Walt,
I think a lot of what you say is sensible, but I think we would disagree on expectations of what the administration will do in the future. The political backlash was, from my perspective here in Berkeley, pretty wimpy. One day of a respectably-sized protest combined with rather pathetic "occupations" where the protesters numbered less than 500 (at best). I think most people, even undergrads here, recognize that they pay VERY little (I paid more, even after the increases, for an undergrad which is not even comparable) and that amount is not sustainable. Perhaps your impressions of faculty and the furloughs are accurate, but mine have been very different (faculty joke about taking their "vacations" and reference them in class examples). Furloughs happened 20 years ago in the UC system with similar commentary, but hopefully, after moving to a more tuition-based model, they won't happen again.
Anyway, I am optimistic that the political constraints on moving to the "Michigan model" aren't nearly as binding as you think.