Unions leveling Rutgers wealth pyramid from the bottom up

Rutgers workers struggled to make ends meet while top officials gobbled up millions

Published April 18, 2023 4:00AM (EDT)

A protester with a bullhorn leads chants with Rutgers students and faculty as they participate in a strike at the university's main campus in New Brunswick.  (Michael Nigro/Pacific Press/LightRocket via Getty Images)
A protester with a bullhorn leads chants with Rutgers students and faculty as they participate in a strike at the university's main campus in New Brunswick. (Michael Nigro/Pacific Press/LightRocket via Getty Images)

This article was originally published by InsiderNJ. Used by permission.

According to the tentative four-year deal brokered by Gov. Phil Murphy between Rutgers University and the unions on strike since Monday, adjunct professors will see a 43 percent pay increase and graduate worker a 33 percent bump in salary, that will be retroactive to July 2022 to when their last contract lapsed.

Citing an email sent out to students by Rutgers President, Jonathan Holloway, graduate students "would see their 10-month salaries increase to $40,000 over the course of the contract" with the minimum salary for postdoctoral fellows and associates rising by 27.9 percent, the New York Times reported.

The suspension of the strike for now, is great news for the 67,000 students at the Newark, New Brunswick and Camden campuses who were just weeks away from the end of spring semester.

While it's always good news when collective action by workers moves the needle in their direction, it's important to keep in mind that the dramatic double-digit gains where the result of years of abject neglect of this workforce that's been exploited because they love what they do and care about humanity.

The Rutgers strike can't be seen in isolation but as part of a massive national movement looking to counter the corporate takeover of higher education that's helped to accelerate wealth inequality to historic levels. As was been demonstrated in last year's six week long strike at the University of California, and several others around the country, the higher ed workers represent a new militancy informed by COVID.

For decades now, starting with President Ronald Reagan's busting of PATCO, the air traffic controller union, American higher education has been morphing into a multi-billion pyramid scheme that's shackled a generation in debt while paying out obscene salaries to coaches and administrators. It's nominally tax-exempt, but deeply anchored in the "greed is good" philosophy of Milton Friedman.


Last year, in a study of faculty employment trends over a 20-year arc, the American Association of University Professors that over 53 percent of colleges had replaced tenure track positions with so called contingent, or adjunct slots, up dramatically from 17.2 percent of colleges surveyed in 2004.

In upbeat statements, the striking unions were generous in their praise of the role played by Governor Murphy and Rutgers University President Holloway for fleshing out the "framework" of the deal which remains conceptual and very much a work in progress.

Significant details need to be resolved like sick time/maternity leave policy as well as tenure protections for 1,300 members of Rutgers Biomedical and Health Sciences (AAUP-BHSNJ)

"What's distinctive about these contract talks is that higher-paid tenured professors are refusing to go home with a deal that just serves their needs and say they will dig in their heels until part-time professors and graduate workers' demands are met in a reasonable way," observed Mary Ann Koruth in her comprehensive analysis for NorthJersey.com.

For several months, after their contract expired the Rutgers unions found they were spinning their wheels in talks with Holloway who had threatened to go to court to get an injunction to head off a strike, something Murphy wisely dissuaded him from doing.

"We are extremely pleased that we reached what we believe is the basis for a transformative contract for part-time faculty at Rutgers," said Amy Higher, President, Adjunct Faculty Union (PTLFC), in a statement. "We deeply appreciate the Governor and his staff's efforts to help us win gains for which we have been fighting for a long time: multi-semester appointments for hundreds of us, and significantly higher pay for all of us."

"This framework sets a new standard. Our members have struck to transform higher education in the State of New Jersey and across this country," said President of Rutgers AAUP-AFT Becky Givan. "The framework we have agreed to today sets in place unprecedented gains for contingent workers, graduate students, and our communities."

The suspension of the strike is not just a big relief to the backpack set, but for Gov. Murphy. If the work stoppage had gone any longer national media outlets would have had reason to have started scratching below the "blue state" veneer.


