Tuesday, June 28, 2011

She Knows There's No Success Like Failure And That Failure's No Success At All

So it appears that we will have a budget either today or tomorrow.  The Governor has given up his search for phantom Republican support and has agreed to sign a slightly modified version of the budget that the Democrats in the Legislature passed a few weeks ago.  It is not a pretty picture.

  • The new budget agreement is built upon the cuts that were already imposed in March.  For Higher Ed this fact means $500 Million in cuts for UC and CSU each as well $400 Million cut for the Community College System.  The budget does nothing that I can see to restore funding for health care for the poor and elderly, continues to squeeze the K-12 system, significantly cuts the Calworks program, and accepts the cuts to the state's Court systems.
  • Based on additional revenues that have come to the state so far this year, the budget assumes a very optimistic revenue scenario for the rest of the year.  But if the revenue estimates prove unrealistic then there are triggers for additional cuts.  These include an additional $100 Million in cuts for both UC and CSU, the possibility of further cuts to K-12 and a further shortening of the school year.  
  • As a result, it is more than conceivable then that both UC and CSU will end up with $750 Million dollars in cuts by the end of the fiscal year.   
  • Brown and the Democrats are talking about putting revenue initiatives on the ballot in November of 2012.  The Republicans are sure to counter with attacks on pensions and calls for a strict spending cap.  It will be a very difficult election battle and one that everyone needs to attend to.
  • Indeed, perhaps the only success in this failure is that the Republicans were so zealous in their refusal to consider having an election on Brown's tax extensions (a vote there was no guarantee Brown would carry this fall) that Brown did not give them their demands on pensions and spending caps.  The latter in particular would have ensured the decay of governmental services in the state and would have, almost inevitably destroyed what remains of public K-12 education. 
Brown has effectively wasted the first 6 months of his second governorship.  Rather than taking the opportunity to challenge the status quo and inequalities of California's political economy he helped entrench them even more.  The only success here is that the Republicans failed to impose their vision on long-term governmental budgeting.  But that isn't much to claim.

Wednesday, June 15, 2011

Budget Day

Updated Below: 1, 2, 3, 4, 5

Today is the deadline for the Legislature to pass a budget without having their pay frozen.  So it seems like that something will emerge by the evening.  There is no guarantee that what passes today will actually become the state budget (there is no requirement that Jerry Brown sign it in order to keep his pay from being frozen).  But given that the Democrats have decided that the Republicans will not compromise what emerges today will probably be the best that we will see.  And it will be pretty bad.  Among other likely actions will be another 300 million dollar cut to higher ed (split between UC and CSU) as well as other deferrals.   For a quick look at what is on the table today see:

http://www.latimes.com/news/local/la-me-state-budget-box-20110615,0,6619176.story

Update:

UCOP responded in its usual forceful manner:

"We are assessing the latest proposal from the state Senate, and it's too soon to say with certainty what the impact would be. But there's no question that additional cuts would not be good news for UC and the Californians it serves. The university already has taken steps to absorb a $500 million cut, and we have been preparing contingencies in the event of an all-cuts budget. Any further cuts would threaten our ability to provide access, affordability and academic excellence."

Update 2:

The Senate Passed the Main Budget Bill this Afternoon.

Update 3:
Yudof and Gould Respond to the Budget (h/t Dan Mitchell) 

Update 4:
Brown Vetoes the Budget  

Update 5:
Democratic Leadership Responds to Veto  

We will update the story as, if, we get more information.

