While UC campuses weighed current-year budget cuts in the range of 6 to 15 percent, the Board of Regents contemplated a vision of equilibrium. When the UC Office of the President's November presentation was done, a regent invited chancellors to respond. UC Riverside's Kim Wilcox (at left, perhaps showing the size of his budget gap) started a courteous series of dissents from the junior campuses, with a timely assist from Berkeley's Carol Christ. Wilcox was featured in Teresa Watanabe's LA Times story that covered the disconnect between celebrating UC's racial diversity (done) and actually funding it (not). The effects of cuts are swaddled in confusion, a confusion seeded by UCOP's budget narrative and planted in the fertile soil of the regents' modest knowledge of their university.

1. UCOP

Each November, UCOP proposes a budget to the Board of Regents for the following fiscal year. In November 2020, they proposed a budget for 2021-22, which the regents then voted unanimously to approve. The result becomes the University's official budget request to the governor and the legislature. 

Here's the summary attachment of the request. Noteworthy items include the request for a full restoration of the state legislature's cut to UC's 2020-21 budget of about $300 million, a second year of pay freezes for faculty and most unrepresented staff (merit increases are funded), and a 1.5% wage increase for a category of non unionized frontline staff.

The dominant narrative is . . . a balanced budget! (Same for Finance and Capital Strategies.) Each item is an increment on an invisible base. Nearly all the items are personnel costs, in keeping with the perennial narrative element that workers are the cost albatross around the university's neck.  The failure of the state to fund capital projects is given the artificially minute price tag of $15 million (debt service).  The exception is deferred maintenance, featured as mostly an investment in cost savings, and expressed as a one-time sum, with no definition of total need (likely 100 times larger) or notice that DM is in fact the opposite of a one-time thing, by its very nature. The request for a state funding increase ($217.4 million, oddly parceled into four items) is not defined as a percentage of a general fund base or as a response to specified campus conditions. The amounts are very small, and have no obvious connection to the mass of current operations.

The budget document (B4) was presented to the regents by the two budget officials who do these honors at regular two month intervals, Nathan Brostrom and David Alcocer. They are both highly competent people who are genuinely devoted to the wellbeing of UC: my comments are not about the individuals but the narrative.  The presentation began about 2'15" into the last session (bottom video on this page; perma-archive of audio is here).  UCOP framed the current year cuts with a full "V-shaped" recovery.

The shortfall is minimized as "near-time," even though these non-core operations are, on campuses, forcing cuts to the educational core.  The term "bridging strategies" suggests losses have been contained, the further implication being no damage to the workforce and no need for better state funding support. As we have often noted in this space, the virtue signaling of self-reliance lets the state off the budget hook.

In presenting this slide, Brostrom noted the campuses have different shortfalls and different strategies for filling them.  This slide looks at the system aggregate.

The main message is, again, the balanced budget. The state cut UC $300 million in the middle of a pandemic when it was losing $2.2 billion in revenue and incurring an additional $431 million in Covid-19 expenses. This reality disappears.  In the UCOP story, cuts don't really matter because the cuts were made up with a bunch of harmless-sounding stuff, like attrition and using reserves. 

Same thing for next year.

The state's cut to UC funding is permanent, so it shows up again. The current year's cost increases do too--so they apparently weren't actually covered as shown in the previous slide.  There are some new "savings." These are really self-imposed cuts: the 10-year UCPath fiasco (a systemwide personnel transactions platform), in which IT "efficiencies" have really meant "morale-crushing rigidity and huge new costs," should have ended UCOP's annual invocation of such savings. But the regents don't seem to know operations realities like UCPath's impacts on staff, so there they are again.  Non-resident student tuition is assigned a full bounce back, and the rest is supplied by restored state funding (though Brostrom noted verbally that this would be "one-time"). It all adds up to the standard budget narrative of equilibrium.  

