ProfessorBainbridge.com

Todd Henderson inveighs against fossil fuel divestment

As longtime readers know, I am not a big fan of divestment campaigns. Neither is my friend and sometime coauthor Todd Henderson:

No matter what your views are on the climate change debate, no rational person should support divestment. There is no evidence to demonstrate it will do anything to help the climate, and it will ultimately cost the University hundreds of millions of dollars—Swarthmore estimates it would cost their endowment $200 million over 10 years to divest. This is money that could be spent on research, scholarships, or perhaps best of all for the cause, reducing the University’s carbon footprint.

Here is why divestment won’t work: A central tenet of corporate finance is that demand curves for individual stocks are approximately horizontal. For most things we buy, demand curves slope downward. This means if we demand less, less will be supplied and at lower prices, but stocks are not like other products. The stock price is merely an estimate of the cash flows that ownership of the stock will produce in the future, and therefore is not determined by a “demand” for the stock. Unless the sale of stock conveys information to the market about the future cash flows, no individual sale can move the price.

If the Office of Investments, which manages the University’s nearly $9 billion endowment, sells all of the shares it owns in ExxonMobil, the stock price of ExxonMobil should not change. Others will stand ready to buy the shares at the current market price, meaning supply and demand aren’t helpful ways to think about stock prices. Unless the money that ExxonMobil is expected to earn in the future goes down, the stock price will stay the same. And nothing about the decision of a few university endowments to sell the shares provides the market information about how much oil or coal will be sold at what prices tomorrow. Undervalued shares in the near term will be bought up until their price more or less reflects the expected gain from holding those shares. In an extreme case, ExxonMobil could simply go private, removing any need to rely on public markets for funding or valuation.

The fact that the stock price of divested companies will not fall means that these firms will not experience a higher cost of capital, and therefore nothing about their capital raising activities, project choice, or other decisions will be affected by divestment. Managers with stock-based compensation won’t be affected either nor will other shareholders of these firms. In short, the economic impact of the SJSF demands on the targets of their ire would be nearly zero.

Go read the whole thing.

Is it really going to cost $24 million a week to reopen the UC system?

According to the UCLA Faculty Association blog, the answer is yes:

The Regents were told last week that testing for some kind of reopening during the coronavirus crisis would cost $24 million a week. Just the 10-week quarter for courses would be $240 million, and presumably you would have to have more than 10 weeks for exams and other functions. ...

From Calmatters: ...Dr. Carrie L. Byington, a top UC medical expert, pulled the curtain back on what campus re-openings would look like; the expenses are significant and the logistics complex. She said that she predicts that both COVID-19 cases and circulation of the flu will increase in the fall. Universal testing is unfeasible, said Byington, the executive vice president of UC Health, which includes five academic medical centers, a community-based health system and 18 health professional schools. With roughly 600,000 students, faculty and staff at the UC, weekly testing would cost the system $24 million a week because each test is $40. 

Absent a vaccine, I'm guessing my UC colleagues and I will be teaching online again in the Fall. Of course, if that results in declining student enrollment (especially international students), there'll be a major revenue hit. So we're screwed (if you'll pardon the vulgarity) either way.

Apropos of the vaccine qualifier, the UCLA FA also reports that:

Byington also shed light on a possible vaccine for COVID-19 in the form of a patch developed in conjunction with UC Davis. The hope is that the vaccine patch will go into clinical trials in the summer.  “Not only does it give us hope for having a vaccine, but also a mechanism to deliver that vaccine that would allow millions of people to receive the vaccine in their own homes, as the vaccine could be mailed, and they could place it on themselves in their own homes,” she explained.

University of California system to phase out the SAT and ACT at the undergraduate level: Is the LSAT Next?

The WSJ is outraged:

Applicants to the largest university system in the U.S. will now be judged entirely on how well they can flatter admissions bureaucracies with coached personal statements, as well as high school grade-point averages whose meanings are obscured by grade inflation. ...

The higher education business model was already under pressure before the coronavirus, and the recession may force deep cuts in the UC. The regents’ political move to compromise educational quality against faculty advice does not bode well for the future of a system that for decades was an engine of opportunity.

I must confess that this is not an issue I have followed closely and I'm certainly not prepared to assume it'll either be a disaster or a huge success.

Instead, I'm mostly curious as to whether the anti-standardized testing activists who successfully lobbied the Regents on undergraduate admissions testing will turn their attention to graduate and professional schools. Will the LSAT likewise be thrown out?