Thursday, June 2, 2011

Recentering Academic Development

Over the past two weeks academia has been buried in a blizzard of reports, which is a symptom of the current pandemic of concern about the state of U.S. higher education.  These reports include
  • the Education Trust's Priced Out, about the extent to which rising tuition and funding cuts are hurting low-income students
  • a dull but worthy report from UVa's Miller Center calling for a stronger focus on degree completion
  • an analysis by the Richard Vedder shop of UT-Austin's recent data dump on faculty productivity, arguing that higher ed's funding problems can be fixed by getting rid of a large number of the least productive faculty
  • the widely discussed "What's It Worth?" report from Georgetown's Center on Education and the Workforce that correlated differentials in wages with college majors.  It turns out that engineering majors make more than studio artists! Lower wages also unsurprisingly correlate with "womens' work" and with professions that care for and develop people rather than manage money and commodities. Though the study was reviewed in some quarters as a sign that correct market incentives would force students out of their 'fluffy majors" and toward gainful employment, Patt Morrison's disussion with the report's lead author, Anthony Carnevale, and the comments on her web page, suggest instead (1) a backlash against the injustice of the labor market and (2)  defenses of those non-technological majors that are directed at forming cultural, social, and historical knowledge, solving social problems, developing personal capabilities, and helping the individual student understand his or her future possibilities in society.
Which brings us to the real star of the show, Richard Arum and Josipa Roska's book Academically Adrift, which was widely reviewed a few months ago.
Many reviews hooked it into the current trend of bashing colleges to justify massive, absurd cuts in their public funding. Their study does suggest that students aren't learning enough in college.  But their real story is much more powerful than that. They replace stock metrics like degree attainment with specific academic development goals, and measure how well students are doing at mastering these. 

Today the Los Angeles Times published their useful crib of their book.  There you can read the following elements:
  • outcomes are faltering because "many students were not being appropriately challenged," i.e. were not being given enough work. 
  • the main reason is that universities have strayed from the core mission of instruction (I would add research which they do not). "Many institutions favor priorities that can be boasted about in alumni magazines and admission brochures or that can help boost their scores in college rankings." 
  • this amounts to a major paradigm shift in which "Colleges have abandoned responsibility for shaping students' academic development and instead have come to embrace a service model that caters to satisfying students' expressed desires."
  • the correlative is the replacement of academic-instructional with non-academic professional staff, or in other words the administrative bloat that has increased pessimism and cynicism about higher education's priorities among faculty and voters alike.
There's a vicious cycle here, in which senior managers saw alumni and donors willing to pay for a range of expensive services, benefits, celebrations, atomospherics, and derivative products (e.g. high-end medical services) but not for instruction or basic reserach, so they moved university resources very logically towards the service model for students and donors-businesspeople-politicians alike, which increased the quality advantage of those services over that of the core mission, while also requiring the increased hiring of non-academic administrators.

Much of the public is no longer willing to pay for the service-university, where so much of that service is clearly going not to their children or grandchildren or neighbors children but to the usual suspects at the top of a society whose growing inequality has led to their own economic decline.  It could be an entirely different story for the development-university, one centered on the academic development of all of its students, undergrad and grad, through teaching and research alike.

We need to take a chance that a broad majority would pay for that, and offer it to them.

Unwavering Adherence to Failed Strategies: Analogical Version

Friday, May 27, 2011

UCSD and the Crisis in Public University Research Funding

Reports surfaced today in the San Diego daily newspaper that three core members of UCSD's Center for Theoretical Biological Physics are moving to Rice University, and bringing much of their collaborative infrastructure with them. The story illustrates one of this blog's perennial themes, which is the damage being done right now by the ridiculous cuts in public funding, and by our leaders' foolish acceptance of each current massive cut as the new normal.

But the story also illustrates the vexed and subterranean relations between public universities and big science.  Nothing here amounts to a comment on the research or the individual scientists involved: the story is a structural one of high-cost research and public subsidies that must be thought through if public higher ed is going to make it to the other side.

The story is this:
The three scientists [José Onuchic, Herbert Levine and Peter Wolynes] are transferring their labs to the Rice's BioScience Research Collaborative (BRC), a new center that specializes in the study of cancer in association with other Texas Medical Center institutions. The BRC arose from the $3 billion bond package that Texas voters approved in 2007 to study and treat cancer. The initiative specifically calls for the recruitment of prominent scientists. Rice says it was able to recruit Onuchic and Levine was the aide of $10 million in state money provided to the university.
Star scientists move a lot, though not so often as a team. Making this situation unusual is that one of them, Herbert Levine, explicitly named public funding cuts as a "secondary reason" for leaving:
"The major reason is that Rice has made a remarkably generous offer to my colleagues and me, both in personal terms but mainly as it concerns collective research support.


