Jerry Brown's Back-Door Support for Privatization

As Chris noted in his last post, Governor Brown's proposed higher education budget contained few surprises.  Unfortunately, that means that his budget fails to address the real funding and resource shortfalls facing the three segments and will serve to strengthen the hands of those--like retiring Berkeley EVC George Breslauer--who advocate piecemeal privatization.  Although Brown correctly notes that he has staunched the cuts that have plagued higher education since the Great Recession--while ignoring his own role in the earlier cuts--the realities of his proposals display his unwillingness to do more than allow for a permanent underdevelopment of higher education. He lets himself appear as more of a friend to the sector than his proposals warrant.

In his discussion, Chris emphasized two points:  first the likelihood that Brown's budget plans would lead UC to rely more and more on lecturers and adjuncts and second, that it will increase the turn towards what EVC Breslauer refers to as "unit-level entrepreneurialism." (3)  Each demands attention.  Although the number of tenure track positions at UC has increased since 2007 the bulk of that increase is due to expansion at Merced.  (see the relevant statistics here)  At CSU there were in 2012 fewer tenure track faculty than there were in 2007 (14)  This despite increases in enrollments.  Nor is there any evidence that "unit-level entrepeneurialism" is likely to decrease: the recent proposal on policies for approving self-supporting programs is only one example.

But I want to focus on two other issues that underline the Governor's support (intentional or not I cannot say) both for privatization and for a policy discourse that conceals the question of privatization itself.

First: By tying state funding growth to a freeze on tuition while funding the sectors below the funds they need to face their challenges, the Governor effectively encourages campuses to increase the number of their non-resident students.  An increase in the number of non-resident students is, after all, the simplest way under the present funding regime for campuses to increase their revenue.  This situation is compounded by the severing of state funding from enrollment numbers.  I know that UC and CSU administrators might prefer this situation.  After all, it allows them to curtail enrollment if they want without losing funding.  And it avoids the traditional problem of enrolling more students than the state was supporting.  But it also means that there is no economic incentive for campuses to enroll an additional resident student compared to a non-resident student.  Now I realize that politically this is unlikely--UC is unlikely to curtail in-state enrollment and risk the damage that would result; CSU only does it under extreme duress.  But if Brown and UC were really concerned to, in the words of President Napolitano, "Teach for California, Research for the World," they would create a new funding model in which the state actually funded all resident students rather than encouraging campuses implicitly to seek out non-residents because of their economic value. 

This encouragement of non-resident enrollment, in turn, has several likely long-range effects--even leaving aside the more extreme market-derived prognostications of people like Brad DeLong.  First, despite UCOP's claims that the increase in non-resident enrollments does not curtail educational opportunities for residents, it is quite clear that it does.  UCOP may be right that there is no one-to-one swap out of resident for non-resident (although Berkeley did try that not too long ago) but even when that doesn't occur the effect is to place greater strain on the teaching, research, and support elements of the campus.  Given that the numbers of tenure-track faculty are not growing in accord with the increase in student numbers the faculty-student ratio will increase.  The Governor seems indifferent to this reality.  Moreover, it seems likely that the growth of NRT and especially international students will only increase inequality within the higher education system.  The greater resources of UC will be compounded compared to CSU and within UC the resources of those campuses that can draw international students most effectively (at this point Berkeley, Los Angeles, and San Diego) will grow faster than other campuses (Davis I believe plans to join the pursuit in a big way).  Put another way, Governor Brown's strategy is a strategy for increasing inequality within higher education.

Brown, of course, insists that given tuition increases over the last 5 years, the sectors have increased their total core funds even with state cutbacks.  But this is one of the clearest examples of why the notion of a "dollar is a dollar is a dollar" is false.  For under present circumstances, where UC's accessibility is tied to its financial aid programs rather than its tuition levels, a dollar in tuition is worth less than a dollar in state funding.  This is for the simple reason that approximately 1/3 of every tuition dollar needs to go to maintaining financial aid rather than to the educational operations of the institution.  Even Speaker Perez's effort to expand state financial aid simply deepens the fundamental logic.  For both treat support for higher education as a private and privatized good and not as a public shared function.  The economic burdens fall on students and their families.  And to make matters worse, as Chris pointed out in November the Governor has suggested that the increase Speaker's increase of financial aid is held as an alternative to increased funding for the University.

Second:  Both the Governor and the Legislative Analyst display a highly confused sense of higher education costs.  The key here, as Chris pointed out, is the emphasis on on-line courses as a mechanism for lowering costs and price.  The issue is not only that 2013 demonstrated that current technologies do not save labor costs nor work effectively in helping students overcome previous educational failings.  The issue is that what Brown tries to dismiss as "high-cost traditionalism" is not being driven by instruction (whose costs as Bob Samuels and others have pointed out has actually gone down over time) but by the demands of research--especially scientific research.  And the way that those costs are borne by universities.

Now before people blow a gasket I am not arguing here against research (scientific or otherwise) nor do I think that scientists are somehow at fault here.  The problem--which the Governor and others refuse to recognize--is that society expects universities to be the center of basic research, that the way that research is organized creates a large administrative structure as well demands expensive infrastructure, and that the costs of this structure combined with the infrastructure exceeds the funding (both direct and indirect) provided for scientific research.  Nor does this take into account the labor costs faced by researchers of responding to the various administrative and oversight demands.  Brown's rhetoric suggests that UC can cut costs through instructional technology (his insistence that instructional technology can overcome the challenges CSU faces is a whole other problem); but this emphasis on instruction prevents the open discussion of the real costs of basic research, of the demands placed on (or seized by) universities to perform needed research, and the willingness of society to support that research adequately.  As debates over the sequester and new practices at the NIH have made clear this is not a problem that is going to go away.  Universities have been able to overcome some of the shortfall through cross-subsidies.  But as the core of public funding is hollowed out those cross-subsidies will become less possible and both instruction and research will suffer.

If the Governor truly wants a discussion about the priorities of higher education he would need to move beyond the narrow confines of budget "realism" and trigger a debate about actual costs (for instance the balance between medical centers and campuses).  In exchange for the possibility of arguing for adequate funding, the Governor should demand from the systems clearer financial accounting (if you talk with Sacramento you quickly will see how frustrated they are at the lack of transparency). 

So, when the Governor insists that UC and CSU should simply make do, he not only is securing a state of continuing underdevelopment of higher ed, but, especially in the case of UC, he is encouraging a privatization of the University that will serve no one in the long run.  To make matters worse, in failing to grapple with the actual responsibilities and costs of higher education he prevents a public debate about what higher education for a better society would actually look like. Otherwise he is simply pretending leadership.