31 August 2009

UC faculty walk-out proposed for Sept. 24

A walk-out is proposed for the first day of classes, Sept. 24 (for those campuses on the quarter system). Endorse the proposed walk-out by emailing ucfacultywalkout@gmail.com.

It's noteworthy that UPTE, the union that represents 12,000 UC researchers, techs and health care professionals, has also called a one-day strike for  Thursday, September 24, over the university’s unfair labor practices.

Show me the money

A document released by UCOP last Friday addresses Employees' Frequently Asked Question on the furlough program. After going through many details concerning the implementation of furloughs, UCOP finally addresses the question:
I’ve read that the furlough plan yields much more than $184 million. Please Clarify.
And, surprisingly, the answer is a stunning vindication of what has been argued on University Probe for almost two months:
Yes, savings from the furlough plan will total more than $184 million. When all UC funds sources are taken into account (UC general funds, auxiliary enterprises, contracts and grants and medical center revenues) the furlough plan yields approximately $515 million.
So the furlough plan will generate $330M in excess of the advertised $184M in general fund savings. So, what does UCOP plan to do with that windfall? Read on:
The additional dollars resulting from the salary reductions in other non-general fund sources will be used to help offset other cost increases and revenue shortfalls in those areas, such as rising costs of technology, utilities and health benefits as well as revenue shortfalls such as cuts in Medi-Cal payments to UC medical centers. To the greatest extent possible, campuses will seek to deploy savings generated from non-general fund sources strategically to address their specific needs and to address the balance of the $813 million state funding shortfall after savings from furloughs/salary reductions are taken into account, consistent with any restrictions on those fund sources.
So, let's see. The State cuts general funds appropriations to the UC by $813M; UCOP announces that 25% of that — the famous $200M — will be taken in salary reductions throught the furlough program, and the remaining $600M and change divided among the campuses to make up through other cuts in their operating budgets. But now it turns out that those were not the actual numbers: $515M will be generated through the furlough program, and the remaining $298M  divided among the ten campuses.

In addition, the campuses will absorb other increased costs (cuts in Medi-Cal payments, rising utilities and benefits costs, etc.). So here is the question: if that was the plan all along, why go through the $200M rigmarole? Just tell UC facuty and staff that they will absorb the bulk of the general fund cuts. But of course that might have appeared — unfair ?

And of course, no figures are available as to what decreased Medi-Cal payments to the medical centers will cost the UC, or what the increased utility and benefits costs will turn out to be.

It would seem that UCOP is out to protect medical centers and other revenue generating operations, and if they have to do this on the backs of faculty and staff across campus, then so be it.

30 August 2009

UCSB, UCSC divisions speak up against furloughs

Two strongly worded letters from Santa Barbara and Santa Cruz divisional chairs take exception with the furloughs and their implementation, especially as regards the now (in)famous Pitts memo. The SB letter can be found here (thanks to Chris's Blog Archives for posting it), and the SC letter is here.

Especially the SC letter is impressive for the way the argument for furloughs and their implementation on non-instructional days is dismantled, under four distinct headings:
  1. Incoherence of UCOP’s view of our Systemwide mission;
  2. UCOP’s Inability to Follow [its own] Guidelines;
  3. Institution of Tiering of Salary and Effort by Discipline;
  4. UCOP’s Messaging, or Lack Thereof.
It is a great read altogether. Hats off to the SC division for speaking up!

28 August 2009

Limits on Executive Compensation at UC, CSU die in the Legislature

Senate Bill 217, originally introduced by Sen. Leland Yee (D-San Francisco) and overwhelmingly approved by the Senate in May, died in the Assembly Appropriations Committee yesterday. The bill would have prevented UC and CSU from increasing executive compensation in any given year in which the State's appropriation for UC and CSU was less than in the previous year.

It's true that limiting executive compensation will not solve the University staggering budget problems, but it would have been a step in the right direction. UC and CSU lobbied hard against the bill, on the premise that a cap on executive compensation would have caused the University top brass to leave for greener pastures, thereby causing the university million is recruitment costs to replace them.

As pointed by the California Chronicle, it's funny how salary reductions for faculty and staff (in the form of "furloughs") are supposed to save the University money, while the same for senior managent would actually cost more.

Equally funny how "bad optics" considerations can lead to the most egregious breach of shared governance in recent memory, while they carry no weight in the case of executive compensation.

Is there really no shame at UCOP?

26 August 2009

Vote of no-confidence on Yudof's leadership

The UPTE union has called for a vote of "no confidence" in Pres. Yudof's leadership. Polling stations are open beginning today, Aug. 26, to Wed. Sept. 2. A list of polling stations can be found here, or one can vote online here.

