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Well, it’s the end of Nicholas Dirks’s first semester as Berkeley Chancellor, so why not offer him some unsolicited advice?

Brad DeLong, professor of economics | December 11, 2013

So how is new UC Berkeley Chancellor Nicholas Dirks doing, anyway?

As you may or may not remember, I think that the historic tasks of a UC Berkeley Chancellor today are three: two financial (with concomitant implications for the deployment of Berkeley’s resources) and the third technological. The financial tasks are:

  • to rebalance Berkeley’s finances in this post-Clark Kerr era by (partially) transforming it into a finishing school for the superrich of Asia.
  • to rebalance Berkeley’s enrollment by creating a system in which nobody who should be going to Berkeley feels that they cannot afford it or cannot risk it, and yet in which it is rich Berkeley graduates rather than the poorer median taxpayers of California who bear the financial burden of supporting the public university.

The technological task is:

  • to figure out how to use, rather than to misuse, abuse, or not use the new educational technologies made feasible by our ongoing revolutions in information and telecommunications.

And, of course, the chancellor must make progress via the Sisyphean process of bureaucratic persuasion and marginal budget reallocation.

Tall order, yes? Certainly not one that I am qualified to take on, or would take on even if they paid me $1 million (a year) to do it. But that will not stop me from advising and judging, will it?

So let me expand on these three:

I. (Partially) a Finishing School for the Superrich of Asia

The first priority of the chancellor is to successfully execute a strategy to keep Berkeley great–to reinforce the reasons that it is worthwhile keeping a university like Berkeley around at all.

The days of Clark Kerr are over. The belief that the taxpayers of California should pay for the young citizens of California to get as much education as they want for free is no longer politically popular. Would that it were still. The old social democratic belief that America should have the best universal free public education system in the world was a principal source of America’s relative prosperity and economic leadership for a century. Now that the political coalition that supported that belief is gone, America will be a much less exceptional place.

But those days are gone. Chancellors can no longer rely on the legislature of California to fund Berkeley at the level needed to keep it an exceptional university. Berkeley needs another and a different strategy.

The strategy that Berkeley has settled on is to seek to produce the funding stream necessary to maintain a great University by becoming a finishing school for the superrich of Asia. This may be the wrong strategy–I sometimes think so, many others think so, and you can certainly argue so.

But it is the strategy that we have.

And the worst strategy of all is to have no strategy.

A bad strategy is vastly preferable to no strategy, or to an unimplemented strategy.

So the chancellor needs to implement the strategy that we have, and that requires throwing money at three areas:

  1. Student Life: You can take the kids who have grown up in Orange County and throw them unsupervised and unsupported into Berkeley and they will do fine. You cannot do that with kids from Bangalore or Kuala Lumpur or Chungking. Dormitories, advisors, student life support–all dimensions of administrative activities that Berkeley has historically skimped on need to be beefed-up, and beefed up substantially. Every dollar of available money should, for the next five years at least, be devoted to this task.

  2. Presentation-of-Self in English: The English-speaking and oral comprehension skills of the future students who will rebalance Berkeley’s finances are first-rate or they would not be seeking admission. Their English-language prose-writing skills are not. If Berkeley is to provide value, the money must flow like water to writing teachers and writing coaches. And also drama teachers. The principal thing Berkeley can teach the smart and well-prepared children of the superrich of Asia that they will find useful and worthwhile is presentation-of-self in global English-speaking culture. To do that requires: (a) convincing the out-of-state students that they need to learn how to write and also how to act, (b) beefing up the English department to teach them how to write, and (c) beefing up the drama department to teach them how to act. We have already devoted every dollar of available money to our first task, but the second task needs to be funded and funded amply as well. So the rest of the university needs to be squeezed to produce the money to do this.

