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Tuesday, November 17, 2009

Tuesday, November 17, 2009

What the Regents should do instead of increasing fees

If you are going to inflict pain on students, the least you can do is feel their pain.  The second thing you can do is broadcast their pain to the Governor and the legislature that caused it.    Maybe then they’d think twice about forcing more fee hikes with more cuts. Maybe even the fanatical governor would think twice, since he is promising still deeper cuts, and to go after “the high-hanging fruits.”

The Regents are expected to increase undergrad resident “Ed Fees” 32% over the next 18 months. They are also set to explode professional school fees beyond limits set by their own rules – from zero to $6000 for Environmental Design at Berkeley, zero to $6000 for Information Management, zero to $4000 for Social Welfare, zero to $11,000 for Physical Therapy at UCSF – a 2/3rd increase for Public Health at Berkeley, and 40% increases in Nursing at 4 campuses scheduled for 2010-2012. In responses, UC leaders are saying that 32% fee increases won’t affect students that much at all.  The Blue and Gold Plan press release says that over half of UC undergrads get grants averaging $10,300 per year - which would suggest to normal readers that half of undergrads will continue to pay no tuition.

In the same vein, the Regents' documents state that "financial aid program enhancements . .  meant that undergraduate students with family incomes below $180,000 experienced, on average, an increase of $1,200 - $1,500 in resources for education expenses” (Regents Nov F1 p 12).  Or a page later,  “UC projects that, on average, students with incomes below $180,000 will experience financial resource increases, either through gift aid or expanded tax credits, to cover the full amount of fee increases already approved and now proposed for 2009-10.”  This sounds a lot like UCOP is saying, the more fees go up, the better off all (but the richest) students are.

This is a script from a model sometimes called "high-tuition / high-fees," and at other times called "privatization." It is not a script based on student reality. Even UCOP’s rosy scenario leaves an average $11,000 gap in the cost of attendance, which is three times what "middle-income" familes ($50,000-$100,000) are able to pay for college and nearly five times the average outlays of lower-income families (Sallie Mae Figure 6). These gaps are filled with increasing student debt, and increasing student work while in college.  Private student debt tripled in the last downturn, debt overall continues to grow, 75% of the public college students who borrow have more than $10,000 in debt, with a median of $17,700.

Stats can be strung out for a while but let's cut to the chase. Debt reduces incentive to continue and reduces freedom of career choice and economic contribution. Excessive work lowers attainment for students who do attend.  Today I spent an hour with a first-generation student who pays for fees and rent at UCLA by working 38 hours a week as a shift supervisor at Starbucks. How much more exactly is UC going to ask her to do?

This gets us back to strategy.  The Ed Fee hike will net $330.0 million for UC (Display 3), which, as a percentage of 2 years of  UC's "core budget" (p 3) comes to 2%.  Is 2% really worth all this student grief?
Secondly, when the Governor and the legislature read that UC covers its fee hikes with financial aid, what reason do they have to rebuild public funds?  The logical effect is the opposite - to think UC can save itself with higher fees, and help low-income students with better aid.  UCOP has been sending a mixed message for years - we need more public money, but we can always raise private money through tuition increases. The effect has been a disaster for public funding - not the one cause of the disaster, but a major one.  In the ten years that have seen fees double,  public funding is now back exactly where it was (Display 4) - well below, actually, corrected for enrollment growth and inflation.  And with its soothing talk of managed fee hikes, UCOP is giving Sacramento no reason to change.

Here's what the Regents should do instead:

1.Recenter UC’s message on the reality that massive fee hikes are very bad. They are just plain bad - bad for students, nearly useless for restoring operating funds.

2.Hold state leaders responsible for the cuts that forced the hikes. The Regents should say this: We had a Higher Education Compact with the Governor. It held us to 3% annual increases, and then, when things got tough, the governor reneged on the deal. The same happened with the legislature: we got the bipartisan shaft. We are going to explain to every student and every parent just what you all have done to their university. We will ask them to ask you to explain how you will fix it. If you can’t or won’t fix it, we will ask them to vote you out of office – as enemies of students, of public higher education, and of the future of the state.

3. We have a new "Compact." It is not with Sacramento this time. It is a “Compact with UC Students.” Our Compact with them is this: we will not charge them more for less.  We will set a minumum investment per undergraduate student that maintains UC quality (as the Academic Senate recommended in 2008).  We will establish a multi-year strategy for sustaining this investment, with clear revenue goals.These will center on repeated increases in state funding requests. Any fee hikes will be strictly limited, devoted to enhancing educational quality, and their uses will be clearly defined. If we cannot do this with the current scale of enrollments, we will shrink enrollments. And we as UC leaders will join with students, staff, and faculty in tracing the problem to Sacramento, starting with Governor Schwarzenegger, because it is a problem no remotely affordable fee hikes can fix.

