Mark Yudof Says Yes-No to UC's Public Option

You didn't think Mark Yudof would come out in favor of 32% 1-year tuition hikes and full-speed privatization, and you were right. He opposes these things. "I am angry too" about higher fees, he says, and adds, "The closer that the university comes to being free, the happier I am."  This is nicely said.  In his last paragraph, he states, "We will not privatize the university.  We will continue to enroll students from all economic strata. We will not go the way of other states and rely on a vast expansion of nonresident enrollment." Also all good to hear.

On the other hand, Mark Yudof did propose a 32% increase 1-year tuition hike.  We can note some other anomalies.  He told the UC Commission on the Future that the Governor "gets it" on higher ed, and in this piece expresses the "highest respect" for the Governor who initiated the 25% two-year state funding cuts.  His main public message before the students got mad about the hikes has been about the importance of high executive salaries.  And he has praised "entrepreneurial" faculty without any nods to the enormous obscure public-service effort of teaching and advising and non-sponsored research in the social and cultural disciplines that helps hold the state together and tries to keep it moving forward.

We need to take seriously the details of the story Mark Yudof tells around his anger at his own fee hikes.  His explanation for how we got here is that the university has "for the past decade [engaged in ] faith-based budgeting. That is the approach that, somehow, if we wait, the legislature will turn on the spigot."

But this is not what happened.  UCOP wasn't waiting around in the 1990s and 2000s. It struck two deals with two governors, the second with the Schwarzenegger administration.  Called the Compact for Higher Education, it angered legislative Dems because it took place behind their back.  The Compact insured a shifting of support from public to private money, in two ways.  It built in 7-10% annual fee increases as part of the funding model, and as Stanton Glantz has had to note many times, it committed UCOP to "continue to seek additional private resources and maximize other fund sources available to the University to support basic programs."  UCOP may not want the kind of privatization that is now turning out to be truly unpopular, but about five years ago it agreed to move even its "basic programs" away from public and into private money. For basic programs like instruction, "private resources" = higher fees.

Some warped details in the piece contribute to a misleading picture.  "To begin to rebuild the university, we will have to raise tuition in two phases by a total of 32 percent over the next two years—from $7,788 to $10,302."  Unfortunately,  32% fee increases won't rebuild anything.  The mid-year increase in 2009-10 will net $75.1 million  (page 12), or less than 10% of the current cut.  The 2010-11 increase will partially offset who-knows-what cut next year.  These terrible fee increases are dirt at the bottom of a big hole, even if it is one that does not yet have a coffin.

Mark Yudof says a couple of things about filling the hole: "we are seeking other sources of support and pressing our case hard in Sacramento, the rest of California, and Washington. . . .We are looking for a reset."  I don't know what "reset" means - a return to 2007?  And what exactly is the case UCOP is making for public funding?

I won't harp on public funding here because I do it in the piece linked above and in lots of other places. But a meaningful relation to it would have do two things.  It would have to make arguments for what public money uniquely does at UC, and this piece does not do that.  Second, it would have to show support for the staff and faculty who perform the public function, and show a desire to unify them in a UC community that is reaching out to the state.

Instead of this unifying approach, Yudof dishes out needling and division.   Some misconceptions, Yudof writes, "come from well-meaning professors who refuse to accept just how severe this financial crisis has become—after all, it's human nature to hope for a painless reprieve from a difficult passage." I can only imagine that the point of this inaccurate and belittling comment is to split students from faculty who are allegedly too locked in their ivory tower to understand money or sympathize with suffering students.  It is your president, dear students, who truly understands you.

The paragraph continues,

I understand—and share—the frustrations of students, and faculty and staff members. But it is important to note that the numbers participating in a recent walkout to protest the handling of the budget crisis were modest compared with our 180,000 employees and more than 200,000 students. And many people focused as much or more on state support as on campus and system administration.

This seeks to isolate unions from students, and to sidestep criticisms of UC management.  Is it really possible that nothing in UC financial management can be improved, that no maldistributions can be found and corrected? Are students supposed to think that the whole budget solution is to get $1 billion back from a state that, as Yudof rightly notes, has been cutting UC for 20 years?  I'd bet that on Mark Yudof's 20 trips to Sacramento he heard from legislators at least 20 times that they haven't trusted UCOP financial management since the compensation scandal days, and won't give UC more money until there's real openness and change.  As a message to legislators, the statements in this piece don't cut it.

The legislature isn't Yudof's audience though - the audience is students.  UCOP doesn't have a plan for rebuilding public support, but it might be able to claw some money back if students and parents start pressuring Sacramento in a way they haven't before.  They should do this. Yudof is good on the benefits of UC that must be preserved. But he does not oppose, and in fact endorses, an Arnold-centered California politics in the very moment in which the Governor could have been isolated by a coalition of unions, academics, high-tech executives, and service workers in hospitals, schools, firestations, and the DMV as a Herbert Hoover throwback with plutocratic economics.

Where was UCOP when we lost the federal stimulus?  UCOP's political world aligns with key Regents, including the Board's many Schwarzenegger appointees, who have long supported cutting public support for more or less everything,  and if they have a reason other than lowering their own and corporate taxes I don't know what it is.   Gov Schwarzenegger's only real goal for California is lower public expenditures; his sole strategy for closing the budget gap was public funding cuts; his approach to student fees has been to raise them, except in the year that he was running for reelection; his approach to student aid was to propose the total elimination of the Cal Grants program; his approach to tax reform has been endorsement of his commission's proposal to cut the top state income tax rate in half in a moment in which tax revenues continue to fall through the floor, making the eventual recovery even smaller and further away.

Yesterday in the Senate Finance Committee, Sen Max Baucus said,  "I see a lot to like in a public option," and then voted to kill it. In concrete terms, where is UCOP's support for the UC public option?

UC Systemwide Protest Roundup

Thank you to Parties Unknown for this aggregation of coverage of the systemwide protests of UC's budget cuts on September 24th.  And thanks as well for greetings from Weimar, Germany.

We Are All Corpses Now?

There were kick-off events of Sept 23-24 all over the UC system, and they seem to have succeeded at their goals of making the cuts visible - or audible - and expressing deep commitment to the public status of the University of California. We've linked to news coverage at left, and await video and further descriptions of the specific commentary.
How did UC's various senior managers react?  Berkeley's issued what I read as a backhanded thank-you note.  But before we could detect signs of any administrative rethinking of strategy, we received the e-version of President Mark Yudof's "Big Man on Campus" interview in the New York Times, and our email went absolutely nuts.
The first wave mostly asked whether the interview was a parody - it seemed so offensive, thoughtless and crass.  My own first reaction was surprise at the self-demolition of the carefully cultivated image of Yudof as a sober defender of UC's public character.  As people realized that they were not reading The Onion or an NYT mirror site, surprise was replaced by anger -click here for excerpts.  See also Jonathan Lemeul's analysis of  UC Yahooisms below,  and Akos Róna-Tas's thorough description of Yudof the undertaker.  Dean Dad also gets in his licks.
All excerpts were sent to lists rather than to any of us personally (the title above is from one of them). They signal a depth of concern about the state of UC leadership that many of those leaders seem to feel free to ignore as the university's tradition of open exchange has to compete increasingly with message management.
I have also posted the best description we have received of Mark Yudof's positive achievements in his year as president.  It's worth factoring in at a moment like this - not to produce ambivalence, but greater clarity about how to work (or not) with UCOP.
Addendum: Michael Salman digs up a brief history of Yudofian cemetery jokes.  And then he adds his own assessment of Yudofian competence.
Addendum 2: Prof. Mary Furner writes the Regents; other excerpts are added to that list.
I ask Mark Yudof to at least tweet a dissent from this description of his general attitude.  And better than a self-dissent would be an apology.