  3. Key Subject Areas: High-fee-paying out-of-state students will come and pay high fees only if they can reliably get the courses and majors that they want, and have them taught well. This means that money has to flow like water to engineering (especially computer science) and biological sciences (especially pre-medical) and economic sciences (especially finance) and international studies (especially economics). These particular customers are kings. And the money that flows has to flow to effective teaching–and not to raising the living standards and laboratory setups of senior faculty. God knows how the chancellor will persuade departments that they have the budget so that everyone who wants to major in computer science, biological sciences, economics, business, etc. can and will do so — as we have already spent every dime and more on student life, English, and Drama — but the chancellor will have to do so. Throwing money like water at key areas that require expansion and emphasis in a time of general budgetary retrenchment is the hardest thing an academic administrator can ever do. Yet the chancellor has to do it, lest Berkeley become just another urban state university campus, rather than something exceptional and valuable.

II. Financing Public Higher Education

Let me outline how economists like me look at it: To go to Amherst College requires $45,000 a year in tuition, plus you “spend” $20,000 more in the income you do not make at the job you do not take because you’re going to Amherst College. Total cost: $260,000 over four years. To go to UC Berkeley requires $15,000 a year in tuition and fees, plus you “spend” $20,000 more in the income you do not make at the job you do not take because you’re going to Berkeley. Total cost: $140,000 over four years. To go to a hypothetical Free Berkeley requires $0 a year in tuition, but you “spend” $20,000 more in the income you do not make at the job you do not take. Total cost: $80,000 over four years.

What would the argument for shifting from our current UC Berkeley to Free Berkeley be? It would be that a number of students, who for their sakes and ours should go to Berkeley would go to Berkeley if it cost them $80,000 in forgone earnings, will not go if it costs them $140,000 in foregone earnings plus tuition and fees. What are the arguments against our shifting from our current UC Berkeley to Free Berkeley? The first argument is that for every student who would not go to current Berkeley but would go to Free Berkeley, the taxpayers of California would have to pony up $60,000 that they would not be able to spend on what they want.

Given that the average taxpayer of California is considerably poorer than the average Berkeley graduate, that upward transfer to the relatively rich leaves a bad taste in the mouth.

The second argument is that for every student who would go to current Berkeley, the taxpayers of California would have to pony up $60,000 that they would not be able to spend on what they want.

Given that the average taxpayer of California is considerably poorer than the average Berkeley graduate, that upward transfer to the relatively rich leaves a really really bad taste in the mouth.

In my view, these arguments against are overwhelming: there is no valid argument for transforming UC Berkeley as it currently exists into Free Berkeley.

There is, however, a powerful argument for allowing Berkeley students to pay for their education not now but later: those whose families are cash-strapped now ought to be able to pay for the education 30 years down the road. And there is an argument for offering future wage insurance: those whose future career paths do not lead them to high incomes 30 years down the road should not have to pay, and those whose future career paths lead them to riches should pay more. Thus the argument is not for Free Berkeley but rather for current Berkeley, plus a much expanded program of income-contingent grants to pay for college.

And perhaps there is a deeper, sociological and anthropological argument for changing the legal and cultural form of the current-Berkeley-plus-expanded-income-contingent-grant program. Rather than incur extra administrative costs, the repayment-by-the-rich part could be assigned to a progressive income and wealth tax. Or, alternatively, we could create a social norm and cultural expectation by which those who do very well in their careers financially are then expected to give lavish financial gifts to their alma mater. Gift-exchange relationships in which both sides feel that they have received surplus value do tend to build more social solidarity and social harmony been cash-nexus relationships in which both sides feel they have incurred equal costs.

Perhaps this is really what Free Berkeley would be: a place where tuition and fees are $0, but attendance does come with a string attached; thus those alumni strike it rich in their careers contribute gifts to the university that more than cover the cost of educating their cohort, or feel like real losers if they do not do so. But this is not a system in which higher education is free. Or, perhaps, I should say this, is not an argument for Free-as-in-Beer Berkeley. Perhaps people should pay cash-on-the-barrelhead upfront for their elite education. But this does not mean that the–poorer–general taxpayers should pay for elite educations, and that the elites should then live their lives free of obligations to those who, after all, paid for what they got. This is a system in which higher education comes with profound sociological and cultural obligations to repay –whether that repayment is enforced via the IRS, or via celebrations and public display at the 25th and 50th reunions.