There are risks in this kind of strategy. But a loss of 40% of of enrollment-corrected state funding from 1990 to 2005, and another 25% in the past 2, says that the conflicted high-fee public model has failed - and has failed faster the faster that fees  rise.   UC's truly amazing students deserve much better than this, and the Regents need to do something besides pass the hikes.

19 comments:

Zazie Smith said...

Chris, and what would happen to the furloughs under your plan?

Anonymous said...

So the possible levers are (1) how much the state supports us (2) how many students we take (3) what we charge the students (4) how much we spend on each student.

You advocate reducing the number of students (2) and argue that will lead to increasing state support (1) more than fee hikes (3) will lead to increasing state support (1). I doubt it. UC is educating a smaller and smaller percentage of the populace. If we get smaller, the state support death spiral will just accelerate. Why would the populace support us more if we turn away students than if we raise fees?

A prudent solution would be that 1/3rd of the CUTS come from higher fees, 1/3rd from some kind of new state revenue source (a new tax on oil?) and 1/3rd from the institution itself (either shifting funds from other enterprises or reducing the cost per student).

UC is already perceived by the populace as too elite. Taking fewer students will enhance that impression. We should demonstrate our pain during this recession by squeezing them in and figuring out how to educate them. Then after the recession, we will be supported for our sacrifice.

Chris Newfield said...

Zazie- the furloughs would continue this year and not come back.

Anon -I think people understand protecting quality, esp if it's spelled out as students still having their problem sets graded, discussion sections where they can learn how to talk in public, etc. We would protect UC's rep as public by laying out all the ways we aren't elite (UC generally argues that it IS one of the world's elite universities). The enrollment growth has been damaging our finances for years and years, and hasn't at all prevented cuts. Why not reverse it, with a clear condition that multi-year step-ups in GF open doors?
Im afraid that your 1-3 has been 20 years of bad luck. We've used GF under compacts instead of oil revenues but otherwise we already know the result and they aren't good. I agree with you that we need to do better with operational streamlining that would put more $ at the rockface

Chris Newfield said...

the other key variable is reward and punishment towards political leaders. we will no longer say after the Gov cuts us 25% that the "Governor gets it" about higher ed. This will shift the political dynamic we have now, in which there is zero political cost for cutting UC.

Anonymous said...

Sure I agree about not letting the political leaders off the hook. Hosever, I think there there is a moral dimension to the decision on fees vs. reducing enrollments. Denying access to students fundamentally changes their lives (especially if CSU and CCCs reduce at the same time). particularly for at-risk and low income students.

Charging higher fees (with increased aid for the neediest) makes it harder in the short-term for the students and family and may increase their debt burden, but they still have the opportunity for a UC education. And thus an opportunity to contribute productively to the California economy.

Increased hardship versus being locked out entirely -- I think the choice needs to be looked at from that point of view. Yes, reverse the long-term trend when California achieves a more rational fiscal basis, but minimize the irreversible long-term harm that would result from a short-term locking out of the neediest students.

Anonymous said...

Here's an example of bartering away a tuition increase for a smaller budget cut -- so it seems fee increases can be effective political bargaining chips too
http://www.kansascity.com/115/story/1577049.html

Anonymous said...

I'm sorry, but a $20 Billion deficit is vastly more leverage than the entire State education system (K-12 plus UC, Cal State, and Community Colleges) and every pther worth while public service can muster.

Talk about rose colored glasses! The State's $20 Billion deficit going into the next budget year is only a small part of the problem. The entire country is in the biggest structural economic crisis since the Great Depression, and it is catching up to that level - real unemployment (U6) is nearing 18% nationally, the banking system remains insolvent (held afloat by phony accounting), manufacturing has been in crisis for 40 years, labor is gutted, more than 20 States face double digit declines in revenue, State and local cutbacks defang Federal stimulus measures, pension funds (including UC's) face insolvency.

As members of the UC community, esp as faculty, we think first of our obligations as intellectuals, researchers, teachers, etc, and argue for the importance of education and research and cultural work (in the broadest sense). All true enough and I agree completely.

But if we really care about education and research and cultural work, we need to face up to the crisis of the society we live in.

