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The Neoliberal Stranglehold on the American Public University

Photo by Phil Roeder | CC BY 2.0

Photo by Phil Roeder | CC BY 2.0

In a previous CounterPunch post I described how the University of Virginia (UVA), a world-renowned state university, has been turned into a de facto private institution because of decades of budget cuts imposed by its state legislature.

Maladroit and clueless oversight, “meddling” would be the more accurate description, by UVA’s Board of Visitors (i.e. its board of trustees) in recent years has compounded the problems confronting UVA.

Unfortunately, the difficulties faced by UVA are replicated across the US since the Reagan era, where numerous universities are facing greatly reduced financial support from the state, coupled with increased ideological interference from the same state legislatures cutting their budgets.  The need to find compensatory financial sources encourages institutions to blur the line between propriety and corruption or nepotism, and to accept monies from somewhat shady sources or correspondingly grubby means.

Here are a couple of examples.

The pharmaceutical giant Mylan has been much criticized in recent months for the stratospheric price-increase of its epinephrine EpiPen while increasing the compensation of its CEO Heather Bresch by an even vaster amount. To quote from an NBC NEWS report:

 … filings show that from 2007 to 2015, Mylan CEO Heather Bresch’s total compensation went from $2,453,456 to $18,931,068, a 671 percent increase. During the same period, the company raised EpiPen prices, with the average wholesale price going from $56.64 to $317.82, a 461 percent increase….

Experts have determined that an EpiPen costs around $35 to produce, so this is price-gouging on a monumental scale.   A recent CBS report confirms the scale of Mylan’s price-gouging:

CVS is now selling a rival, generic version of Mylan’s EpiPen at about a sixth of its price, just months after the maker of the life-saving allergy treatment was eviscerated before Congress because of its soaring cost to consumers.

The drugstore chain says it will charge $109.99 for a two-pack of the authorized generic version of Adrenaclick, a lesser-known treatment compared to EpiPen, which can cost more than $600.

Mylan also produces the execution drug rocuronium bromide.

Mylan takes care to shift these obscene profits offshore– it moved its corporate registration to the Netherlands to avoid paying US federal taxes.

Media interest in the leaders of Mylan helped highlight a few things.   Perhaps the most interesting of these is the career of its CEO, which has been deeply entwined with the entrails of the West Virginian oligarchy, as indeed has its premier state university, West Virginia University (WVU).

In 2007 WVU awarded a bogus MBA degree to Ms. Bresch, who happened to be the daughter of its then governor (now US Senator) Joe Machin.

An independent investigative panel found that WVU altered and falsified its records in order to grant Bresch her MBA degree even though she had not met graduation requirements.

WVU’s president Michael Garrison, its provost Gerald Lang, and its business school dean Stephen Sears, resigned as a result of the investigation.

Garrison was a high-school and WVU undergraduate classmate of Bresch’s, and a longtime friend of the Manchin family.

The chief of staff of a previous governor, Garrison had been involved in the appointments of 5 members of the WVU board of governors which made him its president, even though he had no experience in academic administration.

Somewhat in the manner of Joseph Ratzinger, who used his position in the Vatican bureaucracy to pick the cardinals who would make him the future Pope Benedict, Garrison chose many of the board members who would make him WVU’s president.

Also embedded in the bowels of the West Virginian oligarchy was Mylan’s co-founder and Chairman, the late Milan Puskar.  Puskar is WVU’s biggest donor, and its football stadium was named after him when he gave WVU a $20 million donation.  He supported Garrison’s candidacy for the WVU presidency, saying there needed to be closer ties between Mylan and WVU.  After all, Mylan has a subsidiary adjacent to the WVU campus.

Garrison, by now WVU’s president, had been a lobbyist for Mylan.  Puskar also chaired Joe Manchin’s transition team when he was elected governor of West Virginia.  Mylan thus had copper-bottomed access both to Governor Manchin (after 2010 a US senator) and the leader of the state’s premier university.

This jaw-dropping symbiosis, taking cronyism almost to the nth degree, between the pharma giant Mylan, one of West Virginia’s foremost political families, and its leading state university, may be unmatched elsewhere, but there are other places which have displayed a similarly problematic appetite for corporate largesse.

(Incidentally, my Facebook posting on this WVU symbiosis was somehow removed within 24 hours.)

The late Carl Lindner Jr was to the University of Cincinnati (UC) what Milan Puskar is to WVU when it comes to mega-donations.  Lindner gave UC its largest single donation ($30 million), as well as many millions in smaller donations.  UC’s business school is named after him, as well as several smaller units within the university.  UC’s athletic center is named after his brother Richard.

Lindner, a staunch Republican (though he also donated to Bill Clinton), was one of the richest people in the world.  The basis of his wealth was ownership of United Dairy Farmers, Great American Insurance, Chiquita Brands International and the Cincinnati Reds, among many others.  He also owned companies that were major issuers of junk bonds, and he was an important customer of junk-bond king Michael Milken.

Lindner was Chairman and CEO of Chiquita from 1984 to 2001.  Chiquita had earlier been United Fruit, notorious in Latin American history for its savage mistreatment of workers, use of illegal pesticides, rampant environmental despoliation, and wholesale corruption of the local political system.

During Lindner’s tenure as Chairman and CEO, Chiquita’s executives made under-the-counter payments of approximately $1.7 million to an illegal Colombian rightwing paramilitary group, subsequently branded as a terrorist organization by the US State Department because it operated death squads.

According to the Huffington Post, in 2007 Chiquita was indicted by the US Justice Department for “illegally funding a foreign terrorist organization”, and agreed to pay a fine of $25 million.

Lindner therefore headed a company which funded a US-designated terrorist organization for many years, he dealt extensively in junk bonds, and yet his name is festooned in several places on UC’s campus.

Cynics would say it is perhaps time for Duke to rethink its decades-old taboo and name something on campus after its very well-known but disgraced alumnus Richard “Tricky Dicky” Nixon.  Compared to the devout Baptist bankroller of death squads Lindner, the sweaty and jowly Tricky Dicky, oozing insincerity at every televised appearance after commissioning a botched burglary at the Watergate Democratic HQ, and engineering the subsequent cover-up, is somewhat akin to an office clerk who pilfers petty cash being matched-up against Bernie Madoff.

(Tricky Dicky was of course a war criminal, along with his henchman Kissinger, but it was not this which precipitated his ignominious resignation.)

Such are the snaking byways of the contemporary neoliberal American university.

More articles by:

Kenneth Surin teaches at Duke University, North Carolina.  He lives in Blacksburg, Virginia.

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