I recently attended the AAUP Higher Ed Summit in Chicago, my first time at such an event, and I learned some stuff. Despite my role with the Center for the Defense of Academic Freedom, I’m not, and never have been a member of the AAUP, but CDAF was sponsoring a panel, and Chicago is my place of origin, so I seized an opportunity for a trip to see the family and get my first truly close-up look at what AAUP organizing looks like.
As personal takeaways, I realized a couple of things: 1. The people who are doing the organizing are working very hard, even in the face of great challenges. A panel on the union’s role working in concert with the American Federation of Teachers in Minneapolis in order to resist the ICE occupation was both harrowing and inspiring. 2. Even if we are not going to go so far as to join an organization or actively organize, it behooves anyone working in or adjacent to higher education to understand the threats to the freedom to teach, learn, and research that underpin these institutions.
At the newsletter, we’ve covered a number of these threats: the overt Trump strong-arming, the (largely unenforceable) executive orders, and the strong drive to create new accreditation avenues that will certify institutions without guaranteeing even basic academic freedom rights.
But one threat I, personally, was not sufficiently alert to in terms of its impact on academic freedom is the role of debt. Fortunately, at the conference, I connected with Jason Wozniak and arranged to ask him some questions.
Jason Wozniak is an associate professor in the Department of Educational Foundations and Policy Studies at West Chester University. He is co-author of Lend and Rule: Fighting the Shadow Financialization of Public Universities, researches and writes on education debt, and is currently finishing a critical education theory of student debt manuscript for Johns Hopkins Critical University Studies Series. Since Occupy Wall Street, Jason has been a researcher and organizer with Debt Collective, the nation’s first union of debtors.
Jason Wozniak: Thank you, John, for this opportunity to expand on some ideas that I shared at the AAUP Biennial in Chicago. Much of what I said there, and that I elaborate upon here, is shaped by years of collective research and organizing with both Debt Collective and The Coalition Against Campus Debt. I’ve learned so much from members of both groups, mainly that we either build collective power to abolish debt, or we suffer grave consequences.
John Warner: I was struck by a lot of things during your presentation, and I want to get to some specifics, but one angle that sticks with me is how “debt” is a labor issue in many different ways across educational institutions. We tend to first think of something like student loan debt and how it distorts the ways both students and faculty operate, but this is not the only thing that’s at work, right?
Jason Wozniak: I really appreciate this question, John. I agree. Debt is fundamentally a labor issue. Labor leaders and rank-and-file union members already know this, but I think we still have a ways to go before we can say that labor has successfully figured out how to organize against debt, to abolish it. If you look at labor relations and questions of labor power through the lens of debt, you arrive at a very difficult question: in financial capitalism, who’s the boss we have to organize against? And what you realize, in higher education, for example, is that it’s one thing to take on an administrator or a Board of Trustees, but it’s another to go up against creditors or credit rating agencies.
I was fortunate enough to interview some amazing labor organizers for a piece on this topic for In These Times. The conversations confirmed what many of us at Debt Collective have been saying for a while now: that debt is wage theft, it robs workers of their leisure time, and it suppresses labor militancy. In short, and there is a great new book about this by Giorgos Gouzoulis, who’s got the time and money to strike when you are working non-stop to service debt? Who can risk losing pay, and maybe even your job, when the obligation to pay debt constantly haunts you? In higher education, it’s not only student debt, but also what The Coalition Against Campus Debt (CACD) calls “institutional debt” that shapes labor relations, constrains what we do, or how we do it. Generally speaking, debt can be used both as a way to extract wealth from the working class and poor and as an apparatus of social control. Creditor-debtor social relations are typically asymmetrical in favor of creditors. This power differential changes the nature of waged work and processes of social reproduction. Importantly, we always have to acknowledge that debt burdens different people differently. Its impacts are gendered, racialized, and classed.
John Warner: Awareness seems to be on the rise. Debt was on the agenda of the recent AAUP-AFT meeting in Chicago.
Jason Wozniak: One of the reasons I’m enthusiastic about the resolutions to the AAUP-AFT higher ed platform that passed while we were in Chicago is that AAUP calls for the abolition of current student debt, free college tuition to lower the risk of future debt, and the necessity to study the ways that university institutional debt is driving so much of the current austerity that is causing all sorts of personal and instructional harms.
At the AAUP, I wanted to raise awareness of “the other college debt crisis,” institutional debt. Summarizing arguments made in Lend and Rule, let me put a few key points on the table for consideration.
Debt and credit function as a type of “shadow governing” apparatus in higher education. Take credit ratings, for example. If you read the Moody’s Higher Education Ratings Methodology guidelines, you find that universities are incentivized by the promise of better credit scores to not only suppress labor wages but also labor power. From the vantage of credit rating agencies, tenure systems, strong labor protections, and legislative control of tuition are not democratic treasures, but red-flag liabilities; they may endanger an institution’s ability to repay creditors.