An Argument Against Abolishing The Master Plan

BY
Jonathan Lemuel

It is always intimidating to write against the opinions of the Great and the Powerful. This difficulty is especially large for someone, like me, speaking on topics far out of my depth. Indeed, my only claim to this subject, as some of you may know, derives from my efforts to translate the ramblings of my Yahoo into prose approaching a Journal. But as I listened to my Yahoo and struggled to understand the sounds, I noticed a continual mention of a “Master Plan”; normally expressed with great anger, frustration, and sadness. Indeed, whenever he mentioned this “Master Plan” it became almost impossible to calm him down without the help of Physicians. Curious, I began to research this topic and discovered, much to my surprise and confusion, that the Master Plan was a sort of archaic document that the Great and the Powerful had decided no longer should guide our thinking and policy. Yet when I looked further into the topic I became less sure why they thought that was so.

I want to be clear that I am not suggesting a return to the Master Plan in its primitive form. To do so, I would have to be as mad as my Yahoo. For three decades now the Wealthy and Powerful have expended great efforts in teaching all of us that the notion of an egalitarian system of education was simple foolishness, unfair to those wise enough to hold power and wealth (especially in papers called capital gains) and cruelly denying to them the freedom not to be concerned with others. I would never think to challenge the wisdom of the labors of those decades. Nor would I be misunderstood as suggesting even a return to the Master Plan of the 1990s. For to do that would be to expect that 25 cents of every $100 dollars of income in the state would be committed to the University of California and, the Lord only knows, how many pennies more to the California State University and the Community College System. No person with any claim to realism or wisdom could expect such extravagant sums.

But even so, when I read about the “Compact” or the notion of the “Hybrid University” I am unable to see exactly how they will provide the good of Public Higher Education. Now I am just as seduced by a new catch-phrase as anyone; and I certainly understand the immense prestige our society grants to anyone able to come up with a new and distinctive slogan. But, alas, I am prone to thinking in analogies and my mind remembered the excitement of “New Coke” and how that only created a problem and was unable to solve it. So I was left to ask: what is the problem that the “Compact” was supposed to solve? And what is the improvement that the “Hybrid University” sought to name? The “Compact” I have heard (if any of the Wise would correct me please do), was meant to preserve Public Higher Education from the Governor imposing even further cuts even though we are assured that “he gets it with regard to Higher Education”(RegentsTranscipt2). I was surprised to learn, however, that the “Compact” set up funding levels far below those that would have enabled the Universities to educate growing numbers with relatively equal resources to those they possessed in 2001. And I was truly shocked to learn that the Governor did not even deliver on the resources he promised in the compact.

Now having seen the evident failure of the “Compact” to defend Public Higher Education I might, had I been a Regent and a less timid soul, have thought that perhaps we might try another strategy to convince California that it was endangering a crucial part of the State’s happiness and future (although I understand that the Regents would have run the risk of appearing as unseemly as the Yahoos who recently sought to make that case on various college campuses). But Wealth and Power are clearly more far-sighted than I. For they chose to turn in their crisis to a proponent of the “hybrid university,” a person willing to articulate a new path even if, as he says, “the shine is off” education. And it was, unquestionably, a brilliant move. For if the “Compact” preserved a façade of Higher Public Education while merely acquiescing in a decline of public support, a rising dependence on private fundraising, and increased financial burdens on students, the “Hybrid University” provides a fully conceptualized argument for why the new financial order has made traditional public higher education obsolete. It is economic necessity the Wise tell us. Something has to lose out to healthcare (and it cannot be prisons or corporate profits of course), so students will have to pay more for their education and the shared commitment to public education will wither away. It is no one’s fault you see. It is just the way things are.

But, and here I hope I do not get out of my place, I do wonder if it will provide all that it seems to promise. After all, the “Hybrid University” is a new brand. What old brand did it replace? This question stumped me and the wits around me. But then I remembered an older President who proclaimed a “multiversity.” Now the multiversity was controversial in its time (and its time was the archaic period of the “Master Plan”). But the multiversity named itself by form and function—by the types of education it provided and the public functions it performed. The question its proponents had to answer was how to finance and justify it. The “Hybrid University” on the other hand names itself by its finances. It is named by its money flows and guided by its fundraising and administrators. Its form and its functions, its educational aims and offerings follow but do not lead. It is true that the State has been an “unreliable partner”(RegentsTranscipt1) But does that mean that we should therefore seek out disestablishment and acquiesce in the end of the Public?

I worry, then, that Abolishing the Master Plan may not do all of the good that it is supposed to do. For all agree that they are determined to maintain the California University system in its greatness and excellence—and in its accessibility. But their steps to abolish the master plan will make the University system no longer a system of Public Higher Education. And with that will there still be accessibility?

Still, I do have some hope. After all, it seems impossible for a private university to operate on the scale of the University of California and the California State University. And if students are not educated what will they do? There are, of course, the prisons. But it costs considerably more to incarcerate than to educate. And, since the State has also decided it is a waste to train prisoners the loss to the workforce may strike some business as unwise. If nothing else, the profit margin may put paid to the Abolition of the Master Plan.

There is NO Alternative

There are the great stories of what UC does for learning, for knowledge, for the economy, for California - and especially for students. There is the budget story, which is the story of the foundations of what makes the future possible.  I've posted the slides that two of us presented to the Regents in May 2007. We described the budget crisis and the likely outcome if nothing was done - and nothing was.  Please teach these slides!

There is NO combination of high quality and general access without major public funding.  There is no economy recovery and no social progress without this public funding. September 24, October 14, and all the other days of the academic year are about rebuilding the understanding and the public support and the vision of collective development that have always made the best parts of California possible.

Here's the current road off the cliff: beyond Shrunken Horizons we get Path 6, "Extreme Arnold."  It is completely unacceptable.

UCSB Day of Action Sept 24

Day of Action Schedule ">

Saying the Thing that is Not

By Anonymous.

To the Reader:  I have done my best in this post to translate Yahoo into something approaching common English.  As you all probably remember from your reading of Gulliver’s Travels it is common for Yahoos to speak mostly in grunts and to express their dismay in an unintelligible lack of reason. I have also attempted to track down some of what the author may have been referring to so that you can follow his “logic.” Obviously we have to take into account the source of this “confession” in judging what to make of its rambling nature and near madness.   So I need to apologize in advance for imposing on you what may appear to be silly and disrespectful observations.—

At several points this summer I have felt appropriately chastened and shamed by my doubts about the plans of our university leaders.  As Professors Cr--han,  Pow--l, Interim Provost P--s, and Dean E--ly have reminded us Yahoos, we have been unjust to the President’s Court and were making unreasonable demands and claims about the state of the University and the reasons for its present crisis.  Despite the best efforts of these teachers, I have unjustly continued to think that something is happening unworthy of the Houyhnhnms in charge of the University.  My continuing lack of blind faith has, I must confess, troubled me deeply.