Unless and until we stop trying to argue for the just desserts for UC or for higher education - which just pits us against every other just claim for support in a time of economic crisis - we will be the losers. And it is morally indefensible for UC not to charge higher fees to wealthier students while aid is cut to the elderly, the diasbled, the ill, to public health, to K-12 education, and tens of thousands of State employed workers are layed off.

The alternative is to make a bigger and broader case for the future of the country, along the lines of Bob Herbert's NY Times column from Nov 17. The issue is not higher education or public health or green energy or jobs, etc, or even all of those things. the issue is the future of the country (which depends on all those things).

The future of the country. Either you are for it or against.

Reframing the issue is that simple. To use once trendy language, the first step is to decenter ourselves from the discourse. We are not the center of the world, nor even the country or the State.

Zazie Smith said...

Chris, I don't get it, under your plan, where exactly would the money come to end the furloughs?

Catherine Liu said...

Chris, I think that a Compact With Students is a good idea. At this point, I don't we can avoid a student fee hike, but we can ask that it be reduced, delayed or rethought. One thing we can look at is student debt and the ways in which it has been used as a profit center for banks, many of which are now insolvent. We can't punish Citibank all by ourselves, be we can insist that we don't want our students to be crippled by crushing student loan debt, unforgivable in case of bankruptcy.

helicopter said...

At UCLA today, students are being pepper sprayed and beaten - mostly because the lies and misinformation they have been told about UC fees, Yudof's salary, and alternative budgets. That's what got them riled up beyond any dialogue. Do not perpetuate the idea that there is a way out of this that avoids pain to faculty, staff, students, and families. It's utter bullshit.

Catherine Liu said...

Misinformation pepper sprayed students?

Chris Newfield said...

Helicopter is right: e.g the SFC reporter at the R meeting thinks poor students are taken care of, Pell Grants go up to $180 K family income, and things will be bad for a few middle class kids. Regent Reiss said the same on KPCC yesterday. Fees go up 32%, but UCOP tells everyone there's no problem for students, and on top of that, the public sees no reason to worry about state underfunding because UC has all this new money. This is a trap: the damage to students is hidden, and the state has NO incentive to restore funds.

I agree about the "moral dimension" and see the appeal of the argument about how higher fees and debt are better than lower enrollments. But this has been the muddle-through strategy for 20 years, and it has impoverished undergrad UC education while radically segmenting college grads by income, leaving public service professionals relatively much poorer and at-risk than 20 years ago (see David Brook's book The Trap for a really good version of this argument). We can't go on like this!

I also agree that higher ed needs to be part of the big picture and not set against it. But I'm a "hegemonize the chains of equivalence" kind of strategist. The battles need to be fought hard on their own terrain with real expertise by insiders while staying on the lookout for (but not devoting oneself primarily to) convergence with similar battles in other domains. This internal coalition-forming seems to be happening at Berkeley, Santa Cruz, and other campuses, and I think it's a great thing. I also don't think it should be overshadowed or made to seem small in some way by the epic battles that Anon correctly describes.

I think rich families should be taxed much more than they are, especially on assets. They are not contributing enough to the general society that makes their existence possible. Turning ed fees into a mechanism of redistribution, however just, interferes with universal higher education, which is one of my central goals. "Education should be free" - it can be at the point of access if the wealthy pay more into the general fund in the first place.

Zazie - as I understand it, the "Restoration of One-time Reductions" (Display 5 of the Budget Request)claws back the funds that will end the furloughs ($180 M or so saved, $305 M to be restored). My plan would do the same: its point is to get the state to see the *necessity* of correct public funding, and ending furloughs is part of that, on simple anti-Hoover grounds

Michael Meranze said...

Helicopter--can you elaborate on which lies you mean?

Zazie Smith said...

Chris, so it's elephants all the way down? So where will the state get the money? The state is broke. I wouldn't mind if taxes were raised, but what if the state doesn't raise taxes? And does reducing student numbers really save money (unless you lay off faculty and sell some dorms)?

Joseph Maizlish said...

Student fees of $68 per semester (I'm talking about when I was a freshman, 1959) helped the state's populace develop itself and led to achievements in all sorts of creativity -- science, technology, business, social services, and education itself. Dozens of my fellow students and I benefited ourselves and the state (very few of us getting anything like rich in the process) and continue to do so. Unburdened by the urgency of loan repayment, many of us could work in low-paid positions or donate part of our time with community service organizations, the beginnings of the environmental movement, women's movement, you name it.

