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Don't be Bamboozled by UW budget!

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Don't be Bamboozled by UW budget! Powered By Docstoc
					        Don’t be BAMBOOZLED by the Budget
                 A University of Washington for the Elite and the Superwealthy?
                                   Not On Our Backs!
                                     Public Statement by Democracy Insurgent
                                                  March 4th 2010

 We are in a period of recession, unemployment and warfare. The unemployment rates are close to 10%
nationally, as well as within Washington state. Yet what has been obscured is that for people of color, particularly
Black folks, many are already living in a depression. The national unemployment rate for Black folks in this
economy is 17.6 %. 1 In Washington, only 3% of the population is Black, yet Black folks make up 28% of the prison
population. The prison system appears to be the place where the powers-that-be think they can generate most
profit out of Black folks. In the meantime, military enrollment targeted at youth of color has also increased.
Undocumented students among us are forced to choose between the military and increased chances of
deportation. The Dream Act is designed to offer citizenship to undocumented students who either go to college or
join the military. However, with the cost of tuition rising it is becoming only one more form of a poverty
draft. Many of us ask:

Why war and prisons, and not education? Why are the University of Washington, the community colleges and
other institutions of higher education becoming less and less accessible at a time when they are most sorely
needed? Why are they trying so hard to shut us out and keep us ignorant?

There is an urgency to our struggle. We are people of color, working class students, women, people with
disabilities and queers who know that it is on our backs that the powers-that-be declare that they are “too big to
fail.” We will be the ones who absorb the cuts caused by the crisis they created. We will be the ones who will be
barred from the walls of higher education. We will be the ones to pay back with a lifetime full of debt, for which
we will be blamed if we slip up and can’t repay. This is the unfair game of double, triple, quadruple jeopardy.
Welcome to our reality.

Some people like to think that the UW is safe. Some people enter this university with a “I’m here to get what’s
mine and no one else matters” attitude. They think that once they speed through their 4 years, or 5, or
increasingly 6 years in UW then they need worry no more. UW after all, is a public institution. UW after all, is an
educational space that is held by high lofty ideals. UW after all, is a unionized workplace, better than all the
private companies downtown, or better than those sweatshops in the Third World, and we should be thankful,
appreciative and submissive for all the gifts of this university.

Those who speak like that do not understand that 4, 5, 6 years of being a UW student doesn’t negate a lifetime of
being a person of color, or a woman, or a person with disabilities, or a queer person. It is as Malcolm once said
that under white supremacy, a Black man with a PhD is still the N-word to the powers-that-be. Our liberation as
oppressed people cannot be individualized. It has to be collective.

In our generation, white supremacy will increasingly play itself out in numbers and legalities that we do not
comprehend – the numbers from the bank statements and student loan offices that we will continue to get at the
end of the month for 20 years after graduation, that don’t match up with the low-wage jobs more and more of us
will be channeled into. It has and will continue to play out in the increasing statistics of people of color in prison,

1
Joel Dreyfuss. “Nothing Special for the Black Jobless.” The Root,


                                                              1
http://www.theroot.com/views/nothing-special-black-jobless
locked down even for non-violent crimes and misdemeanors, or in ever expanding immigrant detention centers
filled by ICE raids that also play the role of union-busting. These numbers will rip away our dignity, endlessly defer
our dreams and erode our families and relationships.

The University of Washington is undergoing a long term plan of restructuring and privatization that will make this
university less and less accessible to students of color and working class students, further increasing the gap
between wealthy white elites and the rest of us. The justification for the tuition hikes are based on a “we are too
big to fail” model. This is the same trick Wall Street pulled on us even when the big CEOS continued to reap in
millions of dollars. They count on us to bail them out. They hedge their bets on our ignorance.

Some of us are proud and smart enough to act up and fight back. Our future and dignity aren’t for rich white men
to boss around with their lies. We fight for low tuition, because contrary to everything the administration will say,
it is still the best financial aid for students of color and working class students. We fight for the right to receive an
education that is not a mere country club experience for rich white kids. We fight for our brothers and sisters to
be able to enter higher education and increase their prospects for good jobs, not prisons and fast food-chained,
low waged lives. We fight because we don’t want to be last generation college students.


                          WHY PRIVATIZE? MYTHS AND REALITY
Privatization is a big word but it best captures what is going on right now. What privatization means is that this
university, as well as other institutions of higher education, will be increasingly run like a private company, rather
than as a public good that is accountable to citizens. Private companies are run according to a profit motive,
which means they will always try to cut down on costs to increase their profits. For the university, this means that
UW will increasingly bar people of color and working class people from attending because we are not the rich
profit-generating consumer base that can sustain a high-tuition privatized school. We are either shut out, or we
have to take out more and more loans to enter. On the labor front, this means that management will try to
squeeze more and more labor from a lower and lower paid workforce. We see this happening already with the
custodians, trades workers and the Teaching Assistants on campus.