It was with great relief then that I discovered UCOP had graciously provided a new fact sheet about the University’s funds entitled “UC unrestricted Net Assets: myths and facts.”  I eagerly sought to read it (admittedly a difficult task since I was never taught the great Language Administraticus) but, but, to my dismay it only furthered my doubts and skepticism.  While proclaiming that it would lay to rest the myth of “unrestricted assets” it seemed, I think (Ed. Note: ?), to change the subject to what it calls “uncommitted assets.”  Here I was informed that “substantially all of these net assets have been committed internally to specific programs and to meet a wide range of needs…”  This turn of events left me deeply confused.  I had thought—perhaps mistakenly—that the criticisms that had been raised about the use of UC funds were suggesting that the issue wasn’t legal restrictions but the choices of university administrators.  But now I am told that the reason that the funds cannot be used is because university administrators have chosen to use them in other ways!  How can that be an answer to the question? I wondered.  But Houyhnhnms would never say anything that was not.  And while the fact sheet explained the decline in UC endowments and the commitments of some funds it didn’t speak to the $200 million dollar loan to the state—money it seemed that might have been spent to protect endangered programs.  I was struck to the core with dread.  For as far as I could see, either UCOP had not shifted the terms of the debate and failed to directly address the criticism or else they were not

Houyhnhnms.  But if they were not Houyhnhnms then were they…..”  But I could not go to so fearful a thought.  I must, I grunted to myself, must be misunderstanding.

            To gain relief I returned to the Great Chastisements of the summer.  Here I was relieved to be told by Professor Cr—han and others that the President “has worked closely with faculty, staff, students and Regents to resolve our budget deficit in a way that minimizes harm to our academic enterprise” and that he “listened to faculty and staff suggestions in crafting a furlough plan built on fairness and shared sacrifice.” 

 But sadly my relief did not last long.  Undisciplined and unworthy thoughts started to flood in:  I remembered that as the furlough system was elaborated more and more people were allowed out of the system and income of some of the best endowed protected; I realized that while UCOP maintained its overhead tax on grants it was allowing programs to be cut in the colleges (programs once cut which may never return), and that while there was consultation on the size of the furlough cuts, UCOP had succeeded—over what I believed to be unanimous Academic Senate opposition—in receiving from the Regents emergency powers that allow them to intervene in academic governance in unprecedented ways (for instance the Interim Provost’s decision on furlough days). 

            Fearfully, I ran next to the great Teacher of Boalt.  Here I was truly reassured.  It was simply “provocative fantasy” to think that UCOP and Regents had not done enough to lobby the Governor and Legislature.  And there were “zillions of alternatives” being considered to the actual plans for cuts and downsizing (Ed. I assume that he must mean “reforming” but I could not be sure given his obviously unrealistic use of language).  I looked eagerly then for examples of alternatives that had been proposed and the reasons why they wouldn’t work.  Yet out of zillions I found none.  Of course it was reassuring to be reminded how unreasonable it was to expect “masses of faculty and staff [to] spend the time to become proficient in budget tradeoffs, and sensitive to competing values and goals.”  Better to leave the decisions to those already making the decisions and already sensitive to different “values and goals.”  I felt tremendously reassured.  I’m sure, for instance, that if I had access to the Berkeley budget I would find that the Great Dean of Boalt had used some of the revenue from rising tuition at the Law School to help support the College in its time of need.  But, once again unworthy thoughts flooded my brain.  I remembered that although this crisis was triggered by the crisis of the California budget its damaging effects were much, much worse because of the foolishness of the Compact signed by UCOP and the Regents with the Governor years ago.  And although my memory is weak as Yahoo’s memories are, I seem to remember that several years ago an Academic Senate Futures Report predicted the dismal state of University funding.  Yet when I looked at the University Commission on the Future none of the authors of the study were listed as members.  But the Great Dean was.

            And so I am left with my own despair.  The Great keep telling me that they are right and that I should not question their policies.  And indeed, that is my Yahoo nature.  But, and this way madness lies, they seem too often to be saying the thing that is not.  And I seem to remember having been told that a University was not a place for saying the thing that is not.  That it was a place where debate and questioning should flourish.  That calls for information and transparency should not be belittled.  Is this not a University any longer??

            I have cut off my translation here.  As one can see the author (whose identity I will protect because of the clear instability of his mind) is beginning to fly off into a madness beyond his previous irrationality.  Perhaps one of the members of the Medical Centers will be able to nurse him back to whatever health a Yahoo normally has.

            Your humble editor:  Jonathan Lemuel

Berkeley Faculty Group Endorses Week of Education

The members of the Reactivate the Berkeley Faculty Association endorse the "Week of Education" concerning the budget crisis.  We encourage all faculty to find ways to participate in it. There are many possibilities, ranging from holding in-class discussions with students about the nature of the crisis and possible solutions to it, to taking part in walk outs, and attending the rallies, seminars, colloquiums, and other activities planned for this week.

In our view, these activities are not about disrupting classes or bringing the campus to a standstill. Rather, they are opportunities to educate our students, ourselves, and the public about the structural problems in state government and public culture that have undermined California's capacity to support broad student access to affordable, excellent public higher education.  This week affords opportunities for us to examine and discuss these challenges and to debate the pros and cons of different ways to move the university to a more sustainable future.

We applaud our friends in SAVE and the Solidarity Working Group and all the other faculty, staff, and students involved in organizing the Week of Education.

Wendy Brown
Judith Butler
Tony Cascardi
Louise Fortmann
Waldo Martin
Chris Rosen
Alex Saragoza
Anne Wagner
Dick Walker

Day of Action at UCI

This is the UCI Day of Action blog. It contains a press release, program of events and a link to a critical document that has been developed by a group of concerned faculty.

Video of UC Berkeley Teach-In on the State of UC

all SEGMENTS HERE

Mark Yudof's Budget Remarks at UC Regents Meeting

Links to Segment 1, Segment 2, Segment 3

Charles Schwartz again critiques the claim that "restricted" funds are truly restricted.

UC CFO Peter Taylor says restricted funds really are restricted.

Starving the State of California?

The Parsky Commission Tax Proposals
by Michael Meranze

As Chris noted in an entry last week,the Commission on the 21st Century Economy (COTCE, commonly referred to as the Parsky Commission) is about to issue its recommendations for tax reform to the Governor and Legislature. Although the Commission hasn’t released its recommendations in final form, Staff presentations yesterday,earlier Commission documents, as well as the California Budget Project’s (CPB) analysis of the proposals give a pretty clear indication of the direction and implications of the Commission’s thinking. Although I would urge everyone to read the documents themselves (I am not a scholar of taxation), Chris and I thought that it might be good to provide a short précis and context for the Commission’s recommendations and its implications for our discussions here.

