Over the years, hundreds of educational leaders from other states and countries have approached California State University chancellor Charles Reed for advice on how to build a successful system of higher education. These days, however, fewer people are asking him. That's because as the state continues to strip its schools' budgets, it's seen as less of a role model for how to use education to build a strong economy. "California had one of the best-prepared, smartest and most creative workforces in the world," says Reed, who has run California State University's 23 campuses since 1998. "That's what gave California a world-based economy. Californians have begun disinvesting in its future."
What people used to ask Reed about is known as the Master Plan for Higher Education, which was approved in 1960 to meet swelling demand from the baby-boomer generation. The plan defined specific roles for the state's three higher-education systems — the University of California, California State University and the community colleges — and it ensured a spot at a university for all students who qualified. Many say the first-rate system that resulted from the plan was a major reason why California became the eighth largest economy on the planet and home to Silicon Valley and a large share of the biotech industry. (Read "Why the Downgrade and Market Volatility Are Especially Bad for California.")
As the academic year gets under way, however, it will be the third time in the past four years that the schools are operating with reduced funding. Beleaguered by a budget crisis, Sacramento has shrunk outlays for California State to $2.14 billion from almost $3 billion in 2007-08. University of California funding has seen similar reductions: shriveling to $2.37 billion from $3.3 billion. Community colleges have taken a hit as well over the past couple of years, leading to fewer enrollments and course offerings.
There is no question that universities continue to give a great education to students who earn it, says Nathan Brostrom, University of California's executive vice president for business operations.