It is not a coincidence that everything is happening at the same time, under the rhetoric of the budget crisis. The
administration is trying to squeeze through new management techniques and new tuition structures (high tuition
and tuition-setting ability by the Board of Regents) at this time of economic crisis. If it were any other time, we all
would be fighting back but, now they can try to convince us that this is the least worst option. In this piece, we
break down this myth of inevitability, that the university NEEDS to push through these changes. We claim, in
contrast, that the University does NOT need to make these changes. There are other ways to meet the budget
shortfall. Yet, the university administration is deliberately pushing through these measures that raise tuition,
because it knows it can. Mark Emmert and the Board of Regents know that if they tell us that they have to raise
tuition for our sake, we will gladly roll over and let them do it. This is part of a long term plan to make UW into a
more elite, white, rich university that does not serve the needs of our community.

MYTH NUMBER ONE:
We are facing a budget crisis in the university because of the state’s cuts to UW. The administrators
did not have a say in these cuts. We have to suck it up and deal with it.


REALITY CHECK:
We demand that the state fund higher education, from UW to community colleges. We demand changes in our

                                                            2
regressive tax structure, so that social services and education can be better funded. However, our push for state
funding does not mean that we are oblivious to Mark Emmert’s administration’s attacks on working class
students. Mark Emmert and the Board of Regents tell us we need to only protest Olympia to demand more for
our education. That, we know to do. However, we will not let that distract us from the battles that also need to be
fought on our own campuses! Let’s not forget that Mark Emmert and the Board of Regents are only too happy
that the state cuts are opening up space for the privatization of the university. After all, they have been fighting to
have tuition-setting authority long before this year’s budget cuts! The state cuts serve only as yet another
scenario for them to justify tuition hikes.

It is true that the in the 2009 legislative session, the legislature cut funding to UW by 25.6% for the 2009-2011
biennium. This number sounds astronomical, but consider the following facts:

The state funding to UW constitutes only 11.3% of the $3.5 billion UW budget. When the state cuts 25.6% of its
funding, what it amounts to is a mere 2.8% cut to total UW budget. This means a reduction of $101 million in
state funding this year. This cut was partially offset by $24.7 million in federal educational stimulus money.
Overall, this means only a $76.3 million reduction in funding for the 2009-2010 year. 2

In the financial reports for 2009, the UW has suffered an investment loss of $469 million. According to the UW
report, “the University recorded a “bottom line” loss of $375 million in fiscal year 2009, primarily due to an
investment loss of $469 million, as a result of market value declines in fiscal year 2009.” 3 This is where the bulk of
the losses for fiscal year came from. Yet, nowhere have we heard Mark Emmert or the Board of Regents publicly
discuss these numbers. We have reason to believe that they raised tuition to fill this loss, not the loss from state
cuts.

According to a study of American universities’ recent investment practices, large universities such as the UW have
been part of a trend of US universities engaging in risky investments, on the backs of their students. Since 2004,
the UW Treasury, overseen by V’ella Warren, has been investing in hedge funds, known for their high risk
factors. 4 5 Even when the market was doing well, however, tuition continued to increase an average of 6.6% from
2003 to 2008. In 2003, tuition was $4968; in 2008 it was $6802 and by 2010, it will be $8800. 6 Students did not
reap the financial benefits of a well-performing market.

In fact, we are now becoming the most debt-laden population of students in history. The New York Times ponders
our future, “As the most heavily indebted class of students in history graduates from college into one of the worst
job markets in memory, holders of the nation's roughly $670 billion in student loans are bracing for an increase in
the number of students who cannot pay them back.” 7

We continue to pay more when the economy is thriving. We pay even MORE when the market faces a shortfall.
Does this make sense?

It is not inevitable for a public university to invest in private equity funds, hedge funds, in volatile currency trading

2
  According to the Seattle PI, “In 2008, state funding accounted for $396 million of that, or 11.3 percent. In the forecasted
budget for the coming academic year, public funding drops to $321 million.”
                                                                               th
Nick Eaton, “”UW to borrow from private financial model” Seattle PI, April 30 2009
http://www.seattlepi.com/local/405696_uw30.html
3
  University of Washington 2009 Annual Report, http://f2.washington.edu/fm/uw-annual-reports Page 13
4
  Hedge Fund Alert August 2004, www.ymerfund.com/Fund%20News%201.pdf
5                                                                     th
 Stephen Glain, “Chasing Cash” Newsweek International, August 28 2006
http://www.stephenglain.com/index.php?mact=News,cntnt01,detail,0&cntnt01articleid=100&cntnt01returnid=58
6
  University of Washington Ten Year History and Mandatory Fees
http://www.washington.edu/admin/pb/home/pdf/tuition/2008-09-tf-history.pdf
7                                                                                           th
 Jillian Jorgensten, “Student Loan Lenders brace for rise in defaults” Boston Globe, May 6 2009


