Today's NYT has a long piece on the privatization trend at public universities across the country, pointing out that some, like Michigan, have been at it for a long time, while other are just setting out on that path. The UC is catching up pretty fast it seems.
The new, privatized or semi-privatized university will be smaller: fewer students will be able to afford it, and faculty numbers will be reduced through attrition. Students will be, by and large, wealthier, smarter, and less diverse.
One problem pointed out in the article is that there is a finite, and in fact small, supply of such wealthier smarter students, and as more and more public universities compete to attract them there might not be enough to go around.