What Katehi didn't say

As we know the Davis Chancellor addressed the 5,000 participants at the rally held today on the UCD quad: the full 2:44 minutes of her emotional speech can be viewed here. She apologized for Friday's "events" and vowed to work to re-gain the students' trust. That cannot have been easy, and it certainly took courage. But equally important is what she did not say. For instance, here is something many were expecting to hear:

The Chancellor will ask the Yolo County DA to drop all charges agianst the arrested students.

This is so obvious it is a no brainer, and yet nothing was said in this respect. Here is another one:

The Chancellor will make sure that all riot control equipment on campus is removed from possession of UC PD.

Again, nothing in this direction. Or one more:

The Chancellor will make an explicit commitment to safeguard free speech and other constitutional rights on campus.

The list could go on, including working with the students to reverse tuition increases, working with faculty to restore shared governance, respect the right of workers and staff to unionize and engage in collective bargaining. But none of that was forthcoming today. Perhaps tomorrow?

Comparison-eight salaries

System-wide senate committees and working groups have started posting documents before they reach the stage of Council approval, which is a welcome development to the extent that it gives the rest of the faculty some insight into the workings of the system-wide senate and helps dispel the perception of senate proceedings as shrouded in mystery and removed from faculty concerns.

Among these documents is a report by the working group on Faculty Salaries and Total Remuneration, entitled "Faculty Salary Gap and Restoring UC Competitiveness." It makes for very interesting reading, at a time when UC seems poised to cut retirement benefits and increase employee contributions.

It's noteworthy that the proposed regime of fiscal austerity does not extend to upper echelons of the administration, witness the executive salary increases enacted by the Regents at their September meeting, bringing "executive salary increases and bonuses in fiscal year 2010 to an additional annual commitment of $11.5 million".

Equally  noteworthy is the stark contrast with faculty salaries. According to the working group report, faculty salaries lag significantly behind average salaries at the "comparison eight" institutions, a group which comprises four public universities (Illinois, Michigan, Virginia and SUNY Buffalo) and four private ones (Harvard, MIT, Stanford and Yale). Associate Professors seems to have it the worst: UC salaries lag behind comparison-eight averages by 13.3% for Full Professors, 15.2% for Associate Professors, and 9.2% for Assistant Professors.

These are average salaries, reflecting any off-step increments awarded to faculty (and we know there are units across the system where most faculty – like in Lake Wobegon – are above step). The administration has long argued that the salary lag disappears when considering total compensation, which includes benefits; but that was not true in the past, and it will certainly be even more of a fig leaf with the upcoming changes in the pension plan. 

The situation is even more disturbing when looking at the salary scales, which of course do not reflect off-step increases. Just to take an example from the report, the average salary for Full Professors at comparison-eight universities is $146,030; supposedly this should correspond to the mid-point through the Full Professor rank at UC. The on-step salary for Full Professors, step V  is $103,300 or almost a whopping 30% below the benchmark (and, yes, there actually are full professors in the system with on-step salaries). Clearly UC salary scales are totally meaningless.

In 2007 the Regents enacted a 4-year plan conceived (a) to close the gap with the comparison eight; and (b) to adjust the salary scales in order better to reflect real faculty salaries. The first year of the plan was implemented in 2007-08, but years 2-4 were promptly scrapped during the recession. In fact, faculty salaries, far from being adjusted upwards, were further reduced by the furlough program. 

The work group insists the a simple resumption of the 4-year plan would not be "tenable," and that a joint Senate-UCOP task force be appointed to further look into the situation. In the meantime, the following recommendations are put forward to the council for approval and transmittal to UCOP:

1. UC budget proposals must provide for a resumption of the Faculty Salary Plan as of 2010-11;
2. In recognition of resumed UCRP contributions, UC must enact an across-the-board increase of the salary scales of no less than 2%, also effective 2010-11;
3. As soon as possible, the university must enact a further across-the-board increase of 5% applied to both salary and off-step increments, with further increments apportioned to actual salaries and salary scales as determined by the future task force.

These are all very real issues. Faculty do not have the protection afforded a large portion of the staff by the unions, which negotiate salary and benefits. The senate is our only voice, for now at least. Each division is represented on the Council by the divisional senate chair. Contact your representative on the council and urge swift and forceful action on the issue.

The Bain Berkeley model for faculty: the sequel

First of all, here's why we should all care about what happens at Berkeley. The model being pushed at UCB by the administration on the basis of their Operational Excellence  initiative and the report commissioned from Bain is bound to be a benchmark for the whole system. The other nine campuses will be under increased pressure either to take similar measures or to be relegated to second-tier teaching institutions. It's important therefore that faculty and staff through the system respond to the more extreme distortions of the Berkeley-Bain model, on pain of seeing that model pushed on them as well.