                                                               3
http://www.boston.com/news/nation/articles/2009/05/06/student_loan_lenders_brace_for_rise_in_defaults/
and in firms that were highly compromised by subprime mortgage loans such as Bear Stearns, Goldman Sacs,
Fannie Mae and Freddie Mac. It is even more unreasonable to expect that we, the students and workers, will pay
for mistakes on speculative deals with tuition hikes, layoffs, and frozen wages. In the meantime, you can be
assured that those responsible - Mark Emmert and V’ella Warren - will not be taking a pay cut anytime soon.
Mark Emmert makes a base salary of $620,000. However, that doesn’t include his deferred salary of $250,000,
$23,000 in retirement pay, and $12,000 in car and housing allowances. Emmert and Warren function in the UW
they way CEOs do in a Wall Street company. Their compensation cannot be threatened and when they do fall
they fall with a golden parachute. They are TOO BIG TO FAIL.

PS: Mark Emmert the fact that you didn’t get a pay raise on your million dollar income for most of us does not
mean you took a pay cut!!


MYTH NUMBER TWO:

Instruction is first to be affected when the university faces cuts because it is the primary mission of
the university. Suck it up and pay more tuition if you want a good education.


REALITY CHECK:
Instruction is facing cuts at the UW not because there is insufficient money, but because instruction has been
deprioritized in contrast to construction projects.

As of July 2009, after the budget shortfall had been announced, UW nonetheless decided to fund $1.05 billion
dollars in construction costs. 8

The costliest projects were the following:

Molecular research lab: 78 million
Business School: 147 million
HUB renovation: 128 million
Housing Dormitories: 147 million

Some of these funds come from the sale of bonds which will have to be repaid. We will explain this later in the
piece. What is important to remember is that at this time of economic crisis, the university is choosing these
construction projects over our instruction. This also means that we, and future generations of UW students, will
pay increasing amounts of money toward financing the debt incurred from these construction projects. These
debt repayments will be prioritized over instruction. 9

While one may argue that the HUB renovation and the building of housing dormitories are important buildings in
a university, when it is coupled with high tuition and less accessibility for students of color and working class
students, one wonders, who benefits from these buildings? Who is the future consumer of these buildings? We

8
  Jan 2010 UW Capitol Projects Semi Annual Report, July 2009-Dec 2009, pg 49
 http://www.cpo.washington.edu/html/Projects_Reports.htm
9
   In the UW report on the “Ten Year History of Tuition and Mandatory Fees,” it is stated that “Intramural Activities Bond Debt
Service Fee began Winter 2003 for 30 years: $35 per quarter to pay bonded debt for the Intramural Activities Center.”
Subsequently, from 2003 onward, there was an annual $105 fee for the IMA costs. We can expect that any construction
projects that the UW is pursuing right now will be repaid in similar manners – through hikes in student fees – that we and
future generations of UW students will pay.


                                                              4
http://www.washington.edu/admin/pb/home/pdf/tuition/2008-09-tf-history.pdf
can be sure that with ever increasing tuition fees, the future consumers of a swanky dorm and HUB will not be
working class students and students of color. They will be the rich and the elite. We will further discuss this later
in the piece.

Robert Meister and Bob Samuels, the authors of “They Pledged your tuition to Wall Street,” and “How America’s
Universities became Hedge Funds” respectively, analyze the rationale behind the astronomical 32 % tuition hikes
in California. 10 We suspect that their analysis may hold true here at UW.
The two professors argue that large public universities have shifted their emphasis away from undergraduate
instruction toward profit-generating research based expenditures. This attempt to generate income for the
university is coupled with heavy administrative overhead that oversees logistical details, as well as heavy
investments in construction projects for labs and offices. This de-emphasis on undergraduate instruction is
coupled with a cruel irony, that our tuition and student fees are used to acquire the funding for these projects
that we barely benefit from.

Research comes with benefits for the university which however, are not channeled toward instruction.
As Samuels puts it,

        This move to find new revenue through research activities was enabled in 1980 by the passage of the
        Bayh-Dole Act, which allowed universities for the first time to buy and sell research produced at federally
        funded labs. Not only did this law push universities to seek profits by selling the results of their research,
        but the move to increase research triggered a major expansion of administration and staff. 11

The research revenue, and the perks of federal funding remain out of reach for undergraduate students.
 In 2009, the UW received $200 million in stimulus money, the top awardee among US universities. Of any
research funding that the university acquires, half of it should go into what is called "indirect funding."
According to Provost Phyllis Wise, this money goes toward building maintenance and utilities, libraries, and
administrative costs. 12 Yet we wonder, why it is that in March 2009, when talk of the budget cuts first came
around, the first thing we heard was that library services were to be cut drastically, and library staff laid off? 13 It
appears that there IS money in the university, whether through indirect funds from research grants, or revenue
from the sale of research findings, yet it was not allocated for the library, a general good. Could it be a part of a
public relations campaign by the administration to justify tuition hikes? Could they be saying “look, if we don’t
raise your tuition you won’t have good library services”?

