Summers’ Resignation and University Governance-BECKER

I will follow Posner's example, and compare my present views with what I said a year ago in our discussion on February 27th about the opening controversy between Harvard President Larry Summers and his faculty critics. My views remain close to what they were, but some of my statements then need to be clarified and even changed somewhat. "As Harvard's president, Summers has shown vision, enormous ability, and strength, qualities typically lacking in university presidents…. If allowed to persist in his endeavors, he will go down as one of the great university presidents of recent decades." Alas, he was not allowed to finish his agenda, although it was a breath of fresh air and long overdo not only at Harvard but also at many universities. He made promising starts in revitalizing sciences at Harvard, recruiting a younger and more balanced faculty, holding faculty to higher responsibilities for teaching and research- the Cornell West episode is one good example of this- and beginning the process of giving Harvard undergraduates a better education. It is not clear to an outsider how to weight different aspects of the faculty opposition that led to his resignation. But I believe it is a combination of the inherent tendency of all faculties to resist changes in what they do, despite their radicalism on many political issues, a concern that he was usurping some of the authority that faculties claimed for themselves, and Summers blunt style. Those overly sensitive faculty members at Harvard who consider his style blunt and confrontational should attend some of the seminars in the department of economics at the University of Chicago. Summers would appear relatively mild in comparison. Summers has an inquiring mind, and he ran up against faculty members with closed minds on issues like explanations for the differences in male and female achievements, or the contribution of some members of the African American Studies program. "Posner argues against the view that faculties should be running universities. He points out several problems with such a system, including that professors pursue their own narrow interests instead of the universities long-term goals, that professors are not selected for interpersonal skills, and that universities have become too complex to be run by a faculty collective. Strangely, he comes down in favor of university trustees as having interests that are better aligned with those of universities. Yet my experience is that trustees typically know little about, and generally do not have much interest in, the universities they oversee, they are intimidated by professors, are not very brave in their trustees' role, generally go along with whatever is presented to them by university administrations, and very seldom force a university president to quit." The Harvard experience has strengthened my views on university trustees. Perhaps one reason why university trustees are usually so ineffective is that they are mainly drawn from business, with an eye to fundraising and their own financial contributions, and have had little experience with university administration. By contrast, corporate boards usually contain many members who do or have run companies, so they know a lot about corporate administration. That said, I failed to mention last year my long-standing belief in greater power for presidents, deans, chairmen of departments, and other administrators than found at most American and foreign universities. A faculty-run university is usually biased toward compromise and the status quo, while a president and his administrators will sometimes take bold actions when given the power. Power and boldness can lead to major blunders and great variability in outcomes, but it can also lead to university greatness. The great presidents of the past, such as James Conant of Harvard and Nicholas Murray Butler of Columbia, were not reluctant to use their power to transform the sluggish universities they headed. Since it is so hard to be a really great university, that risk is well worth taking. "Still, I believe the only satisfactory way to evaluate how universities (or businesses) are run is by their success or lack of it in the long run. Although there is no simple way, like profitability, to judge universities, there is an effective way to judge a university system. The American college and university system is widely accepted as the strongest in the world. This is why American universities are filled with students from abroad, including those from rich nations with a long history of higher education, like Germany and France. I conclude from this that the American university system must be doing many things right, at least relative to the other systems. And what is right about this system is rather obvious: several thousand public and private colleges and universities compete hard for faculty, students, and funds. That the American system of higher education is the most competitive anywhere is the crucial ingredient in its success. Competition tends to weed out the inefficient and the ineffective, regardless of whether competing enterprises are private profit –maximizers, as are most business firms, private non-profits, as are many American universities, or public non-profits, as are the majority of universities. In any industry, including the education industry, many different approaches are tried, as in the Robert Hutchins great books approach to undergraduate education at the University of Chicago. Many of these approaches fail, as the great books approach failed because it turned out to be a poor way to teach science, economics, and many other subjects. The basic effect of competition is that only the successes tend to survive in the long run. What survives in a competitive environment is not perfect evidence, but it is much better evidence on what is effective than attempts to evaluate the internal structure of organizations. This is true whether the competition applies to steel, education, or even the market for ideas. Given the effectiveness of the American higher education system, its governance, including the role of faculty, is probably on the whole along the right lines. Some literature has even shown that an industry composed of workers cooperatives, Posner’s analogy to faculty-run universities, in a competitive environment tends toward efficiency because these cooperatives have to bid against each other, and against other industries, for labor and capital. Much of that literature would apply to universities run by professors, and to other aspects of the structure of American universities. Yet enterprises in even the most competitive industry often appear to be inefficient when looked at under a microscope. This is why the many best sellers every year on how to improve the management of American companies before long pass into the market for shredded paper. I am dubious about proposals to improve a competitive system that is working. The American university system is competitive and it is working well, at least judged by its ability to continue to attract the best students from abroad, that few Americans go abroad for advanced degrees, and by the current efforts to imitate the American system of higher education in many other countries. We should not be complacent, but that is pretty effective evidence in its favor, including the approach to governance." I still support these claims about the beneficial effects of competition, and that the American system is superior to other higher education systems. But I should have been clear that this does not mean that every organization even in a highly competitive industry is doing well and cannot be improved. Defective companies can continue to survive for quite a while even in competitive environments (look at General Motors). This is especially true among universities. Past reputations count for much more at universities than at say car companies, which is why the ranking of universities is much more stable over time than is the rankings of firms in various other industries (an observation on rankings that Summers once brought to my attention). I support many of Posner's proposals for change that he lists at the end of his post, but I weight them somewhat differently. The following are to me the most important: 1. The Arts and Sciences faculty has too much power relative to professional schools at Harvard, as shown by what happened during the Summers controversy. An overall University Senate would have helped Harvard during this crisis, as it would have helped Columbia during the student disturbances of the late 1960's (where I taught at that time). It was crucial in the University of Chicago getting through those disturbances in much better shape than Columbia and many other universities. 2. Presidents should have more power and faculties less, for the reasons I gave. Universities will continue to be run mainly by faculties, but their power is excessive at Harvard and many other universities. 3. In light especially of the Federal law of the 1990's that prevents universities from forcing faculty members to retire, and because of the great competition among universities for faculty, a competition that in many fields is becoming worldwide (see my post on tenure of January 15th of this year), academic tenure is excessively strong. It should be greatly weakened, if not abolished.