ASU has already dropped the LSAT. According to Inside Higher Ed, Oregon "may admit up to 10 percent of an entering class without requiring the LSAT from students in an undergraduate program of its own institution, who scored at or above the 85th percentile on the ACT or SAT and who are ranked in the top 10 percent of their undergraduate class through six semesters of academic work, or achieved a cumulative grade point average of 3.5 or above through six semesters of academic work."

And, of course, the coronavirus wreaked havoc on this Spring's testing.

I last looked at the data over 20 years ago, at which time it seemed to me that the LSAT did a reasonably good job of predicting first year law school grades but not ultimate class standing or bar exam passage. So, on the merits, it's not a hill on which I would be prepared to take a last stand.

Having said that, I can't imagine many law schools volunteering to abandon the LSAT as long as mean LSAT scores factor into US News rankings.

Do professors have a right to teach remotely until there's a cure for COViD-19?

Inside Higher Ed reports:

... many professors say they'd prefer a remote term, or even a delayed academic year, to teaching face-to-face again too soon.

“So far, no one has really talked about protecting the faculty,” said Alan Czyzewski, a professor of accounting at Indiana State University who is over 60 and statistically at a greater risk of falling ill with COVID-19 than many of his students and some of his colleagues. “I’m not saying we shouldn’t be doing everything we can for students, but the faculty are equally important. If we get sick, or three to four of us get sick all at the same time, who’s going to be teaching class?”

Czyzewski said working from home for the next eight months is hardly ideal. But an all-online semester remains his preference for fall, absent the mass deployment of a vaccine.

Like Prof. Czyzewski nobody at UCLA (or, as far as I know, the UC system generally) has specifically addressed the concerns of over 60 faculty (such as yours truly). But maybe they should:

Christopher J. Lee, associate professor of history and Africana studies at Lafayette College in Pennsylvania, recently wrote a piece for Boston Review called “Higher Education in the Age of Coronavirus: The Right Not to Work.”

By that, Lee wrote, “I do not mean not working at all, but the right not to work under certain conditions.”

For example, he said, “given that a number of schools are seeking to re-open before a vaccine is available, one prospect is to give faculty members the choice of whether to continue teaching online or not. This proposal could benefit at-risk colleagues, while allowing the option of in-class teaching if a faculty member prefers it.”

...

The right not to work under certain conditions draws upon existing Equal Employment Opportunity Commission guidelines that require reasonable workplace accommodation for reasons of disability or genetic information, Lee says. Given limited testing capabilities and the many epidemiological unknowns of COVID-19, “faculty members would generally fall within this latter category, even without preexisting conditions, until a vaccine is available."

Sounds like a good research project for employment law faculty. Because I for one would prefer not to go back to the classroom until there's a vaccine or a treatment.

Lawsuits against the University of California asking for tuition and fee refunds abound

From UCLA Faculty Association:

Lawsuit over certain UC fees during coronavirus crisis

Another refund lawsuit against UC

More news on how the University of California will open in the fall

From UCLA Faculty Association:

The "hybrid" instruction method for the fall is being repeatedly reinforced in public statements as the likely plan for UC. However, there is a long distance between an actual plan and a concept. Moreover, even when a specific plan is announced, there will be uncertainty about the fiscal side. How many accepted students will actually enroll? The state budget - and thus the allocation to UC - may change over the summer. What happens if during the fall there is a surge in coronavirus cases on a particular campus?

Note that UC-Berkeley - because of its semester system - is going to have to go first. Other campuses can observe what happens.

Of course, UCLAW is on the semester system too so we'll also be one of the guinea pigs.

I submit herewith my "Diversity, Equity, and Inclusion" statement for my merit raise at UCLAW

As regular readers know, I'm up for a merit raise at UCLAW this year and am now required to submit a statement of how I contribute to the University's goals in Diversity, Equity, and Inclusion. I have just emailed the statement to the administration. It reads as follows:

Although I am aware and respectful of the many dimensions within which a university properly seeks a diverse faculty and student body, I have long been particularly concerned with the lack of intellectual diversity at the law school. A survey of U.S. law professors in general found that white Democratic professors (both male and female), Jewish professors, and nonreligious professors “account for most (or all) of the overrepresentation among racial, gender, religious, and ideological groups in law teaching.”[1] The groups that “account for most of the underrepresentation among racial, gender, religious, and ideological groups in law teaching” are Republicans (both male and female), Protestants, and Catholics.[2] This disparity persists even though “religious and political diversity are probably more important for viewpoint diversity than gender diversity and roughly as important as racial diversity.”[3]