We already commented on the two main components of the proposed model, i.e., the push to both centralize and standardize, and Chris Newfield now has a detailed analysis. In particular, Newfiled points out how the solutions proposed by the Bain report do not align with the problems they identify. Their diagnosis of the administrative problems at Berkeley should rather recommend a bottom-up, distributed organizational model (which is characteristic of organizations with a capacity to innovate), not the top-down, authoritarian model that Bain imported wholesale from  corporate culture – and an outdated one at that.

The most disturbing aspect of the report, of course, is the proposed staff reorganization based on the concept of supervisory span (the target here is a 6.6 span, meaning that each supervisor should have on average 6.6 position immediately below in the organizational chart). Moreover, the advertised 6% to 8% cut in their $700M payroll would translate in laying off close to 10% of the staff. Berkeley staff are understandably worried, especially in absence of any meaningful and organized response (see the comments to Michael Meranze's Staffing the Downsize).

Faculty should not be lulled in the conviction that the proposed reorganization does not affect them. It does and it will. If the recommendations of the Bain report are implemented, this would make life much more difficult for faculty as well (as also Chris Newfield points out). Let's not make any mistakes about this: until and unless the faculty speak up about this and support, even lead, the staff in their push-back, this what the future will look like at UCB and across the system.

But there is more: the Berkeley administration has, of course, a particular vision for the faculty as well (we would not expect anything less from them). It's just that it's easier to deal with staff first. The documents posted in preparation for the Aug 19 "Retreat" for Deans and Chairs spells it all out. A handout ominously entitled "Beyond Compromise" (written by two Berkeley faculty and an administrator) explains the implications of the Commission on the Future recommendations for Berkeley. Beside the by-now old chestnuts of online instruction and non-resident tuition, the presentation introduces "alternative faculty compensation plans." The handout does not go into much detail about these compensation plans, but it does indicate clearly that it would involve a "two-tiered status of faculty." The top tier supposedly would be comprised of research faculty (bringing in copious amounts of grant money under increased overhead rates), while the bottom tier would be comprised of mainly teaching faculty, including a "greater proportion of courses to be taught be lecturers and GSIs." The proposed shift would naturally result in "fewer ladder rank faculty, more lecturers."

Not a lot of reflection is needed to see just how bad an idea this is. The two-tiered model for faculty runs counter to very idea of a research institutions and undermines shared governance. The whole point a student coming to Berkeley is the opportunity to be taught by world-class faculty and, for instance, learn physics from a Nobel laureate. Conversely, our top faculty should relish the opportunity to teach introductory-level courses. Expanding the roles of lecturers and GSIs would greatly damage the idea of an institution such as Berkeley. Graduate students are not here to provide cheap labor but to learn the trade and develop their research skills.

One also has to wonder how exactly Berkeley plans to reduce the ratio of ladder faculty to lecturers and GSIs. Attrition through a hiring freeze? Tightening tenure standards? Encouraging people to leave by not matching outside offers?

Again, if the faculty at Berkeley and elsewhere do not speak up and develop an articulated response to these guidelines, this is what the future will look like.

The Berkeley Bain Report

The consulting firm of Bain & Co. has finally released their Operational Excellence report commissioned by Chancellor Birgeneau. It's chok-full of organizational jargon and catch phrases, not excluding crimes against the English language (who knew that to "incent" is now a verb?). I have taken only the most cursory of looks at the 205 slides of the report, and here are some first-hand impressions.

There are, of course, some commendable ideas in the report, for instance when it comes to energy savings (yes, it's a good idea to turn off the lights when you leave your office). But the rest of the recommendations are informed by just two principles: centralize and standardize. The distributed nature of many services at UCB, along with the diversification it entails, are identified as cost sources. The proposed solution is to centralize as much as possible the delivery of services, not just to achieve economies of scale but also to bring about increased efficiencies when the units reach a given critical mass – the appropriate size (measured in FTEs) to allow for  a more rational allocation of tasks.

The report addresses several areas:

1. Procurement
2. Organizational simplification (including HR, Finance) 
3. IT
4. Energy management 
5. Student services
6. Space management

(the last more tentative). One recurring theme that is bound to be the most controversial is the issue of supervisory span, i.e., the average number of people who report to a given supervisor. The average span at Berkeley is relatively low (about 4.4). The report recommends bringing that closer to the benchmark of "6-7 for expertise-based functions and 11-13 for task-based functions" (whatever that means). The result would be a much flatter organizational chart, with many people now in supervisory position re-classified as "contributors" (i.e., people with no further employees below them – gotta love the jargon, in the best Minitrue tradition). The report makes no effort to hide that as part of this flattening process, many employees would have to be "transitioned" (the transition is of course from "gainfully employed" to "out of work").