25 August 2009

Pres. Yudof's appeal to "protect the UC"

In what I assume was a system-wide email delivered to every faculty and staff mailbox (also linked from UCOP's website), Pres. Yudof is encouraging UC employees to contact the Governor's office as well as their representatives in the legislature in order to convey the urgency of UC's situation and invite them to make higher education a budgetary priority.

While this is probably a good idea, once again Yudof declined to endorse any specific measures that would alleviate the financial predicament of the University, and specifically the oil severance tax that many are advocating.

The broader question, though, is why UCOP is now embarking on this PR campaign. There can only be one reason: they know the worst is yet to come. And they are probably right:
  1. State revenues are not going anywhere any fast — and especially not up — even if California were to experience a (modest) economic recovery next year.
  2. Re-distributing state general funds (from, say, the $11B in the prison budget) is politically difficult, and the Republicans in the legislature, in their infinite wisdom, would want to take that money out of social services for the poor, the sick and the elderly anyways.
  3. Finding new sources of revenues in the short term would run against the jihadist opposition to any new taxes.
  4. Fixing California's revenue structure is a long term proposition, which would at least require:
    • enacting re-districting reform (and perhaps open primaries);
    • exempting commercial properties and perhaps second homes from Prop. 13;
    • repealing the 2/3 majority requirement for budget items;
    none of which can be done in the next few months.
  5. And last but not least, the $600M in federal stimulus money that have kept the University (barely) afloat this year will not be renewed.
So the situation is bleak indeed. There might — but just might — be a small chance to push through A.B. 656 and put in place the same oil severance tax that Texas has been using since the 1800's to fund higher education. It would still require a 2/3 majority and the Governor's signature, but it seems like the best (perhaps the only) chance we have. But it's a narrowly-targeted measure for a very specific cause, widely used in other states for similar purposes. So it might get past at least a few Republicans and land on the Governor's desk.

So, yes, please do go over to the UC for California website, and write to the Governor and the legislature, but make sure to press the case for A.B. 656.

Whistle-blower protection comes to the UC

As reported in the SF Chronicle, the California legislature approved whistle-blower protection for UC employees. The bill was introduced by Leland Yee, (D-San Francisco) and now needs to be signed by the Governator himself.

Apparently until now UC was exempted from whistle-blower protection as long as it conducted its own investigation, which is surprising. What is not surprising is that UCOP had opposed the measure.

23 August 2009

More on the Pitts memo

Reading the memo to the Chancellors and the Senate Chair, one is struck by how disingenuous its language is. Just look at the very first sentence:
After speaking at length with all of you and a number of other people with an interest in the issue, we have decided that ...
So Interim Provost and EVP Pitts reports consulting "at length" with those to whom the memo is addressed (the Chancellors and Senate Chair Croughan) as well as a number of unspecified other people. The decision to go against an explicit recommendation of the Senate was rather momentous, and transparency about the process all the more necessary — instead we get something very much like the Cheney energy task force.

After such mysterious consultations, Pitts announces: "we decided." Who is "we," pray tell? The letter is signed only by P/EVP Pitts. This looks like an attempt to characterize the decision as one that was shared by the letter's addressees and deflect responsibility for the consequences.

We learn a bit more about the process from a statement by Chair Croughan, in which she decries the outcome:
the proposal was then discussed with the EVCs, Chancellors, State Government Relations, and Public Affairs.
So it would appear that the Academic Senate is odd man out here, left alone to support the reasons of the faculty. Finally, with complete lack of irony, the memo commiserates
faculty who have ... increased teaching workloads; employees who have fewer days to do their work and sometimes fewer colleagues to help them; administrators who have reduced staff and budgets to accomplish their complex tasks;
only to finish with the suggestion that faculty seek compensated "outside professional activities" to make up for the salary cuts. (This again makes it clear that this administration's main concern are the revenue-generating units around the campuses: the professional schools).

Even more surprising is that this should have been a no-brainer for UCOP: they could have decided to receive the Senate's memo, allow furloughs on teaching days (like in the Cal State system), pay lip service to shared governance, and everything would have been peachy until the next round of cuts. Instead, they decided to show cavalier disregard for shared governance and use an authoritarian approach. Why? Two possibilities come to mind:
  1. Because they can. UCOP either did not consider, or did not care about, the possibility of a faculty backlash (which might or might not come — we'll see).
  2. They did this because they know that there's more to come. More cuts down the road when the State budget fails to improve following a modest economic recovery next year and federal stimulus money runs out. It would be dangerous to acknowledge the principle that cuts lead to less instruction, given that we are headed towards more cuts and increased fees. The students would be getting less instruction for more money, and that would not sit well with the public — they might even consider blaming the University's administration!
(In fact, that future cuts were a consideration is mentioned in Croughan's letter linked above.)