At UCLA, we know that the campus as a whole leans substantially to the left. “A study of various university faculties showed that at Cornell the ratio of liberal to conservative faculty members was 166 to 6, at Stanford it was 151 to 17, at UCLA it was 141 to 9, and at the University of Colorado it was 116 to 5.”[4] Conservative students at UCLA have been “harassed, stalked, and threatened.”[5] I recently searched the opensecrets.org donor database for political contributions made by persons who claimed UCLA School of Law as their employer. Thirty-eight of those persons contributed solely to Democratic candidates, the Democratic Party and various affiliates, and liberal PACs. One person contributed to both Republicans and Democrats. Three persons contributed exclusively to Republican candidates, the Republican Party, and various NRC affiliates. Of the faculty members who contributed exclusively to Republican candidates, the most recently hired of the two was hired in 1997. As a monetary matter, 92.67% of all contributions went to Democrats and affiliated groups.[6]

Because conservative students and students of faith often feel alienated and estranged in an environment that is so relentlessly liberal and secular, I have made particular efforts to reach out to and support such students. I have served as a mentor for leaders of The Federalist Society and Christian Law Students Association. I have given talks to both organizations. I taught a Perspectives on law and Lawyering seminar devoted to Catholic Social Thought and the Law, which gave students—whether Catholic or not—an opportunity to consider how their faith (or lack thereof) related to the law and an opportunity to learn about a coherent body of Christian scholarship that might inform their lives as lawyers. I have also tried to lead by example, such as by serving as a volunteer with the Good Shepherd Catholic Church’s St. Vincent de Paul chapter, which raises funds for distribution to poor persons who are in danger of losing their home due to inability to make rent or mortgage payments.

I'll let you know if I get the raise.

As regular readers know, I'm up for a merit raise at UCLAW this year and am now required to submit a statement of how I contribute to the University's goals in Diversity, Equity, and Inclusion. I have just emailed the statement to the administration. It reads as follows:

Although I am aware and respectful of the many dimensions within which a university properly seeks a diverse faculty and student body, I have long been particularly concerned with the lack of intellectual diversity at the law school. A survey of U.S. law professors in general found that white Democratic professors (both male and female), Jewish professors, and nonreligious professors “account for most (or all) of the overrepresentation among racial, gender, religious, and ideological groups in law teaching.”[1] The groups that “account for most of the underrepresentation among racial, gender, religious, and ideological groups in law teaching” are Republicans (both male and female), Protestants, and Catholics.[2] This disparity persists even though “religious and political diversity are probably more important for viewpoint diversity than gender diversity and roughly as important as racial diversity.”[3]

At UCLA, we know that the campus as a whole leans substantially to the left. “A study of various university faculties showed that at Cornell the ratio of liberal to conservative faculty members was 166 to 6, at Stanford it was 151 to 17, at UCLA it was 141 to 9, and at the University of Colorado it was 116 to 5.”[4] Conservative students at UCLA have been “harassed, stalked, and threatened.”[5] I recently searched the opensecrets.org donor database for political contributions made by persons who claimed UCLA School of Law as their employer. Thirty-eight of those persons contributed solely to Democratic candidates, the Democratic Party and various affiliates, and liberal PACs. One person contributed to both Republicans and Democrats. Three persons contributed exclusively to Republican candidates, the Republican Party, and various NRC affiliates. Of the faculty members who contributed exclusively to Republican candidates, the most recently hired of the two was hired in 1997. As a monetary matter, 92.67% of all contributions went to Democrats and affiliated groups.[6]

Because conservative students and students of faith often feel alienated and estranged in an environment that is so relentlessly liberal and secular, I have made particular efforts to reach out to and support such students. I have served as a mentor for leaders of The Federalist Society and Christian Law Students Association. I have given talks to both organizations. I taught a Perspectives on law and Lawyering seminar devoted to Catholic Social Thought and the Law, which gave students—whether Catholic or not—an opportunity to consider how their faith (or lack thereof) related to the law and an opportunity to learn about a coherent body of Christian scholarship that might inform their lives as lawyers. I have also tried to lead by example, such as by serving as a volunteer with the Good Shepherd Catholic Church’s St. Vincent de Paul chapter, which raises funds for distribution to poor persons who are in danger of losing their home due to inability to make rent or mortgage payments.

