SAN FRANCISCO - University of California students take to the streets on Thursday to protest fee hikes, campus racism, and what they call privatization of the public system that was a beacon for the state in the 1960s.

Students are not alone in their dissatisfaction. Polls show residents see California headed the wrong way with a gaping budget shortfall, legislative gridlock, slashed social services and double-digit joblessness.

Marchers may be the vanguard of a debate about whether California should temper its aspirations or pay more to maintain universities and other Golden State hallmarks.

This is unprecedented, unparalleled, you know. This is ridiculous, said Jesse Cheng, a student nonvoting member of the university governing board. For the students at the (University of California) now, this is our political moment... We can stand up and improve our system and get our state out of these incredibly difficult times.

Marches are planned in Berkeley, the 1960s protest hub, Los Angeles, Sacramento and campuses of state universities inside and outside the University of California system.

Racist acts, including a swastika and anti-gay graffiti has raised temperatures on campuses. Fee hikes of more than 30 percent to over $10,000 per year will make the university more costly than rivals in other states.

Students see that closing doors to less affluent, minority students -- privatizing the university -- and building on the effects of a 1996 state initiative which banned affirmative action at state institutions.

California did not even charge an Education Fee -- the equivalent of tuition -- in the 1960s, when state investment built campuses into national-level institutions, roads to link the state and canals that made the desert bloom with food.

Beyond the fact that there isn't money, there is a sense that education has become a private good, University of California spokesman Pete King said.

The state has cut support and so university fees have risen, he said. Fee hikes will take university costs above the four state schools it compares itself with, including schools in Virginia and Michigan, the university said.

For Hoover Institution scholar Bill Whalen, who used to work for moderate Republican Governor Pete Wilson, the university's issues reflect an overreaching by the state on services and promises -- without the financial power to do so.

We are at a time where we can't afford this path of spending, we just can't keep up with it. It's like the Soviets trying to compete in the arms race, he said, arguing that the university and state needed to clarify their missions.

The university also gets plenty of criticism. Students say administrators have been slow to address racism on campus and are forcing university diversity to plummet with higher fees.

A new campus that opened in the agricultural Central Valley in Merced in 2005. It was a long-planned expansion to increase services where they were needed most for some, and a bad move at the wrong time to others.

There is nothing else to call that but a hair-brained scheme, said Patrick Callan, president of the National Center for Public Policy & Higher Education.

Other state universities feel the pinch: rival University of Illinois is weighing tuition hikes of up to 20 percent for incoming freshmen, said Stanley Ikenberry, interim president of university's campus at Urbana-Champaign, in a newspaper interview this week.

But Callan sees California in a unique position. There is a kind of hubris on the part of the state and the university embarking on costly missions when times are worst, he said.

UC Berkeley student and organizer Ricardo Gomez sees the state moving away from conservative economic policies and toward goals like free higher public education.

These crises are going to offer the electorate and people of California an opportunity to once again to stand up for what we believe in, he said. He plans to march on Thursday.

(Additional reporting by Andrew Stern in Chicago) (Reporting by Peter Henderson)

California Michigan