To what problem is the modern American university a solution?

AI Log reviews "Dartmouth College V. Woodward: Colleges, Corporations, and the Common Good" by Adam R. Nelson

To what problem is ChatGPT the solution? is the question Jane Rosenzweig of

The Important Work

puts to the students in a writing course she has been teaching since 2023. That question and the course syllabus have helped me make sense of what it means to teach and learn now that many people are using this new cultural technology to solve the problem of homework. This “problem” has made the related question about the purposes of higher education more difficult to ignore.

The invention of the US university happened over the long nineteenth century but in political and legal terms, it was “invented” in the 1819 Supreme Court case Dartmouth College v. Woodward.This new history by one of the leading scholars of American higher education considers how this complex case shaped American social and educational life— and continues to do so today. It feels important in this moment when the political and legal structures that created the university are changing.

Published in April by the University Press of Kansas and available in paperback as an ebook for $27.99.

It should also not be forgotten that business and enterprise forms have to be “invented” in the same way as technical products. This depends solely on the historical existence of circumstances that either “negatively” hinder such lines of thinking or “positively” promote them, and not simply on a compelling causal relationship, any more than on strictly individual events.

—Max Weber, Economy and Society

Inventing the American university

As far as I know, Ben Kuipers was the first person explicitly to analogize corporations to AIs. In this 2012 paper, he argued against getting too worked up about artificially intelligent robots taking over by pointing out that “we already share our world with artificial creatures that participate as intelligent agents in our society: corporations. Our planet is inhabited by two distinct kinds of intelligent beings — individual humans and corporate entities — whose natures and interests are intimately linked.”

I’ve written before about Charlie Stross’s darkly hilarious take on this idea: “clearly artificial, but legally they're people. They have goals, and operate in pursuit of these goals. And they have a natural life cycle.” And, I have recommended The Unaccountability Machine, where Dan Davies has some fun with it. I find the analogy an interesting way to think about the broad range of things we might call complex adaptive systems, which include institutions of higher learning. Lumping large AI models, universities, democratic governments, markets, and human beings into one category is a big idea, perhaps too big. But big is useful sometimes, and it seems useful as a framework to think about the relations between AI models and universities. Maybe it takes an AI to manage an AI?

The university is a technology first invented during the Middle Ages in the Mediterranean world to organize the collective intelligence of humans for the purpose of preserving and creating knowledge, and for disseminating that knowledge. To understand its reinvention in North America, I recommend Adam R. Nelson’s new book, Dartmouth College V. Woodward: Colleges, Corporations, and the Common Good.

As any historian, political scientist, or contract lawyer can tell you, the case is important, though each would have a different view on why. What matters for the analogy we’re working with is that this is where John Marshall wrote the ancient concept of corporate personhood into US law, stating: “A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law.”

Marshall’s ruling in the case, read aloud in the court on February 2, 1819, invented the American corporation and the American university system. Daniel Webster, a rising star at the time, deserves credit, along with the whole team of lawyers on both sides who worked the problem. Like all big inventions, its inventors barely understood what they had created and had no way to anticipate how it would be used. It took years of innovation and diffusion for business and enterprise forms to fully develop, a continuing process that might be described as coevolution between Kuipers’s “two distinct kinds of intelligent beings,” who together create a rich ecosystem of natural and artificial beings.

My broader interest is in thinking about what it means to be a part of this ecosystem where universities, humans, and large AI models interact, but for this essay, let’s focus on how the court’s framework created a platform for the development of corporate entities, especially those for the purpose of educating youth and disseminating knowledge in the United States.

Most absurd against the nation itself

Daniel Webster understood the case as political and personal. He was a graduate of Dartmouth and, like John Marshall, a Federalist when federalism was losing out to Jefferson’s republicanism. His line from closing arguments–"It is, Sir, as I have said, a small college, and yet there are those who love it”–is said to have moved the Chief Justice (and Webster himself) to tears. Yet, the two men probably cared less about the fate of the small college in Hanover, New Hampshire, than about solving a set of political problems that emerged as electoral politics threatened barely established social structures in the early republic.

In the 1810s, Dartmouth was the scene of numerous overlapping fights that were at once personal, political, financial, and religious. Some of these fights were internal, like the battles between Dartmouth College’s board and its president or between the separate entities known as Dartmouth College and Dartmouth University. Others involved external actors, like elected state officials battling the board over the right to appoint new board members. Although these disputes are shot through with religious and political positions that are obscure today, many elements are as familiar as today’s headlines. Nelson tells the stories of these conflicts in a way that respects the genuine differences (sectarian religious conflict no longer plays much of a role) and illuminates the ways little has changed (universities and state governments were co-dependent from the beginning).

The case itself was about who controls the College. Put simply, should the Governor appoint the trustees because it is a “public” institution or do the trustees themselves decide because it is “private”? Marshall understood that he was solving a political problem. Like Webster, he was worried about what Republican success in national elections would mean for the nation, and he looked to protect nongovernmental entities from newly powerful Republican governors and legislators. Critics could and did characterize the court’s ruling as Federalist elites thwarting the will of the voters to protect their economic interests.

