It’s your job to be less confused than Nigel

The University of Arizona has gotten itself into a remarkable financial mess — or, to put that in less animistic terms, the “campus leadership” at the University of Arizona has screwed up the budget in an apparently monumental way. (BTW a topic for a separate post is the cult of “leadership” which has infected higher ed. Every provost and chancellor now thinks he’s Napoleon or Patton, or at least the CEO of McKinsey, which is where I suspect this kind of nonsense originates, via the Harvard Business School etc.)

The details, such as they are:

The University of Arizona’s president said this week that the institution has a “major problem” with its finances — a rare pronouncement from a major research university.

The main problem, according to Robert C. Robbins, the president, is that Arizona has $240 million less in cash on hand than officials calculated this past summer.

How in the hell do you misplace $240 million? That’s like 12% of the institution’s entire annual operating budget!

In June the university reported to the Arizona Board of Regents that it expected to have 156 days of cash on hand, amounting to about $6 million per day. In October officials realized their financial model had “miscalculated” the projection. . . .

“I was as surprised as all of you to learn that we didn’t have 156 days’ cash on hand,” Robbins said at a Faculty Senate meeting. “I didn’t realize that our savings account dipped to this level.”

This is not a rhetorical question: What do these people do all day? Isn’t it your job, Mr. One Million Dollar a Year Man Who Does Not Teach or Research, to “realize” this kind of thing?

Robbins cited two major problem areas: the athletics department and financial aid.

During the Covid pandemic, the university lent $55 million to the athletics department, using money from cash on hand. The loan has not been paid back fast enough, Robbins said. . . .

Now the athletics department “is going to require some draconian cuts, and we’re just going to have to live with that,” Robbins said. It’s possible Arizona will eliminate some of its 23 sports programs.

In addition, Robbins said, the university has been losing money from its generous financial-aid policies. It costs around $20,000 a year to educate each student, but in-state students pay an average of $5,000, Robbins said. And students with high-school grade-point averages above 3.75 pay nothing.

“We lose money on everyone,” he said. “I have not really understood that as well as I should have.”

Oh for Christ’s sake. This is:

(a) The most basic math imaginable; and

(b) YOUR JOB.

I’m trying to find an analogy here. How is this not like a faculty member saying “I am supposed to show up to teach my scheduled classes. I have not really understood that as well as I should have.” Or “I am not supposed to spend my grant money on a ski vacation to Gstaad. I have not really understood that as well as I should have.”

And check this out: Robbins has been the president of the University of Arizona for THE LAST TWENTY-ONE YEARS! Slow learner I guess. Edit: Actually only six and a half years. I regret this terribly unfair snark. Also too, he’s a surgeon by training, who was the CEO of a hospital before his current job.

Speaking of which, right here at the University of Colorado, another flagship research university in the soon to be defunct PAC 12 with a wildly undercapitalized athletic department, we had our own little unpleasantness last fall, when “campus leadership” discovered that $120 million in endowment gains that had already been committed to pay for various university projects had “somehow” not actually been realized, because “someone” forgot to take the money out of the market! And you’ll never guess what happened next: The market went down, the $120 million went to money heaven, and suddenly $120 million in financial commitments no longer featured $120 million to pay for said commitments.

Exactly ONE person lost his job over this, while to this day the faculty has been given no explanation from “campus leadership” about how this happened.

When these people talk about how universities should be run like businesses, apparently their model is Enron, or maybe Bernie Madoff.