Berkeley does not appear to have a strategy for constructing this sociological pattern of placing the burden of funding the University on the bottoms on which should be placed other than hoping each year for a better football team. But by now lots of universities have done this, yes? Even people who did not go to Harvard give to Harvard lavishly. I have absolutely no clue how the chancellor should go about constructing this long-term intergenerational sociological gift exchange financial funding pattern. But, once again, somewhere the chancellor needs to find the energy and the tools to do so.

III. Technology and Education

The fever of the MOOC has broken. As we got to have suspected all along, the students who will benefit enormously from MOOCs and Kahn Academy and so forth are the students with a cognitive skills, energy, and persistence to have been able to learn from the open University on TV, or programmed instruction, or simply picking up a book. For those who do not have the requisite skill, energy and persistence, the coming of the MOOC and of education over the Internet will do little: If they are to learn effectively, they need to be embedded in the social matrix of a university–classes and deadlines and attendance and tests and papers and peers around them all doing the same. And those who do not need this sociological matrix are a small minority, even at Berkeley.

So the real questions of the area of technology in education today are these:

  • What are the key elements of this sociological matrix necessary to make education actually happen for all except the luckiest and most persistent of students?
  • How can we use modern computing and communications technologies to substitute for those costly things of the University currently does that are not key elements of preparing this sociological matrix?
  • How can we maximize the value gained from the application of resources to preparing this sociological matrix?

The post-Gutenberg university was very different from the pre-Gutenberg university: A lot less reading of texts aloud, a lot more outside reading of now-cheap books, a much wider curriculum, more discussions and tutorials, lectures as commentaries on rather than regurgitations of texts–or, rather, that is what good lectures were–and so forth. The post-Berners-Lee university Will ultimately be something very different from the post-Gutenberg pre-Berners-Lee university, and the universities that can first figure out what that something very different will be will dominate the 21st and 22nd centuries.

No, I do not have the answers.

No, I do not have a clue as to how the chancellor who is already performing the two financial and sociological tasks will also manage to guide Berkeley to a proper appreciation and understanding of the issues involved in this ongoing technological transformation.

But the Chancellor has to do so.

As I said, it is not a job I would take for $1 million a year.

2175 words

Comments to “Well, it’s the end of Nicholas Dirks’s first semester as Berkeley Chancellor, so why not offer him some unsolicited advice?

  1. I understand that this is not a history paper, but nonetheless suggest that the comparison of the pre- and post-Gutenberg university is a little telescoped.

    Some changes such as the much wider curriculum and more discussion occurred after Gutenberg but not necessarily all due to Gutenberg. Many of these changes to curriculum and pedagogy were the result of Humanism, which antedated Gutenberg.

    And of course expository lectures have been as important in the 500 years after Gutenberg as they were in the 300 years before.

  2. I have to contest the idea that the (suspiciously monolithic) group of “superrich students from Asia” only wants to study medicine, computer science, and economics. Students from abroad who I’ve spoken with often give a different account. Sometimes, these students have interests beyond what their parents are forking over money for: music or linguistics or history (and so on). Sometimes the solution is to double-major: pre-med and music, or CS and linguistics, or economics and history.

    Obviously I prefer it when my students have my subject, in the social sciences, in mind as a primary goal, but educating the future doctors, developers, and economists of the world in the humanities and social sciences is clearly something we need to consider here: not only is it a socially responsible thing to have in mind, but it’s also in demand!

  3. If they would reduce or eliminate state income tax for the poor, and increase it for the superrich, and allocate more state money to higher education (UCB/UC and other systems), they could solve these problems without distorting the old and brilliant California master plan.

    — Leslie Bary (classes of 1978, 1980, 1987, 3 degrees UCB, with various relatives with degrees UCB going back to class of 1912; we all benefited from low fees, and others should too)

  4. Professor DeLong has hit on a good point, though… it is obvious that the state is not going to support Berkeley at the levels of the 60’s, when the vast majority of the taxpaying families in California will never have a child that will get admitted into the school.