The main thrust of the report seems to be that about $100M of potential savings can be achieved by reducing diversification in the delivery of services, downsizing and re-organizing lower-level staff, and centralizing many functions. (I also could not help noticing how the report makes no mention of the extravagant expenses incurred by the supposedly self-sufficient UCB Athletics department, which, have been consistently backfilled with campus funds for many years.)

It is also important to take notice not just of the substance of the recommendations, but also the manner of their implementation. Bain envisages these changes to be brought about in a completely top-down manner (the word they use, of course, is "cascaded"), with no participation by the staff and faculty that would bear the brunt of these measures.

And all this, of course, cost Berkeley about three million dollars. I am sure many of our own faculty at business schools across the system could have come up with better solutions for a lot less.

Mandatory reading

Charles Schwartz's latest installment on the UCRP is mandatory reading for anyone worried about the performance of UC's pension fund.  President Yudof has been rebutting calls for more "shared governance" in the management of UCRP investments by pointing out that UCRP is doing just fine, thank you, and that UC faculty and staff have nothing to worry about. In particular, Yudof points out that

For the decade ended June 30, 2009, UCRP’s total return exceeded that of the benchmark by 30 percent, whereas for the previous decade the return exceeded benchmarks by only 4 percent.

This is because the 2001-2009 annualized return was  2.30% against a 1.77% benchmark (+.53%), whereas the 1991-2001 return was 13.9% against a 13.3% benchmark (+.6%).

This way of representing the annualized return is just meaningless crap: if the benchmark had been 0% even a .001 return would have been infinitely better (no doubt justifying even higher incentive pay for the Treasurer and even more astronomical fees for the external investment managers).

In fact, Schwartz compares UCRP's performance against that of a peer group  (the way it used to be before UC Treasurer Patricia Small was forced to resign so that the University could retain brokerage firms earning fat fees and commissions). Schwartz's conclusion:

The overall picture from this data is that there was much better performance, relative to peers, in the earlier years than there has been in the last decade.

So, if anybody needed any more reason to be worried about the way the University plays with our retirement money, look no further.

Skimming the UCOF proposals

As widely reported, the proposals contained in the preliminary report of the UC Commission on the Future, are numerous and varied.  Here are a few highlights, beginning with the good parts.

• Continue the University's commitment to the Top 1/8, which promises the top 12.5% of high school graduates in California admission to a UC campus.
• Continued commitment to financial aid for low-income students.
• Increased graduate enrollment, to bring in line with the proportion of graduate students to undergraduates at peer research institutions.
• Establish financial aid eligibility for undocumented students.
• Give students a multi-year tuition (the standard term to replace "fee") schedule, so as to avoid mid-year increases like the one from last November.

All of these are laudable and clear goals, but none of the above address the financial situation of the university. When it comes to pointing to a possible solution to the current budget crisis, the Commission's recommendations are often vague, outlandish, controversial, or all of the above:

• Increased enrollment of non-resident students, ranging from 5% to 15% of total enrollment, possibly displacing California students. 
• Increase the newly-christened tuition by 5%, 10%, or 10% or  (according to different scenarios) a year for five years, bringing tuition to $13,148, $16,591, or $20,721 by 1015-16, respectively.
• Introduction of 3-year degrees by streamlining requirements and expansion of summer session courses and AP credit transfers.
• Exploration of online courses, the holy grail of financially challenged institutions.
• Revision and renegotiation of Indirect Cost Recovery (IRC) formulas, based on the principle that externally supported research must include 100% of indirect costs.
• Expansion of self-supporting programs, e.g., Executive MBA's.
• Allow externally supported researchers to buy out their teaching from their grants, and hiring non-ladder faculty to "backfill" those researchers' vacated teaching.
• Explore the possibility of allowing different campuses to set different tuition levels.
• Promote a set of administrative "best practices" to eliminate administrative redundancies and bring about efficiencies at all levels. 

What is most striking about these proposal is how vague they are. The last point, concerning "administrative best practices," for instance, is just an empty slogan unless substantiated by clear examples and precise criteria of applicability. Other proposals are bound to be controversial with the faculty: implemementing 3-year degrees would require strictly holding faculty and departments to pre-set teaching load (a number being circulated is 900 credit hours a year for each faculty member). Similarly, insisting on 100% indirect cost recovery will not ingratiate the science faculty at all.