A more sympathetic account would characterize the court as acting to limit what John Adams and Alexis de Tocqueville called the tyranny of the majority. The founders had invented a system of government that balanced majority power with minority rights within the government, but left nongovernmental enterprises vulnerable. Marshall and his allies on the court saw the Dartmouth College case as a way to address this problem by interpreting the Constitution’s contract clause to protect institutions chartered before the American revolution.

Nelson explains:

But since the US Constitution said nothing about either “charters” or “corporations” the court had to find a way to justify its decision that Dartmouth College should be independently governed. To do so it opted to read “charters of incorporation” as legal “contracts” which once made for charitable purposes could not be unmade without the consent of all parties.

We don’t talk much about charters these days, but at the time, the provenance and meaning of such documents were critical features of a legal system that relied on English Common Law yet no longer recognized the authority of the British crown. Corporations are, of course, another story altogether. The Dartmouth case is a reminder that, as much as we have narrowed the meaning of the term to business enterprise, the entity that prides itself on being the oldest corporation in the Western Hemisphere is a university.

Marshall’s act of creative interpretation asserted the court’s power to protect the small, well-loved college, and by extension, other institutions run by or sympathetic to Federalists and their allies. This included many universities considered today to be the most prestigious in the world. Views differed on whether this was a prudent move by the court to limit the power of elected officials or a cynical act of men trying to preserve power lost in free and fair elections.

Nelson tells of Republican editor Isaac Hill, of the New Hampshire Patriot, reporting various conflicts that called into question the justices’ independence.

During the eleven months between oral arguments and the final decision, Justice Story had been elected to Harvard’s board of overseers, a possible conflict of interest. He added that Justices Livingston and Johnson had accepted honorary doctorates from Harvard and Princeton, respectively, and that both college lawyers, Daniel Webster and Joseph Hopkinson, had accepted honorary degrees from Princeton—the upshot of which proved to Hill that Federalist colleges had used their influence to buy off the court. The majority, he concluded, had not reasoned “on the merits of justice in the case” but had “travel[ed] out the record” to reach a decision in favor of private interests.

The Republicans had long-standing frustrations with how the courts, with their Federalist leanings, approached the issue. But it wasn’t just about influence and personal loyalties. There is a fundamental conflict about state power at the center of the case. Here is what Thomas Jefferson had to say when his ally, the recently re-elected Republican Governor of New Hampshire, wrote to complain about Dartmouth College's resistance to oversight from the Republican majority in the state legislature.

The idea that institutions established for the use of the nation, cannot be touched nor modified, even to make them answer their end, because of rights gratuitously supposed in those employed to manage them in trust for the public, may perhaps be a salutary provision against the abuses of a monarch, but is most absurd against the nation itself.

Questions about the rights of those managing universities in trust for the public were not answered definitively in the Dartmouth case. But in deciding that Dartmouth College was self-governing rather than subject to control by the elected representatives of New Hampshire, Marshall invented a solution that worked to promote the creation and continuation of institutions of higher learning for two hundred years.

Invisible, intangible beings existing only in contemplation of the law

Marshall’s solution involved an extended analogy. Here is the relevant passage:

A corporation is an artificial being, invisible, intangible, and existing only in contemplation of law. Being the mere creature of law, it possesses only those properties which the charter of its creation confers upon it, either expressly or as incidental to its very existence. These are such as are supposed best calculated to effect the object for which it was created. Among the most important are immortality, and, if the expression may be allowed, individuality; properties by which a perpetual succession of many persons are considered as the same, and may act as a single individual. They enable a corporation to manage its own affairs and to hold property without the perplexing intricacies, the hazardous and endless necessity of perpetual conveyances for the purpose of transmitting it from hand to hand. It is chiefly for the purpose of clothing bodies of men, in succession, with these qualities and capacities that corporations were invented and are in use.

Mitt Romney gave us the short version in 2011: “Corporations are people, my friend.” This unrehearsed remark caused a kerfuffle during Romney’s campaign because most educated Americans take Marshall’s invention for granted without understanding it. The idea that corporations are individuals before the law seems like it is about businesses paying their fair share of taxes (or not) and property rights. Who would imagine that the same concept was invented to protect higher education from elected officials?

In his closing remarks, Webster, defending institutional self-governance, argued exactly that:

This, sir, is my case. It is the case not merely of that humble institution. It is the case of every college in our land. It is more. It is the case…of all those great charities founded by the piety of our ancestors to alleviate human misery and scatter blessings along the pathway of human life. It is more. It is, in some sense, the case of every man who has property of which he may be stripped.

The threat to Dartmouth College was a threat to every property owner:

Shall our state legislatures be allowed to take that which is not their own, to turn it from its original use and apply it to such ends or purposes as they, in their discretion, shall see fit?

In accepting Webster’s argument, Marshall wrote corporate personhood into US law in a way that granted Dartmouth immortality and individuality, and by extension, allowed all business and enterprise forms to become artificial beings, organized to live beyond the lives of the humans who make them up.

