Another Reality (Remarks at UC Irvine Protest, 11/9/11)

By Rei Terada

In March 2010, about a thousand people at UC Irvine marched here and on the street, on University Avenue. I was amused that a couple of commentators wrote afterward that UCI students were “protesting reality.” Someone headlined a blog for The Atlantic, “Students Protest University Cutbacks, Reality”. This remark assumes that once reality has been determined, you have no right to say anything further. That assumption can be refuted in a number of ways, even if—and that’s an “if”—we don’t dispute the amount of the state budget shortfall since the recession of 2008. First of all, anyone who cares about reality should always ask, what makes the reality the way it is? What are the conditions on which reality depends? That is the question known as “critique,” and critique is the mainstay of the Enlightenment education that Universities historically support.


The condition of the reality that UCI students protested in 2010 is that the state has been defunding public education since before the global financial crisis. The UC Regents claim that this in turn is another inalterable and involuntary reality that they can do nothing about, but that’s not true. A few years ago it would have cost the median California taxpayer $32 to return UC funding to 2000 levels. Since then the economy’s grown even worse, and now it would cost $49. The UC Regents’ point of view is that the California taxpayer is ignorant or selfish, and should just cough up the $50—that the Legislature should impose a tax. But by doubling tuition since 2000, long before the global financial crisis--last week proposing to raise it again, 16% a year for the next four years--and giving almost a third of the places (31% at Berkeley now, for example) to out of state students paying $36,000 a year, the UC Regents give California taxpayers no reason to fund an education that they’re being told is no longer for them. Middle-class Californians can’t afford the tuition increases; they can’t bear to take on any more debt; and they have no reason to contribute when qualified students are no longer guaranteed a UC education.

The leadership of the university bears the responsibility for these community-destroying policies. The more they turn from public to private money, the less incentive the legislature has to raise revenues on the university’s behalf; and the more they privatize the university, the more middle-class tazpayers are right to feel that this whole project is no longer theirs. These arguments have been made in financial detail by Robert Meister of UCSC and Christopher Newfield of UCSB. UC Administration is turning the wheel in the wrong direction; and they have hired a president, Mark Yudof, who came in with a template for privatizing the university before the global financial crisis had even happened. President Yudof stated in print in 2007 that he intended to raise tuition by 32%--exactly the amount that the Regents did raise it in a first so-called “response” to the crisis: a response that predated the supposedly inevitable problem. The condition that supports our current reality of massive tuition increases and cuts is a program of privatization that actively weakens the foundations of citizen support and then blames the citizens for not being supportive.

Our reality would have been different if instead of making students pay—-and pay-—and pay—-and pay again, the leadership of the university had said something like the following:

“The state has been decreasing funding for decades, and we can’t go on any more. Now we’re in crisis. And in crisis the education of students and the well-being of our community comes first. The educational part of the budget will be the last to be cut. We will not be asking more from our lowest-paid and most vulnerable workers than we ask from our highest-paid workers. We will not be laying off janitors and food service workers while giving expensive raises to ourselves. We’ll be cutting from management. We’re asking for salary reductions from everyone making over $100,000 a year. We’re trying to renegotiate our contracts so that private money donated to us for non-educational purposes, such as construction, can be turned toward education and student support. And the cuts that we do have to implement will be shared equally, because every part of the university is equally valuable. To do otherwise would be crazy: it would pit groups of people against one another at the time when they’re most stressed. If everyone shares the cuts equally, everyone will realize that this concerns them personally. And we’ll restore the resources if and when our situation gets better. Nothing that currently exists is to be closed down permanently, even if we can’t run it right now. By staying together, we can affirm our community, whatever the practical hardships might be.”

That’s what I would have liked to hear in another reality, and that’s why this reality is well worth protesting.

You might think that even if reality is worth protesting, protesting doesn’t work to change it. My impression, for what it’s worth, is that student protests have slowed down the process of privatization, and in fact are the only thing that has had any impact on the process. It’s also clear that student protests globally have, along with Tunisia and Egypt, created the conditions for the current Occupation movement--California student protesters especially. Protesting reality today is no longer a joke in the way commentators thought it was in 2909-2010.

All of that said, however, it also makes sense to think of what the community wants to do in a way that goes beyond what it wants someone else to do, whether that’s the State or the UC Regents or local administration. It’s good, in the manner of Occupy, also to ask what the community wants to do regardless of what others think. It’s not just a matter of being in a terrible situation, but of how you want to live it. Just as there are things that money can’t buy, there are things that cuts can’t take away if you don’t let them. You can cancel a philosophy class, but you can’t defund critique--not against informed resistance. In the future it might become the case that you have to organize more of your own education; if classes you want to take no longer exist, you may need to connect with other people who want to learn it and teach it, and with their help take initiative to make it happen. While UC is pushing toward online classes for pay, we could make our own courses and post them online for free. Professors could allow in their classrooms UC students who are no longer enrolled because they couldn’t afford to pay or because they couldn’t make it academically because they were working so many hours. Students could donate their used textbooks to an exchange where you could leave an expensive textbook that you no longer needed and pick one up for free that you did need, instead of selling books back to the bookstore.

The fact is that UCI students already do a lot of things like this. There are already entirely student-run concerts and student-run lecture series and panels and radio stations and poetry societies and magazines to which the official culture of the university pays no attention, but this unofficial culture is thriving nonetheless. There is hardship involved in this--that is, doing these kinds of things is a lot of work and time, and it’s never for pay. But they make this time and place something that the plans of administrators are incapable of recognizing. What I’m describing now is not so much protesting reality as modifying it while continuing to protest it. The possibility of doing more of that, on the horizon now maybe by necessity, is the hidden potential of our lamentable situation: the possibility that students might transform the university at the moment when it’s being abandoned by its managers.

Officer 14 Tweaks on the Line- Occupy Cal 11/9 (UPDATED ACROSS THE DAY)

Penn State students riot for football coach fired in coaching staff molestation scandal (grand jury report).  The Nation follows up with a comparison of Berkeley and Penn State.

Crowds at Occupy Cal - Daily Cal Coverage.  Mercury News coverage with photos. SF Chronicle story and slideshow.  The AtlanticWire has a digest of news coverage.
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Occupy Santa Cruz.  Occupy UCLA. Occupy UC Irvine, Occupy San Diego  

And here is a first-hand report from Irvine:

Report from Irvine by anonymous
"We had a spirited teach-in and march in which about 400 participated, followed by a General Assembly in front of the administration building. TA and lecturer union reps, librarians, queer student groups, graduate and undergraduate students, and faculty spoke at the teach-in. Between the teach-in and the GA the students marched into ongoing classes and through the science library and the UCI bookstore. They chanted "Students' needs, not corporate greed" and "Educate, Occupy. Take back UCI." The OC Register has of course written us up with special attention to our profanity. (At one station of the march, a student began his speech with "My name is Alexander, I'm a student here and I'm fucking pissed off!")" 

Berkeley City Council has decided not to renew mutual aid agreements with UCPD and neighboring police forces in aftermath of recent police violence.  h/t CC

Thousands March in London.