Administrators and Boards of Trustees make decisions with debt and credit in mind. Economic logic and ethics supersede educational rationale. There’s just no way to ignore the fact that decisions to fire faculty and staff, close programs, or, worst case, entire colleges, are motivated in part by the necessity to service current debt and/or the perceived necessity to secure credit ratings that promise access to future debt under better terms.
To take just one example amongst many, consider the case of Wittenberg University in Springfield, Ohio. Facing a $25 million debt in 2023, the school cut staff and programs, eliminating their Spanish, German, Chinese, and East Asian studies programs. They even shut down the bowling team. Universities can still be universities without bowling teams, but Music, Spanish, German, and East Asian Studies?! I guarantee you that readers out there can immediately recall other programs that have been slashed, or they know colleagues who have been fired.
If we are going to get to the root of the austerity problem, we need to link these cuts to the institutional debt crisis, and then link that crisis to the broader higher education funding crisis. Once we do that, we recognize that our campaigns to fight back should not be unilaterally focused on individual administrators. They need to be more structural.
Failure to do this puts the whole university project at risk. When debt determines which programs we keep and which programs we jettison, we really do need a more robust discussion on a question Derrida once asked: “To whom or what does the University respond?” If the short response is “debt covenants”, or “credit rating agencies”, instead of say, “the public good”, or “the search for truth and wisdom”, then I think we need to ask ourselves what makes a university a university today? In other words, material conditions call into question the ontology of the university.
If you read the Moody’s Higher Education Ratings Methodology guidelines, you find that universities are incentivized by the promise of better credit scores to not only suppress labor wages but also labor power. From the vantage of credit rating agencies, tenure systems, strong labor protections, and legislative control of tuition are not democratic treasures, but red-flag liabilities; they may endanger an institution’s ability to repay creditors.
John Warner: We’ve had recent examples in the New School, which is attempting a significant restructuring, and Hampshire College, which is closing, that are often presented as sort of “business model” failures, like these sorts of institutions are just not ones that can attract enough students at a tuition level that can sustain their operations, but you spoke about how these are really both debt stories.
Jason Wozniak: You are right, the New School and Hampshire are just two of many examples that illustrate the ways debt impacts higher education institutions. Let’s put some numbers on the table to help us tell this story. In Lend and Rule, we estimate that the institutional debt crisis is somewhere between $350-$500 billion, and we note that between 1989 and 2021, university debt increased by 482%. There are a lot of factors that lead to college closures or the shuttering of programs. We need to recognize that debt is a major driver. In fact, debt (and credit) are a big part of the “business model” approach to higher education governance. But it’s important to take a step back from local conditions to look at the economic state of higher ed at a macro level. We need to recognize that much of what happens at, and to, universities and colleges is determined by the political economies in which they reside.
John Warner: Amen.
Jason Wozniak: Wolfgang Streeck argues that in the neoliberal era most countries in the Global North shifted from being “tax” to “debt” states. Briefly stated, in a tax state, you pay for social goods like education via taxation. In a debt state, you increasingly rely on debt because your tax revenues don’t cover costs.
Since the Reagan era, we’ve seen drastic cuts to taxes on the rich and corporations in the United States, cuts that Trump’s Bill solidifies. With less revenue available, and politicians who prioritize things like war instead of funding education, not only do we see widespread austerity, but also the use of debt to provide and access social goods.
People will often say, “Well, this person or that university made a choice to take on debt.” But in a racialized and gendered neoliberal political economy in which people compete against one another for work nonstop and can’t fall back on dwindling public safety nets if they “lose,” or when universities are forced to compete against one another for tuition dollars, don’t we need to rethink this “choice” argument? Many universities that engaged in the so-called academic arms race to attract more students and donors took on massive debt for amenities and real estate projects like dorm construction.
Let me also mention one political implication of the institutional debt crisis. Debt limits how and when we fight power. Universities are trying to get through this Trump administration while being massively indebted. Always fearing cuts to available funds, and needing more credit, universities not only obey the Trump administration in advance, but also the credit rating agencies that determine credit availability. Undoubtedly, this type of anticipatory obedience weakens university resistance against current onslaughts.
John Warner: And the thing is, there’s nothing unique about the New School or Hampshire. Every institution, very much including public institutions, is saddled by debt. It’s been years since I dug into the specific numbers, but for public colleges and universities in South Carolina, where I live, it was something like 10% of student tuition off the top went to servicing bond debt that primarily exists because the state will not fund construction and operations at these universities that are supposed to benefit the public.
Jason Wozniak: That’s exactly right. I could create a very long list of colleges and universities that are restructuring or closing because of debt. And I’m surprised that you know those South Carolina debt numbers. Not many people are aware of the ways that the student debt crisis and university debt crisis are related and how the latter intensifies the former.
