Friday, February 19, 2010

Asset Stripping: Understanding and Resisting the Pillaging of Public Higher Education in California

By Robert Ovetz, Ph.D.

“Can't look away/The powers that be might take it all away/Together we burn, together we burn away”
—Uncle Tupelo, “Graveyard Shift”
“There is always, I believe, a close relationship between the intensity of the threat and the brutality of the response”
—Eduardo Galeano, Open Veins of Latin America

The $2 billion dollars in budget cuts, skyrocketing tuition and fee increases, and layoffs in public higher education over the past couple of years have been draconian. But they aren’t new. We are seeing only the latest chapter in a 30 years long series of entrepreneurial remaking of public community colleges and universities so that they operate more like corporations in the face of growing opposition from students, faculty, staff and communities.
This restructuring is not about making California public higher education more efficient, serving more with less or any of the other explanations we hear bandied about. It’s about asset stripping, stripping away the usefulness and relevance of public higher education to the majority of the population to learn about themselves, their history and gain the intellectual tools to improve their lives and change their world. In this two part article we will look at asset stripping of public higher education over the past 30 years and the impact on students, especially those attending community colleges.

Part I: Why Budget Cuts, Privatization, and Rising Costs?
Asset stripping is made possible by austerity: budget cuts, privatization and rising costs. Programs that are not “self-sustaining,” eg. generate outside corporate sponsorship, are defunded and public resources are shifted to subsidize programs that do generate such investment. Surviving programs are increasingly subject to forms of evaluation imported from the for profit world so that they are judged on the quality of the product (ie, you, the student) churned out and how disciplined and hard working the product is (ie, measured by your grades and later paid salary).
I call this asset stripping process the entrepreneurialization of the universities—the process of reorganizing and restructuring colleges and universities (or any public institution) into businesses. Entrepreneurialization is a two part process of austerity, shifting an increased burden of the costs to the individual rather than society, and the privatization of resources held in trust for the public. In the process, the individual sinks deeper into debt to purchase on the market what used to be provided by society through taxes.
Entrepreneurialization of the colleges and universities can be traced back to 1980, the same time that so-called neo-liberal restructuring of the global economy became predominant. Neo-liberalism seeks to starve the state of revenue (through tax cuts for the rich and corporations and economic decline) in order to shrink the state by stripping all of its responsibilities that are relevant and useful to people to improve their lives (ie, public support programs like unemployment and public education) and change the world (ie, regulate and limit business, protect the environment, ensure work safety). These responsibilities of the state to the vast majority of society are the result of small victories accumulated over centuries of struggles.
The language of neo-liberal entrepreneurialization is coded and mystified. It’s a language that justifies ripping apart our gains under the guise of “necessity,” “productivity,” “flexibility,” and “streamlining” while denigrating our gains as “luxury” and “entitlement.” For example, CSU-Stanislaus President Shirvani fears that our movement ”has driven expansion in higher education beyond what is reasonable or necessary.” (Chronicle of Higher Education, 10/18/09) His counterattack is nothing short of radical: “Cutting costs is not enough. We need to break down expectations based on entitlement and focus on educational productivity and outcomes. Institutions should review redundancies, rethink staffing models, and streamline business practices”—in short complete reorganization of public higher education into explicit businesses. Cognizant of the resistance to his plan, Shirvani is desperately planning for “today's harsh economic realities” to have “finally broken the stranglehold of the sense of entitlement about higher education.”

College or Prison?
Neo-liberalism has evolved as a strategy to pare down the state so that it serves only the needs of business to make profits and protect its investments. That is why we see ballooning budgets for police, military and prisons while funding is slashed for everything else that serves social needs. In California between 1984-2004 prison funding rose 126% while higher education funding declined by 12%. In 1980, 10% of the general fund went to higher education and 3% went to prisons. Today, almost 11% goes to prisons and only 7.5% goes to higher education. This is not an accident or bad planning.

At the same time we see a strangling of new revenue sources by lowering taxes for the rich, corporations and property owners and increasing borrowing through high interest loans that are paid off decades in the future. Since 2002, the percentage of the state budget that goes just to repaying this debt has more than doubled from about 3% to 6.55%. (State Legislative Analyst’s Office) That means there is less money for everything society agrees should be funded.
This shift in spending and revenue generation is a strategy. It’s a counter attack against the gains of the past 100 years of public higher education.
This strategy began to be applied to higher education in 1980 when Congress passed the Bayh-Dole Act allowing universities to turn publicly funded research into privately owned products and corporations. The law passed with little notice. Private profit was once again funded by public cost. But this seemingly insignificant measure became a virus that has only grown to infect and mutate all of higher education.

Student as Product
Little by little more and more of higher education has come to be evaluated as and cajoled to be more and more like a profitmaking corporation. Public universities and community colleges went from being nearly free to charging rapidly rising fees and tuition while the majority of funding to support higher education shifted from local government to the individual. In fact, community colleges were free until 1984-85.
At the same time the state was shifting from generating revenue from taxes to debt, student loans began to overtake Pell Grants so that today 77% of financial aid is in loans. This has created the new phenomenon of lifetime indebtedness to private banks most of whose student loan portfolios are 100% guaranteed by tax dollars. Teaching and learning have grown to be explicitly evaluated according to the productivity of students, ie. how well they are molded to fit into waged work. Faculty and programs that did not demonstrate their relevance to the interests of profits and work have had to fight to survive overcrowded classrooms, budget cuts and layoffs. As many turned to outside corporate funded foundations, corporations or government to make up the differences they further found themselves submitting to this same logic: subservience to the market.