OWS and the Reeducation of Desire.

Links for November 9

Students, staff, and faculty engaged in protest across the UC and CSU systems today.  So far I've tracked reports from Berkeley, Channel Islands, Davis, Fresno,  Irvine, Long Beach Los Angeles, Riverside, San Diego, Santa Cruz, and Sonoma State.  I'm sure there will be more news as time goes forward.

Protests in London.  Surprise, Surprise, the Police were there as well.

CSU threatens to raise tuition next year by 9%.

Yudof starts to walk back early reports of tuition freeze. Now it depends on receiving large infusion from the state.

Did you notice that the state budget is looking really bad for next year?

The LAO responded to Brown's pension proposal.

Links for November 8

Yudof announced no mid-year tuition hikes.  I wonder if he is nervous about protests at the Regents' party next week?

UC Davis plows ahead with plan to increase out-of-state and international students.

Bob Samuels discusses the rising inequality at UC here and here.


CSU faculty, librarians, and coaches to hold 1 day strike at two campuses.

As the CBP notices, some of California's wealthiest are CEOs of corporations that pay no federal income taxes. Somehow I suspect that is not because they don't make enough to pass the threshold for taxation.

Ohio voters reject GOP effort to attack collective bargaining.  Even the NYT notices.

Remember all those conservative claims that the poverty statistics overstated poverty?  Well the newer method has taken a look--and the numbers are even higher especially among the elderly.  Of course you can't convince a University of Chicago economist of the facts..

Check out our new Documents for Dissidence box in the upper right.  It provides announcements and background information and analysis that might be useful for upcoming protests.

The Story that Needs Changing

In the last few weeks I've given a number of talks on college campuses about the self-feeding devolutionary spiral in puliic university funding.  I've tried to describe the mechanisms that are continuing to accelerate decline, and identify points of resistance that could help with rebuilding.   The goal must remain mass quality rather than limited access to premium content.  Our higher ed system is stratified enough as it is, and "private good" solutions only make it worse.

Robert Mejia offers an overview of my "Rebuiling the Public University" talk at the University of Illinois-Urbana-Champaign.  By coincidence, I spoke in the same room a few hours after UI-Urbana faculty had met their new systemwide president for the first time, and heard him speak directly about his plan to take control of enrollments away from each campus and centralize them systemwide.  This struck me as the kind of administrative exercise that makes an executive's mark without improving the institution itself, and that distracts attention from the deeper issues of rebuilding funding and upgrading academic goals.

An example of the deeper issue occurred the day after the coverage of the Illinois faculty meeting, in an article in the Los Angeles Times on how California public universities are leading the way in public tuition increases averaging over 8% last year.  The article started with a causal connection between legislative cuts to public funding and increases to student tuition.  But it then cited an expert saying that the real problem wasn't public funding cuts but public campus inefficiencies, particularly the inefficiency of faculty who don't teach enough.


My critique of the elements of this damaging story is posted on the University of Illinois Faculty Association page.  I would like such critiques to be part of a broader effort to change the public narrative about the everyday work of public universities, so that yahoo solutions can't so easily get dropped into the middle of articles to distract the reader from the real issue.

The real issue is that imposing higher teaching loads and more on-line instruction on public universities won't reverse the relentlessly growing gulf between elite privates and their once-elite public peers.  The economists Robert Archibald and David Feldman, in their recent book Why Does College Cost So Much?, note that the inaugural, 1987 edition of the U.S. News and World Report rankings had eight public universities in their top 25. In 2010 the top-25 includes exactly 1 public university (UC Berkeley, at #21). 

The rankings are of course rather silly, but they do include measures such a per-student expenditures and average student-teacher ratios. On these measures of quality, public universities have been allowed to decline for decades. The decline is directly connected to falling public funding, which has never been replaced by the private sources so ardently discussed, in spite of the decades their advocates have had to achieve this replacement.

The result is stark, in Archibald and Feldman's terms:

In 1980, public universities spend roughly seventy cents per full-time equivalent student for every dollar that private schools spent.  By the middle of the 1990s, that figure had fallen to fifty-three cents per dollar.  These changes have consequences (p. 237)

We already know where the combination of cuts and "efficiencies"is taking us -- towards a class hierarchy of private over public, in which the latter, who teach close to 4/5ths of all college students, are forced to lower quality further while pretending they are not.

Teaching processes can always be improved, but public university executives need a much tighter focus on closing the funding gap with private universities so that we can close the gap in quality of service. Playing around with alternatives to rebuilding funding will only make the public-private gap that much wider .

Links for November 4

In Oakland, Occupy supporters and city officials debated at a public meeting.  And you can get more information here.

Assembly Budget Committee expects 5-8 Billion dollar deficit next year.


Students and professors are trying to steer graduates to useful work, offering alternatives to Wall Street.

Silicon Valley Investor donates $150 Million to Stanford Business School for program to fight poverty; proves irony is not dead.

Harvard Students Walk Out of Economics lecture class because they want education not propaganda.  Not sure what else they expected from Harvard economics though.

In Texas, one community college system board is debating whether to end tenure, they have already set up rules to punish tenured faculty from "grumbling" about superiors.

Occupy Wall Street is organizing a march against the bogus bank fraud settlement.   Greg Palast has the latest on Goldman Sachs' effort to pressure OWS's bank.  They are using taxpayer money to do so by the way.

Dean Baker points out that, despite some improvement in the latest job figures, at this pace it will take 33 years for the unemployment rate to return to pre-recession levels.

Thousands are moving their money to credit unions.

NYT tries to claim that poverty isn't so bad.  No joke.

Have a good weekend.

Links for November 3rd

#OccupyOakland closes down nation's 5th biggest port.  UCOP appears to have asked its employees to stay away from the office, located near the occupation, and to work from home.

Colorado votes down a tax-increase measure for education.  The state governor wants to balance the budget by cutting higher education but much of the legislature is resisting.  The governor is a Democrat, and those opposed to higher ed cuts are Republicans.


In Wisconsin, Gov Scott Walker is targeting the UW system, with 7% of the state budget,for 38% of the cuts.

Bob Samuels analyzes UC compensation data, with special attention to salaries over $200,000.

Average student debt is also up 5% this year, to over $25,000.  The figures exclude debt incurred by students at for-profit colleges, as only 5 of 471 for-profits reported student debt figures.  Parental loans push the average to over $34,000.  California remains a "low debt state" (a bit over $18,000) (the report is here).

Higher Ed Watch discusses a cause identified in a recent Department of Education report: "the country’s public and private four-year colleges are now spending a greater share of their institutional aid dollars on trying to attract the students they desire than on meeting the financial need of the low- and moderate-income students they enroll."

Those mulling the fate of public pensions get a good reminder from David Atkins of the incentives in the financial community for putting public assets into play.

Students of management mishaps should make sure they didn't miss this NYT piece on cognitive fallacy: decision-makers routinely ignore evidence of the failure of their decision processes (h/t to Marcia).  One apparent cause:  "people who face a difficult question often answer an easier one instead, without realizing it." 

