I had lunch this week with a professor of medicine at Stanford University. Mercifully, the conversation didn’t dwell on his specialty (urology), but the professor did feel the need to gripe about Stanford’s endowment, which has cratered.
In an attempt to cheer him up, I mentioned that Stanford’s endowment problem looks like a mosquito bite compared to Harvard University’s endowment’s code red.
I’ve written previously about the serious endowment problems that Ivy League schools are grappling with, but Harvard is in a class by itself as it faces the biggest financial crisis in its 373-year history.
Compounding Harvard’s poor endowment decisions is profligate spending. From 2000 to 2008, for instance, Harvard built an extra 6.2 million square feet of space, which is roughly equivalent to all the space at the Pentagon.
For anyone interested in attending Harvard or is a student or alumni of Harvard, I’d suggest you read a fascinating article in the August issue of Vanity Fair that details Harvard’s woes. The headline on the cover, Harvard’s Big, Dumb Financial Train Wreck, says it all.
You’d be foolish to think Harvard’s endowment meltdown won’t impact students. According to Harvard sources who spoke to Vanity Fair, there are going to be massive layoffs (they’ve already started), courses will be slashed and class sizes will grow. And the carnage won’t stop there:
Radical change is coming to Harvard. Fewer professors for one thing. Fewer teaching assistants, janitors, and support staff. Shuttered libraries. Less money for research and travel and books. Cafes replaced by vending machines Junior varsity sports teams down graded to clubs. No raises. No bonuses. No fresh coats of paint or new carpets. Overflowing trash cans.
Will prospective students care about any of this? They should, but they probably won’t even know about the crisis because many students are so mesmerized by certain brand names such as Harvard that they fail to really research schools. And that’s a shame.