The New School’s leadership delivered separation-package offers to roughly 40% of full-time faculty as part of a plan to close a $48 million budget gap, prompting faculty outrage and warnings about erosion of shared governance. President Joel Towers, who became president in summer 2024, and trustees argue the cuts are necessary after several years of deficits and enrollment decline from about 10,400 in 2019 to 8,800 this fall. Faculty described offers as coercive and said lack of consultation violated norms of academic shared governance; professors said the deadline and threat of involuntary reduction if offers were declined intensified tensions. The institution cited dwindling short-term credit as a key pressure point that accelerated the timetable. The New School’s case spotlights the trade-offs university leaders face when addressing structural deficits: rapid cuts can stabilize budgets but risk faculty morale, accreditation questions, and harm to recruitment and retention. Other institutions watching similar fiscal stressors may face parallel governance conflicts.