Lawrence Soley: The selling of the Academy

Lawrence SoleyLawrence Soley: The selling of the Academy
Lawrence Soley is Colnik professor of communications at Marquette University in Milwaukee. He is the author of Free Radio: Electronic Civil Disobedience (Westview) and Leasing the Ivory Tower (South End)

Large corporations, conservative foundations and well-heeled executives are buying the ivory tower and transforming it into an annex for industry. Across the country, well-funded defense contractors are seducing physics and electrical engineering departments. Pharmaceutical and biotech firms are wooing molecular biology, biochemistry and medicine departments. And IBM and a few high-tech chip-makers are bedding down with university computer science departments.

While the right wing and the media denounce universities for harboring radicals, industry is creating endowed professorships, funding think tanks and research centers, sponsoring grants, contracting for research and influencing who is hired as faculty and consultants. Under this cozy arrangement, students, faculty and universities serve the interests of corporations, not the public, as they sell off academic freedom and intellectual independence.

There has been a "virtual explosion over the past several years in the number and variety of university-industry alliances," concludes the National Academy of Sciences. The Chronicle of Higher Education agrees that industry and academia "are increasingly resembling each other."

The auctioning of academe to the highest bidder extends from the Midwestern college that adopts a corporate logo for its sports team to the selling off of major research programs at top universities. At the Massachusetts Institute of Technology (MIT), for example, a number of elaborate programs serve corporate interests. One of these is MIT's Industrial Liaison Program (ILP), which charges 300 corporations from $10,000 to $50,000 per year in membership fees. Like campaign contributions, the fees buy corporations "access" -- in this case to research reports by MIT faculty, to 70 symposia and faculty seminars and to personal attention from MIT academics.

An inducement program patterned after the coupons on the top of Betty Crocker cake mixes encourages professors to participate in the ILP. They accumulate "points" and redeem them for travel to professional conferences, computer equipment, office furniture or other prizes. MIT awards each faculty member one point for each unpublished article that is made available to an ILP member, two points for a phone conversation or a brief campus meeting with a corporate member, 12 points for a visit to a company's headquarters or lab, and so forth. Each point is worth about $35 in prize money.

Another program that ties MIT to industry is the New Products Program (NPP), a joint project of the mechanical engineering, electrical engineering and management departments. Under it, corporations pay the university $500,000 to develop a new product within two years. Three faculty members and four graduate students are assigned to work on the product, and the students wind up devoting more than half of their time to it. In effect, students pay big bucks to participate in an internship.

Program Director Woodie Flowers said he is "90 percent sure" that MIT will shut down NPP by September and open a new program under the School of Engineering. The National Science Foundation, Ford, ITT, Xerox, GM and Polaroid have already committed $30 million to the project, to be spread out over an 11-year period.

The University of Minnesota (U of M), described by former National Endowment for the Humanities head Lynne Cheney as a bastion of political correctness, typifies the extent of the alliance between industry and academia.

In 1996, for example, U of M signed an exclusive agreement with Coca-Cola, giving the soft drink maker exclusive "pouring rights" on campus and making it the official sponsor of on-campus promotional events, such as the "Diet Coke Volleyball Classic." Its College of Liberal Arts houses the Personnel Decisions Inc. Professorship of Organizational and Counseling Psychology, funded by a firm that develops psychological tests given to prospective employees; the Mithun Land Grant Chair of Advertising, named for an owner of the Twin Cities' largest advertising agency; and the Elmer Andersen Chair in Corporate Responsibility, named for a former Minnesota governor and CEO of the H.B. Fuller Co. That paint and adhesives manufacturer exports products banned in the United States, including toxic glue sniffed by street children in Third World countries.

U of M's business school is named for the owner of the university's preferred travel agency; and professors in the medical school have used their laboratories to conduct research for firms such as Curative Technologies and Endotronics, in which they had financial interests. Within the School of Journalism is a research center called the China Times Center for Media and Social Studies, funded by a Taiwanese newspaper magnate and political leader who "seeks humbly to promote" democracy in China, Taiwan's bête noire. The university "needs to make no apology for affiliating with private industry. This is part of our mission; always has been," says retiring U of M President Nils Hasselmo.

