University of Michigan doesn't always act in the best interest of the state and nation under its current corporate governance model
I would like to respond to the Sept. 12 guest column written by Michael Boulus, executive director of the Presidents Council, State Universities of Michigan, titled “Entrepreneurial autonomy better than bureaucratic system to manage Michigan's universities,” in which he argues against more centralized governance of state universities.
First, you should keep in mind that this column is written by the chief lobbyist for Michigan universities. Second, the word “corporate” should be substituted for the word “entrepreneurial” because that is the structure we really have had for the last 20 years at the University of Michigan (since President Bollinger). This is in contrast to the “shared governance” academic model that built this great university.
The shared governance model gives the faculty and to some degree students a substantial voice in the major decisions of the university. Corporate governance gives nearly all decision making power to the administration, often with a “captive board” that only listens to the wishes of the university president.
An example of how the corporate structure has replaced the shared governance structure is what the U-M refers to as the “rule of two” in the election of each colleges executive committees, which are supposed to advise the deans on major decisions. The U-M administration made a rule that, in all such elections, the faculty must forward the two top vote-getters to the dean and he will pick which of the two will sit on the executive committee. This way the dean can keep faculty members off the committee who he does not like and who might give him advice he does not want to hear. In addition, all executive committees are advisory and the dean can ignore any advice he doesn’t like.
The U-M administration has also consolidated its power by stripping away grievance rights (almost no faculty member has ever won in a grievance). Yet the university has paid many millions of dollars in settlements, court verdicts and legal fees for faculty and students who were wrongfully terminated. Every million dollars paid in settlements costs the students $80 in tuition. The administration uses its own police force to intimidate and occasionally arrest faculty and students on false allegations that they are “threatening.”
The U-M police do exactly what they are told to do, without any independent investigation, because the U-M administration has made sure that the Department of Public Safety Oversight Committee is toothless.
U-M Board of Regents nominations must be made by the political parties and it cost about $50,000 in contributions to the Democrat or Republican parties to buy a nomination. Each member of the board has a vested business interest for being on the board so they do not want to rock the boat. Thus, they are largely a captive board, doing what they are told by President Coleman.
Mr. Boulus points to the acquisition of the Pfizer property as a great accomplishment by U-M that would not have occurred if the decision were made by a centralized Board of Education. In fact, if U-M was seen by Pfizer as an important strategic partner, helping them develop new products, they would not have left, even if they had to pay high corporate and property taxes. U-M President Coleman coveted the Pfizer property, so she had no interest in keeping them in Ann Arbor. That property will never bring as many jobs to Michigan under the university’s direction as were lost with Pfizer’s departure.
Speaking of jobs, U-M has been a huge source of technology transfer to China that has transferred jobs to China and rapidly improved their military power. U-M graduates and visiting scientists have given China, anti-satellite technology, nose cone technology (for their ballistic missiles), B-1 bomber technology, neutron bomb technology, etc, etc.
President Coleman proudly wrote in Forbes magazine “the University of Michigan enrolls more Chinese students than any other American university.” That includes more than 1,300 students and visiting scientist in the College of Engineering alone. Those Chinese students replace American students, decreasing the opportunities for American students to get U-M degrees in engineering. Those potential American engineers could start companies or strengthen companies in Michigan or America.
The newest agreements that U-M has made with Shanghai Jiao Tong University allow for Michigan inventions to be commercialized by Chinese companies. The choice will be entirely up to U-M officials without anyone looking out for the interest of Michigan or America.
This lobbyist dismisses increased tuition at U-M as being due to the lack of state appropriations but that is really a minor force behind rising tuition. Tuition has risen 60 percent since 2002, nearly three times the rate of inflation. State support in 2002 was $351 million and it was cut to $310 million in 2003, but it is still $310 million today (that is the state appropriation but there are other sources of state support since the U-M budget report says that support last year from the state was $374 million). The real driving force is the general fund budget that has risen at a rate of 40 percent since 2002.
The major components of the general fund are salaries and capital expenses. Most faculty and staff will tell you that their raises barely keep up with inflation, so the increases in the salary component of the general fund are driven by increases in the salaries of the university’s highest paid employees.
The university “saved” money this year by shifting some of the cost of health insurance to employees by increasing the employee contribution from 20/80 to 30/70 (a tax most heavily felt by the lowest paid employees). There are also discussions underway to reduce healthcare benefits to retired employees.
At the same time that tuition has been rising, the national ranking of U-M has fallen since 2002 from 24th to 29th in the U.S. News & World Report survey and U-M is not even ranked in the top 25 most desirable universities in the Newsweek rankings.
Centralized Boards can also have their problems but given the existing problems, I think that the example set by world class California universities like Berkeley, UCLA, Cal and USC, which operate under a central board, are not bad.
Dr. Douglas M. Smith is a former (2006-2009) professor in the College of Medicine, Department of Pathology at the University of Michigan, where he was director of the Clinical Histocompatibility Laboratory. His former former appointments have been at the University of Nebraska, University of Oklahoma, and Baylor University Medical Center. He lives in Pittsfield Township.