Manuel Muniz wants European universities to become like their American counterparts and to focus on making Europe more economically competitive. His article in Social Europe of 21 November rests on two assumptions: that American universities have been making the US economy strong, and that universities exist to serve the interests of capitalist economic growth. Both deserve scrutiny.
Consider each in turn. One can argue that the US economy has not been performing well for many years. But setting that aside, it is far from clear that its universities have been responsible for whatever growth the country has experienced. More consequential were the institutional changes that transformed the nature of intellectual property rights. The decisive shift came in 1980 with the passage of the Bayh-Dole Act, which for the first time allowed universities to own, sell and license patents on federally funded research, previously the prerogative of government. Henceforth, corporations could reduce investment risk by cutting their own research expenditure and buying up government-funded but university-owned, or academic-owned, patents.
The Act amounted to the socialisation of risk and the privatisation and commodification of technological profits. In effect, the public as taxpayers paid for the risk of investment in research and development, while corporations were able to avoid the cost and risk. One consequence has been that, outside tech and pharmaceuticals, most large American corporations have ceased or minimised spending on innovative research, thereby boosting profits that have flowed to their shareholders and other investors—not to their workers, whose real wages have stagnated for the past 40 years or so.
The intellectual property revolution
The effect of Bayh-Dole was later hugely amplified when six chief executives of major American corporations, headed by Pfizer’s Ed Pratt, shaped what became TRIPS—the Agreement on Trade-Related Aspects of Intellectual Property Rights—which came into force in 1995 as part of the newly established World Trade Organization.
TRIPS globalised the US intellectual property system and ended any pretence of a free market economy. Most pertinently, it resulted in a multiplication of global patents, to the initial benefit of US corporations. A patent gives monopoly profits to its owner for 20 years, with the possibility of extension to 40 years in the case of pharmaceuticals. In other words, unless the owner of a patent licences it to others, nobody can use the knowledge behind that patent to produce goods or services. That is not a free market.
The system has boomed, accentuating rentier capitalism and greatly increasing the wealth of today’s plutocracy. Before 1995, fewer than one million patents globally were filed each year. Now approaching four million are filed annually, and nearly 20 million patents are in force. In the interim, major US corporations, aided by private equity and Wall Street, have indulged in what is known as “patent hoovering”—buying up hundreds of smaller firms solely for their patents and stringing them together to extract vast rents.
The key point for assessing the claim that European universities should become like America’s is this: the reason the USA has gained is not due to its universities per se, but to the plunder of the so-called intellectual property system, which is morally and economically unjustified. Reputable studies have shown that stronger IP protection is not associated with more innovation or economic growth, but merely with more inequality.
Ironically, the European Union supported TRIPS. However, those American CEOs who hubristically congratulated themselves on cementing American domination of technological innovation erred in one major respect. At the time, China was not a member of the WTO. But since it joined in 2001, it has overtaken the USA and the rest of the world. By 2011, China was filing more patents than the USA, Europe, Japan, and South Korea combined.
This coincided with the decline of US research universities. In January 2025, the journal Nature ranked the world’s top research institutes in materials science. Chinese universities held the top 21 spots and 59 of the top 100. Only 18 American universities made the list.
Another point undermining Muniz’s claim is that many of the billionaires leading the technological revolution actually dropped out of American universities because of their deficiencies. The dropouts include Bill Gates, Mark Zuckerberg, Steve Jobs, Larry Ellison, Jack Dorsey, and Sam Altman. They apparently succeeded despite American university education, not because of it.
The betrayal of paideia
There is nothing here to suggest European universities should follow the American model. But there is a much more serious flaw in the argument. Should universities be primarily dedicated to serving as engines of capitalistic economic growth?
For over 900 years, since the first university was established in Bologna in 1088, followed by Oxford in 1096, Salamanca in 1134, Paris in 1160, and my own alma mater Cambridge in 1209, the primary objective of universities was to inculcate the values of citizenship, the pursuit of truth (paideia), and respect for empathy, compassion, and morality.
Perhaps the greatest advocate and practitioner of this epistemology was Alexander von Humboldt, the German polymath who shaped the University of Berlin as a constructed commons and who believed in the democratisation of science. He, like all the great educationists through history going back to Plato and his academy, would have been aghast at what American universities have become in the 21st century.
American universities have become factories for the production of “human capital,” maximising the output of graduates while serving the interests of the military-industrial complex. Subjects not conducive to making more money are marginalised; the teaching of philosophy, ethics, history, and culture is being phased out. A remarkable phenomenon has arisen: more and more students are today “functionally illiterate.”
An example of this betrayal is the University of Phoenix, for some years easily the largest American university, with dozens of campuses and 600,000 students. At its height, its founder, John Sperling, who was called “the Henry Ford of higher education,” opined: “We are not trying to develop students’ value systems or go in for that ‘expand their minds’ bullshit.” He was not alone in having such a philistine approach.
The US economy has come to depend on imported educated people. Even Elon Musk has opposed restrictions on the in-migration of educated foreigners on the grounds that American education teaches “mediocrity.” As I have argued in my upcoming book, these low standards have also been a major factor in the election of Donald Trump, who has said tellingly: “I love the poorly educated.”
In sum, European universities must return to their origins and be primarily vehicles for learning and sharing values of empathy, morality, culture, and creative imagination. Of course, they are also vehicles for gaining knowledge for careers. But we must advocate a revival of the ethos of paideia and arete (moral excellence). Let other bodies enhance competitiveness and whatever is desirable in economic growth. European universities must above all be civilising institutions. As such, they will be the best bulwark against the drift to far-right populism. American universities have failed dismally in that mission.
Guy Standing is honorary co-president of the Basic Income Earth Network. He is author of Plunder of the Commons: A Manifesto for Sharing Public Wealth (Pelican, 2019) and The Blue Commons: Rescuing the Economy of the Sea(Pelican, 2022).His new book Human Capital: The Tragedy of the Education Commons will be published in January 2026.