I'll let you know if I get the raise.

Political Contributions by UCLA School of Law Faculty and Staff go 92.67% to Democrats/Liberal Groups

There's an article in the WSJ claiming that political diversity at Yale is 0%. Inspired by that headline, I went to opensecrets.org. I typed UCLA SCHOOL OF LAW in to the Occupation/Employer field of the advanced search engine and searched for all cycles covered by the search engine.

38 persons who claimed the UCLAW is their employer contributed solely to Democratic candidates, the Democratic Party and various affiliates, and liberal PACs.

1 person contributed to both Republicans and Democrats. 

3 persons contributed exclusively to Republican candidates, the Republican Party, and various NRC affiliates.

As a result, 90.48% of UCLAW faculty and staff gave exclusively to Democrats.

The total amount contributed to Democratic candidates, the Democratic Party and various affiliates, and liberal PACs was $97,959

The total amount contributed to Republican candidates, the Republican Party, and various NRC affiliates was $7750.

As a result, 92.67% of all contributions went to Democrats and affiliated groups.

(Note that some of my own contributions were attributed to UCLA as my employer, which probably was true for some of my colleagues. So the exact numbers may be off a bit.)

University Boardrooms Need Corporate Governance-Style Reform

Universities are in many ways the worst run institutions in our society, with basically lousy governance.We see this in the way administrative bloat drives university tuition increases at well above inflation rates. We see it in the way the inmates are all too often allowed to run the asylum. We see it in how hiring emphasizes every kind of diversity except for ideological and intellectual diversity.

Maybe the answer has been staring us in the face; namely, bringing corporate governance reform to the university.

In today's Wall Street Journal, Paul S. Ivey explains that he resigned from the University of Pennsylvania's board of trustees mainly because it turned out that the board was a powerless, toothless watchdog. It sounds like administrators treated Penn's board the way farmers treat mushrooms (keep them in the dark and covered with manure).

Trustees and donors candidly admit in private that they do not want to jeopardize their children’s chances for admission. Many serve out of genuine interest and affection for their alma mater, although they also enjoy the prestige, influence and perks, like access to the university’s medical system, that go with the positions. There’s no incentive to rock the boat, and universities make sure they don’t get much opportunity. At the trustee level, the board is large and its formal meetings are entirely show and tell, with discussion severely limited and vote outcomes never in doubt. Penn Law overseers do not vote on anything. One Penn medical school board member told me he was dropped because he had asked too many questions.

The corporate world offers a parallel to trustees’ abdication of their fiduciary duties. Reformers of the 1980s argued correctly that the interests of shareholders were too often subjugated to personal interest and small-group social dynamics on boards that compel unanimity. Just as the resulting realignment of interests between corporate boards and shareholders unleashed spectacular value for American investors, an activist response by the governing bodies of America’s universities is now essential.

The problem is pervasive, as Michael DeBow explains:

On August 19 [2014] the intrepid American Council of Trustees and Alumni (ACTA) released a timely report on the governance of colleges and universities.  “Governance for a New Era: A Blueprint for Higher Education Trustees” was the work of a blue-chip 22-member committee chaired by Benno Schmidt, a former president of Yale.

The 16-page report is available online, and deserves a wide readership, since most Americans have some stake in higher ed – as taxpayers, even if not as parents or students or employers.

As a matter of legal formality, the ultimate responsibility for a college or university is almost always in the hands of a board of trustees, responsible for selecting the institution’s president, monitoring his or her performance, and making broad policy decisions.  As a practical matter, however, the trustees’ actual input into university governance is usually much less than that of the faculty – who call the shots as to the curriculum and other matters of academic policy, and the president and senior administrators – who run virtually everything else.  This status quo is sometimes referred to, approvingly, as “shared governance.”

Obviously, I'm not calling for the sort of Wild West activism we see in the corporate world. All I am saying is that higher education reform really ought to start with reforming the board of trustees so as to give them real power:

• New board members should be selected by a committee of independent board members.
• Board members should have the power to hire and fire the University President.
• The University President's compensation should be set by the board.
• Board members should be subject to term limits.
• Board members should be committed to fostering a learning environment rather than safe spaces.
• Board members should meet in executive session periodically without the presence of any university employees.
• If the board chairman is a university employee, the board should appoint a lead independent member with power to call board meetings.
• It should be made clear that the university's outside auditors work for the Board not the President.