It is clear to us that the UW administration engages in sophistry and deception regarding the construction and
maintenance of facilities on campus. In the last round of budget cuts in 2009, in response to claims that the
university administration had a top heavy management structure that should be cut, the President’s Office and
the Finance & Facilities Department claimed to have made 16% and 15.85% cuts respectively. 14 What Emmert
really meant was that 400 administrative positions, such as secretaries and office workers, some of whom were in



10                                                                                           th
   Bob Samuels, “How America’s Universities Became Hedge Funds” The Huffington Post, Jan 28 2010
http://www.huffingtonpost.com/bob-samuels/how-americas-universities_b_440954.html
                                                                                    st
Robert Meister, “They Pledged your tuition to Wall Street” MR Monthly Review, Nov 21 2009
http://keepcaliforniaspromise.org/383/they-pledged-your-tuition
11                                                                                         th
   Bob Samuels, “How America’s Universities Became Hedge Funds” The Huffington Post, Jan 28 2010
http://www.huffingtonpost.com/bob-samuels/how-americas-universities_b_440954.html
12
   Office of Research, Facilities and Administrative Cost Primer (Indirect Costs),
http://www.washington.edu/research/main.php?page=indirectCosts
13                                                               th
   Eric Staples, “Odegaard could cut hours” The Daily, March 11 2009,
http://dailyuw.com/2009/3/11/odegaard-could-cut-hours/


                                                            5
14
   Office of Planning and Budgeting, Fiscal Year 2010 Budget Reduction Summary
his office, were facing cuts. 15 This simply meant that colleagues took on more work, or students ran out of
services. He did not mean that top management faced cuts. Mark Emmert, Phyllis Wise, V’Ella Warren, Charles
Kennedy and other top administrators, continue to make annual salaries of $1 million, $ 410, 000, $314, 000 and
$ 260, 000 while those who work for them either face layoffs and income freezes.

Furthermore, as Standard&Poor (the bond rater for UW) puts it, UW has “a healthy endowment with an
estimated market value of $1.5 billion as of March 31, 2009.” 16 Last year when we were fighting budget cuts we
consistently pressured the administration to use the “rainy day fund,” or the endowment to help lessen the
budget shortfall, but to no avail. We describe below why it is important for the UW to pressure students to pay
more in tuition, rather than seek alternatives. This relates to the bond market and the investors. Welcome to UW-
Wall Street.

MYTH NUMBER THREE:

The UW administration is reluctant to raise tuition and student fees. They have no other choice.


REALITY CHECK:
The UW administration borrows money to fund its construction projects through the sale of UW bonds. These
buildings are not necessarily tied to instruction. For example, Ben Hall, a new building at the UW is rented out to
researchers in the region, with no direct relationship to tuition-paying undergraduates. According to the UW, the
university “issued general revenue bonds to finance the building and most of the tenant-requested
improvements. These bonds will be repaid largely through revenue generated by research grants.” 17

Bonds are sold to various financial institutions. When UW sells a bond, it is borrowing money from the financial
institutions. Bond raters such as Moody’s and Standard & Poor rate the UW bonds and decide what interest rate
the university has to pay for such loans. A higher rating results in a lower interest rate. One may argue that the
desire for a low interest rate in the bond rater’s eyes, as opposed to ensuring quality of education and access, is
what drives the university’s decisions. One of the criteria for a low interest rate though, is a guarantee of
increased revenue or income. As we will explain below, this increased revenue explains the tuition hikes and
limited access of the university toward a more elitist consumer base.

In addition, this loan is accompanied by collateral. The UW pledges collateral to the borrower against a risk of
default. This concept is the same as in a mortgage loan transaction. For example, in many situations, the house
that you are buying becomes the collateral for the mortgage loan that you take out. When you fail to pay the
mortgage for the house, the bank takes away your home in what is called a foreclosure. Similarly, when UW puts
your student amenities fees and housing and food services money as collateral to borrow money for a
construction project, this means that the lenders will own all of this money if the university defaults in its loan
payment. We will show that this is exactly what the UW is doing, and it explains the mandatory dine-in plan at
Housing and Food Services. 18


15                                                                                                        th
   Nick Perry, “UW braces for 600 layoffs, deeper state cuts could mean 800 lost jobs” Seattle Times, Feb 10 2009
http://seattletimes.nwsource.com/html/education/2008726887_uwcuts10m.html
16
   Standard and Poor, “University of Washington; Lease; Public Coll/Univ/Unlimited Student Fees”
http://f2.washington.edu/treasury/sites/default/files/S&PReport2009GRB.pdf
17
  University of Washington, Resources for Business and Resources
http://www.washington.edu/research/industry/newsletter/0907insidestory.html
18                                                   th
   Natalie Johnson, “Why Dine In?” The Daily, Feb 25 2010


                                                             6
http://dailyuw.com/2010/2/25/why-dine/
What is most pressing about this issue is that the UW needs to guarantee to the bond raters that it is able to
increase its revenue over time. This guarantee is placed on our backs as students and workers in this community.
This guarantee is based on assuring that UW becomes an elitist institution where more students can pay these
fees. Over time we will be able to enter UW only if we take out hefty student loans, or if we come from rich
families.

