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Shadow-Images of a Factory: The Contradictions of the University as a Service Industry

By Nandini Chandra

A few years ago, my uncle tried to convince me to buy a car. At the end of a long drawn-out discussion in which he advanced multiple arguments in favour of buying a car, and I responded in turn with each of the reasons why I didn’t need one, his last resort was finally: “How is the auto-industry going to survive if people start thinking like you?” It is the same with education now. The education industry needs its buyers to keep it going, and not because it has any specific use-values to offer. Even its abstract promise of jobs to consumers is no longer true. Indifference to all but the overall profit of education (consolidated as a service industry) is the abiding concern.

It is largely believed that the positing of education as a “non-merit” and “tradable commodity” by the GATS (General Agreement on Trade in Services 1995) regime has turned the postcolonial commitment of education as a public service into a creation of surplus (Tilak 2011). What does it mean to think of the university as a factory? As a factory, the university produces skilled or intellectually-enhanced wage labour as a commodity. In the state-funded public universities, students are not commodities in the sense that they are in a position to sell their specific skills, whether engineering, medicine, or teaching/speaking English. The sale of their abstract skills or labour-power brings them an income, enabling them to live beyond subsistence.

With the privatization of higher education, the expertise learnt in the university is no longer a means of improved subsistence and social mobility, but an embodied end, which paradoxically arrests the flow of labour to the other industries. In other words, the fashioning of education as a service industry attempts to turn wage labour into goods, supposedly for improved efficiency. This goal of increasing its own productivity however severely compromises its function as a service provider of expertise and technology to all other sectors of capital. Thus, while education in its avowed role as “service provider” opens up a new line of meta-industry – supplier of technical labour to all of capital – this very process of reconstituting itself as an industry undermines the foundation of capitalist wage-labour by turning labour itself into a good for profit.

A Factory that turns out Unfree Labour

The freedom to sell one’s labour power is implicit in the Marxist definition of wage-labour. This effectively rules out thinking of wage labour itself as a commodity. If the new conception of the university as a factory is intended to make wholesale commodities of students, then it compromises this basic principle of “free labour” within the capitalist mode of production. Free labour is both the freedom of workers from the means of production, and the freedom to sell their labour power repeatedly, and not merely as a one-off.1 For instance, with government funding withdrawn, more and more students will be implicated in the rapacious system of slavery to loan sharks and banks, a system prevalent in the USA since the 1950s, initially for technical courses, and more broadly for all disciplines, with the Higher Education Act of 1965. This is a distinctly non-capitalist relation even as it operates within capitalism.

In an age of non-subsidized private loans, whatever nominal wage one gets will be pledged toward the paying of debts. The wage-as-debt payment is tantamount to an exchange of commodities between two commodity-owners. As such, the price of the commodity accrues to the capitalists, not to the commodity per se. With the evacuation of wages, the surplus – “the gap between the wages and the value produced by the workers” (Murray, 131) – also disappears since there are no real wages to speak of.2 As a factory, the university then compromises the basic conditions of capitalist production such that labour is no longer in possession of its own labour power. In fact, it acts like the site for a peculiar kind of primitive accumulation in which labour is separated from its own labour power, let alone its means of production.

Usually, the violence of separating workers from their means of production is considered instrumental to the process of creating wage-labour, or free workers who can sell their labour power. Marx calls this process “the so-called primitive accumulation”. He cites the case of England to reconstruct the process of primitive accumulation as a historical necessity prior to capital; yet given the fact that capital takes hold of different geographical areas at different points in time, this process is better regarded in terms of a synchronic rather than diachronic unfolding (Tomba, 49). In other words, it is seen as a continuous and repetitive process. Just like wage labour needs to replenish itself everyday to be able to sell its labour anew, capital with the help of the state needs to make it difficult for labour to renew its sale of labour power.

Postcolonial economies like India with an already extant surplus population of the dispossessed are particularly prone to this constant slide into unfree labour. The problem of a surplus population is enumerated in Marx in chapter 25 of Capital, “The General Law of Capitalist Accumulation”, with respect to the rapid growth in the organic or technical composition of capital: “…it is capitalist accumulation itself that constantly produces…a relatively redundant working population, i.e. a population that is superfluous to capital’s average requirements for its own valorization, and is therefore a surplus population” (Marx, 782). For Marx, this surplus population is at once the lever of capitalist accumulation in the form of “the disposable industrial reserve army, which belongs to capital just as absolutely as if the latter had bred it at its own cost” (italics mine, 784). In the context of a colonial economy like India, this permanent force living outside the circuits of capitalist production is not quite a reserve army, since their means of subsistence already constitute a thriving parallel economy, not simply waiting to be absorbed by capital. However, since this economy is organized around primitive technology and long hours, it gets aligned with capital as a source of absolute surplus. If not for this sub-economy of absolute surplus, the productivity gains flowing from a particular new technological maneuver would eventually get generalized, and result in a flattening of profits, until the next round of innovations.