"For our biophysics center, they have offered prime space (to be built to our specs), ongoing administrative support, and facilitated access to foundations such as CPRIT (Cancer Prevention and Research Institute of Texas), all of which will enable us to greatly broaden the scope of our efforts and begin to study medical applicants of physical science theory.

"The current budget at UC makes it clear that this type of support is just not going to be possible here. The fact that private university funds have recovered from their 2008 lows long before state budgets are even close to balanced, has led to a "support gap" all across the country (not just California). So, I don't think that budget cuts specifically "drove us out", they are indeed a factor in our overall assessment that we will be able to do significantly more at Rice than at UCSD, over the next 5-10 years"
Unfortunately. this statement is quite accurate.  Public universities are falling woefully behind their private counterparts in the resources for their core missions of instruction and research.  Harvard president Drew Gilpin Faust was challenged by eleven public university presidents when she even hinted about this problem in a quite interesting 2007 Business Week story called 'The Dangerous Wealth of the Ivy League," Now muttered fears about declining resources for public university research have become everyday reality.

An additional important detail is that the story notes that Rice, a wealthy private university with the country's fourteenth largest endowment per student, just ahead of Cal Tech's, got pivotal support funds from the state of Texas. The article notes that states have taken to stealing each others' scientists with bond packages, and that California has also done this to Texas. The deeper point is that public funding and plenty of it is essential to the the successful pursuit of advanced, socially-useful research.  The universities that are in the best position to leverage this public money are, increasingly, private universities. This doesn't change the fact that high-cost research does not make money, but requires major subsidies from the public sector.

The support gap is likely to grow wider.  This is because a large number of public university leaders have either given up on restoring the levels of public funding that made the American public university system the best in the world, or act like people who have given up, or haven't given up but are afraid to state the situation plainly, in a way politicians can understand: "either restore public funding or kill public universities as we know them, period."  At the same time, these leaders will not state the level to which tuition needs to rise to replace the lost public funding, as this blog has been forced to document on many occasions.  Research is supported both by direct funding from the extramural sponsor and by the host university, who must fill in for underpayments for overhead to the tune of an average of well above 25 cents on the dollar, or in UC's case, a net research loss of $720 million on $3.5 billion in gross revenues earned by UC's very accomplished faculty.  This research should be done, but it costs money and does not earn money.  Either we restore public funding to correct levels, or UC's research mission will decline at the same rate as undergraduate access to small-scale courses. 

The move for the UCSD professors no doubt makes intellectual sense.  It's interesting that Rice tried to build collaboration into the architecture of the facility.  But nothing will change the science's negative economics.  Rice built the BioSciences facility in the mist of a building boom within the multi-institutional Texas Medical Center that created a glut of space.  The 477,000 square foot facility opened in mid-2009 with only one tenant, and colleagues at Rice tell me that the facility continues to have problems covering costs. It appears now to have four extramural tenants.  Basic construction costs are listed as $144 million, and Rice's public financial statements report that the value of assets under construction in fiscal year 2009 was 50% of total existing assets (page 15).  This suggests an enormous financial burden even for a wealthy university.  Hence the benefit of the $10 million in Texas taxpayer money as a sweetener for prospective tenants.  It is also certain that annual public funding will be needed in the future. The research is being done for science, but also for an industry, biotechnology, in which only 13 percent of its companies are profitable, and which arguably has, as an overall industry, yet to turn a profit.

There is the further issue of sacrificial relations among disciplines within a university, as the very high costs of some squeeze out even low-cost fields elsewhere.  In 2010, Rice closed its French studies PhD, meaning that the state of Texas has only one French PhD program left, at UT-Austin.  Rice also closed its university press, which had already been on entirely digital footing, for an annual savings of $150,000-$200,000. (University presses publish books as well as journals, and books are still the primary repository of work in the human sciences.)  Rice also sold one of the campus's major cultural institutions, the student radio station KTRU (91.7), which functioned as a unique outlet for regional and innovative music.  The selling price was $9.9 million.   Of course no one took money from French and gave it to the BioSciences construction company.  That doesn't change the fact that relatively low-cost programs in the humanities and social sciences have a tendency to fall ill in the proximity of big science kryptonite.


