NYU & Wall Street

Over the last two months, protesters in Zuccotti Park and throughout the country have drawn attention to the inordinate power of Wall Street and big finance. The 1% of Americans on Wall Street have gotten rich while the other 99% of us sink deeper into student debt, unemployment, and low-wage labor. This is a movement that directly impacts everyone at NYU because the people who run NYU are the same people who run Wall Street. To fix NYU we need to Occupy Wall Street—because the bankers who ruined our economy in 2008 are already occupying your classroom and your university.

Corporate Greed Doesn't Stop on Wall Street: NYU's Board of Trustees

How are Wall Street and NYU related? First, the unelected Board of Trustees that makes decisions regarding tuition, school policy, labor relations, and expansion plans are almost entirely compromised of Wall Street bankers. John Paulson, for whom the new atrium in Tisch Hall is named, is a prime example of the deep ties between Wall Street and NYU. NYU courted his donations, named a room in Tisch Hall after him, and made him an officer of the Board of Trustees.[3] To most Americans, however, he is famous as the hedge fund manager who made hundreds of millions of dollars betting against the housing market right before the housing bubble broke. In effect, he directly profited when people lost their homes.[2]

Another example of the Board of Trustee's links to Wall Street greed is Board member Kenneth Langone, once called a "living symbol of the excesses of runaway executive compensation."[4] He is an ally of the famous Koch brothers and a major supporter of the Tea Party. He was also a central player in a 2001 scandal in which he helped arrange a $139 Million dollar retirement package for Richard Grasso, another NYU Trustee, who had been the president of the New York Stock Exchange (NYSE). Since the NYSE was a non-profit institution, the pay-out resulted in a major lawsuit, led by then-Attorney General Elliot Spitzer. The NYSE scandal actually involved so many members of the NYU Board of Trustees, including Trustee Martin Lipton and even President John Sexton, that one observer quipped in the New York Times that "it was almost as if they got NYSE and the NYU initials mixed up."[5]

Profiting From Student Debt: The Second Most Expensive School in the US

While the bankers running NYU make millions, they nevertheless seem constantly to ask more from us. According to at least one estimate, NYU is the second-most expensive college in the country.[6] Tuition, fees, and room and board come to more than $56,000 a year. In order to meet these exorbitant costs, NYU creates more student debt than any other nonprofit college or university in the country.[7] In fact, NYU's debt burden per student is 45% higher than the national average - meaning NYU students take on $11,000 more in debt than the average college student in the US. It matters to NYU how much its students can pay: 60% of the university's operating budget comes from tuition and fees. In addition, many NYU trustees themselves benefit from student indebtedness. For instance, Trustee Catherine Reynolds owns Educap, which markets "high-interest private student loans" to unsuspecting students. In 2009 the Senate Finance Committee investigated Educap, concerned that it was abusing its non-profit status to funnel students into high interest loans.[8] Even worse is NYU's relationship with Citibank. In 2007 it came out that NYU was involved in kick back schemes with with the banking giant: they were encouraging students to go through Citibank for their loans, and in return Citibank was sending millions back to NYU.[9] Just a year earlier, NYU's Vice President Jack Lew accepted a job at Citibank leading their "alternative investments unit" that would net him tens of millions of dollars.[10]

NYU's Real Estate Empire

There is a joke that says NYU is a real estate developer that offers classes on the side. Here's the problem with this joke: it's not funny because it's true. Wall Street and New York real estate are closely linked worlds. Indeed, when we talk about Wall Street, we're talking about the interconnected speculative industries of finance, insurance, and, crucially, real estate. In this city, the interests of huge property owners trump concerns of local residents again and again, and NYU is proof. NYU is one of the largest landowners in New York City: it currently controls 6 million square feet of space and is planning to double that in the next 20 years. The university continually leverages its deep connections to New York's so-called permanent government—the revolving door between real estate interests and the supposed regulation of development—to collect zoning variances, to privatize public space, and to ensure preferential treatment. And NYU's attempts to become a "global network university" have meant that this expansion drive is changing not just the landscape of downtown New York City, but indeed the world. This past year, NYU's new, degree-granting campus in Abu Dhabi opened, thanks to a generous $50 million dollar "gift" from the Emir to the University—a downpayment on an ongoing source of funding to pay for facilities both in Abu Dhabi and here in New York. To get the campus built, however, NYU and the government of Abu Dhabi employed immigrant construction workers held under the conditions of indentured servitude, even as groups like Human Rights Watch issued damning statements condemnations.# With this project, NYU has shown that its contempt for workers rights stretches far beyond its Washington Square Campus.

Fighting Back: Labor and the Corporate University

There is an old labor song that asks "which side are you on?" We know which side John Sexton, John Paulson, Ken Langone, and the NYU Board of Trustees are on. They are on the side of the 1%. They got rich fleecing investors and profiting off foreclosures. Meanwhile they ask us to constantly accept lower wages, more student debt, and higher rents. But NYU and Greenwich Village has also been the home of historic fights by the 99%. The 1911 Triangle Shirtwaist Fire, a tragedy that took place in the spot where today stands NYU's Silver Center, sparked union organizing campaigns around New York, which demanded and won an end to sweatshop labor conditions and higher wages for thousands. And recent union fights by GSOC, the graduate student employees' union, and UCATS, the clerical workers' union, as well as undergraduate-led campaigns against sweatshops, have kept alive a different vision of NYU. On November 17th, NYU for Occupy Wall Street is beginning the process of reclaiming our university for the 99%. Occupy Wall Street has called for a day of action that will end with a massive rally in Foley Square at 5PM. But first, at 1:30 PM students, workers, and faculty from NYU will rally in front of Stern to call on this university to cut its ties to Wall Street, lower tuition, and devote its resources to the students and workers here at NYU. The whole world will, literally, be watching what we do here. Come be a part. Come demand that NYU "Cut the Bull."