Two things seem clear. First, the Commission is proposing a far more regressive tax system than already exists in California. And second, the Commission’s proposals will likely decrease revenues to the State—thereby effectively reducing government support for programs in social services, aid to the poor, healthcare, and education. The COTCE proposes flattening the income tax, eliminating the corporate income tax, and eliminate the State’s general use sales tax. In its place it proposes to implement what is called a Business Net Receipts Tax (BNRT) a sort of value-added tax. All of these changes would be implemented over several years. As always, the devil will be in the details but the outlines appear relatively clear.

First, a bit of background though. The COTCE was established by Governor Schwarzenegger to propose reforms to the tax code. Although the charge to the Commission did include language that the code should be “fair and equitable,” (Executive Order S-15-09) the main thrust of the Commission’s charge and its central focus has been defined as making sure that State revenues are less “volatile,” i.e. more predictable and less subject to economic upturns and downturns. The Commission appears to have assumed that this volatility is due largely to the State’s reliance on personal income taxes (especially capital gains taxes on the very wealthy). There is little or no sign in the proposals of any great consideration of questions of equity. In part this is because the COTCE has ignored (or thought it was out of their power) the fact that part of the reason for the volatility in the State’s tax base has been the remarkable growth of inequality in the state. That growth has, besides its obvious destructive effects on the society as a whole, made the state increasingly dependent on the investment results of the wealthiest Californians.

As the CBP argues persuasively, the effect of the proposed changes to the personal income tax and the ending of the corporate tax will be to shift the relative burden of taxation onto the poorer members of the community. For example, whereas the full implementation of the COTCE proposals would result in income tax reductions of 39.5% for those making between $100,000 and $200,000, 23.5% for those making between $200,000 and a Million, and 26.8% for those making over a Million a year, the tax reductions would only be 0.2% for those making under $50,000, 2.2% for those making between $50,000 and $75,000, and 7.8% for those making between $75,000 and $100,000 (CPB at 6). While The Commission’s proposal would raise the standard deduction it would leave itemized deductions only for mortgage payments, property taxes, and charitable contributions. The effective tax rates on Californian’s were already regressive. This will only exacerbate the problem. The Commission’s proposals will also continue the State’s practice of lowering corporate tax rates. Whereas corporate profits have skyrocketed over the past decades their tax rates in California have been cut (most recently to the tune of 1.2 Billion dollars in the midst of the budget crisis).

But at the same time by shifting the tax focus to a BNRT the Commission proposes to place even more reliance on consumption. And at least as far as the proposals suggest, the tax would be on consumption with very few limitations. For example expenses on health care or childcare (except where the latter was done by a non-profit) would be subject to the effects of the BNRT. This is because although the BNRT is technically a tax on businesses, businesses will (as they do in other value-added tax locations) pass most of the costs onto consumers. The CBP suggests (based on documents presented to the Commission) that approximately 71% of the tax would be passed onto consumers, about 19% would be passed onto workers in the form of lower wages, and about 10% passed onto business owners and shareholders. This is in distinct contrast to corporate taxes where a much greater proportion is borne by shareholders. In effect, the BNRT would make possible the tax relief that would most benefit the wealthy and corporations.

Just as importantly, estimates show that the new system would produce less revenue for the state than continuing on the present course or increasing corporate tax rates. While the Commission has taken the position that its work should be “revenue neutral”; in practice that has meant that it has agreed not to increase revenues only to cut them. The difference over several years may be up to several billions. As the CBP points out that is as much as the State spends on CSU and UC each year (CBP at 5). Again, to go to the “bottom line” implementation of these proposals will make the tax structure less progressive, likely reduce revenue to the state, and do nothing to address growing inequality.

Politically, it is unclear exactly how these proposals will fare. The Commission is split on some of these points (although our colleague Dean Edley of Berkeley seems to be in support of them ). And in a legislature with a Democratic majority (I hesitate to say Democratic control after recent events) these proposals seem likely to get a critical reception. Many tax experts are cautious about the BNRT proposal and California’s businesses are not necessarily on board. But insofar as the Commission proposals set the agenda for an upcoming special section, and insofar as they represent the wishes of the Governor (which seems clear), they are significant. If the focus of tax reform is on simple volatility without any consideration of progressivity; if the results of tax reform is to lessen rather than increase the State’s revenues, and if taxes are being displaced onto consumption the state is going to be in an even more difficult situation. And the ways in which this Commission mirrors the increasingly unequal division of power and resources within the University is quite striking. These are developments that worth paying the closest attention to as both university employees and also California citizens.

Again, I would welcome any corrections of these comments by those more knowledgeable on taxation and its implications.

UC Student Association Endorses Walkout

UCSA's Statewide meeting at UCLA this weekend endorsed this resolution by what we are told was an unanimous roll-call vote. There is now a link to the official version.
***
Resolution in Support of the September 24th UC-Wide Walkout

WHEREAS, In an effort to close the budget gap, the University of California Regents in July declared a state of fiscal emergency, afforded UC President Yudof emergency powers and approved his furlough plan and extraordinary budgetary revision.

WHEREAS, The existing budget plan will institute mandatory and elected furlough days for all workers, staff and faculty, pay cut reductions between 4 to 10 percent, major cuts to programs and student services, major cuts to in-state enrollment, layoffs, the elimination of positions, workload increases, increasing class sizes, tutoring reductions coupled with library closures, in addition to multiple and catastrophic increases in student fees in continued divergence from the principles of the California Master Plan for Public Education.

WHEREAS, UC President Yudof's budget plan will perpetuate the privatization of the UC system and neglect its goals of educational access, affordability and shared governance. Thus, it is counter to both transparency and accountability of decision-making to the community it strives to serve by increasingly placing the burden on students, workers, graduate student employees (GSE's) staff and faculty.

LET IT BE RESOLVED, that the University of California Student Association is of the opinion that
-Furlough days are detrimental to the educational experience and overall mission of the University of California
-No furloughs or salary reductions should be imposed on those who make less than $40,000
-The 9.3% fee increase imposed for the 2009-2010 academic year is highly objectionable and the proposed mid-year fee increase is contradictory to the UC’s dedication to accessibility
- The UC budget needs to be fully disclosed and there needs to be transparency in decision-making
- Shared governance and the democratic process should be respected
- The University should return to the Master Plan

LET IT BE FURTHER RESOLVED, that for the aforementioned reasons the University of California Student Association will participate in the UC system-wide Walkout on September 24th.

LET IT FINALLY BE RESOLVED, that the University of California Student Association stand in solidarity with workers, GSE's, staff and faculty and actively build coalitions with these groups for the purpose of the UC system-wide Walkout on September 24 and the continued defense of the future of public education in California.

The Fee Hike Shoe Drops

While I wait for me to finish two articles this weekend, here's our pal Joe's summary of the essentials of Regents Item F1, on the ongoing budget disaster and two new rounds of student fee increases:

For an extremely discouraging read, see Item F1 for the Regents' Finance Committee:
It includes

 "Proposal. Within the current budget context, this Item proposes a mid-year fee increase for all students in 2009-10. Display 3 shows proposed increases  by type of student. For example, the proposed increase for undergraduate  resident students is $585 and increases for resident graduate students range  from $579 to $654. Because the fee increase would be effective for the spring semester, students at semester campuses would pay the entire increase when they pay for spring semester.  For students at quarter campuses, the increase  would be paid over the winter and spring quarters."

 and for 2010-2011

 "An option for a further increase, equivalent to $1,344 for resident undergraduate students (fee increases for others would vary by student level  and program), is being analyzed. A proposal for a 2010-11 fee increase will be brought to the Board for approval as part of the action on the budget plan
 at the November meeting. The development of this proposal will include  consideration of how a significant increase in student fees may affect  graduate student recruitment, given the need to provide competitive support packages."