I'm sure much of that continues today, but I can't imagine that the crushing burden of constant hustling for financing and life under debt are not limiting the freedom to pursue imaginative paths.

CA is the one oil-producing state which has no oil depletion tax, the one state which has BOTH a 2/3 requirement for the legislature to pass a state budget AND a 2/3 requirement for instituting or raising taxes (but only 1/2 needed to reduce them!).

Despite the decades of class propaganda, most Californians favor raising taxes on those who can most afford it (and who draw their great financial benefits from what all California society creates). Even that small percent would benefit from living in a California with accessible education and other well-funded public services.

The change will require effort like that being done at UCLA this week. That work will be all the stronger if we educate ourselves about the public finance topic and the specific things it takes to cure the ills of the starving public sector.

I suggest one good place to start is the site:

http://www.cft.org/index.php/current-issues/245-state-budget.html

Anonymous said...

Chris: UC *is* pursuing your strategy - having concluded that overenrolling to generate moral pressure has failed - now they are reducing enrollments hoping *that* will create pressure. In the fact of huge state deficits it won't work - however at least it relieves some budgetary pressure. You can view the fee increases the same way - in a normal environment they would create political pressure on the State Leg - but in this environment they won't.

I too would be happy to raise taxes (esp on oil) to better fund the university and cut fees - but there is no democratic majority for that right now - the polls clearly show that - so we need a plan for what to do when the state fails to fund us - why would we expect CA to be different from any other state? Are our citizens more pro-tax? Nope. More democratic yes, more pro-education yes, but not more pro-tax.

Repeated talk of 'holding legislators responsible' is empty rhetoric. It is NOT a strategy. We can and should agitate for UC but we cannot expect to radically change state budget priorities in the middle of a recession.

UC was NEVER well-funded b/c of democratic demands - it was always a project of CA elites - Dem and Rep alike - Clark Kerr was a master strategist and bureaucrat - not a democratic activist. He had a great democratic vision - which we should do everything to honor - but he also knew how to get things done - we should honor that too.

Anonymous said...

I agree with my namesake.

Chris Newfield said...

Mr Maizlish - many thanks for your eloequent summary of UC then and now. You caputure an essential point when you say, "I can't imagine that the crushing burden of constant hustling for financing and life under debt are not limiting the freedom to pursue imaginative paths."

Anons: UC suggests it might consider enrollment limitations in its budget doc. They've done that before. Nobody takes them seriously.

I'm not calling for rhetoric, I'm calling for systematic mobilization with a goal of political reward and punishment. Clearly state that "our decision to raise fees, though we felt it necessary, harms our students and reduces opportunity. It especially harms first-generation students and students of color. We lament the reduction of opportunity and quality forced on us by Sacramento, and we will fight its repetition." Identify problem politicians, starting with Arnold. Create talking points about their negative impacts on student access, outcomes, research, and other state benefits. Contact students and parents in their districts. Request that they write, call, attend all public functions and dog them to limit about their stupid decisions. Make it clear they will be proposing other candidates and voting against them. Look for pro-education candidates and run them in primaries against the cutters of higher ed. Get a few wins in soon, and broadcast those.

The public does support expenditures on specific valuable public goods. I can assure you from personal experience that the great majority of the middle classes in California supported UC in the 1960s and 1970s, even after the protest years - my Republican parents, their Republican friends: it was like the freeway system etc a sign of California's greatness. Elites may have engineered it, but they also marshalled popular support, including Pat Brown: in 1959 the economy had fallen into recession, and the state budget deficit amounted to 20 percent of the total budget. Yet California higher education grew because Brown restructured the tax system, raised the top income-tax rate from 6 percent to 7 percent, and pushed high-quality higher education as part of a package of infrastructural development that would serve the entire population. If UC explained the concrete effects of the reduction of quality, what restored funds would be used to do, how they would benefit everyone, and how they would be strictly accounted for, the same support would be there. We must try something. The current path is predictable: fees of $15,000 by 2012-13 at the latest, and flatlined or falling state funding at exactly 1/2 where it would have been if we had continued on the 2001 Pathway growing with state personal income. We have no choice other than to try a new game

Anonymous said...

CTA is contemplating a Split Roll Tax Initiative:

"The California Teachers Association continues to grapple with whether to pursue either of two proposed ballot initiatives it filed this month to generate billions for schools by raising property taxes on large businesses. CTA President David A. Sanchez said a final decision will be made in January by the group’s state council. Each of the CTA initiatives promises a tax break for homeowners and small businesses."

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