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How corporate cash bought higher education

A new book explores how corporations are privatizing public universities.

Javier Zarracina/Vox

In 2014, the New York Times sent an investigative reporter to the University of Oregon to cover a disturbing sexual assault case involving three basketball players.

What he found, ultimately, was a university culture thoroughly corrupted by its entanglements with corporate America — the school’s questionable handling of the rape allegations was just the tip of the iceberg.

In this case, the corporate sponsor was Phil Knight, the co-founder and chair of Nike, one of the biggest companies on the planet. An alumnus of the University of Oregon, Knight has become the school’s most prominent donor, giving almost $1 billion to the university since 1994. His donations are largely responsible for transforming Oregon’s athletics program into a national powerhouse.

The NYT investigative reporter, Joshua Hunt, wrote a book about what he discovered at Oregon, titled University of Nike. But the book is not just about Knight and Oregon; it’s about how public universities are compromising themselves in exchange for endorsement deals and financial partnerships — and about what happens when universities become shills for their billionaire benefactors. It’s also, crucially, about the consequences of states defunding higher education, which has created the space for corporations to step in and foot the bill.

I called Hunt to talk about how we got here and what we can do to shield public universities from corporate influence. A lightly edited transcript of our conversation follows.

Sean Illing

The New York Times sent you to the University of Oregon in 2014 to investigate a sexual assault case involving several members of the basketball team. What did you find when you got there?

Joshua Hunt

The reason I went to Eugene in the first place was that this very graphic police report had come out. The Eugene Police Department released a report that was filed by a freshman at the University of Oregon who alleged that three of the school’s basketball players had gang-raped her at a house party.

The police report was two months old by that time. In the meantime, these three basketball players had competed in the NCAA tournament and had made it far enough in the tournament that the head men’s basketball coach at Oregon, Dana Altman, had gotten a $40,000 bonus. It just really seemed like this was something the school had tried to keep quiet until basketball season was over. The goal was to find out if that was true or not.

What I found when I got to Eugene was a lot of roadblocks on the part of the administration. The university’s office of public records was doing their best to keep me and other journalists and community members from getting our hands on email communications between top administrators and public relations staff at the school, as they were drafting their PR strategy for this story.

The school’s administrators had been quietly trying to hand these players off to another school, basically allowing them to transfer quietly without anyone knowing that any of this had ever happened.

And the whole time I was in Eugene, the faculty, the students, everyone I met who wasn’t an administrator told me, “Look, this all has to do with Nike. This all has to do with the school’s relationship with Nike and Phil Knight.”

It was the fact that the University of Oregon brand was so valuable and its business dealings with Nike so lucrative, and its relationship with Phil Knight so close and cozy, that everything became driven by the fear of a bad headline, fear of a scandal, fear of something that might tarnish that brand.

Sean Illing

Did Oregon sweep this case under the rug?

Joshua Hunt

This is a tricky question. Did Phil Knight show up on campus or make a phone call and say, “Sweep this under the rug”? I can’t say whether or not that happened. What I can say is that nearly everyone at the University of Oregon is terrified of the public relations department. It has a tremendous amount of power, and they determine things like what public records are released to journalists, for instance.

Sean Illing

And their public relations department is an extension of Nike’s PR department — they’re staffed by people from Nike, right?

Joshua Hunt

It’s mixed. There aren’t any Nike PR people on staff, but this is actually even more insidious ... behind the scenes, there’s all this informal advising going on that we don’t have access to, unless you talk to people on the inside and you see it going on.

I spoke to the guy who used to be in charge of releasing public records to journalists at the university. For years, he thought he had a relatively straightforward job. If the school is building a new athletics facility, for example, he would know about it well in advance so that he could start putting together a PR plan to roll out to the media.

So he was very surprised one day when he was called into a meeting where there’s all these Nike folks saying, “Here’s the new logo for the University of Oregon, we’ve been working on it for a while, and here’s this new brand that we built for you guys, and here’s how you’re gonna integrate it into the school’s identity.”

He called it an impressive bit of PR-age and said it was very, very unusual to him. He basically was the best-informed person on campus, but what he didn’t know was that behind the scenes, all these Nike marketing, advertising, public relations, and legal staff were running around talking to a very select group of administrators and making decisions about the school’s future.

So it’s impossible for me to think that something similar didn’t happen in this case.

Sean Illing

I want to move beyond Knight and Oregon and ask you about similar dynamics playing out across the country at other universities. What other major brands or billionaire donors have leveraged their financial power in ways that have compromised the independence of universities?

Joshua Hunt

This is happening now in every state. Oregon was one of the first states to defund higher education at this kind of extreme level, providing an opening for corporations to step in, but other states are now catching up.