One of the primary ways students face the same logic of the market is with rising fees and tuition. The 1960 California Master Plan for Education establishment of all public higher education as tuition (but not fee) free has been violated. In 1960, student fees at UC and CSU were roughly $150. This year at UC fees and tuition are $11,000 (a 7000% increase since 1960) and at CSU they’re $4,900 (a 3200% increase). Since 1990, the cost has risen 600% at the UCs, and 500% at both the community colleges and the CSUs. Between 2000 and 2008 alone, tuition at UC and CSU more than doubled. Rising costs, ballooning loan debts and declining employment opportunity and wages force students to reconsider their focus of study so as to maximize the largest possible later salary.

Little has been immune to the virus of entrepreneurialization. Student struggles of the 1960-70s to demand programs to teach Black, Chicano, Women’s, Asian-American and Indian studies and open up enrollment to more students from these groups was transformed in the 1990s into its polar opposite: multiculturalism. These new spaces of learning now found themselves struggling to prove their relevance to business’ need for a culturally sensitive productive multicultural workforce and to help sell their products to a multicultural customer base. Today we see the same thing happening in the community colleges in their rush to cash in on the “green” business’ need for trained workers to sell dubious new “eco” technologies to increasingly eco-conscious consumers.

Part II: Effect on Community College Students. Why Fight Back?
The pressure for California universities and community colleges to higher education to make themselves subservient to the logic of the corporation has shown itself during the ongoing slash and burn budget cuts happening now across the state. California’s 3 tier system of higher education mirrors the three social classes of American society. The inequity of the system shows itself when you follow the money. The UCs spend 3-4 times and the CSUs 2-3 times more per student than the community colleges, the working poor of California higher education. The UCs hold vast wealth in lucrative contracts, real estate and undedicated funds that the CSUs and community college lack.
We know about programs and departments getting shut down at the UCs at the same time new privatized corporate partnerships with biotech, chemical and oil companies get set up. We know about the canceled programs, limits on enrollments, and overcrowded classes at the CSUs. We know about rising tuition and fees, exorbitant salaries and perks at the top, and how unprofitable sports program are being subsidized by tax funded education programs. These are the concrete manifestations of entrepreneurialization, a filtering process to screen out the wave of students demanding access to resources to which they and their families and communities have been denied.
Entrepreneurialization operates at both the systemic and individual level. Students who submit to the imperatives of profit and change their major to one where there is less or no overcrowding are rewarded with better conditions and maybe even with a bit higher pay for a while after graduation. These higher salaries allow them to repay usurous student loan debts, IOUs on future salaries, for a while at least. Those who do not submit and hold onto their original goals face deteriorating conditions through overcrowding, lack of access to classes and professors, declining resources, and eventually insecure employment at lower wages making their usurous debts even more onerous.

The View from the Basement
But what about the community colleges where about 80% of all college students reside? Within this system of separate and unequal, in which the community colleges reside at the bottom rung, are the entry points for students trying to get a second chance to make up for an inadequate public school education, recover from divorce or job loss or personal tragedies or returning home from a senseless war or prison or addiction or learning English to help them through the arcane maze of immigration laws. From this basement, the filter covering the passageway upward to the CSU and UCs hasn’t just tightened it has closed off with shorter times to apply for transfer, higher entrance requirements and fewer available places. These students now face longer waits with fewer choices among more overenrolled classes blocking their way. Rising fees are met by fewer counselors to help them maneuver the arcane maze that is the 3 tiered hurdle. For those entering with language needs or to make up for lost prior educational opportunities they find missing or overcrowded ESL and Basic Skills classes, and disappearing CALWORKS, childcare programs and counselors.
What appears as an inconvenience or hassle is that and more. It is an attempt to transform a victory we fought for, defended and won over the past century into a defeat.
It is intended to discourage those who otherwise are not or able to fight for what is theirs: the vulnerable, the undocumented, the overworked and underpaid.
It is intended to dissuade one from studying in order to give something back to ones’ family or community and to study to serve one’s self-interest.
It is intended to convince us that the rules have changed for the best. That what was once provided by society is now the sole responsibility of the individual to be purchased on the “market”.
Inconvenience and hassle are intended to convince us that austerity and worsening conditions are not worth the inconvenience and hassle; that we should just stop asking and stop demanding and accept that that which we once fought for and gained can no longer be ours or is becoming just a feeble shadow of what it once was.
But inconvenience and hassle are not very convincing reason to abandon the fight to protect, expand and transform public higher education.
It is no surprise that across the state a new movement from below of students, faculty and campus staff are joining local community is emerging to resist the pillaging of public higher education.

Robert Ovetz, Ph.D. is a migrant mindworker of academia (aka adjunct professor) at two San Francisco Bay Area community colleges. He wrote his Ph.D. dissertation about the entrepreneurialization of the University of Texas. You can find it at Contact him at:

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