My Dialogue with President Yudof

On Dec. 2, 2011, UC President Mark Yudof gave a speech to the California Chamber of Commerce entitled, “A Baker’s Dozen Myths about Higher Education.” This presentation is classic Yudof, and it reveals the great disconnect between the UC administration and the facts on the ground. To analyze several of Yudof’s claims, I will quote his myths and explanations, and then respond to him in the form of a dialogue.

Yudof: The cost of producing UC degrees and credit hours has gone up over the last decade. I hear this myth all the time. And it’s frustrating, because this cost has actually dropped by more than 15%, in constant dollars, since the 1990s. This cost has dropped in part due to a broad range of system-wide efficiencies: common IT systems; reduced employee travel; thousands of unfilled faculty and staff positions; 1/3 fewer employees at the UC Office of the President; a higher student-faculty ratio, and so on.

Samuels: This claim is actually partially true: the money UC spends on undergraduate students has gone down, but that is mostly due to expanding class size, the use of inexpensive lecturers and graduate student instructors, and the elimination of many courses and class sections. What you do not say is that at the same time, the cost for graduate and professional education has gone up, and while there are fewer administrators at the Office of the President, there are more on the campuses. In fact, there are now more administrators than faculty members.

Yudof: Tuition goes up because the university is providing resort amenities to students. Perpetuators of this conspiracy theory are fiercely devoted to it. Rock climbing walls, manicured landscaping, gourmet dining halls—these and other examples are constantly cited as the real cause of higher tuition bills.

Samuels: This claim is also partially true, but it neglects to add that the cost of room, board, and other essentials, like books and computer use have also gone up. Moreover, UC can only construct its new buildings and amenities by promising to raise tuition on its bond submissions.

Yudof: Tuition goes up because state funding goes down. Plain and simple.

Samuels: However, if you look here at the history of UC tuition increases, you see that in the last twenty years, UC has increased tuition every year except twice. This means that tuition has gone up even when state funding has gone up.

Yudof: UC raises tuition as federal student loan caps are lifted. This purported practice isn’t just false. It’s flat-out illegal for UC and other non-profit universities.

Samuels: UC may not be simply raising tuition because the caps on federal loans are going up, but the system is able to increase tuition because students are willing to go into debt to pay for the increases.

Yudof: Tenure track faculty at UC do not teach undergraduates. Tenure track faculty members teach about 61% of all student credit hours at UC. And in fact, this percentage is up slightly in recent years as budget cuts forced campuses to reduce the ranks of lecturers, visitors, and other non-tenure track faculty.

Samuels: First of all the number of lecturers has gone up recently, and the UC is planning to increase its reliance on non-tenured faculty to reduce costs. Second, if tenured faculty teach 61%, then 39% of the courses are being taught by faculty who are not eligible for tenure. Third, UC refuses to track the number of courses and sections taught by graduate students, so they are not included in these statistics.

Yudof: The number of high-level administrators at UC is expanding. UC, we call our high-level administrators “senior management group” members, or SMGs. Rather than expand or remain constant, the number of SMGs has actually declined slightly. Last year, the number dropped from 315 to 293—which means they account for less than 1% of all full-time-equivalent personnel across the entire UC system.

Samuels: “The Senior Management Group (SMG) is only a small sector of the administration that now outnumbers the faculty. While you always concentrate on the senior managers, you ignore the cost of non-senior administrators on the campuses.

Yudof: Non-residents only make up 6.6% of UC undergraduate students system-wide. This is well below the percentage at most of the university’s public comparator campuses. At the University of Michigan, for example, non-residents comprise 35% of undergraduate students. At the University of Virginia, it’s about 30%.

Samuels: You are bending the truth to prove your argument. At all of the elite campuses, non-resident students have replaced students from California, and this trend is only growing. Currently, Berkeley has a target of 30% nonresident students and UCLA is shooting for 25%. UCSD and Davis also have ambitious plans to increase nonresident enrollments.

Yudof: Only the wealthy can afford to attend UC. Nothing belies this myth more than the incredible socioeconomic diversity of UC students. About 40% of all UC undergraduates receive Pell grants. Pell grant recipients come from families with an annual household income of $50,000 or less.

Samuels: The UC system does deserve high marks for making the university affordable to low-income students, but this has resulted in increased costs and decreased enrollments for middle-class students. As you yourself admit, “High tuition actually hurts the middle class much more than it does the poor. This is because high tuition enables institutions to employ a high fee/high financial aid model.” This just proves my previous point.

Yudof: myth #10: UC student debt is skyrocketing. At graduation, the average student loan debt of UC students is $16,795. This figure is almost $10,000 lower than the national average, which currently stands at $25,250. In fact, when adjusted for inflation, UC students’ debt load has remained virtually flat since 2006.

Samuels: Once again, the average debt is remaining flat, but the debt for middle-class students is going up.

Yudof: Corporate and alumni giving can replace all the core funding the legislature cuts from UC’s budget. Corporate and alumni giving is phenomenally important to UC. It played a critical role in the foundation, and the development, of this university. And throughout UC’s history, it has helped sustain the university during times of fiscal crisis—like the crisis we’re experiencing today. At the same time, most corporate and alumni giving is restricted—which means that if the state cuts our core funding, private giving can’t necessarily cover the gap.

Samuels: If the UC cannot use its donations to fund instructional programs, why is it spending so much money trying to raise these funds, and why in the past didn’t the university go on a campaign to raise money for educational purposes?

Yudof: $1 billion can be cut from UC’s budget with zero effect. This isn’t a myth. It’s a canard. I hear this fiction all the time. And I find it very troubling—extremely troubling. UC’s annual budget is roughly $20 billion. A $1 billion hole is hard to ignore on its own. But it’s more complicated than that. Much of our funding is restricted. Hospital revenue is restricted. Government grants and contracts are restricted. You can’t just take money from laser research and give it to a professor of Portuguese. So when that $1 billion is cut from our core funds, it can’t necessarily be covered by our other sources.

Samuels: This is one of your favorite arguments, which I have refuted on many occasions. In fact, the recent state audit found that most of UCs restricted funds are only restricted by the administration. Currently, UC places all types of funds, including federal grants, in its short-term investment pool. It then uses this pool as a central bank and takes out money to support any purpose it chooses. For instance, the UC recently transferred $1 billion into the retirement system and lent the state $1.7 billion.

Yudof: The University of California only serves its students. This is California’s university. It is defined by its public service mission. And it serves all the people of this state. So when UC’s core funding is cut, it ends up affecting all of us, too.

Samuels: Finally, we agree!