When Gown Crushes Town: The Corporatization of Oberlin College

Oberlin College, with a long history of promoting justice and fairness in the darkest of times, is in real danger of losing its moral compass. Instead of ameliorating these societal injustices, the administration and trustees of Oberlin College are actively and deliberately exacerbating poverty and illness in northern Ohio by replacing 108 unionized dining hall and maintenance workers with lower-paid non-union sub-contractors. The cost savings, claimed to total $2 million per year, will primarily come from the fact that Oberlin's unionized workers currently have decent health care benefits while replacement non-union sub-contractors will have none.

"We intend to prevent Oberlin College destroying its most cherished tradition: the promotion of fairness and justice for all."

As Buffy Lukachko, the head trucker in the Transportation Department at Oberlin College said, "My wages, other's wages, might be roughly $28,000 a year, but the expense the College has to pay out for health care is also around $28,000 a year....The way around that is outside vendors because they don't need to worry about health care anymore."

Nearly all of these 108 people will soon face excruciating challenges as they are severed from multi-generational service to the College. As Erik Villar, the union representative said, "A majority of our members...have had generations of family members work here....To be told out of the blue on a random Tuesday... that these changes would be implemented in less than four months is a slap in our face to everyone here."

But for the modern corporatized college, slapping the faces of low-wage workers is the easy way out of financial pressures. Like other elite private colleges, Oberlin, even with its nearly billion dollar endowment, confronts a structural deficit as costs rise while tuition reaches unaffordable levels. So it has asked its "stakeholders" to make sacrifices. Faculty wages have been frozen for two years, pension contributions from the college have been cut by up to 50 percent, and health care premium payments have increased dramatically. Lower and middle level administrators also have experienced cuts, but we don't know as yet if any of the top administrators responsible for the layoff plans are sharing in the sacrifice.

"Stakeholders" has an entirely different meaning for those who serve and clean up after Oberlin's students and professional employees. For those 108 janitors and food service workers "shared sacrifice" means the entire loss of one's livelihood and a giant downward slide towards poverty, in a town (pop. 8,317) that already suffers from a poverty rate of 23.5 percent.

The argument for Oberlin's cost-cutting is not unlike what we hear from other billion-dollar corporations: If we don't subcontract now, continued financial difficulties will later lead to even more job losses. This is the 40-year old pattern that has wiped out millions of jobs in the Rust Belt, and especially in Lorain County in northern Ohio where Oberlin is located. Decent paying jobs have declined, only to be replaced by low paying/no benefit jobs or no jobs at all. Of course, the problem is made even worse because our nation, instead of providing affordable universal health care, has a patchwork of government programs and costly private insurance plans that are likely not to reach these workers when they are let go.

You don't need to be an economist to know that this pattern repeated endlessly across the nation fuels runaway inequality. In a symbolic act of shared sacrifice, college presidents may, in a few rare cases, have their million dollar salaries frozen, but those at the bottom will have their lives crushed. Countless studies have shown that mass layoffs produce negative health effects on laid-off workers, including the increased use of opioids. In fact, Ohio ranks second in the country for number of drug-related deaths. Lorain County has seen these deaths jump from 13 in 2007 to 132 in 2017 and it has been designated by the federal government as "one of the leading drug trafficking counties in the nation." Furthermore, a recent study reports that mass layoffs are, "associated with increased county-level opioid overdose mortality." We must not allow Oberlin to contribute to this hopelessness and despair.

But why blame Oberlin? Isn't this problem a national phenomenon hard-wired into the economy? Isn't this college just another victim of these complex economic pressures?

"It is true that Oberlin is navigating a myriad of economic cross-currents and pressures. But it has agency. It has choice. It does not have to balance its books on the backs of its non-professional employees."

Yes, it is true that Oberlin is navigating a myriad of economic cross-currents and pressures. But it has agency. It has choice. It does not have to balance its books on the backs of its non-professional employees. It could, for example, start by dramatically cutting the salaries and benefits of its highest paid officials. Its former president took in over a million dollars a year plus benefits and a house. There are thousands of academics who would line up for that job even if the pay were reduced by two-thirds. Also there are major questions to be answered about the endowment's investment strategy with its heavy reliance on "alternative" private equity investments that are hard to price and which contain substantial fees. If the College truly opened its books and investment accounts for all to see, it is highly probably that additional cost reductions and revenue enhancements could be found without harming its most vulnerable workers.

Instead, the College seems to be counting on our fatalism--that we'll believe there's nothing much that can be done to reshape the global and domestic market forces that relentlessly enlarge the gap between rich and poor. But the balance of power in this one instance is such that we alumni have a chance to buck this destructive trend.

More than twenty-three hundred of us have signed a petition pledging that we will "withhold our financial support from the College until this decision is reconsidered." Many of us also are actively asking older alumni to hold back their donations especially around their cherished reunions which are designed to maximize contributions. Those jobs can only be saved at this point by creating countervailing financial and reputational pressures on the College. The administration and trustees must come to realize that the College will lose much more from its alumni than it will ever save from these draconian job cuts.

But time is running short as the layoffs are scheduled to start in July. It is likely that the administration and trustees believe they can wait us out. The students, now protesting in large numbers, will soon be gone, and so will the laid-off workers. The administration is banking that we alumni will restart our donations once the dust settles because we love the College and would not want to harm it.

This, however, is a very risky gamble for the College, especially if others on the petition share my disappointment. Many of us are saying that that if these layoffs take place, the bond between us and Oberlin will be shattered. No more donations. No mention in our wills. (See here for an alumni decision to cancel the Susan Phillips Social Justice Scholarship Fund.)

This decision is not made lightly. Only the strongest actions from Alumni are likely to prevent the carnage that the College is about to unleash on these workers, on the community so dependent upon it, and on itself. We intend to prevent Oberlin College destroying its most cherished tradition: the promotion of fairness and justice for all.