    Whether it’s because their children have interests other than intensive SAT prep and doing activities to fill out the college resume; they want to go to a smaller, more personal liberal arts school; or the parents don’t have enough money for tuition and room and board for a school that requires a day’s drive from the majority of Californians, Berkeley is becoming more and more elite.

    The era of the 60’s when Berkeley was admitting anyone that met minimum UC qualifications – and someone of average intelligence could meet UC qualifications with above average diligence and attention to schoolwork – are long since gone. While Cal practices affirmative action on a financial basis, which I as an alumnus am proud of, for someone in the middle class or upper middle class with a child who wants to do something other than study all day and be president of three clubs and play a varsity sport, you can’t get in. And quite frankly, a Cal State education may be better for a B average non-honors student. You certainly get more personal attention from professors.

    DeLong is just pointing out the trends – where Cal currently sets a similar bar for all applicants instead of a high bar for in-state and a higher bar for out-of-state, of high in-state tuition that drives more people closer to home and to Cal States or lesser UCs who offer greater scholarships, and the greater number of better-prepared-on-paper international students who want that prestigious Berkeley degree to get into positions in their home countries – and taking them to their logical conclusion.

  5. If Berkeley is going to use foreign students to help pick up the tab, I don’t see any reason why they should be given steeply discounted tuition rate as they are now. The market rate for out-of-state tuition at large public research universities like Michigan and Illinois is between $35,000 and $38,000. At Berkeley it’s around $25,000.

    If we charged what other schools do, we could reduce the number of foreign students and replace them with Californians at no additional financial hit to the university. No wonder Berkeley is the destination of choice for the Asian student. Top-name school at about a 30% discount.

    Could someone explain why Berkeley is leaving so much money on the table? Which results in an unnecessary reduction to the participation rate of Californians.

  6. I’m a Cal alum and I lived in China for four years, where I met lots of wealthy students who’d love to go to Cal. I now live in Chile, where debates over university funding are front-page news.

    As Chris Rosen suggested above, might there be a way to provide better services to these ambitious but underprepared international students and generate more funds at the same time? What about an intensive, required summer school that includes English and drama classes and special guidance through the culture shock? I believe that this special attention could be highly valued, and most of these students’ families have already spent a fortune on prep courses and tutors and admissions services to get to Berkeley in the first place.

  7. Chris Rosen’s comment above is right on target.

    My father and many in my family are Berkeley grads (I’m UChicago) and we would like nothing better than to see the UC system thrive and grow. That said, many of the students coming from East Asia, particularly from China (my area of expertise), are woefully unprepared for the rigors of an American university curriculum (and living independently). Many of them will have gained acceptance to Berkeley with a great deal of “help” on their applications (this is standard practice throughout much of East Asia), and will have neither the written nor the spoken/oral comprehension skills necessary to understand the content nor the instructors for their courses (TOEFL, SAT and ACT scores are also easily manipulated). That said, some are excellently prepared and will do brilliantly.

    A rigorous system of evaluation during the summer before they officially enter the university should be standard practice, to assess which students will need which kinds of individual assistance (academic, financial, cultural) and help them succeed during their time at Berkeley and thereafter. I’m not sure I support drama coaching, but scholastic and cultural training during those initial summer months is a must. The better prepared they are for life at Berkeley, the more they can contribute to the institution as a whole and the more positive contributions they can make to their peers.

  8. 1. “historically skimped on need to be beefed-up, and beefed up substantially. Every dollar of available money should, for the next five years at least, be devoted to this task.”

    Do you really think there is no support infrastructure of this sort for undergraduates? Did you actually observe this? It seems quite contrary to the situation. Would it not be more advisable to provide sufficient housing for these students or at least a structured way of acquiring it throughout their four or more years at Berkeley?

