SLAC Talk discusses college finances – The Oberlin Review



On November 2, I attended a conference hosted by financial experts Kelly Grotke, OC ’89, and Kris Raab, OC ’89. They were invited by the Student Labor Action Coalition to discuss Oberlin’s financial investments. Learning about Oberlin’s investments has shed light on a common pattern in Oberlin’s current budget plans: austerity. The austerity measures are helping to reduce spending, which for many seems to favor profits at the expense of student satisfaction, good working conditions and accessibility. Instead of acting like a college – whose goal should be to redistribute excess income to make the school a more accessible learning environment for its students and a healthy workplace for faculty and staff – I believes Oberlin is acting more like a business, with a goal of growing wealth.

Alternative investments are investments that fall outside of typical markets, such as stocks or cash. These investments are illiquid, which means that they are difficult to withdraw even if they are performing poorly. Many alternative investments are also governed by private contracts, that is to say they are little controlled and difficult to assess upstream; they can often cost five times more than what is disclosed on tax forms due to hidden charges. They do not legally have to be disclosed to the public, and they are a new draw for colleges due to the possibility of a higher rate of return than traditional investments. Alternative investments usually go hand in hand with austerity measures; although they have the potential to raise a lot of money for an organization, there are many costs associated with them. These costs need to be covered in some way, which could lead to a reduction in other expenses, such as low-level worker health benefits. According to research by Grotke and Raab, Oberlin currently has 64% of its money in alternative investments. This prioritizes business values ​​over community values ​​because it means we have no way of holding Oberlin College accountable for the investments they make, due to the secretive nature of alternative investments.

Most of the questions surrounding Oberlin’s alternative investments have only one answer: we don’t know, because the College won’t tell us. Does Oberlin invest in morally wrong companies? We don’t know, but they are used to investing in companies that do not correspond to the values ​​of the students, especially by investing during apartheid in South African companies, of which they only divested themselves. once the students learned about it and protested. Do investment trustees deal with conflicts of interest or personal transactions, use our money to boost their own business or that of their friends? How much money does Oberlin actually make from these investments? We don’t know, but since alternative placement fees are relatively easy to hide, they might be lower than what the college tells us. It is possible that the College will make more money by investing in safer and more public roads, but it could refuse because the resulting loss of secrecy would reduce personal profits.

Oberlin’s dependence on alternative investments has very real impacts on the College itself. Grotke and Raab explained that when an organization embraces austerity and turns to alternative investments, it typically experiences small-scale job losses, acceleration of work and worsening working conditions, lower labor costs. quality of service, bankruptcies and pension losses due to an opaque ownership structure that hinders accountability, maximization of “shareholder value” at the expense of other values ​​and increasing income inequality.

We can see most, if not all, of these events happening in Oberlin. The college laid off catering and babysitting staff unionized with United Auto Workers, who had stable jobs amid Lorain County’s high unemployment rate. He also renegotiated the rental agreement with the Oberlin Student Cooperative Association and closed two cooperatives, cut disability services and other student welfare programs, and signed a contract with AVI Foodsystems that arguably decreases the cost. quality of catering services while exploiting already overworked students. . They closed several lines of faculty and developed a more expensive healthcare plan for many faculty and students without healthcare. I believe our school, which boasts of having a history of academic access for traditionally marginalized communities, is now following broader trends of restriction in the name of monetary gain. They may be doing this, in part, thanks to the secrecy of alternative investments, which helps them move money around without us knowing if all of these cuts are necessary. Oberlin College must stop being on a path of austerity and return to a mindset of public service and accessibility.

There are many steps that must be taken to ensure that Oberlin College does not continue down this path. Lobbying the College to allow an independent auditor to review their investments would be a good place to start, so that we can at least know what we’re working with, and so the College gets used to someone who Holds him accountable for the decisions he makes. Visit oberlinslac.org to submit requests for anti-austerity measures and to get more involved in the organization. Slides and recording of Grotke and Raab’s lecture can also be found there. We have the collective power to resist the College’s efforts to line the pockets of the most powerful players. Join groups that help you channel this power.


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