Comments

[Arun Khanna]

One, as an ad-hoc measure the next President of Harvard should negotiate a 10-year fixed contract not subject to being revoked by Harvard Corporation.

Two, competition does seem to work in education albeit rather slowly. If one examines pre and post World War II periods, I would guess University of Chicago has gained ground while perhaps Harvard has lost ground.

Three, the only quibble I have with the Summers Presidency is that he should have tried harder to retain Jack Meyer at Harvard Management Company.

[Arun Khanna]

Re: "Those overly sensitive faculty members at Harvard who consider his style blunt and confrontational should attend some of the seminars in the department of economics at the University of Chicago. Summers would appear relatively mild in comparison."

In an economics seminar people have a common objective; I am guessing a big reason for the problems at Harvard is that different faculties don't have a common objective.

[DF]

GB: he ran up against faculty members with closed minds on issues like explanations for the differences in male and female achievements.

Actually, what irked Nancy Hopkins and many others was his implication that the hypothesis "The dearth of women in the upper echelons of academia is due to discrimination" could be ruled out on the basis of economic analysis. Larry said:

http://www.president.harvard.edu/speeches/2005/nber.html

"The second problem is the one that Gary Becker very powerfully pointed out in addressing racial discrimination many years ago. If it was really the case that everybody was discriminating, there would be very substantial opportunities for a limited number of people who were not prepared to discriminate to assemble remarkable departments of high quality people.... .... And I think one sees relatively little evidence of that. So my best guess, to provoke you, of what's behind all of this is that the largest phenomenon, by far, is the general clash between people's legitimate family desires and employers' current desire for high power and high intensity, that in the special case of science and engineering, there are issues of intrinsic aptitude, and particularly of the variability of aptitude, and that those considerations are reinforced by what are in fact lesser factors involving socialization and continuing discrimination."

It was Larry's claim that economic dogma rules out the possibility of discrimination that stuck in Nancy's craw. It's ironic that this statement led to his downfall, given that Larry's dad changed the family named from Samuelson to Summers to avoid anti-Semitic discrimination.

It's amazing and inspiring that all Nancy Hopkins did to set this whole thing in motion was GET UP AND WALK OUT OF HIS TALK.

[Jim Hu]

Those pointing at Nancy Hopkins should keep in mind that she isn't even on the Harvard faculty - she's at MIT.

[dick]

If Nancy Hopkins is on the MIT faculty, then they have my sincere sympathies. I hope they keep her bottled up since she is a danger to the community if let loose.

[snowball]

It's funny that Prof. Becker notes that faculty should have a limited role in running universities because, in part, "professors are not selected for interpersonal skills." Well, Larry Summers fit that description. He was a fantastic professor, with extremely poor interpersonal skills.

He would *never* have landed the presidency of Harvard had he come packaged as Prof. Summers, abrasive and boorish visionary genius. Rather, he was selected in large part because of the perception that he had successfully sanded down his rough edges in DC sufficiently to work well with others in Washington, rising to Treasury Secretary.

