Hats off to the mayor of sector 1 Bucharest! Thanks to the municipality scheme, we were able to pick up 2 bikes at 11.00 Sunday morning – completely free of charge – and cycle around in the delightful Harastroia park and lake in complete safety for 2 hours. Hopefully this scheme – which lasts until the autumn - will encourage more to take to their bikes.
As usual, England is currently the subject of mad scientist experimentation – in the 2 fields politicians most like to play around with – education and health.
A good case-study in economics and in the use and meaning of league-tables is given in an article in The London Review of Books which explores the apparent UK Coalition Government’s drive to emulate US policy toward universities ie customer payment and competition.
The data which appear, at first glance, to demonstrate the great strength of the US university system are revealed, on even the most rudimentary analysis, to demonstrate nothing of the kind. Measure for measure, US universities are manifestly not the ‘best of the best’. If value for money is the most important consideration, especially in an age of austerity, the American model might well be the last one that Britain should be emulating.As far as the government's intentions for the poor health system are concerned, the backlash from the medical profession to the idea of putting GPs in charge of the health budget (in England) has been so great that the Government set up a "listening exercise"in the summer. Two recent discussion threads give a good sense of what's at stake - in the first BBC's Paul Mason sets out the very clearly the thinking which lay behind the reform; the problems it has run into; and what might now happen. A rare analytical discussion. The second thread - from the Guardian - is more conerned with political aspects.
This analysis has serious implications for government policy. There is no evidence here that private sector competition drives up academic standards, but there is clear evidence that market competition drives up prices, since academic excellence apparently costs much more in the US than the UK. Why is this? It isn’t in fact difficult to see why the introduction of market pricing into a small cohort of elite universities will drive prices up, not down. Wherever a small and strictly limited supply of a highly desirable commodity – such as places at Harvard – is introduced into a genuinely open market, the wealthiest cohort in society will drive its price up to levels only they can afford. This is essentially what has been happening at the upper levels of the US university league since the income gap began to open up in the 1980s. For several decades, tuition fees have been rising at double, triple and even quadruple the rate of cost-of-living inflation, first at the most exclusive universities, and then throughout the private sector, so that there are now more than a hundred private colleges and universities in the US charging students at least $50,000 annually for fees, room and board.
The introduction of competition drives down prices only in markets for commodities that can be readily produced. If a firm is producing things inefficiently, or skimming off too much profit, it can be undercut by more efficient methods of production or leaner business models. But there are some things which cannot be readily produced, and ancient universities are an excellent example. Oxford and Cambridge have a 600-year head start on their English rivals. Many of the advantages they enjoy are the product of their long histories: their architectural settings, their libraries and archives; their unique systems of tutorial teaching, collegiate organisation and self-government; and the academic prestige accumulated by two dozen generations of scholars, philosophers, scientists, poets and prime ministers. Their competitors cannot produce these things at any price, much less one that undercuts theirs. And because the ‘student experience’ they offer is one that many find uniquely attractive, they could, if freed from the constraints of government legislation, charge as high a price for this experience as the market would bear, without the risk of being undercut by anyone but each other.
But why does all the extra money pouring into US universities generate such a poor return in the rankings? Evidently, a large fraction of this funding is being invested in something other than academic excellence. This haemorrhage of funds has not gone unnoticed by American university leaders, who have traced the source of the leak to another aspect of market-driven academic culture which the government plans to start importing from America: the ‘student experience’.
Jonathan Cole, former provost and dean of faculties at Columbia, wrote in the Huffington Post last year that in addition to fee inflation, a major contributor to the increased cost of higher education in America stems from the perverse assumption that students are ‘customers’, that the customer is always right, and what he or she demands must be purchased. Money is well-spent on psychological counselling, but the number of offices that focus on student activities, athletics and athletic facilities, summer job placement and outsourced dining services, to say nothing of the dormitory rooms and suites that only the Four Seasons can match, leads to an expansion of administrators and increased cost of administration.
If Cole is correct, then the marketisation of the higher education sector stimulates not one but two separate developments which run directly counter to government expectations. On the one hand, genuine market competition between elite universities drives up average tuition fees across the sector. On the other, the marketing of the ‘student experience’ places an ever increasing portion of university budgets in the hands of student ‘customers’. The first of these mechanisms drives up price, while the second drives down academic value for money, since the inflated fees are squandered on luxuries. To judge from the American experience, comfortable accommodation, a rich programme of social events and state of the art athletic facilities are what most 18-year-olds want when they choose their ‘student experience’; and when student choice becomes the engine for driving up standards, these are the standards that are going to be driven up.
In the course of following the discussion, I came across a good health blog.
Coincidentally, just as put down (a reread of) Colin Leys' 2001 book on Market-Driven Politics (which was the first study I ever read of the "commodification" of public services, I came across a new article and booklet he has written, suggesting that the government's health changes are not (as normally represented) a deviation but rather part of a change whiuch has been more than a decade in preparation.
The Kazanluk gallery was kind enough to Email me yesterday this pic of one of several paintings they have by Vassil Bakarov - "my mother".