UC Berkeley: High Finance, Athletics, and Debt

UC Berkeley's current effort to finance and build a new state-of-the-art athletic performance center reveals much that is wrong with higher education today. While the university is responding to a supposed budget crisis by reducing course offerings, eliminating teachers, increasing class sizes, and raising student fees, it continues to pour money into non-educational activities. As the San Francisco Chronicle has reported, Cal's plan to finance the new locker room and training facility through donations and investments has failed, and now the campus is on the hook to pay for the completion of the $135 million project.

The original idea was to ask people to donate money and then invest that money in the stock market, but the campus could not find enough donors, and much of the money they did receive was lost when the stock market tanked. Since the project is already started, the campus has to use its general funds to pay for the completion of the new facility. In other words, it looks like state funds and student fees that should be going to instruction and research are going to be used to build a facility that only a small number of student-athletes will be able to use.

While the athletic department is supposed to be self-supporting, like most other university athletic departments, Berkeley's program loses a great deal of money every year. In fact, the faculty senate this year voted to stop subsidizing the athletic program after it was discovered that the campus already forgave over $30 million of athletic program debt, and the department was still down another $6 million this year.

It is strange that the country's most prestigious public university feels that it has to funnel large sums of money into a non-profitable extra-curricular program, while the core missions of instruction and research are being short-changed. We must ask, what kind of message does this send to the Cal students who see that their own education is being downsized as the university asks them to bailout the athletic department because it gambled and lost on Wall Street.