Hasselmo's attitude is similar to that of other university presidents, who increasingly come from corporate boardrooms, foundation suites and political back rooms. Michigan State University's president is Peter McPherson, a former Bank of America executive who worked in the Ford and Reagan administrations. The new chief of the University of Massachusetts is former state Senate leader William F. Bolger, and the head of Wesleyan College is former Agency for International Development and National Public Radio chief Douglas J. Bennet Jr.

One reason why university boards of trustees prefer presidents like McPherson and Bolger is that these individuals promote university-industry ties. As Frederic Erbisch, the head of Michigan State University's industrial relations office, observes, the institution is "trying to make an atmosphere where faculty members feel they can be more entrepreneurial. ... I think that with Peter McPherson [as] our president [this will happen], he's had a business background and he's encouraging this kind of thing."

Adding to the happy atmosphere of collegiality, university presidents and chancellors often serve on the boards of directors of corporations that have close ties to the universities. University of Texas (UT) Chancellor William Cunningham sits on the boards of Jefferson-Pilot Corp., John Hancock Fund Management Co. and La Quinta Motor Inns, which established UT's LaQuinta Motor Inns Inc. Centennial Professor of Business. And until several conflicts of interest concerning Cunningham were exposed, he was also paid $40,000 annually as a board member of Freeport-McMoRan Corp., a New Orleans-based mining company accused of environmental pollution. After the chancellor's ties came under fire, he resigned his board seat and cashed in his stock options, netting a $650,422 profit.

Some of the fruits of the Cunningham/Freeport relationship remain: For a contribution of less than one-twelfth the cost of the building's construction, UT named its molecular biology building after Freeport CEO Jim Bob Moffett and his wife. Freeport had also endowed a professorship in UT's geology department, held by a professor doing geological research for Freeport in Indonesia, where the company collaborates with Suharto's dictatorship. At least until last year, Freeport's contract for this research allowed it to review any academic articles the professor wrote before they were submitted for publication.

Cunningham is one of many university administrators serving on corporate boards. City University of New York Chancellor Ann Reynolds sits on the boards of Abbott Laboratories, Owens-Corning, American Electric Power, Humana Inc. and the Maytag Corp. What she gets as a board member approximately doubles her $150,000 annual salary as chancellor. President Stephen Trachtenberg of George Washington University is on the boards of Loctite Corp., MNC Financial and the Security Trust Co.

Yale President Richard Levin, by contrast, sits on only one corporate board -- that of the nonprofit Yale-New Haven Hospital, which comes with the job -- according to university spokesman Tom Conroy.

Yale doesn't go in for the crass commercialism of Diet Coke sponsorships. It does, however, go in for some significant funding from right-wing foundations. Those dollars pay off for their donors in nationally publicized scholarships that promote a conservative agenda.

From 1992-94, Yale received $5.96 million -- fourth-highest in the nation -- from a dozen conservative foundations, according to a report by the National Committee for Responsive Philanthropy, which advocates for poor people. About $2 million of that came from the John M. Olin Foundation (whose beneficiaries elsewhere include ex-Yale law prof and failed U.S. Supreme Court nominee Robert Bork, as well as affirmative-action-bashers Dinesh D'Souza and Linda Chavez) to underwrite a professorship in law and economics at Yale Law School.

Most law-and-economics practitioners at Yale, of whom there are many, come from the liberal wing of this school of legal thought. Not so George Priest, who holds the John M. Olin chair.

Priest is a guru of tort reform. (Translation: limiting people's ability to win money damages from corporate defendants.) He once published a law review article called "The Inevitability of Tort Reform." He's testified before Congress on the subject, and others who testify cite his research. Just last month, Priest wrote a Wall Street Journal commentary criticizing the Supreme Court because it disapproved, as unfair, the proposed settlement of a class action against asbestos manufacturers. The court's decision, Priest wrote, was bad because it would lead to more liability for the manufacturers.

Four years ago, the liberal Alliance for Justice criticized a series of conferences on liability that Priest organized. The conferences, co-sponsored by Yale Law School and Aetna Life & Casualty, drew a high-powered audience of judges. The Alliance for Justice questioned whether, by sponsoring the "pro-corporate" conferences, Aetna hoped to influence the judiciary on legal issues crucial to the insurance industry's bottom line. Priest, at the time, called the criticism "quite unfair": Aetna paid less than half the conferences' cost and had no say in the agenda, he said. What's more, he asked a national association of plaintiffs' lawyers to co-sponsor the events, but the group came up with very little money, Priest said.