The proposal that perhaps most endangers the UC system as it was originally conceived is the possibility of setting differential tuition by campus. This would mean that Berkeley and Los Angeles would be able to charge private-level tuition, while reduced funding at the remaining eight campuses would gradually turn them into state schools. It would be, for all practical purposes, the end of the UC system.

The Commission's report contains a couple of significant acknowledgments, though. The first is the recognition that with less than 100% ICR, research has to be subsidized by core funds. While this might have some rational during the good times, it is less justifiable now. The other one recognizes that given the disparity among disciplines in their access to external sources, internal funding has to be prioritized towards disciplines in the arts, humanities, and social sciences.

The report fails to endorse an oil severance tax targeted for higher-ed funding, the way it is used, for instance, in Texas. Instead, the report goes into some discussion of a general tax for higher education, which would be even more politically unfeasible than oil severance.

But the most basic and longest-lasting impression that one receives upon reading the report, is that it is a document which fundamentally lacks an overarching vision for the university. It's a report that puts together a number of local ideas, some of which have been circulating for years, hoping that their cumulative effect would lead the university out of the crisis. There is no reason to think so. The recommendations are vague, politically controversial, and occasionally contradictory.

Only the articulation of a comprehensive plan, guided by some clear and fundamental principles, would have a chance of bringing together the different constituencies in the university. The way the recommendations are formulated right now, they will only pit students against administrators, science faculty against humanities faculty, and top-tier campuses against the lower-tier ones.

March 4

March 4 is only a couple of days away, and a number of events are scheduled around the state, including a rally on the Capitol steps. The administration has mounted a sizable effort to redirect the protests away from Oakland towards Sacramento, and certainly the dysfunctional Legislature and ineffective Governor bear much of the fault for the current state of the University. But it is also clear that, under the heading "never let a good crisis go to waste," UCOP is looking to use the current situation to push through momentous changes in the way the University is funded and run, from a shift to a "public/private" model to an attack on faculty governance (a weak senate leadership being complicit in this effort).

Will it work? Much depends on participation on the various campuses, especially when it comes to faculty that until now have preferred to sit on the sidelines.

The Governor's parting salvo

It's been a week since the Governor 's State of the State address last Wednesday, and a few days since he made public his budget proposal on Friday, and it's becoming a little clearer what Schwarzenegger is (or is not) trying to accomplish.

Of course, from our point of view, the most remarkable piece of the State of the State address was the proposed constitutional amendment to gradually shift funding priorities from prisons to higher education in a process that is to run through 2014. However, over the last few days (if we can borrow a page from Pres. Yudof's book) the shine has come off the Governor proposal.

It is, first of all,  another piece of constitutionally mandated budgeting, like we did not have enough of that already. The flip side of a renewed emphasis on education is the big push in prison privatizations (rather than, say, reviewing California's sentencing laws or releasing non-violent first offenders). But the most remarkable aspect of the proposal, like the twin proposal to adopt the Parsky commission tax reform, is that it has virtually no chance of passing. It would require approval by two-thirds of the Legislature followed by approval by the voters in a state-wide ballot.

That the Governor was not serious about shifting funding priorities became apparent just a few days later, in the January budget. Because if he had been, he could have started right there and then, without waiting for a constitutional amendment. Instead, the January budget restores a minimal amount to UC (about one third of UCOP's request) and CSU, but cuts K-14 education (including community colleges). The January budget also cuts $1.2B from the Dept. of Corrections, but mostly through reduced inmate health care (and transfer of inmates to County jails). Even if the cut in the Corrections budget were to pass muster with the Republicans in the Legislature,  inmate health care in California is overseen by the federal courts, who would also have to approve the change.

So it is clear that Governor's proposals are just a boutade, soemthing he came up with because he has no idea how to go about fixing the State's problems — and what's more, he never did. The Governor is all hat and no cattle and he has been running California in the last few years by coming up with an amateurish measure after the other.

Finally, we pause to note that our fearless leader Pres. Yudof was quick to praise the Governor for his bold proposal, and the Academic Senate (and a few Chancellors) equally quick to praise Yudof for bringing it about. Too bad the Governor's office remarked that the protests this past fall were "the tipping point," not any pleading by UC's leadership.

When one tries to take it all in, the irrationality and wishful thinking that permeate both Sacramento and Oakland, the conclusion seems inescapable: we are fucked.