The three buildings at UC Davis with the top platinum rating from the Green Building Council are Gallagher Hall, home of the UC Davis School of Management,the Robert and Margrit Mondavi Institute for Wine and Food Science, nd the Tahoe Environmental Research Center in Incline Village, Nevada.

Links for Wednesday, November 2

Occupy Oakland Schedule for General Strike.  Live updates.  Other information.   Video. 

Colorado Voters say no to increasing taxes to pay for education.

Texas Board of Regents invests in company that trolls for course grading data; mandates that campuses sign on to it.

Regional Public Universities are lessening research commitments.

Universities intensify efforts to break into commercial world.

We Can Restore California's Higher Education...If the Leaders Lead

By Stanton Glantz

cross-listed from KQED

Conventional wisdom says the UC and CSU funding crises are the inevitable result of recession-driven budget shortfalls, and the only solution is to soak students and their families.

But it's bunk. Shifting costs from the public to students is a deliberate act of public policy.


Well before the recession, Arnold Schwarzenegger and the UC and CSU presidents signed the Higher Education Compact. UC and CSU accepted huge cuts in state support and agreed to rapid annual tuition increases in exchange for a broken promise of future financial support.

And, though a Democrat, Jerry Brown is accelerating the transformation of higher education from a public good the people of California provide for the benefit of all to a private good students buy.

This is a radical reversal of the spirit that built California. But what's been done can be undone.

In fact, it would not cost much to push the "reset" button on California's entire higher education system, from community colleges to UC's graduate programs. We can roll fees back to 2000 levels, restore state funding and accommodate the students who've been forced out. And it would only cost the median taxpayer $49.

To today's jaded sensibilities that sounds far-fetched. But it wasn't so long ago that a passion for that kind of thinking built California in the first place.

This affordable "reset" will never happen unless university officials stop acting like highly-paid executives at financially failing corporations, start behaving like stewards of a public trust and start making the case to do it.

Links for Monday: Trick or Treat Edition

Is that a costume you're wearing? Gov. Jerry Brown comes as the Honest Republican, proosing that California seek another Bottom-5 ranking, this one for oldest workforce unable to retire on their pensions.

The relevant UC Senate committee comes as the Partner in Reform, responding that the many good parts of Brown's proposal are the same as recent UC pension changes.

UCLA Management professor David Lewin comes as a Mangement Consultant, but offers the most incisive perspective on pension reform, similar Republican measures in other states, and the downside for both the economy and future retirees.


Digby comes as the Angry Middle, tracing one-way austerity to hijacked tax policy.

The UC Berkeley Labor Center comes as the Debate Reframer, analyzing how the systematic destruction of retirement risk-pooling has spread retirement insecurity

Coming as the Pained Observer of Endless Non-accountability, David Dayen chronicles the nothingburger of non-penalties for massive mortage fraud, with ominous forebodings of a non-recovery in mortgage Chernobyls like California.

The Center on Budget and Policy Priorities comes as the Party Pooper, noting Democrats throwing away their high card on issues like Social Security -- cost-sharing for better overall social results.

My friend Jan comes as the Angry Trader, wondering when they'll spin a UC campus off as a Special Investment Vehicle so she can short it. 

President Emeritus of St Lawrence University Daniel F. Sullivan comes as the Higher Learning

Happy Halloween!

Links for Friday, October 28th

Student Regents speak out on rising tuition.   Daily Cal has an interview.  And here is a presentation.

Brown Proposes reducing pensions for public employees.   LAT can only discuss it in terms of politics.

Gavin Newsom vows to change the narrative on higher education cuts.  Do you think the Regents would even understand the concept?


The NYT wants to know:  Is the Obama proposal on college debt any good?

Republican Presidential Candidates oppose Federal Support for College Students.

Texas starts eliminating Physics departments.

Texas regents are eager for "accountability" for others.  For themselves?  Not so much.

The Obama administration is going to let Jerry cut Medi-Cal benefits. 

Have a good weekend.

Links for Wednesday, October 26

There are more concerns being raised about the proposed Negotiated Salary Program.

Surprise! Higher Ed costs continue to rise.  More data can be found here.

An even bigger surprise:  California leads the nation in tuition increases.


States have been shifting burdens not only onto students but onto the Federal Government.

Obama is going to announce some rules changes for student debt.

Occupy comes to UCLA.  Oakland Police Tear Gas Occupy Oakland.

Clair Potter thinks about the relationship between academics and the rest of the 99%.

UK cuts in Education spending are the largest since the 1950s.

Links for Monday October 24

Not to worry: Dan Greenstein and other proponents of UC online assure us that it will maintain quality and not be used to downsize faculty.

Students are confused by UC's new admissions guidelines.

Task Force recommends changing the priorities of California's Community College System.


Mark Sumner has some history on the attack on public employee pensions.

No wonder Eric Cantor was scared to face the public at Wharton Business School.  Oh, and that doesn't count his telling students to work multiple jobs because he can't be bothered supporting Pell Grants.

Rick Scott wants to be Rick Perry:  Now he is going after Florida's Public University faculty.

Speaking of Rick Perry:  it looks like the Texas Miracle was dependent on the expansion of public sector jobs.  Now that they are being cut I wonder what is going to happen to that jobs record?

Senate Panel moves to lessen Federal role in K-12 education.

Schools across the nation are bracing for more cuts. 

Obama administration working on mortgage repayments to help the banks borrowers.

Dick Walker and Martin Bennett propose a new New Deal in response to the jobs crisis.

CUNY has expanded its remediation programs.

You will be shocked to hear that at Division 1 schools spending on athletics grew at double the pace as spending on academics.

In the run-up to fee increases, UK college applications have dropped 12%.

NSP: Eroding the Salary Scales, Undermining Faculty Governance

By Joe Kiskis

A previous post here provided a brief description of the proposed APM 668 Negotiated Salary Program (NSP) and comments from Professor Stan Glantz on the detrimental consequences of the similar Health Sciences Compensation Plan (HSCP), long used in the UC health system enterprises. In this post, I offer comments directly related to language of the proposed NSP policy for the general campuses.

The merit and promotion academic personnel system at the University of California is a great asset of the institution. It is a well-documented and carefully followed system that closely associates rank, step, and salary with accomplishment in teaching, scholarship, and service as evaluated by faculty peers.

For many years, UC salary scales have lagged those of comparable institutions. To partially compensate for this, there has been a growing use off scale salaries, which are set on an individual and ad hoc basis.

It is now widely recognized that this decoupling of salary from advancement in rank and step is undermining unique strengths of the UC academic personnel system, and there have been repeated calls to reform the salary scales so that the traditional value of the merit and promotion system is re-established. Unfortunately the proposed NSP would not be a reform but rather an additional administrative mechanism that circumvents the merit and the promotion system.


The proposed APM language delegates important decisions on how or even whether to implement the NSP policy to chancellors and permits fine grained rules with potentially wide variation between campuses and academic units.

Although it is often assumed, and it is the case in the examples accompanying the draft APM, that the money used to pay a faculty member a higher salary will be very closely associated with non-state funds generated by that faculty member, in fact, there is nothing in the draft APM that makes that association.