Apparently, capital finds it easier to look for and create areas of absolute surplus production than rely on technological breakthroughs to gain a temporary edge in the competition with other capitalists (Tomba, 60).3 The spate of activities in the higher education sector in India under the inspiration of WTO/GATS such as the Foreign Education Providers Bill (FEPs) can be viewed as an attempt to bring together disparate universities, so that they can be realigned on a scale of differential surpluses. The FEPs need the public universities, in order to mark their own products as superior. The violence of realignment is necessary so that universities on different measurement scales can be made commensurate: the annual system changed to semester mode, the three year-undergraduate programme to four years, all of it subsumed under the common grade system, etc. to translate it into the standard American model.

There are two contradictory and circuitous processes going on here: first, the creation of surplus through a realignment with areas of absolute surplus production; and second, the very act of creating surplus however increases the volume of the surplus population, those whom capital is absolutely unable to absorb or those it routinely throws off. The university’s challenge as a service industry is to overcome this impasse of diminishing absorption and lack of jobs, to create jobs through the illusion of jobs.

The History of the Surplus Population within the University

According to Kalyan Sanyal, the surplus population corresponds to a non-capital within capital (Sanyal, 2007). His periodization of the development of Indian capital (2007) has serious implications for how we look at the history of higher education as a public good in India. If the surplus population has always survived outside capital, the imperatives of formal education – let alone higher education – should not apply to them. The skill-sets of people in the sub-economy are after all developed on the streets. The assumption of the state planners in the 1950s was that the unemployed and unemployable surplus populations could be assimilated within the industrial model of growth. In other words, they believed that poverty and unemployment could be eradicated by concentrating on capitalist development alone. To actualize the potential of this population (seen as an undifferentiated mass), the 50s planners subsidized education and offered reservations. They did not take into account the fact that since the surplus population is practically debarred from the formal sector, there was no incentive for them to even enter this space. Noteworthy here is the linking of education with capitalist modernity.

Around the 1970s, a new global consensus emerged in World Bank literature acknowledging the fact that the surplus population is not likely to be integrated within the circuits of capital. The new discourse of developmentalism then focused on uniting this surplus population with a minimal means of production, what Sanyal calls “a reversal of primitive accumulation”, an exercise in biopolitics.4 While the earlier basic needs approach provided subsidies to the poor, the task of the various global aid bodies was now to support this informal economy through capacity building and empowerment, through a transfer of credit, technology and know-how rather than actual entitlements. This was not mere charity, but was necessary to secure a political legitimacy for capital confronted with the enormity of the non-capital of its own creation. (Sanyal, 209)

Independent of World Bank thinking, there was a recommendation to expand reservations in higher education for the socially and educationally backward sections in India by the Mandal Commission (1979), an outcome of direct political mobilizations. But these recommendations were not implemented in higher educational institutes until 2008, after a period of almost 30 years. By then, the parallel economy had been reconstituted as a major GDP-building service sector, its denizens reformulated into potential consumers who could pay, thus neutralizing the progressive aspect of the OBC reservations.5 There is irony in the fact that the education industry is expecting to expand itself on the basis of an appeal to jobs in the sub-sectors of the service industries, which are yet to reveal any real growth, characterized as they are by risks and speculation. In the profusion of vocational/technical institutions of instruction that have mushroomed all over the country, the surplus population has become the core target/guinea pigs of the higher education providers.

It sounds rather counter-intuitive that the Foreign Education Providers Bill (FEP) introduced in tandem with GATS (1995) should facilitate the entry of this peripheral population into higher education. All the protests and critiques of the hundred percent FDI in education have argued to the contrary – how privatization will be a death-blow to the prospects of education for the backward, and how education henceforth would only be for the rich (Prasad 2015, Desikan 2015).  While the threat to reservations is real, the mere fact of the bill and its repeated re-drafting by different ruling parties has been used to prepare the ground for a discursive framework in which the technological transfer via institutions of higher learning is to be viewed as capital inputs into the service sector. The truth is that the technology transfer is of the most rudimentary kind, intended for repairs and maintenance work, or assemblage rather than growth producing innovations. Moreover, as capital inputs, the service sector recruits have to pay for it.