Some of these reforms go beyond what I think is appropriate for corporations, but the reason should be obvious. Firms operate in host of markets that constrain managers and discipline poor ones. Imperfectly, to be sure, which is why governance is important, but surely better than the virtual absence of market constraints on universities.

Another item in the "I probably couldn't get a job as an academic these days" file

As an addition to the "I probably couldn't get a job as an academic these days" file comes this link (via @roddreher) to a University of California San Diego document requiring a written statement from faculty applicants:

The Contributions to Diversity Statement should describe your past efforts, as well as future plans to advance diversity, equity and inclusion. It should also demonstrate an understanding of the barriers facing women and underrepresented minorities and of UC San Diego’s mission to meet the educational needs of our diverse student population.

Some faculty candidates may not have substantial past activities. If such cases, we recommend focusing on future plans in your statement. However, please note that a demonstrated record of past effort is given greater weight than articulating awareness of barriers or stating future plans. A more developed and substantial plan is expected for senior candidates.

I suspect "none" would not be an acceptable answer. I also expect a detailed discussion of how one has tried to promote intellectual diversity within the academy by resisting the left-liberal hegemony would be even less acceptable. Just as well I'm not trying to get a job at UCSD. 

Bad Academic Writing

There is a new paper out on the corporation form and the concept of reification. My initial reaction to the paper was, how can you write on that topic and not cite the seminal work of my friend, co-author, and colleague William Klein. My second reaction was to have a bad headache caused by plowing through this sort of writing:

Combining the reified status of the corporate form with its convenience for the perpetuation of a particular kind of political economy, it can be argued that the highly problematic ontological and epistemological status of the corporate form may very well not be the result of simple theoretical and methodological aberration, and will probably not be solved by better theory formation.

As the NY Times observed all the way back in 1999:

The journal Philosophy and Literature has taken to holding an annual Bad Writing Contest, with prizes going to the work of some of the country's top scholars. There is even an Internet site that automatically creates a ''post-modern'' essay, replete with bloated jargon and incomprehensible sentence structure, every time someone logs onto it (www.cs.monash.edu.au/cgi-bin /postmodern). (''If one examines a post-dialectic conceptualist theory, one is faced with a choice: either reject post-dialectic conceptualist theory or conclude that culture is capable of truth,'' was a recent creation.) 

Yet the debate has taken a new twist recently with a decision by Edward Said, the new president of the Modern Language Association, to use his first official column in the association's newsletter to denounce bad writing. In an essay on how science is growing at the expense of the humanities, he accused literature departments of fostering incomprehensible writing and factionalism, resulting even more in their ''diminishment and incoherence.'' 

It wasn't just Mr. Said's position as head of the largest and most influential organization of literary scholars that caught people's attention, however: Mr. Said himself is a progenitor of a new kind of literary and cultural criticism that has frequently used difficult language. 

One of the country's most prominent literary critics, Mr. Said concedes that his own writing hasn't always been easily accessible, but he said in an interview: ''I moved away from that kind of thing many years ago, because I feel myself that it's terribly important as an intellectual to communicate as immediately and forcefully as possible.

Indeed, clarity ought to be the first goal of every academic. Bad writing is contrary to the very purpose of academic inquiry:

In 2006, Daniel Oppenheimer, then a professor of psychology and public affairs at Princeton University, published research arguing that the use of clear, simple words over needlessly complex ones can actually make authors appear more intelligent. ...

A disconnect between researchers and their audiences fuels the problem, according to Deborah S. Bosley, a clear-writing consultant and former University of North Carolina English professor. “Academics, in general, don’t think about the public; they don't think about the average person, and they don't even think about their students when they write,” she says. “Their intended audience is always their peers. That’s who they have to impress to get tenure.” But Bosley, who has a doctorate in rhetoric and writing, says that academic prose is often so riddled with professional jargon and needlessly complex syntax that even someone with a Ph.D. can’t understand a fellow Ph.D.’s work unless he or she comes from the very same discipline.

Indeed. I have been thinking, reading, and writing about reification and the corporate form for almost 3 decades and I have no idea what point the author was trying to make. Interestingly, the corporate law sentence got a Gunning Fox index of 36, while the invented post-modern literary sentence only got an index score of 21. "An interpretation [of the index number] is that the text can be understood by someone who left full-time education at a later age than the index."

There are lots of explanations for why people write this way, but I think a lot of it has to do with obfuscation. How do you assess the merits of an idea if you can't parse it?