Since tuition is non-state money, it or other non-state UC general funds could be diverted to pay NSPs to individual faculty members at the discretion of administrators.

Since almost all faculty would be "in good standing," and thus, in principle, eligible for an NSP salary increase, essentially everyone would have an incentive to constantly petition their department chair and dean for an NSP. The new process for determining an NSP requires proposals and review with participation from the faculty members making requests, department chairs, and the EVC/Provost. Of course this is in addition to the administrative overhead of the existing personnel processes.

The policy is vague on the role of the Academic Senate in the process. In a fine grained implementation, this could vary by campus or even by college or school. Over time this is likely to further undermine the merit and promotion process and make salary increasingly unrelated to academic accomplishment as evaluated by faculty peers.

The policy creates additional incentives for the pursuit of external funding with the likely consequence that research directions will be further determined by funding entities rather than by faculty creativity and initiative.

The proposed APM includes a provision for a "contingency fund." This is mentioned but not described in the proposed policy language. Implementation of this fund is another item at the discretion of chancellors. From the material accompanying the proposed policy, one concludes that the purpose of the contingency fund is to serve as an insurance policy. In the examples in that accompanying material, there would be a tax on the state-funded, pre-NSP base salary of participating faculty members (3% in the examples). The combined money thus collected would make a campus contingency fund that would be used to continue the NSP for any faculty member for the duration of the NSP agreement even if the external fund source from which the NSP is drawn disappears. So state money is set aside to insure that the salary increases of NSP participants are continued even if the external funds are not available.

Thus the proposed APM 668/NSP goes in the precisely the opposite direction of reform to the processes of salary determination at UC. It would further undermine the merit and promotion system and institutionalize a "system" for determining salaries that is non-transparent, arbitrary, inequitable, open to abuse, and decoupled from peer evaluation of accomplishment in teaching, research, and service.

Links for Friday, October 21

Opponents of California's Dream Act begin collecting petitions in favor of a referendum to overturn it.

As minority enrollments in California have gone up, state funding has gone down.


Regents to consider increasing employee contributions to UCRP in 2013.  Bob Samuels has some analysis.

California Department of Corrections sends out 26,000 notices of possible layoffs.

Looks like the Tea Party is trying to get authority of Michigan's higher education institutions.

Ohio proposes moving all developmental and remedial classes out of 4 year institutions.

Illinois case pits student privacy against freedom of information and press.

Students Occupy Chilean Senate building.

Antioch is coming back.

English government offers to give universities more student slots in exchange for lower fees.

Occupy LA joined the protest against Rupert and Friends.

Have a good weekend.

Links for Wednesday October 19

UC Riverside Students grade the State on its commitment to Higher Ed and it isn't a good one.

And it looks like it is going to get worse.  The Triggered Cuts seem to be on their way.

Iain Pears lays out the situation in England.

The Battle between Public Universities and State Legislators is heating up.  Of course the students are the ones who lose.

Financial aid not based on need is driving low income students out of higher education.

Administrators are pressing hard on faculty teaching loads.

Art Schools are reconsidering the foundations of their education.

A former provost reflects on the distance between administrators and faculty.

Surprise!  The Bloomberg administration turned a petition against school funding cuts into a petition against teachers.  The only surprise is that they got called out over it.

Community College enrollments are declining.

Links for Monday October 17

Today in Links: The Costs of Athletics; the Destructiveness of Austerity; and the Foolishness of Managerial Ideology plus much more

And don't forget Stan Glantz' post on UCOP's proposal to further erode the salary scales immediately below.


A Federal Law Suit has been filed against several Berkeley officials over Wheeler Hall arrests. 

Looks Like Pac-12 athletic programs are still losing money.

Occupy Wall Street has real reasons for anger.

UCFA has organized a petition in support of Occupy Wall Street.

Wall Street itself is sulking.

You really can't make curricular decisions based on enrollment numbers.  Not at least if you want to remain educators.

Washington State's Community College System declares a financial emergency: makes it easier to lay off tenured faculty.

English Students to march November 9th to protest Coalition's attack on public higher education.

More problems with pension and health accounting may be on the way.

More evidence of the damage austerity policy is doing to the NHS.

Problems with UCOP's Proposed Salary Supplements for Grants

Officials at UC and other universities have been scrambling to replace resources lost to public funding cuts.Most seem still to see extramural research funds as net positive cash flow for the institution, which they are not (one news link from our ample coverage plus one previous post).  But grants do provide funds for salaries, including partial salaries for faculty investigators, and with that in mind the Joint Senate-Administration Compensation Plan Steering Committee has hatched a plan for a new policy -- and new personnel section APM-668 --called the Negotiated Salary Program (NSP).

The basic motive is that the University needs to find funds to retain those faculty most at-risk of being recruited away by competing institutions.  The rationale is that since state funds keep shrinking, the University must look to non-state funds to fill in the gaps, meaning looking to federal as well as private grants and donations.  The model is the Health Sciences Compensation Plan (HSCP), which the prosposal would extend to the campuses.

Agencies tie salary paid from a grant to research effort on that particular grants. The proposal discussion cites NSF and NIH language that forbids use of grant funds to augment a faculty member's salary (pp 4-6).  The NSP is meant to be a workaround. It would allow faculty to apply to members of their campus administration, starting with their department chair, to use some portion of extramural revenues as a salary augmentation ("negotiated salary component") for a finite period (1-2 years).

We post below a comment from Stanton A. Glantz, a faculty member in UCSF's School of Medicine. It discusses the major issues raised by the NSP proposal in the context of his knowledge of the health sciences plan itself.

The Health Sciences Compensation Plan (HSCP) programs has several origins:

• Very few faculty are supported by permanent state-funded lines.
• A substantial part of the revenues to pay faculty salaries comes from clinical revenues.
• Schools of medicine, nursing, dentistry and pharmacy, in addition to their academic mission, run major nonprofit businesses providing clinical care. (This is unique: law schools do not run large scale legal practices; business and engineering schools do not manage businesses that produce actual products.)
• As a result, health sciences schools have to provide salaries that are high enough to hold clinical service providers who could be doing the same thing out in the community.  Indeed, these plans were originally developed as part of moving from volunteer faculty to “strict full time” faculty paid by the University. Thus these comp plans require that faculty not have any outside professional income related to their professional practice; any such income has to be paid into the departmental comp plan.
• In recent years, in an effort to encourage generating more clinical revenues, the plans have moved more and more to an individualized incentive structure.
• Grant income has not generally been part of that structure.  Indeed, in some highly compensated clinical departments (like surgery and anesthesia), I have heard of cases where faculty were threatened with salary cuts because they got grants that did not pay for the clinical revenue lost because the faculty member was obligated to do the research.  (NIH has a salary cap, currently about $199,000.)

At the same time, there has been more and more pressure to get grants as a way of bringing more money into the University and thus bringing in more indirect costs.  This has been enshrined in policies in some departments (such as the UCSF Department of Medicine) requiring a certain type of grant (and NIH R01) as a condition for promotion to associate professor, where most faculty are brought in as adjunct faculty until they get an NIH R01.