The title of the Standard & Poor’s rating of UW is literally: UNLIMITED STUDENT FEES. 19 This means that the UW is
able to get an AA1 rating from S&P because it guarantees that it can extract unlimited student fees from us. What
more clearly shows the administration’s vision for the future?

In fact, the UW publicizes how well of a job it has done in extracting more student fees from us. In its Offering
Statement to future investors, the UW states that from 2004 to 2008, the amount students have paid for student
fees have increased by 38%. In this same time period, tuition has also increased by 38%. 20

Here are some excerpts from UW’s financial statements. It does seem like the UW is more honest to its investors
than it is to us, the community that pays for its existence. To us they yell “financial crisis! We need to make cuts!”
But then they turn around and tell the bond raters UW is financially thriving and well-endowed. In fact, the Board
of Regents and Mark Emmert explicitly specify that “investors should not rely on information presented on the
University’s website.” 21 We get propaganda of drastic budget cuts, while they get the inside scope of a financially
healthy UW.

The UW prioritizes the following construction projects over and above the money that could be going toward
classroom instruction. The interests on the loans taken out to fund these projects are from our tuition and
student fees, yet we do not actually benefit from the construction of several of these buildings. 22

         Series 2009A bond proceeds will be used to fund a variety of capital projects, including renovations to the
         Health Sciences Building, development of PACCAR Hall, development of the WDS foundation Building for
         Early Childhood Oral Health, University Tower tenant improvements, expansion of the University Medical
         Center, development of the West Campus Garage, renovations of the Husky Union Building, and
         implementation of the Housing and Food Services master capital plan. 23 [Emphasis ours]

We find the emphasis on these construction projects particularly suspect. The University Tower is an
administrative building. In the midst of economic crisis, and devastating budget cuts, why does the university
administration think it appropriate to renovate the UW Tower? We wonder, which offices are receiving
renovations and why? Incidentally, the 22-storey UW Tower is cleaned by only 4 custodians who are severely
overworked. Rather than putting money toward hiring more custodians, who are burdened with heavy workloads,
the administration instead chooses to focus on “tenant improvements.”

One may wonder why money is going toward the West Campus garage, as well as the Housing and Food Services
master capital plan. This is when the discussion of collateral comes in useful.


19
   Standard and Poor, “University of Washington; Lease; Public Coll/Univ/Unlimited Student Fees”
http://f2.washington.edu/treasury/sites/default/files/S&PReport2009GRB.pdf
20
   Ibid pg 8
21
   Ibid page 2
22
   ibid
“Payments will be made from UW general revenues, which are composed of all non-appropriated revenue excluding
appropriations, grant direct costs, restricted gifts, and some fees. General revenue totaled more than $806 million in fiscal
2008, including student tuition and fees ($365.9 million), grant indirect cost recovery ($197 million), sales and services
revenue ($111 million), and investment income ($76 million).”


                                                               7
23
   Ibid page 4
Like we mentioned above, the university administration borrows money by selling off its bonds to various
financial institutions. For these loans to acquire a low interest rate, the university administration needs to put
down certain things as collateral.

In the Moody’s bond rating report, these are some examples of what the UW put down as collateral:

     -   Student Facilities Fee Revenue Bonds are secured by a mandatory student fee charged to all full and part-
         time students for student services; the bonds have a first claim on those revenues before inclusion in the
         General Revenues pledge. For FY 2008, pledged revenues were $15.4 million providing 4.5 times debt
         service coverage.

     -   Parking System Bonds are secured by the net revenues of the parking system and have a first claim on
         those revenues before inclusion in the General Revenues pledge. For FY 2008, pledged revenues totaled
         $9.2 million and provided coverage of 6.9 times.

     -   Housing and Dining Revenue Bonds are secured by a pledge of the net revenues of the housing and dining
         and have a first claim on those revenues before inclusion in the General Revenues pledge. 24

A recent article in The Daily, “Why dine in?” points out that there is a 2.5% increase in the cost of campus dining
plans. According to the article, “many dorm residents raised questions regarding why residents are required to
purchase a meal plan, and whether HFS could ever have a dining-optional policy.” 25

The findings from the Moody’s bond rating suggest why the HFS costs will never be optional. The administration
might tell us that it is because of ever increasing cost of production. However, it is more likely that the increasing
revenue the university administration gains from HFS goes toward ensuring that 1) Bond buyers have a guarantee
that the UW collateral is worth hard cash and 2) that the UW continues to increase its overall revenue, so that the
loans remain cheap, and the debt serviceable.

