At UVA, Billionaire Donors Plot Corporate Takeover

I have a feeling we're just seeing the tip of the iceberg in this story. Just as billionaires are playing for a corporate takeover of K-12 education, so too are they making a bid for public universities. As state funds for universities grow scarce, universities are forced to turn to private donors for help, which opens the door for those private donors to assume control of university leadership.

So it was that a week ago Sunday, University of Virginia President Teresa Sullivan was informed by the UVA head of the Board of Visitors (what we might know better as a Board of Trustees or Regents) that she could quit or be fired. This decision was made without even so much as a meeting of the entire board. Instead, a backchannel whisper campaign took on a life of its own, and when the head of the Board, Helen Dragas, had gained agreement among key board members, she made her move.

Here's an insider's view, via Slate:

In the 21st century, robber barons try to usurp control of established public universities to impose their will via comical management jargon and massive application of ego and hubris. At least that’s what’s been happening at one of the oldest public universities in the United States—Thomas Jefferson’s dream come true, the University of Virginia.

On Thursday night, a hedge fund billionaire, self-styled intellectual, “radical moderate,” philanthropist, former Goldman Sachs partner, and general bon vivant named Peter Kiernan resigned abruptly from the foundation board of the Darden School of Business at the University of Virginia. He had embarrassed himself by writing an email claiming to have engineered the dismissal of the university president, Teresa Sullivan, ousted by a surprise vote a few days earlier.

Peter Kiernan is one of those Goldman Sachs hedge fund spawned billionaires who knows exactly what we need to do to "fix" everything that ails this country. He generously shares his knowledge with the world in a book entitled "Becoming China's Bitch (And Nine More Catastrophes We Must Avoid Right Now)" Kiernan was one of President Obama's 2008 donors, but in this cycle he has cozied up to Mitt Romney, presumably because the Obama administration has not been kind enough to the capitalists of the world. Go figure. He writes blog posts telling the President that Cory Booker did him a favor, and claims that our biggest problem is divisive politics, which he blames entirely on Democrats and progressives who just don't love money enough.

He is also a guy who either doesn't understand what happens when you hit "Reply All" on an email, or was just too arrogant to care. Via Brian Leiter:

The e-mail, which Mr. Kiernan sent to fellow Darden board members, suggested Ms. Sullivan's resignation would usher in a fast-paced series of unspecified changes.

"The decision of the Board of Visitors to move in another direction stems from their concern that the governance of the university was not sufficiently tuned to the dramatic changes we all face: funding, Internet, technology advances, the new economic model," Mr. Kiernan wrote in the e-mail, which was published in several Virginia newspapers. " These are matters for strategic dynamism rather than strategic planning."

Teresa Sullivan had just finished her second year as UVA's President. As the Slate article explains, her first year had been spent getting a staff in place and her second year had been spent reorganizing the school, streamlining the budget, and doing it by bringing all of the parties to the table and talking through the different options. She had also written a long strategic memo outlining areas where she felt the university had to improve. Not surprisingly, those areas did not align with the concept of "strategic dynamism". Via ACTA:

And in a frank 12-page strategic memo last month, Sullivan laid out the university's fundamental academic weakness. U-Va. has a peerless reputation for undergraduate study, she wrote, but its graduate programs and research endeavors suffer from a "reputation gap." Some vaunted doctoral programs don't actually rank very high, and others are buoyed by a few star faculty.

Last month, the board adopted an operating budget that included substantial language culled from Sullivan's strategy document, although most did not know it came from her memo. Yet, after Sullivan's ouster, Dragas chided the president for lacking a "credible statement of strategic direction."

Also not surprisingly, Board leader Helen Dragas already had Sullivan's replacement in mind: Johns Hopkins CEO Edward Miller. Miller, of course, is well-connected through philanthropic organizations to many billionaire barons. Have a look at Businessweek's list here.

As Slate's article explains, "strategic dynamism" is just another word for "bend over to the billionaires."

Strategic dynamism, or, as it is more commonly called, “strategic dynamics,” seems to be a method of continually altering one's short-term targets and resource allocation depending on relative changes in environment, the costs of inputs, and the price you can charge for outputs. In management it means using dynamic graphs to track goals and outcomes over time, and having the ways and the will to shift resources to satisfy general goals via many consecutive short-term targets. Most management textbooks offer equations one may use to dynamically chart and execute strategy. And for all I know it makes a lot of sense.

Consider sailing, which one might do if one is a hedge fund billionaire from Connecticut. In sailing one sets a general course to a distant target but tacks and shifts depending on the particular environmental changes. I understand why “dynamic” is better than “static.” Who wants a static sailboat? But is a university, teeming with research, young people, ideas, arguments, poems, preachers, and way too much Adderall ever in danger of being static?

The inappropriateness of applying concepts designed for firms and sailboats to a massive and contemplative institution as a university should be clear to anyone who does not run a hedge fund or make too much money. To execute anything like strategic dynamism, one must be able to order people to do things, make quick decisions from the top down, and have a constant view of a wide array of variables. It helps if you understand what counts as an input and an output. Universities have multiple inputs and uncountable and unpredictable outputs. And that’s how we like them.

Indeed. And is that just corporate doublespeak for the real reason, which is that a conservative Board leader (Dragas) didn't see Sullivan as conservative enough, and actually viewed the UVA as ripe for corporate takeover? It's entirely possible.

Via The Hook:

While the Hook's sources downplay any planned privatization by Goldman Sachs, there's no question that Jones and Kiernan favor the idea of applying business principles to education. A year ago, the two helped launch the New York arm of StudentsFirst, the advocacy organization that openly embraces such reforms as eliminating teacher tenure, pushing merit pay, and supporting charter schools. Some of its officials have advocated outright privatization.

When money talks, talent walks. Or gets pushed out the door. Either way, Ms. Sullivan's parting words to the Board today are a portent of UVA's future, via the New York Times:

“Trust does not mean an absence of disagreement,” said Dr. Sullivan, who friends said had been blindsided by the call for her to leave. “But it requires that disagreements be frankly discussed. No matter how accomplished he or she may be, a president cannot read minds. When you choose a new president, tell him or her what you are thinking.”

She said she had not stoked the angry reaction to her removal, but she warned that it would have consequences. “Deans and provosts at every peer institution are setting aside funds now to raid the University of Virginia next year given the current turmoil on our campus,” she said.

It also remains to be seen as to whether the new UVA President will countenance use of the term "vagina." Or allow birth control to be provided free to students. Beware. Change is coming.


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