 In this proposal, resident UG fees rise to $10,302

 Also:

 "Differential Undergraduate Fees by Discipline. The University also intends to ask the Regents to establish differential fees for undergraduates in  certain disciplines, effective for 2010-11, similar to professional differential fees at the graduate level. The University is currently  exploring implementing differential fees for students at the upper-division  level (i.e., undergraduates in their junior and senior years) in business and engineering, in recognition of the higher costs associated with offering  these programs. It is expected that differential fee levels in 2010-11 would  be under $1,000 annually. Various implementation issues will need to be  addressed, including the return-to-aid component and impacts on access, affordability and diversity, in order to assess this fee in 2010-11."

Schwarzenegger Tax Commission Proposals: Will They Reduce State Revenues?

Thanks to Michael for alerting us to the fact that the Governor's tax reform commission has just released draft language of its proposals.  These include a reduction of the top rate of the state income tax and the complete phase-out of the corporate income tax, to be replaced by a "net business receipts tax."  Sac Bee coverage notes that the new income tax would be less progressive than the current one, offering incomes above $75,000 a 30% tax reduction. Corporate taxation also seems slated to fall, although the California Budget Project has calculated that the share of corporate income paid as California taxes is currently half of what it was in 1981 (see slide 8).
The Commission is chaired by former UC Regent Gerald Parsky, a major figure in California's Republican party, and includes among its members Berkeley Law Dean Chris Edley.  Dean Edley has signed a separate endorsement of the replacement of the corporate income tax in the context of the other tax changes.
My preliminary search has not yielded any projections of the revenue implications of the new proposals. Until I see these, I will assume that these changes will reduce the state of California's gross revenues. This would obviously increase the state budget deficit and put additional limits on revenue recovery for higher education, among other sectors.
I can't help seeing these tax proposals in the context of constantly declining public revenues for higher education nationally, which for various reasons has disproportionate hurt undergraduate education (see the review of the Delta Project work lying behind Jane Wellman's presentation to the UC Commission on the Future). In her UCOF testimony (overview here),  Wellman estimated viable cost reductions at 3% a year, with much effort.  This means that this year's 20% cut would take 6 years to make up, under the unlikely scenario of no further cuts and decent growth.
Any further loss in state revenue would be piling one disaster for higher ed on top of another.  Figures please.

Non-resident tuition: “profit” = revenues - costs

An earlier post by Chris noted that there are presently a number of individuals and groups within UC that suggest that UC can increase its funding, independent of the fickle fluctuations in state funds, by admitting more out of state students and collecting the associated "non-resident tuition" and "fees".

So let's clarify just how much extra money is really available as apparent profit from a non-resident undergraduate student (assuming no profit from a California resident). I focus on undergraduates for two reasons. First (as of 2007-08) they make up about 84% of all the non-medical students in the University; second our various graduate and professional programs already take significant numbers of out of state (and even foreign) students, whereas for undergraduates we focus on recruiting California residents.

As we enter the 2009-10 academic year, a non-resident will pay $22,669 more than a California resident in undergraduate fees for the year. At present nearly all of these fees are not subject to "return-to-aid" (a tax that helps to fund student financial aid), and (since 2007) all the money from non-resident tuition remains at the campus where the student is enrolled.

Of course this money is not all profit, each student expects an education and (if the University is to be believed) the student's education costs more than the in-state fees alone provide. In fact this is the basis for the usual "marginal cost of instruction" figure that the state has provided to the University to encourage growth in the number of students at the University. In 2006 (the last time the University really got such funds) the amount per additional student was $9,901, though the Legislative Analyst stated (in 2007) that a somewhat higher figure was warranted ($10,856). Thus the apparent profit should be around $12,000 per non-resident undergraduate. 

As a case study, let's examine the fiscal implications of the suggestion voiced by Chancellor Birgeneau of UC Berkeley that UCB should admit a higher proportion of out of state students. First, let's assume that Berkeley currently enrolls 25,000 undergraduate students, that 13% (3,250) of these are non-residents and the rest (21,750) are California residents. (These figures -- from Chris's blog -- are approximate but reasonable for Berkeley's non-summer enrollments). It has been suggested that Berkeley might try to rapidly increase the proportion of non-resident undergraduate students to 25%, if it did so, how much money are we talking about?

If Berkeley were to maintain its current number of California residents, it would need to increase non-resident undergraduates by 4,000 students (a potential profit of about $48 million). Of course, the student body would then be significantly larger and it may well be that the current infrastructure (buildings, etc.) would be insufficient for the larger numbers. Fixing this would incur additional costs over and above the "marginal cost of instruction" thus reducing the "profit."

If, as seems more likely, the plan is simply to exchange a proportion of the current California residents enrolled at Berkeley for non-residents in the future (as the current students graduate) keeping the total undergraduate population constant, the increase in non-resident numbers would be smaller (3,000 students). However, an interesting question then comes into play. Would Berkeley continue to get its current share of the state's general funds although it would be teaching 3,000 fewer California residents than previously? Typical University practice might lead one to expect that it would (the usual incremental funding model does not take away "base" once allocated). In that case the apparent profit to Berkeley would be the full extra non-resident tuition, i.e. about $70 million (the number attributed to Chancellor Birgeneau in Chris's earlier blog entry).

It may well be claimed that Berkeley's general funds should indeed stay the same, as this reduction in student numbers largely addresses the over-enrollment issue (the increases in numbers of enrolled California students for which the State has not provided the "marginal cost of instruction" explicitly in the UC budget). This is usually stated to be about 11,000 students for the University as a whole (about $110 million per year) of whom about 2,2000 are enrolled at UC Berkeley. However, given the University's avowed intent to offer admission to all UC-eligible students (though not necessarily at their campus of choice) it remains to be seen whether limiting California resident enrollment at Berkeley results in a reduction in enrollments to the system as a whole. If it doesn't, the net effect will have the other campuses suffering still more (relative to Berkeley) as they continue to cope with "unfunded" students.

Of course, Berkeley isn't the only campus considering increasing its numbers of out-of-state students. What will be the implications of other campuses also moving in this direction? The same constraints apply -- if a campus can replace in-state students with out-of-state ones while being allowed to keep its "base" funding from the State general fund, then it could seem quite profitable initially (about $22,500 per student); however there will be a limit to this degree of profit corresponding to the current number of "unfunded" in-state students. After that, the "profit" reduces to about $12,000 per student. 

Furthermore, it is likely that the present distribution of the burden of "unfunded" students will not correspond to the initial distribution of growth in non-resident undergraduates thus potentially locking in effective reductions at those campuses that cannot immediately attract significant numbers of additional out-of-state students.