In reality, it doesn't.  It adds up to cuts on every campus, and a scramble to maximize alternative revenue streams that, in another unstated problem, move workforce effort away from the state-funded educational core.  The actuality of cuts surfaced briefly when the opening regental questioner, Michael Cohen, said about the phrase "cost savings" that "I think you probably grabbed a sentence from some prior documents from the last decade or so," and then asked what long-term savings they mean. Brostrom noted that NRST is capped now, and new high-tuition programs are already in wide use. Translation: the budget patches of the 2010s are now used up. In fact, that leaves workforce cuts, delicately phrased as "attrition and others."  (Cohen also got Brostom to move the number for reserves on the core budget from $174 million to $2 billion, although the issue died there.) In short, "cost savings" mainly means "workforce cuts."

Before we get to the Riverside dissent, let's tote up the core budget story elements:

1. Budget cuts happen, but they never cut UC's world-leading excellence.
2. UCOP cannot stop these budget cuts, but has already neutralized them.
3. All fund sources are basically the same: private is as good as public; borrowing is as viable as state funding.
4. The burdensome costs are personnel (not capital projects, deferred maintenance, or internal subsidies for sponsored research).
5. Campus budgets have inherent differences that the campuses are handling differently.

November brought the latest installment of the "wait and see" policy advanced in every budget presentation during the 2020 Covid period. Covid will fade, and the business cycle will bring UC back to normal. In this story, no new framing, no new thinking, no new policies, no new advocacy, no new mobilization is needed. 

2. The Chancellors

Cohen's question was followed by one from Lark Park, who noted that the system budget doesn't always reflect the campuses and asked if one or two chancellors would like to speak. Enter UC Riverside's chancellor Wilcox.

A lot of people have talked about the pandemic as a magnifier of differences. . . . It's true that we haven't raised resident tuition in many years. And we are a campus that is almost exclusively resident students. That part of our budget has been fixed for many years. . . .And of course that's in the face of the same kind of cost increases that everyone else has faced.  This has been a serious challenge for us at Riverside. To give you an idea, we have now people on campus suggesting that we eliminate the entire athletics program, shut down the study abroad program, our UCDC participation, and our UC Sacramento participation. And that's simply so we can preserve the dollars so we can maintain the core of the university. And ironically the last three . . . are because of our low participation rate, which, ironically, is because our students have fewer resources to participate. So for us, this is a dire situation. There are 6 FTE employed in the chancellor's office at UC Riverside.  I'm one of those six. We anticipate next year there will be 4.  We're cutting everything we can to manage this budget situation. While I appreciate the perspective of Nathan and David on the total being balanceable, the impact on the ground is significant. (2'44'':45 - 2'46":30)

Two other junior campus chancellors backed Wilcox. Juan Sánchez Muñoz at Merced added that his local community depends on campus services that are being curtailed. Cynthia Larive at Santa Cruz noted the added burden of the very high cost of housing in that coastal location. Finally, Berkeley's Carol Christ chimed it to say that although Berkeley's budget is completely different from that of the younger, smaller campuses, "this is the most severe crisis I've ever experienced in my career in higher education. It is a really challenging crisis for the campus.  . . .We have a deficit measured from March 2020 through June 2021 of 340 million dollars." She described a few sources and added, "our losses in athletics are catastrophic."  While there are differences around the UC system, she concluded, "it's not a question of not having budgetary duress on the campuses." (2'55" - 2'56")

The regents' responses made it clear that they do not know what Covid costs and losses plus state cuts are doing to the the campuses. At the end, Regent George Kieffer said, "if we maybe think about a working group, a smaller group, to understand how the process works within UCOP. . . [Formulas for campus allocations] are something I think that the regents have not understood--that I have not understood for most of my term."  Kieffer is the immediate past chair of the Board of Regents.  This admission suggests that the vast majority of the governing board has no real idea of how budgeting works or affects the campuses over which they have complete fiduciary responsibility and control. 

A remarkable summation of the board's competence came from Park, speaking between Wilcox and the other chancellors.