Lend and Rule was published after years of collective research and nationwide political education by our Coalition. During COVID, CACD held countless workshops with faculty, and sometimes staff and students, that introduced people to a critique of institutional debt. Importantly, we didn’t just reveal a problem. And we didn’t want to simply tell a debt story that people hadn’t heard of. We wanted to delegitimize debt logics and ethics, critique debt power relations.
During our workshops, we sought to build awareness and power by walking people through the ways that they could reveal debt levels on their campuses. At one point, we had a nationwide “debt reveal day” in which campus organizers publicly revealed debt burdens. The debt reveal day proved what we already knew: university debt manifests most clearly on local levels, but there is a national structural problem to be addressed that will require a whole new way of funding higher education.
John Warner: One of the central pillars of the AAUP calls for reform in higher ed is to make public higher ed tuition free, a way to remove at least some aspect of the burden of debt from institutional operations. Having written a whole book calling for this, I obviously support it, but you’re much deeper in the cause than I am. How will something like this change our relationship to debt?
Jason Wozniak: I love the book you wrote on this, John. I teach it in some of my grad classes. The fight for free tuition is a fight for a whole new higher education funding paradigm and practice. It’s also a challenge to the debt state insofar as free tuition nationally/locally demands a revenue source other than debt. So, for instance, to pay for it, we’ll probably have to raise taxes on the rich and/or radically change our budget priorities that currently privilege things like war or corporate welfare.
To be honest, I think the only thing that can save higher education is a free tuition campaign. I say this because the general public is alienated from higher education (especially the four years) because it’s too damn expensive, and no one wants to spend their whole life paying off student loans. We need the public on our side now more than ever. We need this leverage. Alone, higher ed labor will struggle to turn the tide, but with public support, a whole new system might be possible. But we need to earn that support, and by winning free college, abolishing debt, and giving working class and poor people the opportunity to study what they want to study free from fascist or neoliberal interference, we accomplish this.
People love to study, pursue knowledge, and engage in debate with others, they just don’t want to go into debt to do this, and no one should have to. Win free college and let’s see what happens to that so-called “enrollment cliff.” Folks from all walks of life will be heading to campus. We’ll need the resources and people power to serve them right, and that means that we can’t delimit what a tuition-free university does because of the debt it owes to Wall Street.
John Warner: But one of the things your presentation made clear to me, going tuition-free isn’t enough by itself.
Jason Wozniak: We have to acknowledge that even if we make attendance at universities and colleges tuition-free, it doesn’t mean that we eliminate all threats of student or institutional debt. We know that many students take on massive amounts of debt not to fund tuition, but for other things like housing, supplies, or even to help their parents in a jam. And we also know that universities will still be debt-dependent to a greater or lesser extent, depending on how we reform higher education funding mechanisms overall.
So I’d like to humbly suggest that while we fight for free college, we also need to seed campaigns for things like institutional debt cancellation for public universities. Starting with HBCUs and Tribal Colleges would be a good reparative first step. That might seem pie in the sky, but if you think about it, we just spent hundreds of billions of dollars on war with Iran. The money spent could have eliminated most, if not all, of the current public university institutional debt in the country.
The campaign for free college will open up all sorts of questions about how we fund higher education. And once you look into this carefully, it’s impossible not to notice the ways that universities, and not just students, are massively indebted because of the ways we’ve divested from public education in the last fifty years.
John Warner: What are other reforms we could or should be taking on in this area? My sense is that there may even be some low-hanging fruit here, provided we rethink some of the past practices of institutions and how they’re controlled and governed.
Jason Wozniak: For better or worse, once you know how to find it, you start to see debt (and credit) relations everywhere. This can be a bit overwhelming, and to be frank, sometimes demoralizing. How the heck are we supposed to do anything about this? What would it take to challenge creditors and credit rating agencies? These are intimidating questions.
But there are, as you say, reforms we can pursue that help us move towards larger structural changes. The reforms can’t be ends in themselves, but they can get us closer to where we need to go. Doing things like debt reveals on campus helps us build wall-to-wall power. And linking campuses in a network composed of debtors creates national power.
Where to start? Debt financing is (perhaps purposefully?), obscure and abstract. But it turns out that it’s not that hard to find out what your university or college’s debt situation is. For all those reading, pause for a moment to do a search for your university’s most up-to-date budget report. Once you find it, use the Control F key to search for “debt.” From there, look for the total debt load, yearly payment, and, importantly, how much interest you are paying annually. Later on, do this with a group of faculty, staff, and students, and then ask one simple question: “What could we do on campus with the money we are paying in interest and fees this year?” You are now problematizing higher ed finance and governance. And you’ll be surprised by where this conversation goes and how quickly people realize that there are both surface and structural finance issues to address that are all related to institutional debt.
