Plenty of Nothing

Here is a quote from the governor’s recent budget proposal: "The University of California (UC) willreceive an increase of $90 million General Fund for base operating costs, whichcan be used to address costs related to retirement program contributions."

Question: What does it mean?  Answer: Nothing.  UC has always been free to take its generalrevenue and put it into the pension fund. Indeed, since the state has so far refused to resume paying the employercontribution for state-funded employees into the pension fund, that is what UChas been doing.

Question: If it means nothing, why are you discussingit?  Answer: It appears that some folksup in Oakland view this statement as a kind of recognition of a stateliability for the UC pension.  As we havedocumented repeatedly, before the two-decade pension contribution “holiday,” the stateroutinely paid its contribution, even putting in IOUs when it was short ofcash.  When the state paid in, whether in cash or in IOUs, that action allowed UC to collect from non-state sources, currently roughly $2 fromnon-state for every $1 of state.

 

Earlier in the state budget crisis, then-GovernorSchwarzenegger put a token $20 million in his budget proposal for the UCpension.  But the legislature – acting onadvice of the Legislative Analyst – deleted the $20 million and insertedbudgetary language that there was no state liability.  That perverse language was later removed, butsince then there has been zero progress in getting state recognition of itsliability.  Note that CSU, which is partof CalPERS, does not have this burden since the state does not dispute itsliability to the giant CalPERS system.

If UC depicts the governor’s non-statement as amounting tomore than nothing, we will continue to get just that: nothing.  As we have noted before, if the state wantsto privatize UC, not taking responsibility for the pension liability is a goodway to do it.  The Regents can’t createmoney.  They cannot raise taxes.  They can only keep raising tuition.

So let’s not pretend nothing is something.  This song sums it up nicely:

The quote from the budget is at http://www.ebudget.ca.gov/StateAgencyBudgets/6013/6440/department.html

A history of UC pension funding by Faculty Association Executive Director Susan Gallick is at http://www.uclafaculty.org/FASite/Home_files/UCRPCAPolicyOpt2012%20.pdf

Maybe the story is in the price

Yours truly received the ad above via email. I haven't read the book but wonder if, just maybe, the story is told in its price. (If you have trouble reading the image above, click on it for a larger picture.)

Regents Go Off UCOP Script

Maybe next time, UCOP might try to put the Regents meeting at the above location rather than at UC-SF. See below:

UC regents balk at mandating annual tuition hikes (excerpts)

Nanette Asimov, San Francisco Chronicle, Sept. 16, 2011

San Francisco -- The University of California regents dodged a controversy Thursday by ignoring a proposal from UC President Mark Yudof that would have mandated annual tuition increases of 8 to 16 percent for the next four years. Instead, the regents turned their meeting at UCSF's Mission Bay campus into a therapy session of sorts, gnashing their teeth about the steep drop in state funding - nearly $1 billion in the last two years - and debating whether they could get California corporations to kick in millions of dollars to UC. The regents also approved raises and incentive plans for 18 executives, with funding for all but one coming from private sources, such as hospital revenue.

…Negotiating with Sacramento is "a waste of our time," said Regent Dick Blum. Instead, the regents should approach people "who actually can write a check," he said. "Chevron, Apple, Cisco and Google - all these companies sitting on money they don't know what to do with." Regent David Crane picked up on the theme, urging colleagues to "start acting like you're a private university. Get real - and don't fool yourselves and think the Legislature will turn around, or you'll be waiting for Godot," he said, referring to the Samuel Beckett play in which the protagonists wait in vain.

…Chairwoman Sherry Lansing suggested they form subcommittees to tackle each approach. The bottom line, she said, is, "I don't want to bring this (proposal) forward in November." Later, UC Executive Vice President Nathan Brostrom, who helped craft the plan, said the idea (of tuition increases) was not quite dead…

Full article at http://www.sfgate.com/cgi-bin/article.cgi?file=/c/a/2011/09/16/MNGI1L4J52.DTL

We will eventually have an audio of this meeting posted. We do have a recording of the script that was supposed to have been followed:

PS: There is the old political adage about not calling the question before you have counted the votes.

Wrong Direction

In yesterday's LA Times, Patt Morrison interviewed former UCLA Chancellor Albert Carnesale. Most of the interview dealt with other matters. But below is an excerpt on UC:

What do you make of what's happening to the University of California?

We had this great public university, but you didn't have to insert the word "public." [It was] able to compete with the best of the privates. We're losing that. We may already have lost it, in large measure. Students now pay more in tuition fees than the state provides. The resource gap is too great. It's not as if all the fine professors suddenly will leave for private universities, [but] when you're trying to recruit new people, they're going to have this in mind. Graduate students will consider going where they can get a better financial package.

What can you do about this? You could have more state funding; a friend of mine said that's called faith-based funding. You could have less cuts. You could have a greater degree of what's called privatization. You might [accept] more out-of-state students -- there's a $22,000 premium for out-of-state students. You could have higher fees and higher aid. No one of these things would do it. It isn't as if there's nothing you could do, but they're all politically difficult.

[The education master plan] has served this state extraordinarily well -- the education level of the citizenry, the ability to maintain fine research universities, to have the kinds of jobs and economic growth California has had. If we want to maintain that excellence, it's going to cost more.

I'm not badmouthing the University of California, but all of the signs for the future are in the wrong direction if it's to continue to compete with the best of the privates. It will still be a leading public university, but that shouldn't be good enough for us…

Full article at http://www.latimes.com/news/opinion/commentary/la-oe-morrison-albert-carnesale-070211,0,6989366,full.column