Chancellor Wilcox I appreciate your candor on this. I know it can't be easy. I am surprised to hear this news, but I guess maybe in some ways I shouldn't be. There was a speaker in public comment this morning who alluded to the per-pupil funding disparities. [At the presidential search town hall at Riverside], we did hear an earful from faculty at the time, about how they felt undervalued in terms of per-pupil funding.  I guess I'm kind of taken aback by this. It's kind of ironic because I remember a presentation you gave, this time last year even, we heard about all that Riverside has achieved. And if we could just tell the Riverside story and the Merced story, it would be tremendous and we'd just get so much state support--in terms of the kind of students we're trying to support. I'm really worried that we are doing a real disservice here. And it worries me--I think that rather than advancing our interests on equity we're actually impeding it when we let the disparity continue to exist. I guess I should look to myself too--I've heard this and I've seen the numbers, but it just hasn't struck me as much. I do know it's tough times across the board because of Covid. But just as we know that some populations are struggling more than others in the real world here, I think that if we don't come to grips with this, we're not serving the system well. I think we need to figure out whether our formula advantages the already advantaged, which is something that goes against a lot of principles we've stated in the last year when we've done away with SAT when we endorsed Prop 209  [sic]. I just think we need to go beyond this veneer, to get at what equity really means. . . . I appreciate your being candid with us and I appreciate the speaker who spoke in public comment. It reminded me of what we heard in Riverside.  I just would like to see this discussion continued in the very near future. I think we have to solve it. I think we have to decide that we want to do more than talk about equity, that we want to put our money where our mouth is. (2'47" - 2'50")

Of course Park is right: the regents have been giving lip service to racial equity and inclusion because they have never bothered to insure that equity was budgeted. They seem not to study before the meetings, nor do they appear to read widely and think independently about systemic issues, even those overlapping with their expertise in finance, construction, and the like. The information is widely available. The Senate's UCPB produced a version of the campus funding disparities chart (via UCSD professor Andrew Dickson) around 2006.  The Santa Cruz chancellor's office injected a similar chart into budget negotiations with UCOP in 2009-10. A state audit thoroughly investigated the situation in 2011, and here at the blog we did a detailed, two-part post on the racialized funding inequities (2011-12; Part 2).  The Riverside campus hosts leading scholars of US and educational racism, structural and otherwise; one of these is Dylan Rodriguez, current president of the American Studies Association and immediate past chair of Riverside's divisional senate. The immediate past chair of Riverside's Council for Planning and Budget, physics professor Harry Tom, could produce an eloquent, comprehensive campus budget summary with an hour's notice. A former president of the Council of UC Faculty Associations, Pat Morton, teaches at Riverside. The current systemwide Senate chair, Mary Gauvin, teaches at Riverside, and was at the regents' budget presentation. And so on.  The information is out there for the regents to find: it's just not found for them by UCOP.   Unfortunately, this "disengagement compact" at the top of UC has hurt 21st century UC students, particularly the very high share of disadvantaged students that are relegated to the poorest campuses.

Chair Pérez concluded item B4 by saying, "I did hear very clearly a desire from regents to dig down, and get a more granular view of the budget, so I will work with the president's office to figure out how we can achieve that."  The regents almost made it a full 50-minute hour on the UC budget proposal for 2020-21 (2'15"-3'03"). With some collective effort, it could be a turning point.

3. The Story

Here are some key elements of the better budget narrative that UC and other public universities desperately need.

A. Big picture context: In contrast to current practice, each budget proposal must be compared to the previous regental request (November 2020 to November 2019).  (November 2019's B4 was a better presentation because it included metrics that nearly touched the third rail of UC politics: budget-driven quality declines.)  The year-on-year pattern should then be put in historical context.  Here's an example from our "essential charts" post in May.

The state underfunds UC (red line) compared to the state personal income benchmark (blue line), and falls dramatically short of funding that tracked both income and enrollment growth (yellow line). State government has been saving money on the UC system for 20 years, and the regents can't see sub-standard campus resources without this context.  

In addition, the inadequate net revenues from past tuition hikes and the terrible effects of new unfunded costs need to be factored in to grasp net per-student funding. UCOP could produce a more authoritative version of this effort:

In the calculation, net educational revenues (green line) follow the clearly inadequate state funding (red line), not higher gross figures the regents see (details are at the post linked above). This is a very bad situation that is redefining the quality and nature of UC. It of course won't be fixed until it is faced.

B. Tie budgeting directly to its effects on policy priorities.  Today's board is rightly obsessed with racial equity and inclusion. It's fairly easy to show a prima facie racist correlation in state funding for UC (from our "First Black President" post).