There are several problems with this:

• Since the federal indirect cost rate is below actual indirect costs (by design, since the federal government requires cost sharing by the university), the more grant money that comes in, the greater the financial shortfall for the department (or school or campus) as a whole. The indirect cost rate on nonfederal grants is even lower. (The University keeps talking about increasing the indirect cost recovery, but the probability that they will ever break even, much less turn a profit, on indirect costs is zero.)
• In the past, these shortfalls have been made up with surplus clinical revenue.  This is becoming more and more difficult as reimbursement is squeezed as part of health care cost containment.
• On a general campus, which does not have this source of money, the shortfall will have to be made up with cuts elsewhere, most likely teaching and non-extramurally supported research programs.  (This is likely happening even at UCSF.)
• There are no meaningful controls on growth. The tradition at UCSF (and lots of other places) is that anyone who can get a grant (what NIH calls a K award, a career development award for junior faculty) that the department likes can join the faculty. There is little or no attention to larger programmatic issues and, when these grants run out, there are often crises in supporting these people.  This was not so much an issue in past years when the NIH budget was growing, but there are now huge problems because the NIH budget is stabilizing or shrinking in real terms.  (In many ways, this situation is like the subprime crisis: Everything is dandy during rapid growth, but there is a reverse multiplier effect when the growth slows or stops.)
• It is of questionable legality. It is my understanding that the federal government and other agencies pay a fraction of salaries based on what the salaries for comparable position and actual effort devoted to the project are.  A system that effectively pays a “commission” for getting extramural grants would violate this principle.
• The department (or school or campus) effectively turns over control over its future to extramural funding agencies, chasing whatever their priorities are for the moment.
• There are serious academic freedom issues.  If getting a grant from an extramural agency is a condition of employment, promotion, or even salary, people with other interests suffer discrimination.  The first question becomes not, “is this an important idea,” but “who will buy it?”

While not precisely the same issue, the UCSF Senate has been trying to deal with related issues of faculty ending up in the wrong series as a result of similar problems (e.g., this report)

See also Warren Gold's astute comments on the topic:

As we discussed before, the problem with the medical school process of X, Y , and Z components is that it does lead to inequity, not equity. X is the base salary that applies throughout the department, e.g., medicine, of which I am a member. But the other components are negotiable with the Chair. And such negotiations lead to a situation in which new young hot shots, who had to be lured from other campuses may be earning as much or more than senior members of the division or department because it takes more money to secure the new hire, or prevent the older department member from being recruited elsewhere. When the process has been running for a few years, you end up with very different salaries within the same division or within the same department regardless of the actual professorial grade or step. When you add in the fact that the majority of our faculty are not ladder rank, but may be in clinical, ladder or other series and their salaries may depend on clinical income and/or grants, the situation becomes even more complex and unequal

There has been an effort for last few years to try to return the salaries to some relation to the actual professorial rank, but I do not think it has been very successful so far.

I think this approach in the general campuses would be a disaster for all the reasons we have discussed including decreasing state support, increasing private support, and increasing inequity.

Links for Friday October 14

Looks like Goldman Sachs has moved from the housing bubble to predatory recruiting for online ed.

Protesters heckle Rupert at his Education Summit with Jeb.

Links for Thursday, October 13

Jerry Brown is going to propose a constitutional amendment on Pensions.

New report from Berkeley argues don't blame budget problems on public employees.

Jeb comes to San Francisco.  So do protesters.  (h/t Peter Krapp)

UCMeP's Equality Bake Sale Raises 1.8 Million.  The Daily Cal has more.

Senate Republicans offer their own jobs plan: cut back people's access to health care, gut environmental regulations and lower corporate taxes.

Hundreds of  private non-profits and for-profits  fail the government's test of financial solidity.

Community Colleges are hoping that Obama's jobs bill will provide funds for needed maintenance and upgrades.  Not that the Republicans care.

The CBP has a new report out about the financial condition of California's K-12 schools.  You will be stunned to learn that it is very bad.

As Online education spreads so does financial fraud apparently.

Enrollment in England's colleges has dropped for the first time since 1999.

Amazingly enough, it turns out that cutting funding does effect service.  NHS wait times are up dramatically after austerity.

Links for October 12

Jerry Brown signs California Dream Act.  Vetoes Bill to allow diversity to be considered in admissions.

Dan Greenstein joins Jeb Bush and the President of US University at a cliché hurricaine in Dallas TX on the Future of State Universities.  As you know, it has been decided that the future of state universities is distance learning.  Greenstein, assured all and sundry that there was a need for "leadership that is innovative, has a clear vision, and is willing to take risks."  Greenstein claimed that "as a university we are committed to launching an online program for undergraduate students." This no doubt was a comfort to sponsoring Govs Bush and Hunt, who invoked studies showing that computer are better teachers than teachers are.


Florida's Rick Scott thinks the state is wasting its money on social sciences.   After all, he thinks that corporations don't want those liberal arts skills anyway.  What is it with Florida governors and education anyway?

Texas school districts sue the state over funding cuts and inequities.

Joseph Stiglitz notes the government "Of the 1%, by the 1%, for the 1%."

Occupy San Francisco takes on Wells Fargo. 

Hospital Workers are on a 24 hour strike at USC Medical Center. 

Paul Krugman comments on the real Panic on Wall Street.

Consumer groups protest Obama Administration's proposal to make it easier for collection agencies to collect student debts. 

In the UK: What are Universities For?

Links for Monday October 10

The Chilean police responded violently to student protesters; students' leaders targeted.

The LAT has realized that UC may no longer be affordable for middle-class kids.  Yet they don't actually oppose doubling tuition.


Anti-Cuts protesters took over Westminster Bridge on Sunday.  Here is some more.

Noting the rising time of precarious academic labor, AAUP issues a statement supporting Occupy Wall Street 

On-line ed flunks again. This follow-up to a previous NYT piece by Matt Richtel offers a useful distinction between the industry's public relations analyses and carefully constructed longitudinal research on on-line outcomes, which are rare at best.

The dependent clause that hurts: The transcript of an NPR piece called the "Luxurious Revenue College Sports Model" notes in passing,

Clark Kerr, who was the head of the California university system back when "California education" was not an oxymoron, opined that the modern American university's purpose "has come to be defined as providing parking for the faculty, sex for the students and athletics for the alumni."

Followers of college rankings -- academic division -- should ponder a comment on a post last week, TB's short summary of the decline of UC's campuses in this year's Times Higher Education tables. S/he makes a suggestive connection between the campus's relative poverty and the speed of its recent decline.

And the UC Movement for Efficient Privatization stamps out the inequities highlighted by UC Berkeley's "Diversity Bake Sale" by selling all cupcakes on Oct 12 for the one fair price of $22,000.

Links for Friday, October 7

Occupy Wall Street (courtesy of Casey Blake)

More today on Banks, protests, international activity on higher education, and even some California news.  All below the fold.


UC Irvine starts an ROTC program.

For Those of you interested:  Here is an analysis of the legal status and time, place, and manner questions of Occupy Wall Street.

Jerry Brown signs bill limiting initiatives to November ballot in 2012.