In the Hooverized economy Gov. Jerry Schwarzenegger is helping to sustain, we have three choices.
  1. Continue to conceal and distort big science research costs as though this research raised money for universities.  This will increase internal tensions and damage or even eliminate the disciplines that are essential to solving the world's terrible social and cultural problems. 
  2. Disclose those true research costs to ourselves and the public.  Come together to convince the public and its politicians that they must correctly fund expensive research as a public necessity.
  3. Move the humanities and social sciences into separate institutions, so they can retain the funds their enrollments generate that are now in part spent on costly infrastructure of little benefit to their research or their students.
I vote for door number 2.  But if we are offered only door number 1, an increasing number of human sciences faculty will be tempted by door number 3.

Monday, May 16, 2011

Quick Pass on the May Revision

I only have a few minutes today to look at the Governor's May budget revision, and here's what I see. Current-year revenues are up $2.8 billion over forecasts, and $6.6 billion over two years. Governor Brown, true to his turnscrew austerity vision of aHooverite unstimulus for all Californians, increases allocations to no one except K-12 and the community colleges "pursuant to Proposition 98," and, unbelievably, prisons, with a drop for mental health (page 4).

The Regents' strategy of saying that state funding is never coming back has paid off big-time: UC and CSU get exactly zero - not even a $10 million or $50 million booby prize for not fighting the $500 million cuts. The crappy squeezing of health services is intact (page 3), as is the closing of 70 state parks to save a whopping $11 million this year. There is no wavering of Gov Brown's vision in which government's one and only priority is reducing the deficit. 

If I have misread something here, or you can explain why it's a lot better for health and education and public infrastructure to have Jerry Brown rather than Arnold Schwarzenegger in the governor's mansion, please write.

Michael Here: Just a quick note to reiterate Chris' comment on spending.  The May Revision assumes that the Governor will still get almost all of his tax extensions (although the income tax is shortened).  In other words, it is still possible that he will end up with an "all-cuts" budget with even more fierce slashing of the budget for education, health, etc.

See helpful background on the state deficit at the UCLA Faculty Association blog.

Sunday, May 15, 2011

Change the Culture of Helplessness

I'm grateful to Cloudminder for a steady stream of UC news updates: check out this past busy UC week. Berkeley's Daily Cal has been providing coverage of management and finance issues that is as good or better than the state's daily newspapers. See this piece on UC's decreasing net assets, for example.

But staying in the steady stream of dismal news does make it harder to remember that it doesn't have to be like this. I can still imagine an Arnold Schwarzenegger who forced a state funding growth ceiling on UC and CSU via the Compact but who did not then abandon it unilaterally in 2008. I can imagine a Board of Regents whose members get close to a couple of local campuses and use independent information to assess UCOP reports, and who evaluate solutions offered by faculty, students, and staff. I can imagine a UCOP that decides that transparency with more state trust is better for revenues than opacity with less state trust, and that makes a real long-term effort to explain the details of the budget, including answering questions like why basic arithmetic doesn't back up core claims such as the amount the state gives to UC per student each year (supposedly $7200, page 3). I can imagine a state legislature that would allow higher ed revenues to grow at the same rate as state income (if this had happened since 1990 UC would have $6 billion in state funding rather than be looking $2.5 billion). I can imagine a state population that would be willing to pay the same share of its income in higher education taxes that it did twenty years ago, and not closer to the half that share that it pays now (chart 2d).

The supposed impossibility of that version of California is not a fact of nature. It has been and is continually created by the decisions the major players make on a daily basis. This includes UC’s Regents and Office of the President. In these cases, their agency is regularly concealed behind a consistent strategy of blame-shifting onto the state legislature and, behind them, the voting public and their alleged universal rejection of the very concept of a public good. The university's decline has been accelerated by a culture of helplessness at the top, one which assigns blame elsewhere and helps to demobilize its own community.