The decline and fall of the UC system

"It's always difficult to make predictions," Yogi Berra used to say, "especially about the future." But in the case of the UC system, all the information is there, for anyone who cares to look:

The furloughs will be extended at least another year. There is no reason to think that the budgetary situation at UC will be significantly different in 2010-11. In fact it will be worse, as the federal stimulus funds expire and the state shows no signs of economic recovery (also thanks to layoffs and furloughs at the various state agencies and universities). The only options that would avoid extended furloughs at UC is if the state were to re-examine his priorities and shift some resources from, say, the Department of Corrections to higher ed, or if UC took seriously the idea of sharing revenue from the Medical Centers and other profitable units. Fat chance.

The privatization process will accelerate. This will mean higher fees for students, higher student/faculty ratios, increased reliance on private donors and industry partnerships, renewed efforts to recruit from a dwindling supply of affluent out-of-state students.  Emphasis will be on the revenue-producing units, such as the Medical Centers (which already have been spared the brunt of the budget crisis). At the same time, there will be increased erosion of shared governance, as a bloated and arrogant administration decides to keep ignoring the voice of the faculty (and staff, and students, and parents, ...). We have already commented on the issues facing such a "hybrid" model and the inherent tensions that would prevent its implementation across the board at all the ten campuses.

UCRP will switch from the DB to the DC model. One of the reasons why faculty were willing to put up with salaries hovering around 85% of those at comparable institutions was the outstanding UC Retirement Plan with its defined benefit model. (Never mind that private brokers had been circling in the water for a long time.) With the wave of upcoming retirements the defined benefit model will be more and more costly to the university, and there is increasing talk of switching to a defined contribution model. The most senior faculty, of course, will know this and will anticipate any planned retirement not to see their benefits slashed, thereby contributing to the accelerated decline of the university.

UC will get smaller. Smaller in faculty and students. Students will be driven away by the higher fees, especially middle class students with limited access to financial aid. Already Cal State schools and Community Colleges are seeing significant upticks in applications. Similarly the faculty will be driven away by extended furloughs, a less attractive defined contribution retirement system, and the general loss of prestige of UC. Central administration is said to welcome a reduction of 10% to 15% in the number of faculty system-wide, with peaks if 20% in some units. They might just get their way.

The UC system will break up. Ultimately the different campus will not be able to undergo these processes at the same rate. Berkeley and UCLA will be allowed to set their own tuition, and will increasingly rely on the alumni base and their limited endowments. They will fully embrace the Michigan model, but will have to compete with the privates (USC, Stanford) and each other for a limited number of tuition paying students. The remaining eight campuses, unable to raise tuition (for market reasons) will gradually be assimilated, whether de jure or de facto, into the Cal State system.

Student coalition calls for system-wide strike

A student coalition is calling for a system-wide strike to be held Nov.18-20, concomitantly with the Regents' meeting where the proposed fee increases for next year will be considered.

The students demand:

• that the Regents vote no on the proposed fee increases.
  

• that the UC stop cuts and layoffs, and end its aggressive union-busting tactics.
  

• transparency of the UC budget, including complete figures on how much of the additional revenue from fees will be diverted for construction and used as bond collateral.
  

• that the Regents expand enrollment of underrepresented groups and ensure equal access to education for all.
  

• an explanation for the failure of the UC leadership to make an effective case for public higher education.
  

These seem all pretty much on track to me.

Bring democracy to the UC

The University of California is governed by the UC Regents, a body established in 1878 when Article IX, Section 9 of the California consititution was drafted to ensure that

the university shall be entirely independent of all political and sectarian influence and kept free therefrom in the appointment of its Regents and in the administration of its affairs.

Commendable as these goals sound, the appointment of 18 Regents by the Governor to 12-year terms seems to have achieved exactly the opposite result than intended by those who enacted the state Constitution. The Regents have essentially unchecked authority on the University, free to pursue whatever vision might move them. All is well, of course, as long as that vision is informed by the common good of the citizens of California, but it can go dangerously astray when it's not.


The flip side of political autonomy is lack of accountability.


That is why there is now a "student and alumni-led" democratization effort, The Phoenix Project, aiming "to build a state-wide coalition that can model democracy by bringing together University of California stakeholders." 

The appointment of essentially autonomous Regents to what are close to life terms is not the only way to ensure that the University  is "independent of all political and sectarian influence."

The  Phoenix Project has put forward another option, which would have looked outlandish in 1878, but not in 2009, intended to develop a model of governance that brings all the different constituencies at the UC (students, alumni, faculty, local communities) into the deliberative process. This is of course still quite vague, but people are beginning to explore the details of such a plan.