Presentation by Charles Schwartz, Professor Emeritus of Physics at UC
Berkeley
National Conference for Student Regents and Trustees, held at UCLA,
April 4, 2009
posted at
http://ocf.berkeley.edu/~schwrtz
Public Higher Education is in deep trouble
throughout this country. The simple name for what is going on is
PRIVATIZATION. That means that more and more of the cost for the
core academic budget is being shifted from state funds to student fees,
mostly being put upon undergraduate students and their families.
The leaders of these public universities and
colleges bemoan this situation; but their only solution is to ask, beg,
and pray for increased state funding. Few of them have any real
expectation
of success; and so your fees will continue to rise rapidly.
I want to outline some alternative remedies
that can be advanced if you, students and student leaders, get
yourselves educated about what is really going on in the financial
world of university operations, and then get yourselves organized to
demand some necessary changes. My analysis is focused
primarily on
the major research universities, like UC, but may also have some
relevance to
other comprehensive institutions, like CSU.
At a recent meeting of the UC Board of
Regents I heard a report from the Vice President for
Budget, in which he mentioned that student fee revenue at UC covers 30%
of the Cost of Education. Shortly afterwards, I heard the
president of the UC Student Association echo that same statistic:
student fees pay for 30% of the Cost of Education.
That statement about the Average Cost of
Education is regularly found in the official budget which the Board of
Regents sends on to the state capitol; and so you can understand the
way that the Governor and the State Legislators respond in times when
their overall budget picture is very tight: Well, those university
students are still getting quite a free ride at the taxpayers' expense,
so it is the lesser of many evils to let student fees go up some more.
What I want to tell you is that the way they
calculate "The Average Cost of Education" is a big fraud. This is a
very old and very bad habit of accounting that is used not just by the
University of California but by all our universities. The cost
numbers that they use cover the total cost of everything that the
professors do throughout the academic year, plus their support staff in
the academic departments, plus other supporting and overhead costs of
the institution. If you want to know what is the true cost of
Undergraduate Instruction, then you need to separate out the portion
that goes for faculty research work and the portion that goes for
graduate programs. Those other missions of the university - faculty
research
and related graduate programs - are very important public services
performed
by the university, but it is wrong to hide the cost of those missions
under the cloak of undergraduate education. It is especially wrong to
dump the cost of those missions onto undergraduate students and their
families.
I have carried out a detailed study of this
question, using a
variety of data sources that come from the university itself. This
disaggregates the bundle of costs described above using a Faculty
Time-Use Study conducted some years ago. My result, for the year
2006-07, is that the average cost (that is, cost to the university) for
undergraduate education was about $7,000 per student. That
strongly contradicts the official report that the Average Cost of
Education was $17,000 per student. And it means that undergraduate
student fees are now at the level of 100% of this cost, not 30%, as
they have claimed.
This result of mine is very controversial. You
can read more about it on my web site. Under "Anthropology 139
Lecture"is a recent talk I gave on this subject to an undergraduate
class at Berkeley. (http://ocf.berkeley.edu/~schwrtz/Anthro139.pdf
) Under the TOPIC: "Cost
Accounting at a Research University" you can find links to several
other papers that go into various details of this analysis. There is
also a 1-page handout I prepared for this conference, titled "A Short
Course on University Accounting", which includes some numbers
illustrating the ways in which official numbers about University
expenditures for "Instruction" can be very misleading.
You don't have to accept my numerical results.
But you should understand that the establishment way of calculating
"The Average Cost of Education" is both dishonest and destructive when
you are looking at a research university. And the assignment I give to
you, as
students and student leaders, is to take this question, directly and
persistently, to the top officials of your own campus: What is your actual cost, averaged
per student, for providing undergraduate education, as separate from
other missions of the university? Just asking this question of
your campus officials will launch you on a fascinating journey: I
am familiar with the many forms of avoidance and misdirection that they
may use in response, because the truth of this matter, at any of our
leading
research universities, is something that most faculty, as well as
administrators, are afraid of.
This can be a potent challenge to the current
wave of privatization. It speaks not only to the question of,
Whose dollars are going where?, but it also raises the question of
credibility: Who is to be trusted in speaking publicly about university
finances?
I can suggest a second line of approach to the
problem of escalating student fees, which does not depend on my
controversial cost analysis. In the good old days, when state funds
paid for the entire core budget of our public colleges and
universities, then it was just that the majority of seats on those
Boards of Regents and Boards of Trustees were given to elected public
officials or to individuals appointed by elected public officials. But
now that a large portion of the core budget has been shifted from state
funds to student fees and tuition, isn't it proper to demand that a
proportional number of seats should be reallocated to Regents or
Trustees who are chosen by those students (and their parents) who are
paying the bills? I estimate that, given the current financial
balance between state revenues and student fee revenue at UC, there
ought to be 8 students in voting seats on that Board, not just
one. The same arithmetic seems to hold up for the CSU system; and
I imagine something similar would apply across the country.
You may think this is a wild idea, radical and
unrealistic. But it follows the old American philosophy of No
Taxation without Representation.
A third topic I have looked into is the growth
of administrative bureaucracies at the university. Here is a graph showing how management
personnel, throughout UC and also at the Berkeley campus, have
multiplied way out of proportion to total employee numbers over the
past fifteen years. I have asked top officials to look into this data
and give some justifications; but they have failed to do this. My
estimate is that this apparent bloat wastes something like $600 million
a year in university funds.
To make any real progress in reforming the
financial mess facing public higher education will require not just new
ideas but also new political organizations. There ought to be some new
group, made up of undergraduate college students and their tuition
paying parents, who want to see their interests represented in some
collective fashion as consumers facing the industry called higher
ed. Can you imagine such a thing?