The awful truth is that thousands of Rutgers education workers struggled to make ends meet through the pandemic while Rutgers University President Jonathan Holloway was offered a total compensation package well in excess of $1 million, which included an annual six figure bonus.

Of course, Holloway has all the other Master of the Universe perks like his 14,000 square foot presidential home as well as a chauffeured car for when he's on Rutgers business. There's also the opportunity for him to serve on a for-profit corporate board of directors and one that's non-profit.

And yet, Holloway's sweet deal pales in significance to what Rutgers is paying football coach Greg Schiano, who NJAdvance Media reported enjoys an eight year $32 million contract.

Last year, Rep. William Pascrell (D-Dist. 9) wrote Holloway to inquire "how the university's lucrative athletics program is furthering the educational purposes for which Rutgers receives tax exemption."

"Specifically, Rutgers reportedly agreed to pay its head football coach more than $32 million in basic compensation over eight years, while still owing its former coach $7.5 million through the 2022 season," Pascrell wrote. "In addition to being the highest-paid state employee in New Jersey history, the head coach also receives a car stipend, a clothing budget, a country club membership, a private box at all home games plus 20 premium-level tickets, personal use of private planes for recruiting purposes, and other perks."

Pascrell continued. "It is unclear how such lucrative compensation contracts further the overall educational mission of Rutgers and benefit your student body as a whole. These contracts also present a stark contrast to the benefits received by the university's student-athletes, whose grants-in-aid each semester pale in comparison to their coaches' compensation."

According to NJAdvance Media's Johnathan Salant and James Kratch, "Schiano took a 10 percent pay cut in 2020 amid the pandemic while "Rutgers athletics reported a record $73.3 million deficit and spent $118.4 million to fund the athletics department in the most recent fiscal year, according to a ledger filed with the NCAA."

"University officials said there was a net loss of $26 million from their projected budget due to COVID-19 testing and safety expenditures, as well as a steep decline in arena and stadium revenues because fans could not attend events during most of the 2020-21 academic year," according to the newspaper.


NJ Advance reported that a comprehensive review of the program's books since 2003-04 "showed the athletics department's deficit to be $556.9 million."

Meanwhile, over at the Rutgers University's endowment, that's supposed to help defray the costs of university's operations, they were doubling down on relying on high-risk, high-fee hedge funds.

In an article headlined "Rutgers Puts Wall Street Before Teachers" , The Lever's Matthew Cunningham-Cook reported that  Rutgers "pumped more than $246 million, or 12.6 percent, of its $1.9 billion endowment investments into high-risk, high-fee hedge funds in just the past two years. The amount that the university has invested in hedge funds has more than doubled since 2020, from $213 million to $459 million."

"Rutgers' increase in hedge fund investments comes as other major investors, including the New Jersey state pension fund and the California Public Employees Retirement System have pulled away from the sector, due to concerns about fees and performance. Hedge fund performance has overall suffered relative to the broader market," the Lever reported.

Cunningham-Cook cited a report from Markov Process International, a research firm that found Rutgers portfolio's performance had "massively trailed its peers…. In fiscal year 2022, the Rutgers endowment returned [a loss] -9.7 percent, as opposed to an average of [a loss] -4.5 percent for its peers. Had Rutgers' endowment performed at the same rate as the average endowment over just that one year, it would have about $96 million more in its coffers, according to a Lever analysis."

"Compounding matters, hedge funds charge investors high fees — whether they perform well or not," the Lever reported. "Hedge funds typically charge a 2 percent commission on assets, plus a 20 percent commission on fund performance. Index funds, by comparison, typically charge a 0.1 to 0.4 percent commission for pension funds."

It's going to take more than one decent contract to flip the pyramid that Rutgers has become but it's unions have started the process and we should all be grateful.

By Bob Hennelly

Bob Hennelly has written and reported for the Village Voice, Pacifica Radio, WNYC, CBS MoneyWatch and other outlets. His book, "Stuck Nation: Can the United States Change Course on Our History of Choosing Profits Over People?" was published in 2021 by Democracy@Work. He is now a reporter for the Chief-Leader, covering public unions and the civil service in New York City. Follow him on Twitter: @stucknation

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