A final wrinkle will depend on how the state comes to view the increased fraction of non-residents as we seek capital funding for replacements / expansions. If it chooses only to support capital costs proportionately to the fraction of in-state students at a campus (a suggestion that would, I suspect, appeal to the Legislative Analyst's Office), then the costs associated with out-of-state students would grow, limiting further the ultimate profit.

So what does it all mean? In essence, Berkeley can maximize its "profit" by increasing the proportion of out-of-state students while keeping the total undergraduate population constant. Clearly the additional funds (estimated as up to $70 million per year by moving to 25% out-of-state undergraduates and assuming that Berkeley does not lose state funds as its number of in-state students is reduced) will be useful to Berkeley -- though perhaps not a silver bullet.

However, if such a plan is carried out there will be (less desirable) implications for other parts of the University. The reduction of 3,000 in-state-students at Berkeley demands that the University, as a whole, reduce its "over-enrollment" by at least the same amount (3,000 students) so as to minimize the fiscal impact on other campuses. Even then, this scenario implies that Berkeley would cut about 800 students from its "funded" enrollment without losing state funds thus effectively increasing its state support (relative to its "workload") by over $8 million. (This is included in the $70 million figure above.) These funds are implicitly lost from the other campuses, in that the number of students they have that are "unfunded" will be reduced, while their funding for students remains the same. On the other hand, the other campuses will be explicitly disadvantaged if the University-wide over-enrollment is not reduced by the full 3,000 students. They will be asked to accept a reduction in their average per student revenues as a result of accommodating the additional "over-enrollment".

Of course -- as with Chris's blog a few days ago -- none of this addresses other possible concerns of such changes in the resident/non-resident ratio. Rather I have tried to clarify the fiscal impacts by examining two scenarios using current information about revenues and costs. It may well be that what really happens is a mixture of the two: that Berkeley increases its proportion of out-of-state students by both increasing the total number of undergraduates and by reducing its actual numbers of in-state students. The fiscal impacts -- even if fees and the "marginal cost of instruction" also change with time -- can be estimated simply: "profit" = (revenues - costs); but remember to account appropriately for the costs!

Notes on the UC Commission's First Meeting

UC planning and budgeting are currently controlled by a logic of cuts, and the Board of Regents Chair Russell Gould said at the start of the meeting that this is a problem.  We need to avoid, he said, reducing resources in ways that reduce quality that further reduce the capacity to attract resources. We need to avoid, he said, a death spiral of cuts.

The kick-off speaker for the UC Commission on the Future, Jane Wellman of the Delta Project, flew the flag on this topic:

I would never argue that a university should compromise on excellence, particularly a public university. if you’re willing to sacrifice quality then the state has no incentive whatsoever to fund you properly. . . Let me be clear. I see no reason for this state or any other state to accept the inevitability of declining investments of public resources in education. This generation deserves to have the same level invested in their future as my generation did. At a time when we under the economic and social importance of increasing attainment there’s no reason for us to accept inevitable declining resources.  We’re never going to get those investments without coming to the table with a lot smarter conversation about cost management and resource management. I do not imagine for a minute that the cost challenge you face can be handled exclusively through productivity increases or cost cuts. It’s got to be tackled on the revenue side. It’s got to be tackled on the tuition side.  But you’ve got to have a piece of that that speaks to cost management.

Unfortunately, this statement did not appear until 1 hour and 22 minutes into the discussion.  By that point it was too late to prevent the establishment of three familiar themes:

A. there will be no increases in public funding
B. there will be revenue enhancements on the margins, i.e. higher and differentiated tuition.
C. everything else will be expenditure cuts

This is pretty much where UC's administrative discussions already were.  The Berkeley campus has long pondered charging higher tuition than other campuses and increasing its share of non-resident undergraduates, perhaps now up to 25%. Other campuses are doing the same, though in my math these will produce fairly small revenue enhancements. President Yudof asked questions that suggested tentative support for surcharges for more costly undergraduate majors as has been imposed in Illinois and elsewhere - $1000 more for electrical engineering than for Political Science, for example.   No one suggested a new focus on turning the legislature around (with new data, new cost containments, new anything).  And the logic in the system, to repeat, is to cut and cut and cut.

Clearly no one on the Commission likes this. But there was a beginner's air to much of the discussion, and new movement was largely up to Wellman.

Did she provide this?  Yes she did, but more in the back of her tapestry than on the front.  Here's my list of her main points, generally paraphrased.

1. the deep problem with higher ed is educational attainment, which everyone agrees has to double (in terms of the number of degrees).  We need 50-60% of the population with some college or BAs.  
2. You can’t solve this problem by increasing UC productivity, since UC is already one of the top performers in the country.
3. Nationally, higher ed costs haven’t gone up more than 1% a year. But prices have gone up. The political system is so focused on price now and on degree value for money - there is so much more political criticism of higher ed out there - that much better accountability and public explanation are needed.
4. UC has a state subsidy per student that is among the highest in the country for a public research institution.  So despite the shocks you enjoy a level of fiscal support and access to resources than has no equal elsewhere.
5. One cost driver for publics is competing with privates. The private/public gap has gone from 2:1 to 3:1 in terms of core spending.  There's some better news now with the decline in their endowments but you do need to ask how many of your campuses can be internationally competitive for top research.
6. All universities function through cross subsidies. It’s normal for less expensive programs to subsidize more expensive ones.  Traditionally, undergraduate education has helped to pay for grad education. When 80% or more of the cost was paid by state, no undergrad wrote a check to a grad student. With falling state support this subsidization will be a problem.  If you look to increase undergraduate tuition by much, these cross subsidies are going to be a challenge.  
7. Softer international demand for graduate programs will continue, and that means we will have to grow our own in a way we have not had to do before.
8. The federal government has not been paying for the costs of its research for some time.  This means that students are increasingly paying for the costs of overhead.  The issue of who pays for the costs of research will come up – it’s not a free lunch, somebody has to pay for that.  
9. Look at attainment and have specific goals.  If you don’t have attainment goals then the financial questions won’t work, you’ll  costs in some measure of need, quality, productivity.  See Washington, Tennessee, Minnesota, especially Ohio, which have robust and thoughtful approaches to attainment goals and to how they're going to pay for it.  In Ohio, there's some reduction in competition and overlap, development of defined centers of excellence, differentiation of tuition with financial aid targets, no-frills options and lower-priced, narrower institutions, shifting enrollment pressures to community colleges.  Maryland is also good on cost effectiveness, more off campus study, education abroad, off campus (distance), faculty workload. They are looking at cost structures and delivery for high-enrollment courses, with an eye for delivering high-quality.
10. You can’t do this alone.  You need policy solutions and state frameworks for addressing underachievement.  You can lower costs simply by letting the state not educate enough people to be eligible for college, and therefore not have as many students to teach. You can solve your cost problem by not trying to serve the population of California as you have in the past. But that's not an acceptable solution. It's a possible scenario if the attainment challenge is not handled. In response to a comment from Senate Chair Harry Powell, Wellman noted that the California cuts will mean the loss of about 300,000 students from higher ed this year, and studies show that once you lose them they don't come back.
    
11. The Return on Investment measure will be important for this work. You need to be looking at costs with some measure of need, some measure of quality, some measure of productivity.
    