In Oklahoma, Texas oilman turned hedge fund investor T. Boone Pickens has poured hundreds of millions of dollars into his alma mater, Oklahoma State University. There’s also the University of Maryland’s relationship with alumnus and Under Armour founder Kevin Plank.

There are other schools in other states that don’t have [to contend with] a charismatic, swaggering CEO, so the dynamic is very different. Sometimes it’s purely about money. For example, UC Berkeley has had two famously disastrous partnerships. One was with the Swiss pharmaceutical firm Novartis in the late ’90s, and one happened about a decade ago with BP Oil.

These partnerships grow out of the same need for funding, but they’re insidious because they hinder transparency. Schools are able to find these loopholes for public records laws for protecting trade secrets. And the contracts these corporations write when they want to collaborate on research with universities are often written so there’s no obligation to publish research, so they can kill studies that might benefit the public but harm the corporations funding them.

We know this is something that happens regularly.

Sean Illing

Why should average citizens be concerned about this?

Joshua Hunt

I think everyone should understand exactly how vulnerable our public institutions are and how they can be taken over pretty quickly and easily. There doesn’t have to be some grand, evil scheme. It can all just start with something as simple as defunding an institution.

These institutions, when their survival depends on it, will pretty easily and quickly find a corporate benefactor, and this is invariably corrupting.

It rots away at the entire structure of a public institution. If you care at all about the role of the university in our society, then you should be alarmed by this.

Sean Illing

And no matter what, if you’re a taxpayer, you’re likely paying for this one way or the other.

Joshua Hunt

Absolutely, and that’s an important point. Phil Knight, the co-founder of Nike, doesn’t give money away; he invests it. So one thing Phil Knight likes to do is if he wants to build a $150 million athletics facility that’s going to be named after him, or someone in his family, he’s not going to pay for all that. He’s going to pay for $80 or $90 million. And the school is going to say, “Well, trust us, we’re going to come up with the rest of the money.”

And in the end, they won’t — at least, they never do at the University of Oregon. What they end up doing is going to the legislature for state bonds. Those bonds come with hefty interest payments, and part of the brunt is borne by taxpayers. Taxpayers who never get any credit for all this stuff, and who probably don’t even know what they’re helping to subsidize.

Sean Illing

How is this impacting the quality and direction of education on college campuses?

Joshua Hunt

It’s always tied to the corporate benefactor’s needs; it’s not tied to the university’s needs. The university’s needs are secondary, always. Which means the university is always in a weaker bargaining position, which means they always get the worse end of the deal.

For example, the University of Oregon’s partnership was built on college football because they had a fluke trip to the Rose Bowl in 1995. Phil Knight’s an alum, so they went to him for help and he said, “Sure, I’ll help out.”

But consider what’s happened academically at Oregon since.

As the football team has become a rising brand in the sport, and has become infinitely more valuable, at the same time they’re paying their faculty less and less and they’re at the bottom of their cohort of similar schools across the nation.

The faculty are getting screwed and the class sizes are larger, and meanwhile, the school is making more money by bringing in more out-of-state students (who pay more tuition), thanks in part to the popularity of the football team.

This is the sort of perverse situation that really concerns me, where you have this misalignment of incentives, where the schools are going to be making more and more money as the quality of education actually goes down and down and down.

Sean Illing

Is Oregon a vision of what most major state universities will look like in the near future?

Joshua Hunt

Yes, because for one thing, more and more states are disinvesting in higher education at an alarming rate. It’s a big problem. Oregon was early to this trend, but everyone else is following along now. So that’s one problem.

The other problem is we’re in this age now of the professional administrator, the professional university president. So once upon a time, a university president rose through the ranks at their university; they rose up through the faculty and they became university president. That’s not the case anymore.

Now, university presidents come into office and stay for at most five years, and they come in with a pretty clear playbook, which is, “I need to build something and put my name on it, or have my name associated with getting it built. And then I need to leave for a bigger paycheck at another school.” It’s this merry-go-round of professional university presidents who are just professional administrators and have never really been faculty in any significant way.

So that’s a problem, because that kind of short-term thinking is precisely what leads to deals with corporations and with billionaires like Phil Knight and T. Boone Pickens that aren’t necessarily great deals for faculty or for students. The administrators are more or less just thinking about making the campus look better for marketing brochures.

Sean Illing

There doesn’t seem to be any clear way out of this spiral, particularly in light of our current political climate. Apart from getting states to invest in their universities, do you see any obvious solutions here?

Joshua Hunt

We need to collectively take stock of how important these public universities are in our society, the role they play in upward social mobility and democracy. Public universities are one of the great ideas in world history, and we should fight to save them.

I think a good start is making sure the corporations are paying their fair share of taxes, so that if Amazon is supporting the University of Washington, if Nike needs to be supporting the University of Oregon, they can do it with their tax dollars, as opposed to secret gifts and unfair apparel or research deals.

That’s a good place to start.