The State We're In

By Michael Meranze

July has come again and we are without a state budget. While this fact is no great surprise, the summer of 2010 will not be simply business as usual for UC, California, or the United States. Indeed, one doesn’t have to be a Cassandra to recognize that decisions made this summer will haunt us for a long time. At the state and federal levels Democrats in disarray have demonstrated little ability to construct a political platform that could mobilize popular support while energized and organized Republicans have made it clear that they are willing to sacrifice the interests of the population in pursuit of ideology and corporate profits. On the international level mass hysteria about short-term deficits promise to drag the world economy back into another recession if not worse. And on the local level the University’s leadership (both in Oakland and on the Board of Regents) is primed to accelerate UC’s transformation into an increasingly feeble copy of an already crisis-ridden economic order of increased hierarchy, indebtedness, labor intensification, and the destruction of any sense of common purposes or commitments.
The situation in California is depressingly familiar. Despite being one of the world’s wealthiest economies, California has, for several decades now, turned its back on the accomplishments of the 1950s and 1960s. Instead its governing class has produced policies that have dramatically increased economic and social inequality, starved the social safety net, re-inscribed racial distinctions and segregation while cutting the corporate contribution to state revenue nearly in half and developing an overall tax structure that is regressive in practice.

In addition, as part of Proposition 13 and the initiatives for term limits, California’s budget process is designed to fail. Both the budget and any tax increases demand a 2/3 majority thereby allowing the Governor and his radical Republican allies to set the framework of the budget process. They, in turn, have made it clear that they will refuse tax increases but will happily cut off social services to the poor, the young, the elderly, and the sick. The imposition of term limits has left us with legislators less able to develop institutional and legislative knowledge and more dependent on party aides and lobbyists.

The State Republicans have framed the present situation as an immediate budget crisis of 19 Billion dollars—refusing to distinguish between current shortfalls that must be addressed and long-term debt repayments that can be spread over time. Facing all of this, the state’s Democrats will attempt to cobble together a budget that will cut services without destroying them. Public employees (and especially their unions) will again be cast as the sources of budget difficulties while Meg Whitman will declare her ability to root out what she fantasizes as outlandish government waste and Jerry Brown will fail to take a public stand in favor of the importance of government investment in people and the future. Limited by the State’s inability to issue currency, and Republican unwillingness to tax the beneficiaries of California’s growing inequality, the state seems headed towards a summer of discontent and the further shredding of the social compact.

But this year, California’s budgetary drama is a microcosm of a much larger problem. As states across the nation are gripped by their own budgetary shortfalls and dependent on federal stimulus money to stay afloat, Washington has become gripped by its own deficit frenzy. Either reasoning blindly from the Greek situation, or simply using it as a smokescreen for long-desired policy goals, deficit hawks and the rearguard of the effort to save the US from the New Deal have gained the upper hand amongst the policy-makers and pundits in the nation’s capital.

Republicans and conservative Democrats have decided that cutting federal spending to bring down future deficits is more important than preventing the nation’s economy from falling back into recession or depression. The repeated failure to pass an extension of unemployment benefits is only the clearest evidence of a collective madness.

The Obama administration, while showing some signs of understanding the foolishness of this policy, has shown little will to effectively fight for it (it doesn’t concern saving the banks after all). Working people, it seems, must pay more and more for less and less so that the Wall Street can be preserved and the Wars fought. Social security is once more back in the cross-fires given Washington's refusal to confront the fact that whatever problems there are in the social security trust fund are due to its having been raided to pay for the Bush tax cuts and the expansion of our military presence across the world. Even having witnessed the massive meltdown of the stock market the federal government seems unable to resist turning more and more of our futures over to the wizards of finance capital.

As a result the stimulus funds that states have been counting on will dry up, no more will be forthcoming, and the federal deficit mania will be pushed down upon states across the nation who will cut their services even further. The already anemic economic recovery likely will collapse.

In Europe the drive for austerity is even fiercer. The EU has decided to tackle its various organizational and currency problems by dramatically reducing social investment, driving down social support, and demanding give backs from workers and students. In Britain, higher education faces millions in funding reductions while the doors of universities are being closed to thousands of students.

Of course, California’s educational sector is already suffering from a Republican driven will to austerity. The State already ranks near the bottom in state funding for K-12 pupils, the community colleges are being asked to serve more students with less resources, CSU has laid off faculty and raised fees, and UC has already raised fees, imposed furloughs, instituted cutbacks, and laid off staff. Even if UCOP’s optimism about the proposed partial back-fill of state funds is proved justified, the University is set to raise student fees even further this year.

In this context, the vapidity of UCOP’s analysis of the future becomes even clearer. President Yudof’s argument for the necessity of the “hybrid” university, after all, depends on a very specific historical argument. For Yudof, the decline in state support for higher education was driven primarily by changing demographics, in particular the “graying of America.” Yudof saw an inevitable loss of interest in funding the education of the young and moreover, he argued, the growing value of a college education meant that state legislators viewed it less as a social investment than as a private investment—if college education was worth so much to individuals then they should bear the burden through fees, tuition, or debt. By casting the decline as an effect of demographics and individual benefit, Yudof in effect ruled out the question of politics. The result was to naturalize—or to use a language that some of the older of us might remember to “reify”—a particular set of political decisions and political values. If you start from the position that the decline in state funding was “natural” then there is little point in attempting to work with others to change the basic calculus.

But that calculus has brought us to the present crisis. Conservatives have effectively persuaded Americans to forget the successes of the social democratic states of the mid-20th century; business groups have deployed anecdotes to create a mythology of businesses fleeing California to greener pastures, and politicians and administrators have succeeded in ignoring the connection between funding and educational success. But there are signs that these assertions are past their sell-by date. In California to speak only of the local, there is abundant evidence that Californians, if not its Republican party, are willing to increase taxes in order to support education and social services. It is not too late to speak out against the effort to transform the present into a new Dickensian world.

Where will UCOP and the Regents stand in all of this? Will they rush to blur the distinction between Universities and for-profit schools or will they allow the Senate to actually evaluate the new online programs? Will they push forward with their ideas to depend more on lower-paid GSIs and Lecturers or will they shelve the notion that they should encourage Senate Faculty to buy out their teaching time through grants? Will they continue to claim that fee increases can be managed with financial aid or will they make clear the burdens placed on students through increased fees? Will they praise the Governor despite his devastating efforts to shred the social network or will they work in common with the entire educational, indeed social service, sector to reveal the human costs of Arnold’s budget?