12. Financing needs to pay much more attention than it ever has anywhere to cost management and to productivity.  But by productivity, she said, I am not talking exclusively about faculty workload. I'm talking about unit costs in order to produce degrees.  The big cost drivers are the program mix, the graduate mix.  You need to look at benefits.  It's the non-salary side of compensation is eating up your budget.  Cost reductions can be somewhere in the neighborhood of 3% year is reasonable, and its gettable.
13. You need to be data driven.  The data on expenditures in higher education is terrible, and confused with data on revenues.
14. There are so many myths about higher education spending held by people within the institution. You need data so you don't chase the myths. 

 That's a lot of points.  One simplification is to reduce it all to Point 12: reduce costs by 3% a year through various cuts and reengineering, and also reductions in benefit costs. That fits with Point 4 - we're fat, relatively - Point 3, about better self-justifications to legislatures, and Point 11, about reforming via ROI -  measuring educational returns for each financial investment.  There's also Point 9, which lays out a program of differential tuition (also higher tuition overall), narrower curriculae, more use of community colleges, distance learning, and increased faculty workload.

The presentation had other ideas, but it slid inexorably toward cost containment. This simplification leaves us with A, B, C above, though C is modified to link cuts to educational productivity goals. This means hitching targeted, percentage cut targets, standard UC operating procedure, to Return on Investment, in which "return" is defined as through educational goals.  Since the Delta reports define educational goals - or productivity - as the unit costs of producing a degree (Point 12 again), tWellman can be seen as trying to push UC from one kind of financial driver to another.  Rather than reducing costs, we would be reducing costs per degree.  No one objects to reducing waste and to intelligent cost containment, but this doesn't offer substantive educational goals on which to build a future (as rightly demanded by Point 10). We are still left with A, B, and C.

Two Commissioners pushed back on this. Berkeley Law Dean Chris Edley talked about excellence and multi-campus aspiration.  He said that we are unlikely to find significant cost savings by telling any campus that they should be less than they aspire to be.  This was the remark that prompted the Wellman comment I cited at the start - that declining resources should not be accepted as inevitable, and that this generation should not get less education than the ones that came before.

UCSB Chancellor Henry Yang noted Wellman's expertise with data on cost.  But I'm wondering, he said, if you could include quality in your cost factor analysis.  Wellman replied, "I wish I could do better with that."  She said that wants to go beyond reputation and resources as the measure of quality to look at persistence, i.e, at various forms of productivity in degrees.

This wasn't the most useful direction that Wellman took.  Everyone knows UC needs real reengineering.  Calls for simplification and elimination of excessive procedures have been coming for years from faculty, staff,  administrators and students, and we need the focus, the stability, and the administrative support to actually do the redesign.  The cuts environment blocks all of these, and replacing one financial metric with a better one won't get us the transformational working environment that we need.

The more useful Wellman appeared in Point 2, which contradicts the cost containment theme by saying that UC is already highly productive.  Her more useful arguments also appeared in Point 10, in which the state has to be addressed and transformed in its understanding of the crisis of educational attainment and in its support.  Here she converged with many official recommendations of the Senate and some unions that have not been pursued.  Point 5 was also important: competing with privates has distorted priorities and budgeting and created a ruinous competition when we should be setting our own educational goals.  Point 7 gave an example of such a goal: "growing our own" brilliant PhDs in relation to both national and state-specific goals, as land grant colleges were always supposed to do.  Points 6 and 8 get to the heart of the campus poverty problem (and are compatible with our wealth as claimed in Point 4): high-cost programs are draining more populous low-cost programs, and this practice needs candid accounting, dialogue, and repair.  At the same time, research is draining instructional budgets (see our Indirect Costs Corner for some analysis of this), and this hidden funding problem needs fixing too.

This gets us to Wellman's more creative set of principles. I extrapolate somewhat:

D. as part of a general data upgrade, data on cross subsidies must be amassed, circulated,  analyzed, justified, and repaired as needed 

E.  productivity cannot be separated from quality, which must be defined independently of financial drivers, before they are relinked

F. there should be increases in public funding so that this generation has the same opportunities as its predecessors

G. these increases are contingent on improved cost efficiency and explanations of UC's public contribution

We can certainly do D, E, and G, as long as we can get massive buy-in from the Regents and UCOP on F!

Regents Commission's First Speaker: Overview of the Delta Project

The "Gould Commission" is holding its first formal meeting tomorrow at UCSF-Mission Bay, and its speaker is Jane V. Wellman, Executive Director, Delta Project on Postsecondary Education Costs, Productivity, and Accountability.  Please listen to this meeting if you can: groundwork is being laid.

Most people may have no idea why the vaunted, controversial UC Commission on the Future would start with the Delta Project.  Here's quick background on three recent Delta reports. It's the last, I think, that got the Regents' attention.  I'm going to identify some strengths and then note a few serious limits to what these folks are up to.  Overall they are serious people, and they are honest about what their analyses really can't show. That's the good news.

The Delta report that has gotten the widest circulation is "Trends in College Spending." Their data are  shocking: they demonstrate that at public research universities, where state funding revenues corrected for inflation and enrollment increases have been declining, fee increases have not gone into instruction but have been diverted elsewhere.  For example, between 2002 and 2006, spending per student on instruction at public research universities actually declined, while student fees, adjusted for inflation, increased nearly 30%.

The obvious implication is that productivity problems in higher education do not stem from instruction, which is getting squeezed, along with its students, who are, as has become a refrain,  paying more for less.  So one possibility is that UCOF, as I think I must call it, would like to hear ideas for administrative reengineering. Everyone I know at UC has at least five ideas of internal systems and processes that need to be fixed. 

Second, the recent piece that was coauthored by the Regents' presenter, Jane Wellman, is called "Rethinking Conventional Wisdom about Higher Ed Finance."  One premise is that state budget disaster is interfering with "the urgent need to nearly double levels of degree attainment."  The appeal to a group like the UC Board of Regents, is another premise:

Part of the problem is that policy makers on all sides of the table keep looking to revenue solutions to the problem, when the evidence tells us that there isn’t going to be enough new money to return us to the funding levels of the past.

I would be satisfied if the state gave us back our old money.  But Delta's view here dovetails with the longstanding (and I always have to add, self-fulfilling) UC premise that state money will inevitably decline: no matter how much we've been cut we will be cut more. The logical conclusion is that therefore the only source of new money will come from efficiency experts, ones with a keen eye for the political need for "stronger accountability."

The running theme of the piece's ten points is that more money doesn't mean more quality, or more advanced knowledge, or more anything.  In fact I don't know a single person who actually believes that it does, especially not teachers, since we know quite well that quality is about rhetoric, relationships, interaction, explaining, affection, and learning from students as well.

I read this Delta piece as an appeal to the all-encompassing cost-cutting paradigm, close to the totemic essence of American business theory, and thus as the required ante for consultancy work, at which it has clearly succeeded.  There is also a buried remark about the value of "deregulation of benefit costs that now represent at least 30 percent of payroll in most states," which sounds like code for that eternal quest of California Republicans, figuring out how to  get rid of defined benefit pensions. And yet the piece mentions the important fact that while the US average funding for higher ed is the highest in the world, "Public investment in higher education in the U.S. actually falls below the OECD average."  And the piece asserts that the end that doubling current levels of attainment means that "we need to be reinvesting public resources, beginning with state appropriations." 

