Privatizing UC

Several recent moves of privatization in the UC system should push us to ask what is behind this movement and what is wrong with it.  While the privatization of part of the UCLA Anderson business school has received some attention, very few people have examined the new private entity UCLA has established to help cash in on innovations. Moreover, it looks like Senator Steinberg’s attempt to push public institutions to use private online providers is still alive.  All of these changes rely on the same transformation of a public good into the hands of a private or private-public management. 

In the case of UCLA Anderson Business School, the main change is that the program, in consultation with the president of the UC system, will be able to set tuition levels and keep all of its revenue except for 15%, which will  go to central administration. Some of the problems with this move are indicative of issues facing the privatization movement in general: 1) there is a loss of being part of a shared public institution; 2) after years of state support, high tuition costs may force out state students; 3) this process is being driven by upper-management and goes against the explicit recommendations of the system-wide faculty senate; and 4) it is unclear if the self-sustaining entity will actually be self-sustaining.  Even though the school will have to pay 15% of its tuition revenue to the university, we do not know if this is enough to cover the cost of financing the debt for building construction, the use of administrative services, or other day-to-day expenses. 

In the case of the new UCLA innovation center, the East Bay Express has a long article on how this push for privatization may place the fruits of university research in the hands of private individuals. At the last regents meeting, a vote was taken to create Newco as a private entity lodged within the university to help monetize university-sponsored research.  Like the privatization of the UCLA business school, this move could change the priorities and structure of a previously public entity.  For example, a new body of outside corporate administrators may not only privatize the profits from this public university, but they could also prevent new discoveries and innovations from reaching the broader public.  There is also the fear that outside corporations will profit as the university takes on the most expensive and risky parts of the research and design process. 

In the neoliberal tradition of privatizing profits and socializing losses, we see how contemporary capitalism is focused on privatizing previously public institutions.  For instance, the recent push for online education is motivated in part by the idea that large amounts of money can be made if public resources go to private companies.  Although Senator Steinberg has claimed that SB 520 prevents public funds from going to private online providers, it is clear that these private companies are not getting into the education business to simply provide a public service.  

The underlying threat in all of these privatizing moves is that the university loses its meaning and purpose.  Instead of being a public institution that stands outside of private interests, the university can no longer offer an alternative to market-based values and thinking.  Ultimately, in the quest to generate more non-public revenue, the university loses sight of the common good.