Organizers of the Academy on Capitalism and Limited Government Fund  hoped to turn their new program at the University of Illinois at Urbana-Champaign into a Hoover Institution of the Midwest, a model for getting more free market ideals and ideological diversity into major research universities.
But when a faculty committee was able to get all the details of the agreement that created the new center, it found provisions that were "fundamentally inconsistent" with university values that are designed to ensure a diversity of views. Specifically, the panel found that portions of the agreement would have restricted funds to research designed to reflect certain points of view, and that donors were given control over matters traditionally left to academics.
The faculty panel -- which was appointed by the chancellor -- said it was "deeply troublesome" that the agreement to accept the center was made without faculty consultation and that many details were kept secret until recently. The panel called for Chancellor Richard Herman to renegotiate the deal for the academy and on Tuesday, a spokeswoman confirmed that he had pledged to do so.
Faculty leaders praised Herman for backing away from a deal that has angered many professors -- even while it was cheered by many conservatives.
The agreement to create the center was signed in July 2006 between the university and a group of wealthy alumni but for almost a year there was very little public information about the arrangement, although rumors started to spread about it. In the summer of 2007, the academy became more public, planning a debut conference and announcing its plans to support research, conferences and events promoting capitalism. Funds were placed in the university foundation, not an academic department, and faculty members started to complain that it sounded like a research center was being created with donor control and an ideological agenda.  Those complaints led the Faculty Senate to urge Herman to appoint a committee to study the issue. He did -- and the professors on the panel (nominated by the Senate) were from a range of disciplines and political perspectives.
The panel's report said that some of the work envisioned in the new center was "outcome neutral," such as the idea of supporting work on "the philosophical, moral and economic underpinnings of capitalism." But other kinds of research agendas, the panel found, "unmistakably signal an ideological predisposition or presupposition." For example, the governing documents the university agreed to said that the center's research would focus on "the relationship between economic growth and reduced government size" and how "free market capitalism can become more effective in providing opportunities and prosperity for individual nations." Another topic cited for research support: "why communism, socialism, government bureaucracy have failed to bring prosperity, and how capitalism brings material wealth to a broad spectrum of society."
There is nothing wrong with any Illinois professor holding those views or doing work that supports those views, the panel said, but there is something wrong with a research center supporting only such work and thereby refusing to support research that might, for example, find that Nordic countries with high tax rates have brought considerable wealth to their societies.
Further, the panel found that documents creating the academy had it housed indefinitely in the university foundation, governed by a self-perpetuating advisory board, and that the board would be making funding decisions, assuming the chancellor's approval. The faculty panel found that it was "highly problematic" to house such an organization in the foundation, the university's fund-raising arm.
Two key principles were at stake, the panel found: institutional neutrality and university autonomy. On the former, the panel said that "a university ... and especially a public university exists for the common good, not for the propagation of the views of its donors."
The faculty panel repeatedly stressed that its objections were on issues of principle, not politics and that it would have had the same reaction to a center with a different ideology -- even if the would-be donor could point to greater diversity that might result from the gift. The panel report imagined a situation where the American Socialist Party, citing the lack of socialists on campus, proposed a center that would support research "examining how public ownership of the means of production and higher income equality achieved by a redistributional tax system will bring economic and moral well being to a broad spectrum of society." Such a donation would be rejected, the panel said, just as the one that was accepted should have been rejected as a "breach of the principle of neutrality."
On the issue of autonomy, the report noted that donors are entitled and welcome to work with fund raisers and academics on shaping gifts that reflect donor interests. But for donors to play a role in handing out grants or approving recipients for research is inappropriate, the panel said. Decisions about who receives funds for academic work -- whether research or teaching -- "lie at the core of the university's functions" and need to be made by professors, the panel said.
While the panel was emphatic that the relationship with the capitalism center needed to be renegotiated, it said that the faculty would be open to an arrangement with these donors that met university standards, and the report stressed that it was not trying to discourage the involvement of the donors.
Nicholas C. Burbules, chair of the Senate at Illinois and professor of educational policy studies, said he thought the faculty panel issued "a very strong report" with an emphasis "on the most important things -- they stuck with issues of academic principle and policy." Some Illinois professors have criticized the politics of the donors, and Burbules said it was important that no attention was paid to that issue in the report.
He said that faculty thinking on the capitalism academy has evolved. At first, as people heard just little bits of information, there was a "what the heck is going on here" feeling. Then as more information came out, many professors felt "anxiety" and there was considerable criticism of the chancellor for making the agreement. But Burbules said that he thought that the chancellor acted correctly in agreeing to renegotiate the deal, and that professors appreciated his quick response to the report.
"We're open to working in a collaborative way with the donors," Burbules said, as long as any arrangement shows "unambiguous" respect for academic principles.
James E. Vermette, a businessman and investor who was one of the founders of the center, said that he had "no problem" with renegotiating the agreement with the university, and that he thought that all that would be needed would be "some wording or clarification." He said he has not read the report.
Vermette said that he and other founders wanted research to be "objective and neutral," and that he didn't have any problem if some of the research supported didn't adhere to his views on capitalism. But he also said it was "absolutely wrong" to say that the original agreement sought to favor some views over others and that the founders' "basic principles" can't change. "We understand what the university is all about," he said. "I'm confident that rational people will be able to work their way through this -- as long as our basic principles don't change."
Anne D. Neal, a member of the advisory board for the capitalism program and president of the American Council of Trustees and Alumni, was more critical of the faculty report. She said that "it goes without saying that the principle of neutrality is central to academic research. Donors cannot condition their gifts on preordained conclusions, and any language that suggests otherwise should be modified."
But she said that she did not believe all departments and programs at Illinois were held to the same standard, saying that she found "ideological terms" in the African American Studies and Research Program at Illinois,  and noting that the women's studies program  presumes that people should "integrate feminist theory into their professional work and everyday lives."
Neal added: "While the committee report raises serious and legitimate questions, I am left with the nagging feeling that the committee's concern about 'ideological predispositions' goes only one way -- and that its problems with the Academy on Capitalism, underscored by its repeated, snide footnotes on the benefits of Sweden's state-run economy -- expose its own ideological predispositions rather than a genuine, consistent concern
about a free marketplace of ideas."