Our tuition goes toward construction projects that increase revenue for the university, that helps it get cheap
loans. Yet it is clear from the cuts we face in our classrooms and TAs, that none, if very little of this revenue goes
toward instruction. How else can we explain the recent news that the UW is prioritizing the expansion of a UW
bookstore downtown, or increased renovations to Rick’s Café, over retaining Teaching Assistants, or keeping our
tuition affordable? 26 In the midst of a budget shortfall where our tuition hikes are justified by cuts in instruction, it
forces us to think twice about what the administration uses to justify tuition hikes.

We have to understand that the conflicting statements given by the administration -- of need and then no need
for more money, is closely tied to the profit-generating mission of the university. To its bondholders and
financiers, the UW presents a confident financial outlook. This is largely based on it guaranteeing that it can raise
revenue. To us and the general public, the UW claims that it is short of money. This is needed to JUSTIFY the
tuition hikes for us. The conflicting attitudes given by the university can only be understood when one begins to
see that this is a profit making institution that needs to ensure a return to its investors. We are merely the
commodities and consumers that they can endlessly extract more, and more profit out of.

24
   Moody’s Investors Service, “University of Washington,WA”
http://f2.washington.edu/treasury/sites/default/files/MoodysReport2009GRB.pdf
25                                                     th
   Natalie Johnson, “Why Dine In?” The Daily, Feb 25 2010
http://dailyuw.com/2010/2/25/why-dine/
26                                                          st
   Natalie Johnson, “A bit of a facelift” The Daily, March 1 2010
http://dailyuw.com/2010/3/1/little-bit-facelift/
                                                                                       th
Kevin Wong, “Husky Central bookstore branch downtown plans expansion” The Daily, Feb 26 2010
http://dailyuw.com/2010/2/26/husky-central-bookstore-branch-downtown-plans-expa/


                                                            8
That the university administration can unabashedly guarantees to its bondholders that it will be able to raise
student amenities fees, and various expenses linked to the university community’s expenses, also says a lot about
the administration’s conception of student and workers movements on campus. They, more than us, know that
they can divide us with their rhetoric and their technicalities. This is a challenge we need to overcome before we
all get screwed. That is why we are publishing this long and complex document. We still need rousing speeches
and protests but we also need an intelligent strategy that is just as precise and aggressive as theirs. We hope this
document will contribute to discussions among workers and students about how to build this strategy.

If we fail to fight back we will pay with increasing student loans and less instruction. We will pay to make this an
elite university affordable only for rich, elite, predominantly white youth. They will be the ones who benefit from
the construction projects, the branding, the country-club experience of the future UW. Once again, history will
repeats itself with its cruel irony: We foot the bill for their luxuries. We cannot let this happen.

MYTH NUMBER FOUR:
High tuition high aid model is the best way to mitigate the budget crisis. See, the administration cares
about the admissions of students of color.

REALITY CHECK:
[The following is reprinted from the Student Liberation Front public statement from Feb 14, 2010]

Low tuition and high aid in the form of need-based grants are NOT incompatible. In fact, both are necessary to
keep UW truly accessible and public. Calling for one but not the other will only push low-income students, students
of color, women, queer folks, and students with disabilities out of the university; effectively transforming UW into
a whiter, elitist institution for the wealthy.

President Emmert has justified his move towards higher tuition by promising higher financial aid for low-income
students through grant programs like the Husky Promise. This high tuition/high aid model is a failed strategy to
bring in more low-income youth in both the short and long-term. In their seminal research report entitled "Losing
by Degrees," the Economic Opportunity Institute showed that universities across the nation that have adopted this
model have resulted in significant REDUCTIONS, not increases, of enrollment by low-income students and students
of color. At the University of Michigan-Ann Arbor (UM), enrollment of freshmen from households earning less than
$75,000 dropped from 34.6% in 1997 to 26.6% in 2007; enrollment of black students decreased from 8.4% in 1999
to 6.7% in 2008. Predicting that the same may happen at UW in the short-term, perhaps this is why
Emmert has already hit the road promoting the Husky Promise.

In the long-term, the high aid in the form of grants will likely drop, leaving only a high tuition model in place. We
already see this trend happening with Governor Gregoire's first draft of the 2010 supplemental budget, which cut
the State Need-Based Grant program by $146.4 million, causing 12,300 students to lose their grants. By his own
admission of Gregoire's budget, Emmert wrote that "the 7,000 students [currently on the Husky Promise] would be
unable to continue." Emmert has provided no solution to keeping the Husky Promise and need-based grants
outside blaming Olympia; meanwhile, tuition of in-state residents will be increasing at least 28% this year and next
combined, and Emmert is pushing to see the Kilmer Bill passed so that the Board of Regents have
full tuition setting ability, a euphemism for unrestricted control to hike up tuition far beyond this 28%. Why has
Emmert devoted so much effort to hike up tuition through Olympia but not to preserve need-based grants?