In the horizon of the threat of FEP, we have seen the entry of middling or three-tier institutions, both domestic and foreign. These institutions of indeterminate quality have succeeded in making some short-term gains by combining programmes of e-learning, franchises and collaboration with Indian institutions of varying quality (Chandra, 2011). The piece-meal programmes, diplomas, and non-diploma short-term courses are designed to cater to people who cannot afford full-time study. The surplus student populations, those who are not eligible for the standard and high to medium quality institutions, are thus forced to pay their way into these shadow degrees, encouraged to be already on the move towards the shadier zones of informal labour. This is akin to how the lowest paid security guards have to deposit a security amount in order to get the blighted job in the first place, or students who fail several papers in engineering colleges that charge a capitation fee, end up getting absorbed in dubious start-ups that don’t begin to pay them until they break even. In this spectre of the worker paying for his own wages, there is essentially an evacuation of the wage form, and concomitantly of surplus.

At the other end of the spectrum, there is the well-told tale of one of the most successful public universities – Delhi University – being systematically targeted by the MHRD to become a sub-standard producer of absolute surplus. The university workers, teachers and students have put up a fight from time to time, which has forced the administration to back out of some of the controversial initiatives. But the state exploits the division among their ranks to come back with more refined methods of torture. The latest attack has taken the form of a very simple ruse – increasing the number of teaching hours.6 The Nigavekar report (2016) does not hide behind the rhetoric of reform and innovation, but goes straight for the jugular. Meanwhile, the ongoing struggle between the lowering and raising of standards has allowed the incoming private providers to open a range of shops that absorb the surplus students who would have otherwise gone to a public university.

The University as a Semi-Factory

The university’s effectiveness has historically consisted in operating as “a sphere of restricted production” rather than as a factory outright;7 a zone of reproduction in which the conditions of creating labour power of different capacities and values may happen. Within the postcolonial situation, the basic struggle is one of how to avoid sliding into unfree labour, and the skills acquired at the university are precisely about learning to market oneself as free labour. Entering the university is crucial to prepping one’s scarce value, i.e. “difference”. If everyone were to acquire the same skills, it would result in a damaging loss of value for those hoping to get the best salary offer or the highest symbolic estimation. Structurally then, if it is to serve as a medium of social mobility, the university must be remote from the mass production logic marked by uniformity.

The hue and cry about the commercialization of education in the wake of GATS needs to be viewed in the perspective of this shift from a restricted mode of selective reproduction to the installation of education as a full-blown production unit. This hue and cry currently expresses itself as a lament for the betrayal of the greater expansion of higher education promised through the implementation of OBC reservations. But nowhere in this totally justified lament do we see an acknowledgement of the existing public funded system as a restricted zone absolutely instrumental to surplus creation. The logic of greater expansion is made without registering the fact that the university as we know it (and try to defend) cannot function either with full laicization or with full commercialization. According to Andre Gorz, the right to education for all and the promise of social mobility cannot go together (1970). In other words, if everyone can get a PhD, then the degree has no worth, and no usefulness for the candidate either.

We need to begin by acknowledging that the panic over the university as a factory is born of our collective anxiety over our ability to sell our individual labour power, i.e. to get jobs. The famed nepotism of the Indian selection process based on extra-academic factors is usually justified through a skewed sense of meritocracy, an automatic assumption that merit (an obsession with a particular kind of intelligence fetish) rests with the upper castes. While reservations have been the only weapon to fight this entrenched privilege, ironically they have also ensured that the “scheduled categories” continue to pay for the unmerited value appreciation of the “general category” candidates. Their supposedly “low” presence assures the visibility and value of the upper caste students. In a homological move, the reforms process displaces this caste logic onto institutions of a lesser pedigree. The disparity between elite and public institutions is then settled not through an attention to specific use values, but the cultivation of social-network and class differentiation.