Here are some examples from the March Regents' meeting.

The chair of the Board of Regents declared the restoration of state funding to be unrealistic, and in so doing took a major step towards creating that reality and locking it in. Sacramento Democrats and Republicans had their suspicion confirmed that UC would not hold them to a higher funding standard, and would not put up a fight against the current cuts. Similarly, Mark Yudof's recent testimony to the state Senate budget committee focused on avoiding a further $500 million cut as part of the so-called "all-cuts" budget, and tacitly accepted the first $500 million as a given.

In keeping with Chair Gould’s aforementioned diktat, Regent Richard Blum laid out a high-tuition plan as an absolute necessity - no further debate desired or required. I calculated that his plan would mean near-term tuition increases to over $20,000 (in-state) and medium-term increases to $40,000. The lower figure is the minimum required to maintain current levels of educational investment without the first $500 million cut. Rather than stating and tweeting the disastrous tuition news every day, UCOP spent all winter and spring saying that it planned no tuition increases - unless the additional $500 million cut took place. The effect was to muffle the only UC constituency with real influence with California's media, financially desperate undergraduate students. Having lost another five-month opportunity for opposition- and movement-building around public funding, UCOP then placed on next week's Regents agenda a proposal for a new 32% tuition increase, which would bring 2011-12 tuition to over $16,000, plus campus and registration fees (see next-to-last paragraph). UCOP waited until it could present the increase as forced upon them by a political reality over which they and their allies have no control.

Then there's the issue of UC's declining educational quality. UC Irvine Chancellor Michael Drake said that his campus is

Poised on the precipice of a negative change in quality, which, if allowed to occur, will require a generation to remedy. He praised the excellence of the UC Irvine faculty, but noted that faculty members now spend a great deal of time mitigating damage caused by cuts rather than building for the future. He described the situation of the University as one of slow decay rather than growth. Most effort is focused on protecting the educational path for students; innovation and growth are not being fostered.

These comments are extremely grave. Within American management culture, which requires continuous displays of problem-solving resolve to leaven its peculiar fatalism, they are a declaration of an educational emergency. They were accompanied by descriptions of the decline of the ability to develop individual creative capacities through face-to-face interactions, such as the wholesale elimination of the Irvine campus’s freshman seminar program.

But the state has heard all of this before. The decline has not yet occurred, is not currently occurring, but may occur in the future if the cuts are not brought to an end. Even Chancellor Drake muddled his message by saying that UC is in danger of moving from A+ to A. The vast majority of Californians, whose lifestyles are hovering around C+, would understandably accept UC “A”. Similarly, the financial statements in the Chancellor’s declarations suggest that the budget shortfalls can be handled with regrettable but nonetheless manageable layoffs that have already taken place. The non-UC reader would think, well they’re tightening their belts and fixing their IT problems and we’ll end up with a UC that gets an A for only $2.5 billion in state funds. There is no screaming on our end that says no it cannot be this way and also no it need not be this way. Refusing to take responsibility for having already damaged educational quality with its past political decisions, UCOP warns of decline this time. It is playing Chicken Little with the state.

In contrast to managerial fatalism, faculty members have been putting up a very good fight. I will have to do a separate post to discuss valuable pieces that came out this last week in The Nation and the London Review of Books, and same goes for work closer to home, such as the immediate past chair of the Senate’s systemwide Committee on Planning and Budget (UCPB) Peter Krapp’s excellent piece on why we need to keep the University of California unstratified and whole. But UC Uncut and UC Whole both entail the continuation of the Board of Regents and the Office of the President. At the moment, they are not the system’s strongest points. Whatever the specific errors of campus leaders, one can imagine campuses moving forward via chancellor-presidents with the local knowledge and on-site accountability of campus administrators. You can get a feeling for this by reading the testimony of Chancellors Birgeneau, Blumenthal, and Drake in March.

But local knowledge and direct accountability are largely lacking at the Regental-UCOP level. This problem will need to be solved if UC is going to go forward as a single system.