[damtp_dweller]

"It's amazing and inspiring that all Nancy Hopkins did to set this whole thing in motion was GET UP AND WALK OUT OF HIS TALK."

It's also extremely ironic that she failed to notice her actions were typical of the "hysterical woman" stereotype she dislikes so much. If I recall correctly, her exact comment was

'[Had I not left the speech] 'I would've either blacked out or thrown up."

[DF]

Don't you guys think it's a LITTLE interesting to think about this:

If Dr. Becker had never argued that one could use deduction from dubious premises (regular economics) instead of empirical research ("behavioral" economics) to conclude "discrimination doesn't exist in the labor market" Larry Summers would never have cited it, Dr. Hopkins would never have walked out of Larry's talk and it's a VERY good bet Dr. Summers would still be president of Harvard?

[Arun Khanna]

Summers did well to cite Becker. However, I can't help feeling that perhaps Summers should have also considered the implications of two less prominent (than Becker) Chicago Professors work. I am referring to Raghuram Rajan and Luigi Zingales (2000), The Tyranny of Inequality, Journal of Public Economics.

[Bob K]

I don't know if there is discrimination in academia. But I've seen amazing teams of brilliant minorities in the private sector doing outstanding research, much better than research coming from academic journals.

In fact, I have the impression that the private sector hires more minorities than academia.

I've always wondered why they are here and not teaching somewhere, why no one tries to equalize the proportion of minorities in academia vs the private sector. I think it's because they make a lot more money here but, again, it surprises me no one tries to poach them to academia. And they have no interpersonal skills problems, no bullies here, they are quiet regular guys inside and outside the office or lab.

[Will]

After reading this thoughtful discussion, I can only wish that Messrs. Posner and Becker were members of the Harvard Corporation. Their example demonstrates why I (as an alumnus of both Harvard and the U of C) will donate generously to the University of Chicago, but will give not a dime to the bloated pustule of pomposity and self-regard which is Harvard University.

[anon]

Generally, some worker ownership of organizations seems to be positive and work. However, it seems like there may be a limit to this. At some point, if workers own too much of an organization (eg, 50%), then the organization is too beholden to workers and not enough to customers and other stakeholders. This may be the case at Harvard.

I have for some time started to get the sense that certain universities do things more for fundraising than for academic purposes. It seems the two may be at odds in certain circumstances.

A university system may be somewhat like the U.S. - you need checks and balances, and separation of powers (executive, legislative, judicial). There may need to be a mix of decentralized, autonomous units (states) and a central body (federal).

Not to pitch false dichotomies... but sometimes it seems like sometimes unique people have to choose between A) being very effective, brilliant, original and pushing and B) dull, ordinary, routine, unoriginal, and even sometimes wrong and ineffective. It seems like people in bucket B) can have longer careers but may not have the same impact. Many people would prefer conventional failure to unconventional success (Keynes).

[chy]

you may use html tags for style are you a spam bot if not type human here

[anon]

The Economist, Feb 25 2006
A Survey of Wealth and Philanthropy

Excerpt:

But just as the world's wealthy and powerful are discovering the joys of giving, students of the American model of philanthropy are becoming increasingly critical of its flaws. This is not just a private concern for the donors: because of America's huge tax breaks for charitable donations, it is a matter for public scrutiny too. The cover story of a recent issue of Stanford University's "Social Innovation Review" is entitled "A Failure of Philanthropy". It argues that those American tax breaks are of most benefit to things like elite schools, concert halls and religious groups. "We should stop kidding ourselves that charity and philanthropy do much to help the poor," says the author, Rob Reich.

[anon]

"but will give not a dime to the bloated pustule of pomposity and self-regard which is Harvard University."

when it comes to one of my alma maters, i have feelings similar to your perspective toward Harvard. However, i have much different feelings toward another alma mater (similar to your U of C perspective). some schools perpetuate stereotypes of people. people living under stereotypes know and feel when someone is stereotyping them - good or bad. some people even feel pressure to conform to a stereotype that may be anathema to their nature (self-fulling, negative stereotypes).

[G Caldwell]

Posner had me agreeing until he said that, unlike the faculty, who he says are employees, "The president is the CEO and he has both a reputational and a financial stake in the success of the institution." A CEO is an employee, however. History shows that CEO's pretty often act in their own self-interest to the detriment of their employers. It should be sufficient on this point to refer to Warren Buffett's remarks today in his letter to the shareholders of Berkshire Hathaway and various recent articles by Ben Stein regarding the avarice of some CEO's. It may be that a university president may have a greater reputational and financial stake in the success of the institution than the faculty does. But Posner offers no evidence or argument on this point. He simply makes a bald assertion. This was a disappointment given his usual clarity in setting out the support for his views.

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