Austerity vs. Investment

in U-M Students, Faculty and Staff

This is an edited version of a longer statement made by UM’s All Campus Labor Council, June 19th, 2020.

UM-Flint Chancellor demands the College of Arts & Sciences cut budgets by 10% resulting in 120 full and partial Lecturers layoffs, class cancellations including some in which students were already enrolled, an even more severe starvation situation on a campus already financially cut to the bone.

UM-Dearborn Chancellor demands departments cut budgets, further reducing resources for faculty, staff, and students on a campus also already suffering under severe austerity measures.

UM continues to reject the One University Campaign’s proposal to invest $10 million per year each in student resources on the Flint and Dearborn campuses including the Go Blue Guarantee, student scholarships, DEI funding, medical and legal resources, and more. (President Schlissel announced at the June Regents Mtg $10 million total to be split between the two campuses at the discretion of the chancellors)

Michigan Medicine has threatened to eliminate employer contributions to non-union employee retirement accounts.

1400 Michigan Medicine lays off and freezes raises for all UM non-union workers (some 30,000 employees), without regard to the income of those employees.

President Schlissel and the UM Regents continue to refuse to invest enough in Flint and Dearborn. Further cuts hurt these campuses the most especially since they have more local Michigan residents, working-class, and students of color.

Austerity:

Undermines the capacity to fulfill a core part of the public university mission to increase educational opportunities for Michigan residents.

Reinforces harm done disproportionately to working families and people of color by the COVID health and economic crises.

Inflicts harm unnecessarily.

EMU Professor Howard Bunsis, an expert on university finances, finds that in the worst case scenario UM will lose up to $690 million, a small amount compared to the size of U-M’s unrestricted reserves:

Myths vs Realities:

Investment:

Because The University of Michigan has access to $6.7 billion in unrestricted reserves it should use this to invest in students, employees and the community rather than continuing to cut resources for those most in need.

→ Dollars taken from the endowment and spent now can yield future returns, especially if those are used to offer more Michigan residents a UM education by improving program quality and student support structures in Flint and Dearborn, that is an investment with many pay-offs, including:

Increased incomes that Michiganders earn because they get higher paying jobs
More graduates staying to work in Michigan and investing in our state economy
Reduced economic and social inequalities throughout the southeast Michigan region and beyond
Increased intellectual capacity for critical engagement with the challenges of our times and building for a sustainable and equitable future

→ During an economic recession, when private sector investment plummets, the public sector should invest even more than it would in good times to offset the decline. New Deal public works projects during the Great Depression yielded long-lasting infrastructure and reduced unemployment and poverty.

→ UM leaders have embraced austerity rather than using the resources available to them to make smart and equitable investments in our students, faculty, employees, and our campus communities. In order to approve the FY 2021 budget at their July 16th meeting, the UM Regents must demand that President Schlissel:

Fund the policies proposed by the 1U campaign for the students of UM-Flint and UM-Dearborn as outlined in the Leaders and Best Without Exception Report
Reverse the budget cuts in Flint and Dearborn, rehire laid off Lecturers across all three campuses, and commit to investing in all UM campuses instead of allowing them to survive only on subsistence fundings, or less.

Click HERE to view the full ACLC statement from June 19th, 2020

Click HERE to view the June 25th Board of Regents Meeting

Click HERE for videos clips of Prof. Bunsis’s May 28th presentation the ACLC