While the loss of space for critical engagement has been a primary focus for critics of the neo-liberal transformation of higher education, the recasting of the relationship between education and economy has not meant the death of critical thinking. Instead, I argue that critical thinking has emerged as a binding point in higher education discourse, while at the same time being occupied by an 'employability narrative' that conflates the longstanding division between 'academic' and 'vocational' education: in the knowledge economy, critical graduates are employable graduates. This pedagogical dynamic is part of the logic of late capitalism identified by Fredric Jameson and Slavoj Žižek, wherein cultural transgression is not a threat to capital, but the basis for its expansion. In response, I suggest that the question for critical pedagogues is that posed by Žižek and Glyn Daly in regards to capitalism, 'How do you subvert a system that has subversion as its dominant logic?'