Is Kamala Harris going to back down and rejoin the talks to let the Banks off the hook?

Obama gives Wall Street a Get Out of Jail Card for free.

Official US unemployment remains at 9.1%.

Former Berkeley Chancellor Berdahl gets new job at UOregon: 2 days a week at $96,000 a year salary.

British Academics challenge their own administration's failure to defend public higher education.

UK Lecturers threaten to work to time if Government tries to change their pensions.

Chilean Students have broken off talks with the government.  The government is threatening to criminalize protest.

Sarkozy is pushing for the creation of a "French Ivy League" that will break with educational egalitarianism.

In the UK there is growing higher ed inequality already.

More from Jeb Bush and Jim Hunt on the future of the University.

Gee, Eric Cantor doesn't like Occupy Wall Street.

Have a good weekend.

Links for Thursday, October 6

More in today's links about protests and occupations, economic inequality, the defense of higher education and why it is that Harvard's economic influence may not be good for the country.


Occupy Colleges staged events all over the country on Wednesday.

And there was movement across California.

Visiting Occupy Wall Street.

Mark Levine reflects on how a great university is dying in California.

1/3 of Americans are one paycheck away from the threat of homelessness.

And there is new evidence on the relationship between inequality, the recession, and unemployment.

Harvard can claim ownership of a chunk of the lesser depression.  No wonder the British think more highly of Cal Tech.

Jeb Bush thinks that online ed is where you should be.

Online proponents seem to be making the same individualist mistake that economists have been making for several decades.  That worked out well didn't it?

Austerity really works.  UK economic growth even lower than expected.

Job Creators at the Chicago Board of Trade admit they are the 1%.

More information on Occupy Wall Street and other occupations and actions.

Turns out that public employees don't do better than private employees with their retirements.  But in California private sector employees are less likely to have retirement benefits from their employers than in the rest of the country.  I guess that is because the state makes such demands on its businesses.

University of Michigan has decided to invest money with venture capital in tech start-ups.

A Heartbreaking Work of Staggering Wrongness

A number of former University of California chancellors met at the end of June to discuss the state of UC, and recently released a statement we linked yesterday, one called Former University of California Chancellors Urge New Funding Models for UC.  The main result is another call for a high-fee UC, this time set at $24,000 for in-state students.

The word "new" has no place in the title of this document. Nearly all of these chancellors were in office during the twenty years of UC public funding decline, and have come together to advocate the acceleration of what they have been doing all along. This consists of advocating business-as-usual non-public revenue growth on a base of doubled tuition.

I've annotated the text below because it is an interesting expression of the intellectual gridlock that is preventing UC's senior managers from thinking their way to a better place. I am also trying to get you to read this kind of thing.  There's a lot more reading just like it coming up this fall, so get in shape!

My comments are in bold

The text of the former Chancellors' letter:



Dear President Yudof:
Thank you for joining us during our assembly of former UC chancellors in San Francisco on June 26-28. As you know, this meeting involved 22 of the 29 living former chancellors. Some of us served as long ago as the 1960s, and one of us was involved in drafting the 1960 California Master Plan for Higher Education; all of us share a deep concern for the University of California. Vice President Patrick Lenz’s comprehensive presentation on the budget was immensely useful to our discussions, and we especially appreciate your taking the time to give us your perspective on UC as well as listening to our thoughts and suggestions. As we promised, we are writing now to share some of the ideas that came out of our two-day meeting.

Our first message is that we support the actions you and the Regents are taking to address the current fiscal crisis and want you to know of our desire to help in any way we can. There can be no doubt that the University faces the most far-reaching restructuring of public higher education in this state since the 1960 Master Plan. Today’s California, however, is very different from the California of 1960. The Master Plan was the product of a disciplined and coordinated effort by the leaders of California’s public and private colleges and universities to create a better and more stable future, grounded in the conviction that higher education is a public good. Today’s restructuring is the sad outcome of decades of ballot-box budgeting, unfunded mandates, and other political restrictions on the rational use of the State’s General Fund.

This is an inaccurate and misleading history of the Master Plan. It's true that the California of the 1950s was overwhelmingly white, and that the refusal of active voters--still majority white-- to support cross-racial pooling of educational resources is a huge factor in our current problems. That is not what the Chancellors say, however.  The point of this conventional narrative of the Fall is that we no longer have the political environment that created the Master Plan's fully public higher education system, so therefore we cannot sustain a fully public higher education system.  

In reality, the Master Plan was a response to continuous political warfare over higher ed plus an attempt to outflank the state's very conservative political class that refused to pay for expanded universities.  Former UC President Clark Kerr, a central figure in the negotiations, told me in an interview in 1996 that it was so hard he wanted to give up any number of times.  In the end, he only got part of what he wanted.  In his recent writing on the subject, he says that while the ex post view sees the Master Plan as a "grand design," ex ante 

the plan looked to those of us who participated in its development more like a desperate attept to prepare for a tidal wave of students, to escape state legislative domination, to contain escalating warfare among its segments. This it also was.  And the preparation, the escape, and the containment in each case was barely in time and barely succeeded.  The master plan was a product of stark necessity of political calculations, and of pragmatic transactions. (172)

The Master Plan was in short the result of an enormous political effort in the 1950s -- in the face of a budget deficit that as Pat Brown took office was 20% of revenues (120).   Sustaining it now will require another enormous political effort. If UC doesn't sustain it, it's because it won't, not because it can't, and the chancellors' potted history is a smokescreen.

The unintended consequence is that the University of California and the California State University have been relegated to struggling for essential support within the 15 percent of the State budget that remains discretionary and within the Legislature’s control. Our two institutions are now the single easiest target for budget reductions. High levels of public approval and low levels of State funding have become a pattern in California. A UC or CSU education is, by default, increasingly treated as an exclusively private good, rather than as the benefit to society it was traditionally held to be. 

UC and CSU are "increasingly treated as an exclusively private good" BY certain conservative advocates for low taxes, their political and business allies, and many defeatist senior managers. This is a political statement, not a statement of fact.  It is not supported even by polling data, where in one recent case two-thirds of respondents oppose increased fees and nearly half were willing to pay higher taxes to keep fees down.  The "private good" claim excuses failure and/or the absence of effort, but it is right-wing ideology rather than a reliable data point.

This can have only one outcome for the University. The Regents and the UC community will ultimately be forced to decide whether the University will continue to be among the best universities—not just one of the better public universities—in the world. We consider it imperative that the choice be the more difficult path of remaining a great university. So it is critical to understand where the budget news leads and what can be done about it.

It goes without saying that the faculty are pivotal. They are the ones who will create new academic models and new and more efficient educational delivery systems. For this reason, we are especially worried about faculty recruitment and retention; a central mechanism for tracking both might be useful to you and the chancellors. We are just as concerned about maintaining the quality of graduate education and opportunities for research. The University must have an evolving intellectual agenda in key areas of research, scholarship, and education, developed by the faculty, articulated by the chancellors and the president, and supported by the Regents. This is what attracts faculty to the University and creates rallying points for the state’s opinion leaders, the general public, and our students.