The Constitution protects these forms from politics. By clothing the bodies that make up a board of trustees in the outfit of an individual, the Court ascribed legal personhood to this corporation. This protects businesses and nongovernmental organizations rights to go about their work without political interference. Of course, political interference is what you call it when you and your friends are protecting a beloved college or university. If you are looking to reform moribund institutions managed mostly for the benefit of those who run them, you call it public accountability.

Public supervision, corporate rights

The Dartmouth board and its allies were happy with their victory, but the case had cost them. Not just the large legal bills, the disruption to their operations had hurt enrollment and revenue. So, having established that they were a private corporation, they applied to the state of New Hampshire for funding. After all, they had a public mission, and the state would see benefits of an educated youth. New Hampshire turned them down, but not for long. Like most states, it was looking to invest in higher education. The New Hampshire College of Agriculture and the Mechanic Arts was established in Hanover in 1866. It was administered by Dartmouth College, but “its charter provided for a separate board of nine trustees: five appointed by the governor and council and four by the Dartmouth College trustees.” Four years earlier, the Morrill Act had established a structure of federal funding for such programs, but much of the “public” funding went to “private” institutions.

Here, in brief, was a sketch of the new system of higher education that emerged out of the resolution of the case. Both sides ended up with something, which set the stage for public and private investment in new and established institutions. Nelson summarizes:

Put simply, Republicans wanted a publicly managed system of secular higher education in which new state universities could benefit from state aid; Federalists wanted a privately managed system in which (sectarian) colleges protected by corporate rights would be guarded from state control. In a sense, Dartmouth served both interests.

The solution has continued to serve both interests. The former colonial colleges, many of them now grouped into an athletic league named after a weed that decorates aging buildings, remain privately managed while states oversee secular systems of institutions. A rich, diverse ecosystem of colleges and universities developed to serve non-elites, and though not nearly as well endowed, they continue to thrive. Eventually, elite universities began admitting formerly excluded groups and even hiring members to be professors and presidents. The controversies over the self-governing and publicly funded institutions did not seem all that threatening to the institutions themselves. Today, for most of us teaching and working in US higher education, they appear existential.

The scale and complexity of this system of higher education, mixed together with different conceptions of private and public, in ways that are quite confusing. Every research university in the United States is funded by the public and is in some sense a “creature of law” in that it has a corporate legal form that defines its rights. And, as we have rediscovered this year, when the state wants to interfere (or is it hold institutions accountable?), the questions at the center of the Dartmouth College case reemerge.

Nelson helps us understand how central the Dartmouth case is to a past that is never dead, or even past.

Dartmouth established the inviolability of private charters as well as the authority of corporate governance under private boards of trustees, but it did not render corporations entirely immune from public oversight. Corporations were still obliged to obey “the laws of the land”; they could not commit illegal acts or compromise public safety. They were, therefore, subject to some measure of public supervision to ensure their fidelity to publicly desirable ends. Dartmouth, in this sense, left open the question of whether the interests of higher education were best served by private or public oversight. New Hampshire’s legislature had said that Dartmouth’s trustees were too preoccupied with private interests to be trusted with the supervision of higher education, but Dartmouth’s trustees said precisely the same thing about New Hampshire’s legislature. Neither side had any faith in the other to advance genuinely public ends—and, for better or worse, both had plenty of historical evidence to support their respective points of view.

What light does this shed on the current turmoil as Republicans elected to office over the past decade subject universities to “some measure of public supervision”? State systems of higher education and “private” universities are ongoing public experiments in creating and disseminating knowledge. As each state government and institution decides how to respond to the actions of the federal government this year, we will see dramatic changes to the national system created by the Dartmouth College case. Self-governing institutions make up civil society. As those institutions lose their rights and privileges, the ecosystem made up of complex adaptive systems changes in ways impossible to predict. In the absence of any countervailing force to the newly elected president determined to maximize his personal power, it seems entirely likely that we will create a dramatically different system of higher education.

Marshall was no stranger to the threat posed by an executive branch that cared little about norms or the rule of law. As a Federalist, he was aligned with a party that had pretty much lost any electoral power by 1819. Twice-elected president, Andrew Jackson showed the limits of the Supreme Court under Marshall in his later years. In Worcester v. Georgia (1832), the Court reversed its ruling in Cherokee Nation v. Georgia (1831), determining that the Cherokee Nation was a sovereign entity. This decision appeared to add a new sort of artificial being to the ecosystem, making Indian nations creatures of the law with expanded rights. Jackson refused to be bound to the rule of law, reportedly zinging Marshall with: “John Marshall has made his decision; now let him enforce it.”

Marshall’s story ends with his death in 1835 and Andrew Jackson naming Roger Taney as his replacement. As the questions raised in the Dartmouth College and other cases decided by his court have returned, the Supreme Court will be asked to determine the obligations of AI companies to the common good and the limits to the Trump regime’s power. The stories Nelson tells in this book are an excellent way to understand the historical context for what is happening today, as the system of higher education we have had for two centuries experiences major disturbances.

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