(The chancellor was being kind. Anyone who has spent more than 10 minutes watching the chaos of California politicians trying to deal with fiscal and budgetary matters would consider “completely irresponsible” to be the mildest of possible characterizations.)

Berkeley is laying off staffers, reducing faculty through attrition and cutting pay. Student fees will no doubt have to be raised, and the fear is that if the financial crisis continues unabated it will be difficult to retain and recruit the world-class scholars who do so much to make the school so special.

Chancellor Birgeneau said he is optimistic that Berkeley will be able to maintain its greatness and continue to thrive, but he told me candidly in an interview, “It’s hard to see when we are going to get back to a situation where we can start rewarding people properly.”

We should all care about this because Berkeley is an enormous and enormously unique national asset. As a public university it offers large numbers of outstanding students from economically difficult backgrounds the same exceptionally high-quality education that is available at the finest private universities.

Something wonderful is going on when a school that is ranked among those at the very top in the nation and the world is also a school in which more than a third of the 25,000 undergraduates qualify for federal Pell grants, which means their family incomes are less than $45,000 a year. More than 4,000 students at Berkeley are from families where the annual income is $20,000 or less.

More than a third are the first in their families to attend a four-year college.

Berkeley is aggressively pursuing alternative funding sources. The danger is that as public support for the school declines, it will lose more and more of its public character. Substantially higher fees for incoming students would be the norm, and more and more students from out of state and out of the country (who can afford to pay the full freight of their education) would be recruited.

This would most likely hurt students from middle-class families more than poorer ones. Those kids are caught between the less well-off, who are helped by a variety of financial aid programs, and the wealthy students, whose families have no problem paying for a first-class college education.

The problems at Berkeley are particularly acute because of the state’s drastic reduction of support. But colleges and universities across the country  public and private  are struggling because of the prolonged economic crisis and the pressure on state budgets. It will say a great deal about what kind of nation we’ve become if we let these most valuable assets slip into a period of decline.