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Wednesday, February 17, 2016

Wednesday, February 17, 2016

Where I Implant UC, There Shall Inequality Be

I realize there are many other factors, but the geography of the state inequality boom does not put the University of California system on the side of broad income growth.  Take a look at the figure at left, from a new report by the California Budget and Policy Center.

Of the top 12 regions that have seen the highest percentage of growth go to the top 1%, 7 have UC campuses.  Of the others, one has Stanford and SJSU, another has a Cal Poly, and two are something akin to agricultural plantations.

3 UC campuses serve more egalitarian regions (Davis, Merced, and Riverside).  They are also lower-income--and not associated with California's famous tech economy.  (I mean tech broadly to include related (and well-paying) financial and other services, and retain the murkiness of the term, whose aggregate employment generally remains less than 10 percent of any regional total.)

Research universities do not only serve their local regions, but there is national pressure for them to shift the balance back in this direction, and UC's D-M-R campuses can plausibly invoke regional service in their pitch for funds. Partial proof was the Riverside campus's successful bid to start a medical school that the state promised not to fund properly, but that carried the day on the basis of its location in a medically-underserved region that could also use new jobs.

What can we make of the kind of stretched correlation I've just produced? We can focus on the politics of the links rather than on the economic causalities.  The latter are very hard to identify. But politics generally works with exactly this kind of loose association.

Two generations ago, UC's association with the "knowledge industry" was an association with rising incomes distributed widely in the population. This reflected the rise in general individual productivity, which could in turn be traced to all levels of educational advancement, particularly bachelor's degree attainment.  UC could say it was building a broad middle-class. Politicians of both major parties had little reason not to fund that.

Today, UC's association with the tech economy is an association with the inequality boom.  While the productivity of middle-income people does not rise more slowly than those at the top, their wages do.   (Explanations for income growth at the top are generally about market pricing power of specific skills, not about their superior productivity growth.)   Going to a UC does not now insure that your wages will rise with your increased productivity.

Of course it never did insure this, and universities cannot fix the plutocratic tendencies of the tech economy, by which I mean that cluster of practices that insure that the "regional advantage" we touted in the 1990s will never produce a tech manufacuturing empire staffed by white-collar armies on the model, of, say, the South Bay aerospace empire of the 1950s and 1960s.  The point is that UC can no longer make the same political claims to resources on the basis of an ever-more democratic distribution of knowledge and income. Compared to CSU and the CCs, it is comparatively rich and also located in fairly rich places that look the least in need of public funding help.

The solution is not only to stress the large numbers of low-income students enrolled at UC. (UC policymakers should stop weakening this important case by exaggerating the immunity of low income students to burdensome student debt).  The solution will involve explaining the concrete contribution UC instruction and research make outside of the tech industry as well, and for the vast majority of California counties that have no UC-sourced start-up companies and limited tech employment.   All UC disciplines make major contributions to the present and future workforce.  Until UC can make the broader case for all the fields and all the skills it offers, budget politics will continue to run against it.


California Policy Issues said...

Keep in mind that high income (related to high tech) is a major source of state budget revenue that filters down to UC.

Chris Newfield said...

3 issues: they stopped trickle-down to higher ed a long time ago-- see the chart here http://utotherescue.blogspot.com/2013/11/the-old-state-funding-model-is-dead.html It registers the extent of the diversion of actual state personal income away from UC (as a stand in for the 3 segments). Second, as economies become plutonomies, they do indeed depend more on taxing the top, since there are such large proportions of poor people. But that's an argument for growing the middle-class so there are more decent incomes to pay more taxes. Third, top-heavy tax receipts undermine the political foundations of public education, since the top doesn't generally use public services in proportion to their higher individual costs. (This conservative anti-tax argument has a point.) UC is caught between stations now--rejecting too many tax-paying middle class Californians from their desired campuses to feel like the people's high quality system that it used to, and yet being far too big and general to do what elites want higher ed to do for them. The only solution is to become a popular top-quality system again, and that will mean dialing back from over- investment in (and exclusive trumpeting of) narrow lines of tech and professional training.

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