This brings us to the third Delta piece, by Patrick J. Kelly, who offers an analysis of higher ed productivity called "The Dreaded P Word: An examination of productivity in public postsecondary education."   He wants to contribute to the debate about how to define and measure the value-added of higher education (6), complains about the poverty of public expenditure data in a way with which I completely sympathize, and then weaves together two themes that clash by night, and which I have a hard time seeing the Regents Commission synthesizing.

The first is the claim that Delta has developed an alternative measurement of higher ed productivity that is better than the two main existing ones - graduation rates and credentials awarded as a percentage of students enrolled - a "measure of output" (7). Basically what Delta does is take this second measure, add state funding and student tuition together to get a figure for "total funding," and then divide that by the volume of different degrees to get the cost per degree.  The Delta twist - their alternative methodology - is that they weigh these degrees according to their "monetary value   . .. in each state's employment market."  So if you produce more degrees in, say, engineering, where a BA earns 20% more than a BA in political science, your weighted productivity goes up that much. The rationale is that this weighted productivity measure reflects "increased personal income" for individuals as well as increased tax revenue for the state.  Delta measures the added value of degrees by the added value of the income of the degree holder and of the income tax the degree holder pays.

The strength of this method is that it uses available data to make cross-state comparisons. The obvious weakness is that it is measuring eventual labor price and not actually the degree's added value. Lawyers cost so much that few individuals ever willingly hire them to do anything, which means that you would not want to live in a state inhabited mostly by people with law degrees. And yet a state university's productivity rating would mushroom if it closed all its college campuses and replaced them with law schools.

The same kind of problem appears on the input side.  A university can increase its productivity rating by producing the same or more degrees by getting rid of its faculty and using adjuncts only. Similar issues arise for many - though of coures not all - forms of teaching efficiencies.  When I was a graduate student I used to grade freshman compositions with a stopwatch because otherwise I would absorb myself with deep reconstructions of everything each student said.  I could hold myself to fifteen minutes for 5-7 pages, and do a good job. Or, I could set the alarm for five minutes and triple my productivity. If I did this, though, I would do a third as many corrections. Student learning would go down even as my productivity went up.

I like the baseball statistics approach to funding problems, as far as it goes.  I like spreadsheets and 535.com.  But the productivity methodology "does not address quality," as the report's author Kelly notes in a series of forthright caveats (28).   So it's hard to see how we are getting a handle on productivity in education when quality is bracketed and set aside.

This is bad enough when we're talking about individual benefits.  The complex process of developing human capacity involves a range of achievements that go far beyond income, and the report does not discuss the content of degrees or their individual impacts.  The problem is even worse when measuring social benefits. One of the reasons that public funding has been taking all these hits is the belief that education is or should be a private and not a public good, and an analysis that reduces the benefit to a state of having an educated population to tax returns is making the problem worse.  As an analysis of education's social productivity, the Delta report is at best irrelevant, and at worse seriously misleading.

UC does indeed have a range of productivity problems. Most of them involve cumbersome institutional structures that need careful redesign, rather than the panicky slashing of the UCOP restructuring project (see the UCPB critique), or the state budgetary slaughterhouse we're about to live through.  These productivity problems also rest on sheer distance and a unilateral, secretive,  not to say authoritarian management style that alienates talented, commited people and blocks the flow of information.  The Monitor Report of two years ago criticized UCOP's tendency to act "as a gatekeeper rather than as a partner."  The efficiencies inherent in fairness, interaction, and equitable, open, egalitarian, and trustworthy dealings are not addressed in any Delta materials. But they are a centerpiece of the great efficiency agenda that UC employees are at least as interested in as are the Regents.

The second of the report's two themes is never explicitly mentioned, but is in the figures. The theme is that California's funding is appalling.  Taking all three segements together, its "Total funding per FTE student by state and student share (2006-07) is 49th out of the 50 states (Figure 4, p 13).  In part as a result, its productivity is amazingly even worse - dead last (Figure 6, p 15).  California's production of STEM degrees (the science degrees prized by policymakers) is in the bottom half (Figure 8, p 18),   Here's a summary shot worth pondering:

 California is off by itself with low performance generated with few resources.  Though its productivity is higher at bachelor's and master's institutions (Figure 14, p 25),  even this productivity comes from higher salaries coupled with consistent state budget cuts in excess even of significant student fee increases.

This third report's bottom line doesn't exist: it cannot not actually say whether a given university system is under- or over-funded (28).  Unfortunately, the Commission may well avert its gaze from the now familiar evidence of poor spending and productivity rates in order to focus on the equation of productivity with the monetary value of degrees for higher ed dollars spent.  But we are going to need to do much better than that.

No Confidence Vote is of Landslide Proportions

Press accounts are stating that the union-sponsored no-confidence vote in UC President Mark Yudof went 96% against him, out of around 10,000 people who cast votes.

UCOP is dismissing the vote as a "stunt." The lopsided nature of the vote does suggest that it may not be a scientific sample of the entirety of UC opinion.  Still, criticisms of UCOP management are deep and wide.  Though they have been muted in some quarters by targeted measures like the exemption from furloughs of employees not funded by the state, and the salary top-ups available through at least some extramural grants, it is not clear how long that will last.

My own confidence is not improved by UCOP's official dismissal of the vote. Management that is trying to govern impartially and keep all parts of the system together would instead have said, "while we do not agree with the views expressed by the vote, we take all UC employees views seriously, and will intensify our efforts to achieve mutually satisfactory resolutions to the problems of this difficult time."  Even a little soothing PR seems out of reach. And this in turn raises the unpleasant question of whether the level of respect for a substantial range of UC employees is indeed so low that respect cannot even be faked.

Cuts and UC's Core Values: UCB Prof. Catherine M Cole

Cole to Students - UC Budget Context

Can Doubling Out-of-State Students Save Berkeley's Budget?

Over the years, UC officials have grasped at many budgetary straws, and the one that is now circulating in the press is the claim that UC Berkeley can recover from its two-year 25% cuts in state funds by doing many small things, above all by admitting more out of state students.

Can it? I'm not going to talk about the impact on diversity, education, and California society of shifting to more out of state students (diversity is already struggling), but will stick with doing the arithmetic on the budget question.
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A Trickle Rising River of Layoffs

Furloughs were pitched by UC administrators as an alternative to layoffs - sort of. Employees were threatened with layoffs - or at least more layoffs - if they didn't support and accept the furloughs/ pay cuts. Berkeley Law Dean and Yudof advisor Chris Edley's denunciation of the delay-the-cuts petition said that delay in pay cuts "would create many more layoffs -- because such a huge proportion of UC expenditures are in salaries."

Layoffs are happening anyway: 300 upcoming at UC Berkeley, 800 at UCSD last June, and, in July, the one year advance notice received by the 67 lecturers in the UCLA College of Letters and Sciences who are past their 6th-year review.

Please send more layoff news as you receive it locally, which is where layoff news often stays.

THANKS to commentators for correcting my mistake on the status of the UC lecturers. Please READ the comments, which contain much fuller information about layoffs than I linked to here.