    2. “beefing up the English department to teach them how to write”

    This is not what an English department does. Ivy League institutions have programs for writing that are entirely independent of English departments and, as a result, these programs do not compromise the academic function of the English departments.

    3. “beefing up the drama department to teach them how to act.”

    See above.

    4. “High-fee-paying out-of-state students will come and pay high fees only if they can reliably get the courses and majors that they want, and have them taught well. This means that money has to flow like water to engineering (especially computer science) and biological sciences (especially pre-medical) and economic sciences (especially finance) and international studies (especially economics).”

    An economics professor wanting more money for economics in the least surprising thing I’ve read all day. It’s amusing that you think these programs don’t already receive money like water in contrast to other programs on campus. It seems like you should leave your office and ask your colleagues – in other departments – about this question at some point.

    5. Part II is much more solid, which figures, because it is the part of this that actually deals with finance. On the other hand, it’s almost as if Professor DeLong wants Berkeley to become Harvard, Princeton, or Yale.

    6. “The post-Gutenberg university was very different from the pre-Gutenberg university”

    It’s really a shame that they won’t be teaching history in DeLong’s university because this is a pretty bad reading of what actually happened. At least he agrees that MOOCs are a failure, which is refreshing.

    7. To return to the original premise, which is that Berkeley should cater to an Asian elite, I fail to see why Berkeley’s resources ought to be put into the programs Professor DeLong supposes they ought to be put into. The universities in the US that cater to foreign elites aren’t enrolling them in droves because of their spending on those things noted in this blog post. They are instead developing new strategic partnerships in those countries in addition to recruiting elites through the networks they have developed. Having a drama department focused on teaching these people how to act is not going to enroll elites, it is just going to destroy a drama department.

  9. I find the Free Berkeley as a wealth transfer to the rich to be a strange formulation based solely on the average taxpayer being poorer than Berkeley graduates. It seems to ignore 1) progressive taxation that shifts the lion’s share of the actual tax collection to a much higher average income rate than the ‘average taxpayer’ overall, and 2) the economic benefits for the state and tax base of a well-educated population with roots in California.

  10. 1) Khan Academy, not Kahn Academy.

    2) Count on an econ professor to think of the value of a college education solely in terms of the future increased earning potential it offers that single individual, and fail to consider the benefits to society as a whole. Whither the liberal arts? The education of our citizenry – emphasis on that last word, citizenry? Your thought process is disappointing.

  11. Here is a win/win strategy for making the convert Berkeley into an effective finishing school for rich Asians plan actually work. Establish a fee based preparatory program for students whose English language, especially their reading and writing, skills are not up to Berkeley’s standards. Rather than throwing them directly into our classrooms, conduct testing to identify the ones who need help and require them to spend the summer getting specialized ESL help as well as an introduction to American culture, through specialized summer classes, fields trips etc. Then require the ones who still need – or want – additional time to prepare for our courses the opportunity to continue in a specialized ESL focused program that includes one or two regular classes for at least one more semester or two if needed. Finance this through student fees that cover all costs (perhaps with some additional revenue generation for the campus). I’m told that Korean and Japanese languages are incredibly different from English – and Chinese and other Asian languages are only a bit less so. They need this kind of help if they are to get any real value out of the Berkeley degrees. We owe them this help – and we should expect their families to pay full freight.

  12. Not that I think that this is a bad strategy, mind you: somebody has to pay to keep Berkeley Berkeley, and we do have something very valuable to offer the superrich of Asia, who do have the money to pay for it. But since this is what we are doing, we should do it with open eyes, and do it well…

  13. Free speech lives at Berkeley. Thanks for sharing your thoughts, making them public, and stirring the pot Professor DeLong.

    I was particularly struck by your statement that Berkeley is becoming, partially, a “finishing school for the superrich of Asia.” For me, that is a new idea to contemplate, and quite an irony for those of us who take such pride in a Berkeley student body that has more students from families who make less than $50,000 a year than all the Ivy League schools combined. I like to say that the American Dream lives at Berkeley.

    That said, I believe the facts back up your assertion. Tough to get your head around this.

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