The solidarity movements against the state’s murder of dalit scholar, Rohith Vemula, become possible in this conjuncture precisely because the prospect of turning into a commodity or a thing (unfree labour) has become real across the board. It is ironic that Rohith, a dalit, forces this universal paradox of what it means to be a thing – a commodity without any freedom to sell (or not sell) itself – into public visibility:

The value of a man was reduced to his immediate identity and nearest possibility. To a vote. To a number. To a thing. Never was a man treated as a mind. As a glorious thing made up of stardust. In every field, in studies, in streets, in politics, and in dying and living. (Vemula, 2016)

The new conjuncture generalizes the system of unfree labour, makes it the dominant practice in any case. In other words, the neoliberal university’s fetish with the factory form – as represented in its obsession with the point system of academic performance, and rankings based on technological upgrade such as e-learning etc. – is actually its reverse image or shadow form.8 It is the opposite of a factory where workers and capital enter into contract as free agents. The more it tries to set itself up in free contractual terms of rational evaluation and efficiency, the more authoritarian it becomes. This is because education is wittingly or unwittingly burdened with the challenge of capital’s losing battle against unemployment. It needs to prop itself as a meta-industry for guaranteeing jobs precisely at the moment when there are no jobs, and fewer lines of new industry. In fact, its projection of a hyper market-responsiveness consists in re-imagining itself as the creator of new lines of industry on the principle of “if there is supply, there will eventually be demand”. For example, the newly launched Sandip University in Nashik was opened without any actual courses this year, but in the pipeline are design, actuarial sciences, nano-technology, bio-technology, cloud-computing, ethical-hacking, etc.: “It will also focus on courses necessary for local industries like wine technology and sugar technology” (Balajiwale, 2016). We can see that the “it will also” is a grudging concession to local needs and industries that have not been able to generate enough employment. Education as an industry then has to cater to the generation of wholly fictitious future capital.

Whether or not it actually transfers any relevant skills, what is important is that it promotes itself as a new panacea for the crisis of capitalism stemming from the general law of accumulation. The education industry anticipates this simultaneous creation of a surplus population and tries to create its own line of profit from this potentially redundant population.

How to Imagine a New kind of University in a Jobless World?

The compulsion of putting future generations of young people through the grind of acquiring all kinds of bogus skills and technology is a desperate way to stall capital’s inability to absorb all but a tiny fraction of labour. The HEP model effectively promises jobs to people without any real job prospects. Corralling this surplus population into an intensely ghettoized service sector, through a professionalization of the very subsistence methods they were already using to survive is symptomatic of caste-based cunning. Moreover, the service industry has very limited opportunities for expansion owing to the fact that it is based on “human capital”. The education industry via the fictitious category of a General Enrollment Ratio (GER) may succeed in creating isolated profits.9 But this does not translate into surplus as long as it is not able to provide a platform for the interaction between different labours. The metamorphosis of wage labour into slaves or cattle will ultimately halt the process of surplus creation. Ironically, the neoliberal turn provides a shadow return to the old liberal ideal of education for the sake of education, since education for waged jobs has become a chimera.

It genuinely appears that the university is turning from a sphere of restricted production to a universal sweatshop or factory. While the shadow-forms of this space seem to convince us that it is indeed a factory, the very lack of possibilities of wage-labour in the designated industries undermines free labour. The factory becomes the disseminator of the non-factory. Its products confront their unfree status. Or else they seethe with the resentment at having to sell on a starkly differential basis, between Delhi and New York, Kolkata and Midnapore, etc. It is hard to escape the frustration of being tied to the differential capacities of these different social institutions.

The conditions of slavery can be both depoliticizing as well as explosive. But to harness these explosive energies properly, we need to first understand that objectively higher education has already delinked itself from the goal of social mobility, not simply by making it just another bad, speculative investment, but also because of the illusion of jobs it creates. To demand that it return to that goal of social mobility might seem progressive in terms of allowing a place for those deprived for millennia. But it is not viable. This is not a call to end reservations, but to liberate it from its grounding in social democracy. As we approach the end of the epoch of wage-jobs, the revolutionary task will be to grab the time released from the loss of jobs to frame a lifelong learning truly free of the constraints of socially necessary labour.

Photo: Occupy California

Works Cited

Balajiwale, Vaishali 2016, “First Self-Financed Varsity of North Maharashtra Launched”, DNA, June 11, 2016.

Bourdieu, Pierre 1993, “The Market of Symbolic Goods”, In The Field of Cultural Production: Essays on Art and Literature, Columbia University Press.

Chandra, Nandini 2011, “Private Nation, Public Funds: The Case of the Foreign Education Providers (Regulation of Entry and Operation) 2010 Bill”, Sanhati, September 9, 2011

Desikan, Shubashree 2015, “Will the GATS close on Higher Education?”, The Hindu, December 30, 2015

Andre Gorz 1970, “Destroy the University”.

India Brand Equity Foundation (IBEF), “Service Sector in India”.

Marx, Karl 1990, Capital: Volume I: A Critique of Political Economy, Penguin Classics.

