it’s been a huge inconvenience. The fact that many of us paid out of pocket for everything and now it’s gone? It’s devastating.”

But the closures didn’t come as a complete surprise. Students and employees alike had witnessed the downfall of their campuses over the years, as layoffs and restructures occurred regularly. Many campuses were left with a skeleton crew of staff and on-campus administrators in the months leading up to the closures, and some campuses even lost their security and janitorial staff. “Months before the closing many of the staff were laid off. We had sub-standard to no amenities. Students had no one to talk to. There were supposed to be counselors and staff members who could guide the students who needed help during their time at college, but it was all taken away. I watched our Dean completely without any support staff try to run the school while doing to jobs of at least 20 people.” said Heather Henderson, another student from the Art Institute – Hollywood campus.

Yet, most of the students whose lives were upended don’t hold any animosity toward their instructors and the quality of education they received. Graduate John Harmon wanted to make sure that the public knew that “despite the many short comings the school had during my time at Ai, the instructors and hard working students always created a feeling of determination.” It’s obvious to students that corporate greed and the capitalist system is fully responsible for this catastrophe and all other atrocities of higher education which plague the working class. “The only way the school(s) can truly serve its community, students, staff and faculty is to take the power from the hands of the corporate elites and allow average people to sail the university toward a public future,” said USC student Kameron Hurt.

Private and for profit colleges and universities indeed need a pathway toward a public future, while all schools need to remove the barrier of tuition. Higher education in the United States can only be truly equal if socialized. Only when admission standards are based on merit alone, when all education is free and when all levels of education from primary to doctorial give all students the best education possible will these issues ultimately be solved. This dream is achievable. It has become a reality in socialist countries like Cuba, which is one of the top producers of medical doctors in the world. If it can be achieved there, it can definitely be achieved in a country with the vast resources of the United States. A better future is possible and it could be closer than we think.


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(14) author’s approximate tuition at CalArts in 2004














Socialism an integral part of U.S. labor history

Socialism an integral part of U.S. labor history

In celebration of International Workers Day or May Day Liberation School is republishing "Socialism an integral part of U.S. history" by Eugene Puryear. Originally published in 2010 as a response to the mobilization of anti-communist propaganda against Obama to paint...

Socialism an integral part of U.S. labor history

Socialism an integral part of U.S. labor history

In celebration of International Workers Day or May Day Liberation School is republishing "Socialism an integral part of U.S. history" by Eugene Puryear. Originally published in 2010 as a response to the mobilization of anti-communist propaganda against Obama to paint...