I'll be direct, Ms. Napolitano: This is an angry letter. The Orange County Register has a story, updated today, saying the University of California has lost millions of dollars because it agreed to something known as "interest-rate swaps."
In this case, the swap apparently involved a bet that interest rates would rise in the future. As we all know, they haven't. Among the many unpleasant discoveries I made while reading this article was seeing the names of the UCLA Medical Center and the UCLA Foundation included in the story. (I realize that neither the Med Center nor the foundation is accused of wrongdoing.)
Now, I want to be clear that I understand you were not UC president when the university first agreed to this deal. But in my opinion, you still have an obligation to answer the following questions:
How much of your time do you spend trying to end this relationship? Or, if the cost of doing so is now impractical, how much of your time do you spend trying to ensure that UC never makes this kind of decision again?
I ask because you found time to attend the Winter Olympics in Sochi, and to my way of thinking, that's much less important than dealing with UC's financial difficulties. (And I say that even if President Obama asked you to serve as his emissary to the Games.)
How comfortable are you — and, for that matter, the Board of Regents — with these financial losses in the face of the increasingly hard time many students have in paying for tuition and living expenses at UCLA and its sister campuses?
I ask because it is painfully obvious that at least some of this money could have been used to help students who are otherwise unable to attend UC. And again, referring to your trip to Sochi, I am struck by a comment from Steve Mantiel, who was identified as a UC spokesperson in a Feb. 5 article in the Daily Californian in which he was quoted as saying, "(Napolitano) feels that having a university president lead the delegation is an acknowledgement of the central role that higher education plays in cultivating excellence among young people."
As to "cultivating excellence," Ms. Napolitano, you could have fooled me. And I'm also curious as to how young people acquire "excellence" if they can't afford the cost of higher education.
How comfortable are you with "interest-rate swaps" in view of our country's recent history with "derivatives," which I believe are often blamed for the economy's disastrous failure in 2008?
I ask because it seems to me that if there ever was a time for cautious investments, that time is now. As Michael Greenberger, a University of Maryland law professor, said of swap agreements in the Orange County Register: "It's a total nightmare and you can't get out of it."
How closely do you follow the events and concerns — affecting faculty and students, as well as athletes and coaches — on the UC campuses? That is, are the needs of students (some of whom represent UCLA and other UC campuses in athletics) heard among the powerful voices that dominate the Board of Regents?
I ask because I have grave doubts that they're heard at all. One of the hallmarks of our time, I believe, is the extent to which the few movers and shakers are oblivious to the effects their decisions have on the rest of humanity. I have reluctantly, and sadly, concluded that UC's Board of Regents is in the vanguard of that indifference.