Saturday 10 October 2015

Revenue Generation

I've become involved in many councils and committees at my university this year.  I did this for two reasons.  One - because I was interested to learn more about the governance of the university.  And two - I wanted to be on the 'inside' of what was going on.  So far it's been quite interesting.

At a recent council meeting for the Faculty of Arts, the Acting Dead introduce a document that outlined potential revenue generating ideas for the faculty.  It met with mixed reviews.

As I listened to the feedback, I grouped people into two categories.  Those who were looking at things from a logical, realistic perspective.  And those that were looking at things from an historical perspective.

The historical perspective was expressed by a number of professors ... loudly and critically.  This group is against revenue generation because (they claim) it goes against what a university stands for, and is suppose to represent.  In general they viewed revenue generation as contrary to what a university should be focusing on, which is pure, un-obstructed research.

The logical and realistic perspective look at revenue generation as a necessary evil.  None of them wanted to do it, but they understand why it was being introduced.  And they could see the benefit of it if it worked properly.  But given the choice, they wouldn't do it.

The reason why this 2nd group saw it as a necessary evil is because overall funding from government, private and student sources is declining (or has declined).  And while there's a chance it could increase in the future, there's no guarantee.  As an alternative to this 'outside' funding, the Faculty of Arts is looking at ways to generate revenue that can go directly back into their pocket for programming they could not otherwise afford.

Departments like engineering, some sciences, business, law, medicine, density, pharmacy, economics, education, etc., have obvious things they could do to generate revenue.  Departments like history, classics, english, philosophy, anthropology, etc., have less obvious things they could do to generate revenue.  And I don't think it's a coincidence that the negative feedback about revenue generation is coming from those departments without obvious sources of revenue generation.

I don't blame them for being unsettled.  For them it's a completely new way of thinking and in some cases will be a big change from what they've done in the past.  But I'm also a realist and I can see the short-term benefits of exploring revenue generation projects.

I'm also offended that so many people in academia find the concept of 'capitalism' so offensive!  We live in a capitalistic society.  Our economy (for the most part) follows capitalistic 'rules.'  Universities receive funds in order to provide services.  Those services are education and research.  Research is a service.  It's providing information and knowledge about something that did not exist before.  From a financial perspective, the service may not be worth much in a capitalistic market, but it's still a service.  Professors are paid for the services they provide to the university.

Those professors then use that salary to buy things they need in order to live (food, shelter, etc.).  And I'm pretty sure that most professors do NOT live at the lowest financial level possible and give the rest of their earnings back to the 'system.'  I'm pretty sure some of them buy cars (even fancy cars) rather than take transit.  I'm pretty sure some of them go on vacations.  I'm pretty sure they buy new clothes every now and again that they don't actually need.  In other words, they take advantage of their salary to participate in a capitalistic society.

Because of this, I find it very annoying that some professors complain about having to think capitalistically, but use every capitalistic advantage they can in order to live their daily lives.  You really can't have it both ways.  If we lived in a country that had an endless amount of money to give to academia and academia didn't have to worry about trying to fund itself, then maybe we could have it both ways.  But we don't live in that country.  And I'm pretty sure if our existing country was to say that we could increase academia funding at the expense of health care, those same professors would be up in arms about losing their health care!

Yes, our current (and hopefully outgoing) government has destroyed many of the things Canadians have held near and dear, and those things need to be reversed with the next government.  But the majority of Canadians actually did elect them in the first place (not me, but someone did) and as a democratic society we do have to live with the consequences of our decisions.

In the meantime, while we wait for a new government to 'fix' the problems caused by the old government (and to create new problems of their own), we need to do something.  We can't just sit back and wait and hope something changes in the future.  That's not realistic.  Instead we have to figure out short-term solutions to the problem, and revenue generation is one of those short-term solutions.

If the Faculty of Arts wants to implement projects and programs that have no other source of funding, they need to come up with the funding themselves.  If we're able to figure out a way to sell some of our services for money, then we can use that money to fund those projects and programs.  If we can't raise the money on our own, then we can't offer these projects and programs, and worst case scenario, we have to reduce some of the projects and programs we already have.  You can't spend money you don't have.  (Well you can, but I'm not sure that the faculty is allowed to incur debt.)

Here's the thing ... revenue isn't profit.  Revenue minus expenses is profit.  Revenue is simply incoming funds.  They key to the revenue generation program the Faculty of Arts is hoping to implement is to have an equal amount of money coming in (revenue) to the money going out (expenses) to balance to zero.  As in NO PROFIT.  They aren't looking to create a nest egg!  They aren't looking for ways to make a profit for giving people bonuses or extra merit increases or to invest in long-term financial investments (like a for-profit corporation would do), they're simply looking for a way to offer more things to their students in order to break even.

And here is where I may be a little biased.  I'm one of those students.  I'm one of the many Arts students who is unfunded this year.  That means I get zero help from the faculty to pay for my education (unlike least year).  If a revenue generating project were to create a funding opportunity for me, I would not be opposed to this.  To me it's a simple calculation - something versus nothing.  Whereas, for a tenured professor (who many of the complainants were) their paycheque isn't likely to change.  Or if it does, it'll only change slightly.  They aren't in a situation where they need to figure out how they're going to pay for food or shelter, as they already have a decent income with which to do this.  They are, however, being asked to do more work for zero increase in pay (under some circumstances).  In other words, there's a lot less incentive for them to make this happen, especially if they already have decent grants.

And this is where I question some of the opinions.  Many folks said they were against revenue generation because it was capitalistic and that goes against the principles of academia.  But is that the real reason they're upset?  Or are they upset because they're being asked to do more work for possibly no additional pay?  That - to me - would be contradictory.

Maybe, and hopefully, there are other reasons as well.  If there are, they weren't explicitly expressed at the meeting I attended.  But whatever the reasons, I wish someone who was against this process could present an alternative solution rather than just complain.  If this option isn't going to work for them, what options would work for them?  Do they have any ideas on how to fund projects and programs without selling a service?  Do they have any suggestions on how to balance the budget via another method?  How can we make this work while still living within the historical principles of academia?