This should be used to shame the legislature out of its practice of giving half the per-student funding to today's minority-majority UC that it gave to white UC. 

C. Clearly explain funding allocations to the campuses, including "rebenching." 

Here's a down payment on an explanation the regents need to have. Rebenching was UC's response to a state audit back in 2011. The audit identified funding inequities that it set forth as racialized ("Racial Patterns of Campus Budget Inequality").  Not only had UCOP allowed campuses to keep all their non-resident student tuition, which "advantaged the already advantaged," to cite Regent Park, but was giving less state general funding to the newer (and browner) campuses.  The plan was to increase the average per-student allocation to the highest level (UCLA's) with new money.  It took about six years, and here's the theory of what happened. 

Here UCOP has told the regents that the campuses now live in budgetary equality. So why was Riverside Chancellor Wilcox saying his campus gets the least money per student?  

Because of how rebenching actually worked.  Rebenching carved out some kinds of campus specific state earmarks and gave each campus a fixed base, so not all state funding was rebenched. Secondly, students were weighted by type, with doctoral students counting 2.5. For example, UC Berkeley had 41,891 students (headcount) at a census point in 2017-18. But it has a high share of doctoral students, so its "weighted" enrollment was 49,894. Berkeley gets the same rate of $6000 and odd per student, but for 8,003 students more than it physically has. Riverside moves from 23,279 unweighted to 26,338 weighted, or an increase of 3059. Berkeley's increase is 19 percent relative to its unweighted base; Riverside's is 13 percent.    This in keeping with the other features of the formula leads to "advantaging those already advantaged."

A final factor is that only a campus's enrollments at the start of the rebenching period were actually rebenched. (I am inferring this from the fact that I was not able to reproduce the UCOP chart above, and got an approximation only by holding enrollment constant.) Sometime during this period, UCOP decided to accept a "surge" of resident students to compensate for the political liability that high non-resident enrollments had created. New resident undergraduates were given whatever amount was cooked up in a Brown-Napolitano deal in a given year ($5000 one year, $0 in another, etc.). Here's actual (weighted) enrollments look like:

No convergence. Flat funding. And Riverside bumping along the bottom. (I assume UCSB did better because it grew less in this period.) The surge's underfunded resident undergrads were the price UC paid for rapid non-resident tuition growth, meaning that campuses like Riverside paid for NRST revenues at campuses like Berkeley.

Each campus experiences its educational quality through total available revenues. Adding tuition (including the non-resident tuition and for-profit masters programs (SSPs) at 3x resident rates to state funding looks like this:

This confirms Wilcox's claim that Riverside has the least revenues per student. UCOP in effect is sending poorer (and mostly URM) students to the poorest campus in defiance of UC's professed values, to say nothing of standards of educational and social effectiveness.   You can also see here the chronic problem of "Two UC Systems," separate and unequal, which the enrollment surge intensified.

D. Tell the budget stories from the bottom up.  Wilcox disrupted budget orthodoxy by talking about his campus for 105 seconds.  The other chancellors spoke for around 60 seconds each.  These vignettes changed the Board's budget perceptions, at least temporarily. They could and should be multiplied a thousand-fold and turned into coherent stories.  Faculty, staff, and students could create a different master narrative by laying out what is happening in classrooms, grad student cubicles, libraries, and laboratories. It would fundamentally change budget perceptions, and also, over time, public understanding and budget politics in a bewieldered state. 

Many other people need to tell their alternative budget stories. You other people. All kinds of campus people. Neither the regents nor UCOP can or will do this on their own.  They don't know enough, and they aren't correctly placed.  You actually do know enough.  This knowledge can overcome the current stumbling blocks: top-down governance, and the absence of a UC opposition party to put forth a New Budget platform for UC.  The Senate hasn't done it. CUCFA hasn't done it.  Even AFSCME, whose Claudia Preparata has done the best independent analysis of UC reserves, hasn't done it.  The pieces of alternatives are a good start but aren't enough. Individual work can always be marginalized in the time-honored UC tradition of shunning the messenger and ignoring the message.  (Even tenured faculty fear shunning, since it makes them feel devalued and also blocks the possibility of an administrative appointment that, during decades of sub-par salaries, is the main way to get a significant raise.) A complete rebuilding of a broken budget model is too important to keep delaying the day regular campus folks start pooling their experiences, saying the way things ought to be, building the story line, and detailing how to fund it.