From here you can dig deeper. Some of my brilliant colleagues in the CACD created a debt reveal worksheet. You plug in debt numbers, and you start to uncover how many faculty positions your debt payments could fund, or how much of the institutional debt load is being passed on to students. To give you just one example of how this works, debt reveal research led by Joanna Gonsalves, Rich Levy, Gyathri Raja, and Tyler Risteen uncovered $3.7 billion in outstanding debt for the University of Massachusetts System and $1.2 billion for the Mass State colleges. While doing research for this debt reveal, students and others learned that “the average student in these two systems paid more than $2,500 each year just for their university’s building debt,” resulting in increases of student debt totals by about 25%. These colleagues then used this information to pressure the state for more funding.
Besides political education and the work of delegitimizing the current logics and ethics of higher education funding, we need to map out points of intervention. If we look at higher education finance through the lens of debt, then the following ideas are intriguing. What if we made bonds sites of struggle? I’d bet my current student debt burden (six figures) that less than 1% of the readers of this piece have ever participated in a university bond agreement negotiation. Given the picture I’ve painted above, this is problematic from a governance standpoint. We need campaigns to bargain for bonds. And just like we need “open bargaining” during labor contract negotiations, we need open bond bargaining over the covenants that influence so much of what happens on campus. Not to be too corny, but this type of collective bargaining over bonds could build the bonds that we need to win the struggles we are engaged in.
Thinking about debt reforms in higher ed also challenges us to rethink what we mean by “shared governance.” Because if debt shapes university governance, and campus workers and students have practically no say in determining campus debt realities, and most certainly don’t get a word with credit rating agencies, then we have to admit that we aren’t making shared decisions about a key aspect of campus life. Further, once we acknowledge that declarations of financial exigency are shaped in part with debt and credit in mind, and these declarations, for all intents and purposes, initiate “states of exception” that procedurally permit administrators and Boards to do as they please on campus while suspending normal governing procedures, then we arrive at another possible reform. The AAUP should reconsider its position on financial exigency with debt and credit in mind. We need to first discover, and then negate, the power of creditors and credit rating agencies to overdetermine decisions on financial exigency.
Again, I want to emphasize that if you start locally but take this all the way down, you come to the conclusion that what we ultimately need to do is democratize finance. As the industrial Marxist unionists used to say, we have to seize the means of production. Here I’m suggesting that we need to seize the means of finance as well, so that we can utilize credit and debt for the common good.
John Warner: These are not necessarily intractable problems, but they are big ones. What are the specific actions individuals should take to A. Better inform themselves about the relationship their institution has with debt, and then B. Act on this information in a way that furthers the goals of removing the yoke of this debt from the labor of students, faculty, and staff?
Jason Woznizak: I appreciate how your questions continue to make finance concrete. I’ll end with some very practical suggestions. I’ve mentioned some of this above, but to reiterate, the first thing to do is to gather colleagues for debt reveals. Again, this should be a wall-to-wall gathering, reach out to all workers on campus, and students. Bring in anyone impacted by campus debt. An easy way to lure them to a meeting is to ask them what they would do with $XXX amount of money each year. Use the interest and fee amount that you found using the Control F function on your university’s budget document.
We should also take a cue from scholars, like Celina Su, who teach us how to do participatory budgeting. Even if we aren’t allowed to do the above with administration, the practice of collectively revealing debt and setting our budget priorities with fellow workers and students builds knowledge and movement muscle that we’ll need down the line.
Further, in the short term, we need to end the “debt state” and return to a more just “tax state.” We need to tax the rich so that individuals and public institutions don’t have to take on debt to get by. Thankfully, there is a wave of tax the rich efforts sweeping the nation that are modeled on the very successful efforts of the MTA and the MA Fair Share tax campaign. Higher education labor, and organizations like the AAUP, need to be involved in these efforts both locally and nationally.
Finally, taking a cue from Stacy Davis Gates, President of the Chicago Teachers Union (who spoke at the recent Higher Ed Summit), I’d like to suggest that debt is a common cause issue that we can use to bring together people from all walks of life. During her excellent and inspiring plenary talk to AAUP members, Stacy emphasized over and over that higher education labor needs to find common ground issues not only within our sector but also outside of it. Debt is one of these common causes that we can build broad coalitions with. People don’t just want affordability; they want to get out of debt. Let’s give them some campaigns to join.
We have so much work ahead of us, but crises like the ones we are facing now present opportunities for transformation. And if we remember that “alone our debts are a burden, but together they give us power,” then anything is possible.
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The views expressed in this newsletter are those of individual contributors and not those of the American Association of University Professors (AAUP) or the AAUP’s Center for the Defense of Academic Freedom.
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