For decades, UCOP budget officials did not believe that the state legislature had an interest in graduate study or in the production of advanced degrees. In accounts that I began to hear from the horse's mouth in UCOP around 2002, senior UC officials did not advocate for this core function of a research university. Better late than never with the former chancellors, but graduate education now needs to be described as a public mission for the whole population and not as a service focused on a narrow slice of California's private sector, whose high-tech portion seems to most people to be doing much better than they are.

SURVIVAL SOLUTIONS
Public multicampus systems like UC have essentially two sets of solutions for survival in a deficit-ridden world. The first is non- controversial: effecting educational and administrative efficiencies; obtaining more research funding and higher indirect cost reimbursement through federal contracts and grants; expanding private fund-raising and additional sources of revenue, such as part-time professional degree programs and patent income from university-sponsored research.

In fact these solutions are controversial.  Extramural research cannot be a new revenue stream because it loses money, as we have had to point out frequently on this blog.  Deficits will remain even if federal agencies increase recovery margins a few percentage points, which, given the current budget climate, they won't.  Simlarly, private fundraising is 98% or so targeted to special activities, and efforts to change this are in their planning stages and, given the tradition, unlikely to succeed.  (UC is struggling even with alumni donations.)  Etc, etc.  The former chancellors should have considered the extent to which alleged profits in these categories are actually loses. The statement is undermined by the fact that they did not.

A second and controversial set of options includes the following:

• raising out-of-state and international student enrollments as a greater source of revenue;
• increasing tuition levels uniformly throughout the system;
• imposing differential tuition—individual campuses set their own student fees so that more selective campuses can generateadditional revenue to offset cuts in state funding;
• adopting a privatization model—through which all or parts of university operations become, in essence, financially self-sustaining.

The University of California is vigorously pursuing every one of the first set of solutions and beginning to explore the second. Our campuses are now admitting more out-of-state and international students. This is a reasonable if sometimes controversial policy, given the state of public funding for students who are California residents, and it offers potential educational advantages as well. We understand the Regents are also considering differential tuition. Several members of our group expressed concern about departing from the long-held principle that tuition levels should be uniform across the system. Others felt differential tuition is likely to help some campuses but harm others. And we note that there are already differences in what the various campuses charge in so-called campus fees; such fees, for example, are 10 percent higher at UC Davis than at UCLA. Our consensus was that differential tuition raises two broad issues: whether it is a more effective option than simply raising tuition on all campuses and whether it can be done in a way that protects the aspirations and effectiveness of the younger and smaller campuses.

endorsing the status quo while punting on the core issues . . .

Then there is the sensitive issue of privatization, also referred to as self-sufficiency. As you know, the University of Michigan and the University of Virginia chose this path some time ago; other public universities are considering, or have already adopted, a similar strategy. The University of Oregon, for example, has proposed that the state’s current annual appropriation for its support be used instead to pay interest and amortization on an $800 million bond. The university’s matching contribution, raised through private gifts, would create a $1.6 billion endowment to replace the state of Oregon’s annual allocation.     There may be aspects of the Oregon idea that would work in a California context—perhaps a portion of State general funds, with an equal contribution from UC through private fund-raising, could be set aside as seed money for such an endowment.

The fundamental question for the University of California is how far we can go in the direction of self-sufficiency and retain our public character. It appears that graduate professional schools are the most likely candidates for a move to financial independence, particularly if we are to maintain their current level of excellence. Still, this model has more than financial implications. In the context of UC’s historical role as a public university, what does it mean for us and our faculty, for parents and students and citizens, if UC as a whole becomes less like a traditional public university and more like a private one? This question requires serious discussion within the University, in the legislative arena, and in the court of public opinion.

This group of emeriti might actually use some of its leisure to address the concept of the university as a public good, either philosophically, or as an issue in economic theory (standard econ has a skewed and limited definition of the public good), or as a practical matter - what has happened to UM-Ann Arbor as a university and a public institution, for example? They don't do any of this, and thus there is no learning curve that might produce a few anomalies to challenge the privatization paradigm that they are pretending to consider anew.

This document again raised for me the whole question of administrative learning.  How do administrators learn new things under the daily pressure to decide? Can they learn new things that could change the beaten path?  Is UC admin captured by a conformity culture? These issues are beyond my scope here, but I am always worried about the very high repetition-to-novelty ratio in senior administrative commentary, and this letter is no exception.

NEW MODEL FOR STATE FUNDING AND STUDENT SUPPORT
The willingness of some states to explore unconventional strategies signals a new era in public higher education.

Let's be clear. Privatization in America is not an unconventional strategy. It is a pervasive tradition and automatic reflex.

This era unmistakably arrived in California when, for the first time, student fee revenue surpassed UC’s share of State General Funds earlier this year. The crossing of these two curves is a disturbing and seminal event.

A few journalists have dutifully reported on the historic moment in which two revenue curves traded places.  Meanwhile, regular people care a lot more about the cost of attendance.  A better candidate for 'seminal event' is  the increase of the Ed Fee past $1000 per quarter (1992-93), or the Compact for Higher Education that mandated annual fee increases of at least 7% a year (2005).  Another would be the 2007 decision by the Regents to let fees at the system's most prestigious professional schools go more or less "to market," which created a precedent for all professional schools and now, for the system as a whole.

At the moment, UC is raising tuition reluctantly and only in response to each new, damaging State budget cut. Two weeks after our meeting, the Regents approved a tuition increase of 9.6 percent and said they will increase tuition again in January if further cuts in State funding materialize (as many believe will happen). Because of chronic budget shortfalls, this approach has the unfortunate effect of asking students to pay more even as they are getting less—crowded classes, fewer courses, eroding student services. Right now, the additional revenue from tuition increases appears to be enough to keep the University afloat but not enough to sustain its excellence or stabilize its future.

Yes and yes on unsustainably paying more to get less. Thank you.

How high should tuition be? High enough to ensure the quality, access, and affordability that have always been the hallmark of a UC education. There are those in our group who argued that—given the State’s current level of support—tuition should not be at the current $12,000 a year but at about $24,000 to preserve UC’s academic excellence.

Here's the punch line -- UC for $24k!  And what did the rest of you argue, with your concern for access and affordability as well as quality?
 
Contrary to public perception, all the evidence suggests that that higher tuition is not a barrier for students—including low-income and minority students—as long as it is combined with adequate financial aid. 

So you all agreed?  Sadly, you all are wrong.  During the twenty years that states have been shifting university costs from the taxpayer to the student, relative degree attainment has declined, continuation rates are flat or falling, and the US has completely destroyed its international educational advantage.   For the first time in its history, younger people are less educated than their baby-boomer parents (p 10). The proportion of U.S. students starting college who actually finish is now 56 percent, placing the U.S. with its world's highest tuition levels twenty-ninth out of the thirty countries measured by the Organisation for Economic Co-operation and Development (OECD). Tuition increases have degraded affordability and reduced attainment (p 8). California, one of the world’s wealthiest places, has seen one of the most astonishing declines in college achievement. The state’s continuation  fell from 66 percent to 44 percent in just eight years (1996-2004). California’s rank among states in investment in higher education declined during the same period from fifth to forty-seventh, according to Thomas Mortenson, a higher education policy analyst (ibid).  The idea that financial aid protects low-income students is a myth, one that dies a thousand deaths in an exacting study of a unique public university data base, William G. Bowen et al's Crossing the Finish LIne, which shows that low-income students borrow more than higher-income students and increase their borrowing with each ongoing year in college, among other disturbing findings.  