This riddle could be solved simply by looking at the unwritten premise behind the Husky Promise and the high

                                                          9
tuition/high aid model. On paper, the Husky Promise is a "guarantee to Washington state students that we will not
let financial challenges stand in the way of...achieving a UW degree." This sugar coated Promise was strategic in
convincing low-income students that they could still access the university and projecting Emmert as a friend to
working-class families, while deeper changes of privatization of the university could simultaneously occur
unnoticed. Three years later amid a state budget crisis, Emmert's call for higher tuition instead of lower tuition and
more grants is revealing not only the priorities of the Regents, but also the initial underlying purpose behind the
Husky Promise: privatization via tuition hikes for students.

Privatization essentially means less state input and more corporate control over UW, as evidenced by the Regents
sitting on the boards of various big businesses. By increasing tuition and student services fees, the Regents have a
secure source of money outside state funding that can be freely used to fund corporate projects and priorities and
to leverage further investment. This explains why workers have been easily cut, at the same time that construction
of new facilities and labs are occurring, so long as the Regents believe the latter is profit-generating. We are
witnessing a wholesale deprioritization of education at UW (layoffs of workers who maintain classrooms,
increased class sizes) and a shift to profit-generating activities such as research. If Emmert believes that education
is public and a priority of UW, then he would have pushed for low tuition and increased grant aid for low-income
students.

The UW Student Liberation Front is demanding low tuition and increased financial aid in the form of grants. We
are fighting for the preservation of the Husky Promise, and re-envisioning it not as a means to increase tuition, as
Emmert wants, but as an ends because low-income students have a right to higher education.


            Money for War, not for Education in the Privatized University
As the economic crisis deepens, youth of color and low-income folks are being channeled from jobs into the
military. At the UW, with decreasing access to grants and loans, and increased tuition, Reserve Officer Training
Corp (ROTC) and military enlistment are pushed by counselors and some faculty as legitimate ways for students to
pay for their educations. External funding for research, which covers materials, staff salaries, and some grants is
at $58 million from the Department of Defense in 2009. This is a $17 million dollar, or 14%, increase from 2006. 27
At the same time, relationships between the CIA, Homeland Security, private military contractors, and the
University become tighter as the University relies increasingly on federal, militarized support for instruction costs.

The examples below demonstrate the relationship between academic departments at UW and the CIA and
Homeland Security:

     •   The Institute for National Security Education and Research (INSER) is a center at UW financed by the office
         of the Director of National Intelligence (ODNI). The ODNI is the umbrella organization for the Department
         of Homeland Security, CIA, and US Marine Corps. The UW-based INSER program resides in the
         Information school.

     •   Tim Thomas, a CIA Agent specializing in “data mining” teaches classes on campus.

     •   In 2010, only a few awards were available for students in Near Eastern Language and Civilization; one of
         those was offered by INSER. This grant provides up to $4,000/quarter for graduate students and
         undergrads to live in a Middle Eastern country. 28

27
   University of Washington, Annual Report 2009 of awards and expenditures related to research, training, fellowships, and
other sponsored programs
http://www.washington.edu/research/.SITEPARTS/.documents/.reportsAnnual/08Annual_Report_-_Fiscal_Year_2009.pdf
28
   University of Washington, The Jackson School of International Studies, Funding for Graduates


                                                            10
http://jsis.washington.edu/religion/graduates/funding.shtml
    •   At a time when custodians and TAs, some of the lowest paid staff on campus, are facing layoffs, and there
        is a hiring freeze on tenured faculty in many departments, INSER at UW is hiring a new researcher to work
        directly under the Officer of the Director of National Intelligence.29

    •    As graduating students face a vacant job market, the university allows CIA recruitment on campus ,
        suggesting it is a legitimate job option. While academic departments such as Disability Studies, drama,
        and social/cultural anthropology face severe cuts (with the latter two not accepting new graduate
        students), the ROTC building is getting a facelift. 30

    •   In 2003, UW launched a program aimed at “developing leaders specialized in homeland security issues,”
        called the Masters in Strategic Planning for Critical Infrastructures. This was designed by the UW
        Department of Urban Design and Planning, with collaboration by the UW School of Public Health, and in
        partnership with the Washington State National Guard. 31


    •   On February 10, 2010, the University announced that it was hiring a police offer with experience doing
        homeland security work to work at UWPD. We know that UWPD collaborates with Homeland Security
        because an officer assigned to surveil us when we protested Secretary of Defense Robert Gates’ speech
        on campus identified himself as affiliated with Homeland Security. 32 Many of us do not feel safe with this
        increased presence of intelligence officers on campus. Will they try to crack down on protests against
        worker abuses and budget cuts by claiming they are fighting “terrorism”? This fall, two Democracy
        Insurgent members were interviewing immigrant custodians during their break to investigate alleged
        abuses they were facing so we could expose these abuses in a public statement like this one. Our
        members, both women of color, were arrested after doing these interviews, and one of the police officers
        asked “how do we know you are not terrorists?” These kinds of McCarthyist-style intimidation tactics are
        not welcome on our campus. And given what we are up against, fear is not an option. Our members
        were able to avoid getting charged by exposing the arrests through public protests and pickets. This
        shows their tactics are not invincible.