In either case, it ain't pretty.

Bullshit

This is, of course, a technical term. Whereas lying presupposes some acknowledgment of — and perhaps even a certain regard for — the truth, bullshitting is only concerned with the effect of the given utterance on its recipient. The California Professor was reminded of the distinction by UC President Yudof's repeated justification of UCD Chancellor Katehi's $400K salary, which represents a 27% increase over her predecessor's. While defending the appointment, and not for the first time, Yudof has pointed out that Katehi is one of the nation's leading electrical engineers and has 16 patents.

Do you know how many people like that are in the UC System? What about people with thirty-two patents — should their salary be $800K? (That would — I shudder at the thought — begin approaching the salary of the UC President). What about Nobel laureates and other world-renown faculty at UC?

The truth is that Yudof's argument is totally bogus — in a word, bullshit. It is of course true that Katehi is a respected scientist, barely tainted by the Illinois admissions scandal. But the scientific credentials have nothing to do with her appointment at UCD, which is just another instance of executive compensation run amok.

22 August 2009

No furloughs on teaching days

According to a letter from Lawrence H. Pitts, Interim Provost and Executive Vice President Academic Affairs, furlough days are not to be taken on teaching days. This in spite a wide consensus among the faculty throughout the System that at least some furlough days were to be taken on instructional days, including an official position letter by the Systemwide Senate. Anybody else out there who finds this outrageous?

21 August 2009

More pain down the road

UC President Mark Yudof warned of more cuts coming next year, when federal stimulus money runs out, with a predicted shortfall of about $600M (this year's cuts for UC amounted to about $800M). President Yudof also indicated the need for the State to start paying for Higher Ed perhaps through higher taxes or live with a "crummy university." Yudof did not specify which taxes he had in mind a refused to endorse an oil severance tax to fund Higher Ed in California the way a similar tax is used in Texas, for instance. Yudof also defended excutive compensaton practices at UC against state Sen. Leland Yee's (D-San Francisco) plan to cap salaries for UC's top brass. UC Chancellors, according to Yudof, already make $200K less per year than administrators at similar univeristies across the country. Funny how the salary lag at UC appears to be a big problem when it affects senior administrators but it is hardly mentioned for faculty and staff.

As reported in a different news item, beside again defending salaries of the top brass, including Davis's new chancellor, Yudof also warned UC unions to approve the furloughs or face layoffs.

17 August 2009

One administrator talks to the faculty ...

... two administrators talk to each other; three administrators form a club. Or so the story goes. It seems a common trend among mature organizations that management tends to be top-heavy, and the University of California is not that far behind the curve.

According to a posting over at Changing Universities,
In 2008, there were 397 administrators in the over 200k club making a total of $109 million, and in 2006, the same group had 214 members for a collective gross pay of $58.8 million. This group and its collective salaries, then, almost doubled in just two years. If you want to know where the UC money has been going, this is a great place to start.
Why, why on earth did UC have to double the number of administrators in the two year 2006-08?

Let's get one point across: UC's mission is teaching and research, and that is carried out by the faculty with support from the staff — in the classrooms, the labs and the departments. That's where the rubber meets the road, as they say. Administrative bloat is not only expensive, it actually interferes with UC's mission.

15 August 2009

Giving the profession a bad name

This is a bit belated, but well worth commenting on. First, the facts: a group of UCI faculty from the School of Humanities have signed an opinion piece calling for the exploration of
viable alternatives, which range from levies on the state’s petroleum production and closing corporate tax loopholes to, yes, raising state income taxes, which are among the lowest in the country.
The full text of the letter is available courtesy of the OC Register. As you will notice if you follow the link, the proposal has raised a veritable barrage of criticism, much of it admittedly wide of the mark.

But the point is different. Beside being obviously oblivious of California's political climate, the esteemed colleagues are clearly misinformed. California's personal income tax rate is among the highest, not lowest in the country, as one can easily check. And the reason is well known: thanks to Proposition 13, California has to rely on income and capital gains taxes, as well as the highly regressive sales tax (also quite high). And while it has been often pointed out how intrinsically unfair Prop. 13 turned out to be (with young couples paying property taxes several times higher than those of their older and more affluent neighbors), it has also resulted in cash flow for the State that is extremely subject to the vagaries of the economic cycle, whence the current disaster.

