Colleen and Mark wondered if I might be able to provide any information on discussions at UCLA or other southern campuses similar to the issues you have been considering about the "Michigan model" or the other concerns raised in the exchanges that followed David Hollinger's post and his exchange with Chris Newfield. My initial response is that I do not have a huge amount of information to offer. As far as I can tell, the discussions here at UCLA have tended to be more fragmented (as befits a more fragmented campus) and less concrete than yours. The last of our large town hall meetings occurred before the final version of Yudof's furlough policy was announced and at that point the discussion tended to be focused on that issue and, alas, revealing the many fault lines among faculty according to discipline, seniority, budgetary source, etc. We are, as well, one of the medical school campuses so our financial arrangements make Berkeley's look like the local bank in "It's a Wonderful Life." Whether there are similar discussions about changing UCLA's financial relation with the system as a whole going on within the administration or in Senate committees I cannot say for sure. But there were some discussion about out of state students in the Spring and I would be surprised if some discussion of that was not happening at least in the administration. The independent faculty discussions that I have seen have been more along the lines of trying to think of strategies to make more apparent the worth of the University to the State as a whole. Nor am I aware of any systematic discussion at either Riverside or San Diego (although that may just be my ignorance). I have heard that Irvine recently had a faculty meeting to start discussing issues and of course Santa Barbara has been deeply involved in both analysis and activism (some around Newfield's blog). But again not along the lines that your thread seems to have pursued. The one exception to all of this, of course, has been the proposals (put forth first by the Sociologists and San Diego and then elaborated in modified form by at least some other department chairs at San Diego and by the Sociologists at UCLA) to formalize a sort of tier-system within UC. I don't think that that has gone all that far.
On the other hand, in reading the exchange between David and Chris I was struck by two different things. The first was that to a large extent they talked past each other on some substantive issues. In some ways, this situation is understandable on the part of Chris since my sense is that he was asked to respond to fiscal and funding issues rather than to the implicit aspects of David's statement. David, in turn, did not really respond to the economic issues that Chris raised (apparently none of them were surprising) and focused more on Chris' tone. But even if we all agree that more research on the funding implications of at least some of the campuses moving in a new direction on out of state students, that doesn't--as others have pointed out--exhaust the implications for the University at large or even, in the long-term for Berkeley.
David writes unabashedly as a Berkeley proponent and that provides a welcome clarity to his arguments. I will take his word that he is used to fighting off Berkeley people who are too humble about their relation to the system (although I have to say as someone who got a Ph.D. at Berkeley and have since taught at 2 other campuses for 20 years I can't recall meeting very many of those). But David assumes that one's first loyalty should be to the campus as opposed to UC (again having experience on 3 campuses may affect the way I look at this). There may very well be an argument to be made for rethinking what different campuses do within the system (as David says this is already de facto the case: we have a medical school, you don't, we have a large medical center you don't etc, Santa Cruz was designed to be different--and still is, etc) but if the question is how should the UC change to best fulfill its goals as a public university I am not sure that that decision can, or at least should, be made except through a deliberation process that would include the faculty whose lives would be being redefined. And that could not simply be the faculty at Berkeley and UCLA. I say could not in the sense of should not--obviously it could be done solely by them. But that would be a matter of power not principle. It may be that a debate within the larger community would take too long or get slogged down. But that is the risk of democratic or intellectual debate.
I was surprised by all of this because David has been a most eloquent critic of the increasing ways that Universities have allowed themselves to be reshaped by the changing configuration of outside power and capital (that was after all the point of the essay that he linked us to). But here the suggestion is that the external environment cannot be changed or challenged and that we must acquiesce and reconfigure the University. This was doubly perplexing given David's original invocation of Lowell. If ever a poem called out for not accepting the limits of the realities provided by market and state it was Lowell's Present Crisis. Instead, Lowell's was a call for thinking and agitation to change the given environment. If as Lowell said, "Truth forever on the scaffold, Wrong forever on the throne,-" I am not sure how having a few campuses try to rearrange the system in their own interests will change that.
Thanks for the invitation and I hope that you have success in coming up with strategies for the crisis.