Warmest congratulations for getting to the end of 2020.  Happy 2021 to one and all.

Stories may seem feeble compared to big data or political power.  This is a false impression. In reality, data and power operate through stories and their effects are determined by them. Your budget slides or whatever have to have the proper story.

The strongest stories in 2020 were abolitionist: abolish student debt, abolish college tuition, abolish grad student rent burden, abolish the police. Abolish the at-will firing of abolitionist scholars. These stories always get out in front of the means of achieving their goals. This is a feature not a bug. Their point is to imagine and concretize the goal itself, and rally people to figure out how to achieve it. The same goes for abolishing Covid-19. Full eradication of pestilence of all kinds is what makes people jump out of bed in the morning.

My approach is chronically materialist and institutionalist, so I chronically focus on finance and budget.  We don't have the same abolitionist power with these narratives, and generally haven't found narrative power in other forms. I'm going to look at the national budget picture here, and then, in Part 2, turn to a local university budget insurgency that should be put to use. 

The Covid relief bill arrived six month late, with fractional funding for higher ed and nothing for the states that fund it. Its support for the overall public is a shadow of the need. The failure of the federal government to meet the basic requirements of its population is a two-party creation. The Democratic contribution has been an unconvincing narrative grounded in a failed economic model.  The compromise deal emerged from moderates from both parties who share the disastrous "safety net" model of government, and who agree that government's collective action produces no real value, just remediation. The Democratic leadership had no better storyline of mass enablement or intelligence working in common, so politics is trapped in the Victorian logic of public assistance, and treats a raging pandemic with quarter measures.

The glaring example of narrative success is Ronald Reagan's hydra-headed narrative, for which the series title was, "government is not the solution to the problem; government is the problem." Thousands of smaller stories fleshed out this master plot. They had a stock cast of characters that were themselves compressed political types, like "welfare queen."  The Reagan machine perfected this narrative with remarkable discipline for decades. It dismembered the New Deal, discredited the civil rights movement, and turned every public system into a remedial function, the very opposite of what created economic value and national greatness. Public education became a problem rather than an asset, and public colleges and universities did not escape.  Reagan's story was a fabrication. But it changed the course of U.S. history.

Barack Obama has been known to quote Martin Luther King quoting Theodore Parker that "though the arc of the moral universe is long, it bends towards justice." It's more accurate to say, "the arc of the moral universe bends towards narrative."  

This week's example is the $900 billion relief finally passed by Congress, that is, allowed to pass by Senate Majority Leader Mitch McConnell. (It is likely to survive Trump's possible veto, with still more delay.)  The deal offers important material relief, but it is also the vehicle for a Republican story, to be told in Georgia.  The story has a goal, which is to keep the Republican Senate majority by delivering both special election seats to the Republican candidates, so McConnell can remain our shadow POTUS. 

The story is this: "Republicans like Kelly and David offered a helping hand to regular Georgians struggling with the pandemic. The delay was (not because they were busy insider trading with confidential Senate public health testimony--that's fake news, but) because we had to fight Democrats who wanted to take your money to bail out failed blue states." The story has to convince a lot of voters that Kelly Loeffler and David Perdue, two of the most plutocratic, anti-Black, self-dealing members of that body, really do care about them.

The secondary story is, "the moderates saved the stimulus." The press is obliging with articles about how Romney, Collins, Manchin, Warner et al. produced a "road-map" for governing under Biden. Sanders, Warren et al failed to get a deal: the future is the bi-partisan center.  Unfortunately, moderation means no money for states and one-fifth of the economic stimulus envisioned by the "liberal" Pelosi in May.

What could help people buy these stories? The lack of a radically different and compelling alternative. That lack is being constructed as I write. For example, Senate Minority Leader Chuck Schumer is NOT authoring a narrative saying this: 

Senate Republicans gave you half a CARES act for a quadrupled pandemic. Mitch McConnell gave you that fraction of a loaf. The bill is crap compared to actual need, and crap compared to what the American people deserve, and it's crap entirely because Mitch McConnell controls the Senate, not me. Let me describe the great version the Democrats wanted that will rebuild the country, and if you want it you need to get Kelly and David the heck out of the Senate.