And so on--there is no evidence that non-debt aid keeps up with tuition increases, or that further hikes won't futher damage overall US educational levels, the improvement of which is the main reason why public higher ed was built out in the first place.  All we see here is a group of former chancellors radiating an indecent complacency about access, one that is out of touch with current research about the damage done to educational attainment by the Great Cost Shift to students.

In fact, annual tuition of approximately $24,000 would make UC more competitive with the best universities for outstanding students. The key is sufficient student financial aid to ensure that only students and families at the highest income levels would pay the full price. Under the model we are suggesting, the State’s current contribution of approximately $12,000 per student, traditionally used by UC as general institutional support for its education programs, would henceforth be used solely for financial aid. In effect, these State funds would become a subsidy to students who are California residents.      This would enable the University to reallocate much, if not all, of the tuition income it has perforce returned to financial aid to preserve the quality of the education we provide for residents and non-residents alike.

Gerald Barnett has just skewered this idea once, but once is not enough for a case like this.  The former chancellors propose a return-to-aid of 50%, meaning a net tuition rate -- money actually going back to educational operations -- low enough to guarantee the continuation of "paying more to get less."  On the level of simple revenue flow, this version of privatization insures that revenues will fall continuously further behind costs.

We also see the classic UC problem of refusing to admit the interconnections among various pieces of the revenue puzzle.   Pieces A and B -- student tuition and state funds -- do not exist in parallel universes.  A affects B, and B affects A.   A and B have a historical record in this case, in which the governor and legislature of the country's most famous knowledge economy repeatedly flatline or cut state funding to all of the state's "knowledge factories."  They do this because they know that UC and CSU can and always will raise fees, as they annually have done.  You don't need to be the author of Hamlet to figure out this psychology.  The desperate chancellors propose to make this ten times worse by converting state funding into a form of welfare, as Barnett points out, while simultaneously making tuition for education 100% private funding.  This plan does not respond to a widespread belief that public universities are a private good, but converts them into a private good.  I haven't recently heard a worse UC idea.

Because this new model would transform what has traditionally been general State support into a direct subsidy for low- and middle-income students, if adopted it could and probably should result in a change in the State’s involvement in the operations of the University. However, this would require further study beyond what we were able to do in our brief session.

In academia, we do our research before we publish our findings.  Obviousy this cart is before the horse.  

The strategy we propose means that only those who can afford it would pay full tuition—a fact that needs to be clearly explained to students and families.

This is not how financial aid works.  It is driven by complex formulae whose details (like work expectation) change at the will of the university.  No parent in America equates a decision that their income level means they must pay full fees with a real assessment that they can afford these fees.

It continues to protect low-income students while making UC more affordable to middle-class students, who are most likely to be squeezed out by rising tuition. It is fairer to all students because they would no longer be asked to pay more for less.

These blandishments sound good but are not true (see above for starters)
 
It is a flexible solution: whenever the State subsidy goes up, student tuition can go down.

State funding increases, foolishly called a "subsidy" here, will never again happen if fees are set at anything like $24,000.

And even with significantly higher fees, UC would remain a bargain compared to the most distinguished private institutions, some of which charge undergraduate fees well over $40,000 a year, and to the best public ones as well.

This is the real logic of all these UC discussions of high fees.  Senior folks constantly point out that UC fees are relatively speaking not as high as those at privates or some other research publics.  Then they make the illogical leap to the claim that this means UC is a "bargain" compared to the publics, when the real case is that thanks to the national drift toward forcing this generation to take on debt for what their parents got for close to free, none of these universities are a bargain, including UC. 

The comparison to tuition at elite private universities makes no sense even in business terms.  Students at Stanford, Swarthmore, Reed, Pomona, Millsaps, and Occidental are paying 40k for classes that are rarely if ever larger than 25 students, where every paper and problem set is hand-graded by a faculty member, where face-to-face guidance is frequent, where personalized active learning is the norm rather than the exception.  As several UC parents have pointed out on listserves, they will not send their kid to a UC factory U for $24k (large lectures, TAs when you're lucky, 90 student "discussion" classes, etc) when they can find a good private college for $40k, and a net tuition of much less. 

If the University of California expects to continue as one of America’s great universities—competing with such institutions as Harvard, Yale, MIT—it must have combined revenues from State, tuition, and other funds at least roughly comparable to theirs. This model will bring us closer to that goal.

UC has never had per-student resources like those of Harvard, Yale, or MIT. Nor has it ever spent remotely as much on each student (start with Figure 1 here).  I have no idea what the Chancellors are literally thinking here, though I read loud and clear the status anxiety, unfortunately demarcated in dollars.

THE LARGER CONTEXT
Whatever the University does, it is difficult to envision a long-term survival strategy for public higher education that does not address the massively dysfunctional web of political decisions that has crippled the governance of this state. California’s entrenched use of the initiative process has changed the state’s tax structure in ways that have had profoundly negative effects on public higher education. This trend began with 1978’s Proposition 13, whose permanent lowering of the property tax has forced the State to depend on the notoriously unstable personal income tax as a major source of revenue. It is because of the unfunded mandate in 1994’s Three Strikes initiative that the State now spends more on prisons than on all of public higher education. Ours is the only state in which ballot initiatives are frozen into the constitution and cannot be amended by the Legislature, however outdated or counterproductive they become as circumstances change.

It is past time to look at the discretionary parts of the State budget and remove some of the constraints that prevent the Legislature from making real choices about the expenditure of public funds. The University can and should contribute to an informed public discussion, through academic examination of the issues by its faculty, of the risks these political realities pose to the future of California’s unparalleled system of public higher education.

Why doesn't the university establish educational goals, figure out sustainable research subsidies, and then tell the state the general fund total it needs, calculate it helpfully as a share of the overall state budget, and then say look to get us this the prison budget has to be cut back to X%?  The prison budget has been a known problem since before Three Strikes -- UCSB's then budget director Bob Kuntz did a good presentation on it during the first big cut cycle in the spring of 1993. The time for discussion is over; the time for proposals is now, with dollar amounts attached. (UCOP's framework for tuition increases was on that score a real advance.)

We understand that some will regard higher tuition, a public/private endowment, or indeed any step away from State support as a step toward compromising the University’s public character.     That is not the intent of our recommendations.  Our hope is that better economic times will bring adequate State funding for all public higher education, including the University, once again. But as California struggles through today’s fiscal impasse, we cannot wait for better days. It is essential to protect the University’s academic excellence now. This may be the only way to ensure UC can continue to be what it has always been, a strong and vital institution committed to meeting its public obligations for teaching, research, and public service of the highest order.

This is wishful thinking undermined by the actual proposals.  The UC community deserves better, more fact-based analysis from its senior managers.