Although universities often claim that corporate money comes without strings attached, this isn't always the case. Contracts for research, such as the one between Freeport-McMoRan and the University of Texas, frequently give corporations some control over the dissemination of research results. The New England Journal of Medicine reported last year that the majority of companies entering into biomedical research agreements with universities require that the findings be "kept confidential to protect [their] proprietary value beyond the time required to file a patent."

According to the National Cancer Institute's Steven Rosenberg, this secrecy impedes scientific research. He contended in the New England Journal of Medicine that "open discussion among scientists, even about the preliminary results of ongoing experiments ... can play an important part in advancing research." Instead of an early and fruitful exchange of ideas, the secrecy agreements have imposed "the ethical and operational rules of business" on scientific researchers, Rosenberg wrote.

Some research deals give the corporate contractor the right to quash the results altogether. A British pharmaceutical corporation, the Boots Co., gave $250,000 to the University of California San Francisco for research comparing its hypothyroid drug, Synthroid, with lower-cost alternatives. Instead of demonstrating Synthroid's superiority as Boots had hoped, the study found that the drugs were bioequivalents. Professor Betty Dong, who conducted the study, submitted her findings to the Journal of the American Medical Association, which subjected it to rigorous blind-review. The information could have saved consumers $356 million, but would have undermined Synthroid's domination of the $600 million synthetic hormone market.

When Boots found out about the article, it stopped publication, citing provisions in the research contract that results "were not to be published or otherwise released without [Boots'] written consent." After Boots announced that the research was badly flawed, Dong was unable to counter the claim because she could not release the study.

Yale has an Office of Cooperative Research, whose mission is to encourage faculty members to develop commercially useful products and processes. That's not the same as selling out, says the office's director, Gregory Gardiner.

For one thing, "the amount of corporate-funded research at Yale and most universities is actually quite small. It's less than 10 percent," Gardiner says. As federal funding for scientific research drops, that percentage will grow, he acknowledges (although Yale's National Institutes of Health funding is on the rise now).

And the contracts under which Yale does work don't really interfere with academic freedom, Gardiner says. Confidentiality agreements typically extend six months to a year after the research is done, giving the sponsor time to review the results and file a patent application if it wants to. "That's just about the only thing Yale will agree to."

In fact, a month or two ago Yale turned down a contract because the corporation, a major pharmaceutical manufacturer which he declines to name, wanted to keep the findings secret for more than a year. But such requests are rare, insists Gardiner, who spent 25 years in research and development at Pfizer Inc. before coming to Yale.

In his view, the confidentiality deals boil down to a question of property rights -- the same debate that surrounds any effort to protect any intangible form of property, whether it's a poem, a video game or lab results. On one side of the debate are those, like the National Cancer Institute's Rosenberg, who prize the free flow of information above all. On the other side are those who want to protect what they've invested in creating (or sponsoring) useful products. "The reality is that without confidentiality and without property rights, nobody will invest what's needed to develop those drugs," Gardiner argues. "It's a balancing of interests."

Even contracts that appear benign can have strings that choke academic freedom. In 1996, the University of Wisconsin signed a multimillion-dollar contract with Reebok, granting the running shoe manufacturer exclusive rights to make and market athletic apparel bearing the Wisconsin logo. In addition to paying coaches for promotional appearances for Reebok, giving money to the university's athletic program and providing student internships at Reebok's headquarters, the contract included an Orwellian clause: "The university will not issue any official statement that disparages Reebok [ ... and] will promptly take all reasonable steps to address any remark by any university employee, including a coach, that disparages Reebok."

Although university administrators disclosed many other provisions of the Reebok contract, they kept the speech-restriction clause secret until the last moment. When it was finally disclosed as the contract was going before the board of trustees for approval, dozens of UW professors signed a letter of opposition. Embarrassed by the exposure of their willingness to sell out the First Amendment and academic freedom, university administrators retreated, asking Reebok to cancel the speech-prohibition paragraph. Facing a public relations disaster, Reebok quickly agreed.