All of this is well known and not at all difficult to find out. Why the Irvine colleagues never bothered to check their facts, it is indeed hard to understand. The whole thing just confirms prejudices and stereotypes about academics — how aloof, privileged and uncaring they are. In sum, the whole letter was just stupid not well thought-out.

The esteemed colleagues could have instead insisted on the oil severance tax (which they do mention), or repealing Prop. 13 while keeping protections for families and individuals (e.g., repeal the part about commercial properties, or second homes, and especially repeal the part about the 2/3 majority requirement). But advocating an increase in income taxes solely for the purpose of supporting the University, with no mention of the plight of the poor, the sick and the disabled was unconscionable.

13 August 2009

The future of the university

Very interesting debate over at Remaking the University between Chris Newfield and David Hollinger concerning the different models for the future of the UC. Under the heading "Should Berkeley be Michigan?" we have the outlines of a proposal coming (not surprisingly) from a group of Berkeley faculty.

The proposal calls for increased enrollment of out-of-state students (who pay much higher tuition than CA residents) up to 20% of total enrollment at UCB. The proposal also unequivocally calls for some sort of privatization on the Michigan model for the top tier UC campuses UCB, UCLA and perhaps UCSD). There might indeed be something to be said for the idea to let the flagships go.

But one of the points made by Newfield is one ought to be careful what one wishes for — because one might get it. In particular, once you start charging higher tuition you lose the price advantage over the privates and then you have to start competing with Duke, Stanford, etc., at the level of their student facilities and other (expensive) amenities. And of course, as a bit of a counterpoint, there is always the chance that education might be the next bubble to pop. When tightening credit markets, people might decide that taking out a loan for $30K to $50K a year for four years might not be the wisest thing to do. If that were the case, this privatizatuon scheme might well turn out to be the higher-ed equivalent of CDSs and CMOs.

07 August 2009

It's all arbitrage

The news of the day is that the University of California is lending the State of California about $200M. This is because, not unsurprisingly, the University has a better credit rating than the State and so it can borrow money more cheaply.

In order to keep a number of construction projects (mostly in the medical sciences) at various UC campus moving along, the University has borrowed $200M on the bond market. The money is then immediately loaned that back to the State at a 3.2% interest rate — higher of course than that which the money was borrowed — so that the State can, in turn, give the money back to UC for those projects (huh?).

Besides: (i) the preeminent role of the medical and health sciences in this story (they seem to be the real winners in the whole UC budget debacle); (ii) the circuitousness of the whole plan (why can't UC just borrow money for those projects?); and (iii) the fact that UC is going to turn a profit on this, there is still one more question looming.

When asked about the loan yesterday in Santa Barbara, Yudof replied: "It's all arbitrage," meaning that UC is taking advantage of an inbalance in interest rates to turn a profit. But of course, as any first-year economics student would know, and unless UCOP thinks investors are stupid, the net effect of this ruse will be just to decrease the University's credit rating correspondingly. After all, the University is taking more risk by lending the money to the State than the 3.2% rate of return on that loan warrants, because otherwise the State could have just borrowed the money itself.

The net result will be to make future loans that the University might want to take out more expensive. This kind of wooly-headed thinking that seems to enjoy a lot currency at UCOP will not help solve the University's problems.

06 August 2009

The Economist on the California Dream

That left-leaning and subversive publication, The Economist, has an article on the decline of the finest public system of higher education in the world, aptly titled — Before the Fall.

05 August 2009

Rumor has it ...

... that employees at some UC Medical Centers will be spared salary cuts, in spite of not being on outside grants. These would be clinical employees, whose salaries are supposedly funded through the fees paid by patients and their insurance companies.

If true, this might help explain the discrepancy between the announced $200M in savings and the projected $500M yielded by the salary cuts: $300M in cuts at UCMC's would simpl never take place.

Can anybody confirm the rumors?

03 August 2009

Would you buy a used car from this man?

The way the University of California is managing its financial resources and implementing the salary cuts and furloughs approved by the Regents appears increasingly shady and underhanded.

There are some questions that the California Professor would like to see answered. These are simple, straightforward questions that should have simple, straightforward answers.

  1. Why are the salary cuts calculated on the base salary instead of total compensation?
  2. The salary cuts will generate upwards of $500M in savings for the university, i.e., more than $300M above the advertised $200M to offset decreased state funding. Where is that extra money going?
  3. According to Moody's latest Bond Rating for UC, the University has between 5 and 6 billion of "unrestricted financial resources" on their balance sheet. Why is that money not being used to offset decreased state funding?