    •   Meanwhile, custodians, majority of whom are immigrants, are receiving mandatory "workplace
        communications training" provided by Phoenix Consulting. Phoenix is part of Dyncorp, a private military
        contracting company that is directly invested in the continuing wars in the Middle East, and occupations
        in Latin America, the US-Mexico border, and East Asia. In summer of 2009, Phoenix received an exclusive
        contract with UW Facilities Services at the price of $28,000. According to Phoenix/Dyncorp's own
        website, their current clients include the CIA, Special Operations, US Army, US Department of Defense, US
        Special Command in Europe, and other intelligence and military branches. Dyncorp has been responsible
        for training militarized police in PLAN Colombia, and also was accused of using their armored vehicles to
        participate in sexualized slavery in the Middle East. 33




29NW   Jobs http://jobs.nwsource.com/careers/jobsearch/detail/jobId/23361727/viewType/rss?rssref=&cmpid=2525 Accessed
         st

30University of Washington, Capitol Projects http://www.cpo.washington.edu/html/Sustain_Clark.htm
March 1 2010

31 http://dailyuw.com/2003/6/24/uw-to-offer-homeland-security-degree/

University of Washington, Strategic Planning for Critical Infrastructure,
http://www.outreach.washington.edu/mspci/curriculum/
32                                                                        th
   Lexie Krell, “UW Swears in new deputy police chief” The Daily, Feb 10 2010,
www.http://dailyuw.com/2010/2/10/uwpd-swears-new-deputy-chief/


                                                         11
33
   CorpWatch, Dyncorp http://www.corpwatch.org/section.php?id=18
As privatization continues, there will likely be an increased reliance on military funding sources for instructional
purposes. As discussed above, revenue generated from increasingly high tuition rates and student fees will likely
be channeled into construction and research-related expenses, which also include hefty administration salaries.
As a result, funding through grants that are earmarked or catered to instruction will be sought by the university
administration. The military funds are one such example. With the invitation of Robert Gates, Secretary of
Defense the overseer of three wars in the Middle East, as the commencement speaker for the 2009 graduating
class, the UW is clearly orienting itself closely with the warmongers, echoing a national political trend in the
country that prioritizes wars and the military over education and healthcare.

True to his business origins, Mark Emmert said in an interview that the university will shift to a much more
market-driven model than it has in the past. With the 2.8% state cuts to the UW budget, Emmert says that the
UW will need to focus on the academic programs that bring in the most money to the university. 34

What better business than military business when war is profit?

For students of color, women, working class students, and many others, the consequences are clear: our histories
of resistance, in the labor struggles and liberation struggles we have fought, will be erased from the education
that we take hefty loans out to pay for. We will lose the stories that have given our people dignity and strength to
weather the storm. Instead, the dominant narratives of us being the white man’s burden, or the terrorist, or the
irrational mad woman, will take on more power as we see ourselves only through the eyes of the racists and
patriarchs; our families will be criminalized and negated by a US nationalist and imperialist revisionism; our bodies
will also be in the line of fire, when we increasingly exchange education and/or citizenship for the military.

Upholders of white supremacy in our generation will confuse us with numbers that we do not comprehend. They
are trying to do this here at UW. We are paying for what will not benefit us or future students like us. We are
paying to make the UW a more elitist campus for only the white and the wealthy. We are funding our own
expulsion from this university campus.

We need to fight this now. At the March 4th Student Strike, many of us skipped class so that we can attend classes
next year. Instead of dropping out, we are walking out! We are coming together to let the administration know
that their Wall Street lifestyles and investment habits will not fly, not on our backs! We demand a democratic and
accessible UW! We are joining students and workers across the country and around the world who refuse to be
bamboozled, who are beginning to rise up and build a movement against the re-segregation of higher
education. Let’s makes sure that one day our children’s generation can speak up in UW classrooms with pride
because they will be learning about how we won this fight.




            Democracy Insurgent is a majority people of color activist group animated by principles of democracy,
     anti-racism, anti-imperialism, queer liberation, Third World Feminism, and workers' power. We are based in Seattle,
                                                          Washington.

                               We are a member group of the UW Student Worker Coalition.
                  Find out more at www.nobudgetcutsuw.blogspot.com and www.democracyinsurgent.org
                                           Contact us at d.insurg@gmail.com


34                                                                            th
  Nick Eaton, “”UW to borrow from private financial model” Seattle PI, April 30 2009


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http://www.seattlepi.com/local/405696_uw30.html

				
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