Corporations have also put their stamp on academic departments by endowing chairs. The Carlson Travel, Tour and Hospitality Professorship at the University of Minnesota, endowed by the owner of the Carlson Travel Network, provides money for the Carlson Chair for research on issues of interest to the travel industry. The executive vice president of the Minnesota Restaurant, Hotel and Resort Associations praised this research funding, telling the Minneapolis Star and Tribune: "We'll have data on who comes to Minnesota and why, why people fail to return, and other statistics that we need to make decisions about advertising, marketing and promotion."

Cal Bradford, a former fellow at the U of M's Humphrey Institute for Public Policy, says that outside funds "determine what universities will teach and research, what direction the university will take. ... If universities would decide that they need an endowed chair in English, and then try to raise the money for it, it would be one thing. But that's not what happens. Corporate donors decide to fund chairs in areas where they want research done. Their decisions decide which topics universities explore and which aren't." After he criticized university ties to corporations, the Humphrey Institute didn't renew Bradford's contract.

Two changes in federal laws have helped cultivate the current relationship between universities and business. The 1980 Bayh-Dole Act, supplemented by a 1983 executive order, allows universities to sell corporations patent rights derived from taxpayer-funded research. The result is a covert transfer of resources from the public to the private sector. The 1981 Recovery Tax Act made the arrangement even more lucrative by increasing corporate tax deductions for "donations" to universities.

Corporations jumped at the opportunity. While the federal government funds about $7 billion worth of research, for a relatively small investment corporations can buy access to the results, at just a fraction of the actual cost. Given this direct subsidy, plus the tax benefits, it's little wonder that corporate dollars going to universities almost tripled from $235 million in 1980 to $600 million in 1986. By 1996, the annual corporate investment had increased to around $2 billion.

The benefit to corporations is demonstrated by an agreement between Sandoz Pharmaceuticals and the Dana-Farber Institute, a Harvard University teaching hospital. Sandoz gave Dana-Farber a 10-year, $100 million grant for research on cancer drugs. In return, Sandoz got the rights to any discoveries made by professors who had accepted Sandoz dollars, even if the Swiss pharmaceutical giant didn't fund the actual discoveries. Under this agreement, Sandoz got the commercial rights for a method of identifying a mutant gene linked to colon cancer, even though the mutant gene research was primarily funded by the U.S. government -- that is, by U.S. taxpayers.

That kind of windfall is atypical, according to Yale's Gardiner. More common, he says, is a government grant like the one that led Yale to develop an AIDS drug called Zerit. The university then licensed the drug to Bristol-Myers Squibb.

"Somebody could say we gave it away," Gardiner says. "But it had never been in a patient." While the government grant was "very small, maybe $1 million to $2 million," drug manufacturers must spend "hundreds of millions" on clinical trials before they can sell a drug. "That drug never would have gone on the market" if Yale couldn't license it to a company that's in that business, Gardiner says. "What we have here is a partnership. Everybody benefits." Yale has done "quite a few analogous" projects, including one that produced a Lyme disease vaccine.

This corporate welfare does not come without some work by the corporations. In May 1995, after several Republican budget-cutters suggested that funding for scientific research be scaled back, university representatives and corporate CEOs met privately with House Speaker Newt Gingrich to lobby against cuts in biomedical research. After the meeting, Gingrich endorsed a $655 million increase in federal funding for the National Institutes of Health, $175 million more than the agency had requested. The success of the lobbying effort indicates the power and influence of the new university-industrial complex. Last year, Yale president Levin joined other academics at a Capitol Hill forum on the importance of federal research funding. At the forum -- sponsored by U.S. Sen. Joseph Lieberman of Connecticut, a Yale alumnus -- Levin pitched research funding as a crucial engine of U.S. economic growth.

Government grants are just one method by which universities transfer resources from the public to the private, for-profit sector. Another transfer occurs when universities use federal and state tax dollars and tuition monies to build state-of-the-art research facilities. Corporations then use them and save the cost of building their own. Add to the equation the low pay of graduate students who comprise the majority of research assistants, and universities can perform bargain-basement research tailored to corporate needs.

This type of research has changed the purpose of universities, making them centers for corporate R&D rather than centers of instruction -- servants of Mammon rather than of Minerva.

New Haven Advocate