Republican values, Schumer could explain in the LP version, dictate mistreatment of regular people, because they oppose government, which is the only way to treat everyone fairly when we all need the same thing. In reality, Schumer reframes it as an "emergency survival bill" and promises to fight again next year. But that's not a story. That's an adaptation to defeat.  

Most people in this country are in trouble--unfed, sick, evicted, unemployed, lied to, and about to be further abandoned by their bankrupt states.  In building the true and motivating story out of this one, it's worth bearing in mind how tired people are of half-measures and excuses. Take the half-stimulus check.  $1200 (the CARES Act level) may have meant that you could pay a month's rent and focus entirely on your 12 other major problems.  $600, the new version, means you can pay half your rent, and have to keep "rent" on the top of your list of 13 things while you find the other half, who knows how. If you find it, you don't thank the Democrats for fighting for a new stimulus since May: you thank yourself, for scrambling for the other half.  

People are engaged in a continuous low-level resistance to weak support. Democrats don't seem to get this, and they are walking into an ambush in Georgia.

There are countless books and papers on narratology, like Paul Waldman's on politics; there's a whole discipline that studies narrative and affective engagements-- my home field of literary criticism. One general lesson is that it's essential to critique the false story, but critique is just the start.

First, the critiques, which are widely available: David Dayen drills into details and pronounces the stimulus to be not enough. It is, after all, about a fifth of the $4.3 trillion HEROES Act the House passed in May. The one-time stimulus check is half of the CARES Act's ($600 per person); extended unemployment is cut from 16 weeks to 11; the eviction moratorium extends only to the end of January. Jessica Haberkorn describes other ornaments on the Christmas tree.  

Eric Kelderman does the drilling for the higher ed elements: colleges and universities get $25 billion of a $125 billion need. The student debt moratorium, already running through January 31st, was not extended, leaving that up in the air at least through Joe Biden's inauguration.  Since the bill has no money at all for states and local governments, they will struggle to avoid more cuts to K-12 and higher ed. By undermining government employment and spending like they did after 2010, Congress is priming the country for Great Recession 2.0.

Some good things do happen: the ridiculous FASFA form for financial aid applications is greatly simplified, some loans to HCBUs are forgiven, and the bill finally extends Pell eligibility to formerly incarcerated students. There's more--but only a drop in the money bucket. On this point, Kelderman cites Ted Mitchell, president of the higher ed advocacy group, the American Council on Education: “The money provided in this bill will provide some limited relief, which is welcome news to struggling students and institutions. . . . But it is not going to be nearly enough in the long run or even the medium term.”

These are fundamentally important critiques and need to be widely circulated.  But they don't generate an alternative story.

A true counter story would have a feature that the UC Berkeley linguist George Lakoff, prolific author on the Democrats' inadequate framing and narrating, calls the "truth sandwich." You set out your own view, you then critique the false or opposing view in the context of your framework, and then state your truth or vision again. 

I started to illustrate this with Schumer above, though I had it a bit backwards: Schumer should start with the glories of the House's HEROES Act, and all the problems it would solve, then blast Mitch's phony, bail out-a-Republican Senator plan, then describe the better future of Builder Biden working with strong progressive Congressional support. 

The more radical and inspiring narrative won't come from above. Bernie Sanders and Elizabeth Warren were exceptions at the national level, but they too had to devote themselves to counterpunching the Washington establishment.  Sanders is in fine form denouncing McConnell's fake Covid medicine, but of course this isn't a left alternative. It's missing the compelling social philosophy that has to do to bipartisan Reaganism what Reaganism did to the Great Society and anti-racism movements.

Abolitionism reminds us yet again that narratives of a new society are going to come from us--not from above but from below.  Sanders did enormous good putting free college and student debt cancellation on the political map, but he did this by advancing concepts developed by scholars (like UCSB's Bob Samuels early on) and activists. This bottom-up process works, but it needs a fully engaged and activated base, in real numbers, to work at the required speed. 

Where is that base?  I'll turn to a current university example in Part 2.