Murray, Patrick 2000, “Marx’s “Truly Social” Labour Theory of Value: Part II, How is Labour that is Under the Sway of Capital Actually Abstract?”, Historical Materialism, June 2000.

Murray, Patrick 2011, Abstract submitted to the Eighth Historical Materialism Conference, November 2011

Prasad, Madhu 2015, “Why Higher Education in India must not bow to the market?”, Sabrang India, December 14, 2015

Ramdev, Rina and Debaditya Bhattacharya 2016, “What the UGC Gazette Notification 2016 Portends for the State of Higher Education in India”, Kafila, May 27, 2016.

Sanyal, Kalyan 2007, Rethinking Capitalist Development: Primitive Accumulation, Governmentality and Postcolonial Capitalism, Routledge.

Tilak, JBG 2011, Trade in Higher Education: The Role of the General Agreement on Trade in Services (GATS), UNESCO.

Tomba, Massimiliano 2009, “Historical Temporalities of Capital: An Anti-Historicist Perspective”, Historical Materialism (17), 44-65.


1 Marx (1990), “…labour-power can appear upon the market as a commodity, only if, and so far as, its possessor, the individual whose labour-power it is, offers it for sale, or sells it, as a commodity. In order that he may be able to do this, he must have it at his disposal, must be the free proprietor of his own labour-capacity, hence of his person. He and the owner of money meet in the market, and enter into relations with each other on a footing of equality as owners of commodities, with the sole difference that one is buyer, the other a seller; both are therefore equal in the eyes of the law. For this relation to continue, the proprietor of labour-power must always sell it for a limited period only, for if he were to sell it in a lump, once and for all, he would be selling himself, converting himself from a free man into a slave, from an owner of a commodity into a commodity. He must constantly treat his labour-power as his own property, his own commodity, and he can do this only by placing it at the disposal of the buyer, i.e. handing it over to the buyer for him to consume, for a definite period of time, temporarily. In this way he manages both to alienate [veräussern] his labour-power and to avoid renouncing his rights of ownership over it.”, p. 271.

2 Patrick Murray (2000), “Value producing labour is not simply abstract labour, but socially necessary abstract labour. And the social necessity is not generic – there is no society in general – but pertains to the specific aim of producing surplus value”, p. 102.

3 Tomba (2011), “The difference between capitalists who exploit labour of different productivity is therefore necessary so that it will be possible to extract relative surplus-value from the advantage that springs from technological innovation.”, p. 60.

4 Sanyal (2007), “While primitive accumulation seeks to transform the means of labor into capital and subsume them within the domain of capitalist relations, this process of transfer is a reverse flow that extricates them from the space of capital and reunites them with labour. I call this decapitalization of means of labor as a reversal of primitive accumulation…”, p. 59.

5 According to the Department of Industrial Policy and Promotion (DIPP), as commodity based industries reach a glut, service industries have to be promoted. The share of service sector in India’s GDP is expected to reach 62 percent by 2020. Indian services sector has attracted the highest amount of FDI equity inflows in the period April 2000-September 2015, amounting to about US$ 45.38 billion, which is about 17 per cent of the total foreign inflows.

6 Talking about the Nigavekar Report on the Academic Performance Index, Ramdev and Bhattacharya (2016) write: “The real intention of the Nigavekar Committee is clear: far from bolstering teaching-learning activities through an apparent increase in teaching hours, it merely sought to cut down teaching jobs while at the same time delegitimizing the ‘value’ of teaching within the API-based PBAS scheme for promotions.”

7 Bourdieu (1993) argues that two separate fields of production exist in the modern world: “the field of restricted production,” which produces specialized goods for and by specialists and “the field of large-scale cultural production,” which produces goods for the public at large, pp. 112-141.

8 I take my understanding of the “shadow-form” from Patrick Murray (2000, 2011). According to him, unlike “value forms” — the commodity, price, money, wage labour, profit, interest and rent — capital’s shadow forms are not constitutive of capitalist society… they might even outlive capitalism. “These shadows cast by the value forms belong to capital’s retinue and are further expressions of capital’s power to shape and subsume society and the ways we represent it.”

9 Prasad (2015) maintains that within the domestic education market, India expects to increase its gross enrollment ratio in higher education from a current 18 percent to 30 percent by 2020.

Nandini Chandra
teaches in the Department of English at the University of Delhi. Her book, The Classic Popular: Amar Chitra Katha (1967-2007), was published by Yoda Press in 2008.


For more stories, read Café Dissensus Everyday, the blog of Café Dissensus Magazine.

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