23 July 2009

Non semper erit aestas

Via TJIC, here's another good story on Harvard's financial implosion. I continue to be overwhelmed with epicaricacy by the misfortune of "Reykjavik on the Charles."

There have been plenty of stories before about Harvard's endowment cratering, but this one also goes into depth about their other mismanagement, including huge building sprees financed by debt instead of fund-raising, truly massive unfunded expansions financial aid, and worst of all coming to rely on a billion dollars a year in disbursements from the endowment to cover operating expenses, which is about a third of their budget.

What also stands out in the piece is the degree to which everyone claims it's not their fault. These people could give the Sun King's courtiers a run for their money in buck-passing. There isn't a single person who comes out of this looking good. (Except perhaps Michael Smith, Dean of Arts and Sciences, who looks like a humble computer engineering professor who got bumped up to administration and just wants to go back to his research papers and lectures.)

Everyone also seems to say that "people" knew various parts of the Harvard strategy were going to end poorly, but no one can ever say who knew this or when they said it or what they did to change things.

Oh, and there's the part detailing how everyone shat on the people at Harvard Management Company for being greedy and having huge salaries, and then when they jumped ship to hedge funds cursed them all for a lack of loyalty. Maybe they were being greedy and paying themselves too much, but what did you expect them to do when it's clear they aren't welcome around campus anymore?

Look to the ant, thou sluggard; consider her ways, and be wise ... it stores its provisions in summer and gathers its food at harvest.
Proverbs 6:6,8

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