"Harvard alumni seek refund of $21m in bonuses; They argue pay plan for money managers needs to be revised" by Tracy Jan, Globe Staff | January 29, 2009
A small group of Harvard University alumni is protesting the multimillion-dollar bonuses paid to the money managers of the university's endowment, which has lost more than $8 billion since the end of the last fiscal year.
Job well done, 'eh?
Ten members of the Class of 1969 sent a letter to Harvard's president, Drew Faust, this month urging that the $21 million in bonuses, disclosed in December, be returned to the university.
"We suggest that Harvard use the economic catastrophe that has now befallen the nation, and Harvard itself, to establish new policies to get the university back on a sounder and more equitable financial track," said the Jan. 12 letter.
Harvard's endowment, which stood at $36.8 billion last June 30, had shrunk to about $28.7 billion as of Oct. 31, though Harvard is still the world's wealthiest university. Faust has warned the university to brace for a total 30 percent drop in the endowment's value by this June 30 - a prospect that forced the Faculty of Arts and Sciences, Harvard's largest academic body, to freeze professors' salaries and postpone nearly all searches for tenure-track faculty to make up a more than $100 million shortfall. The university relies on the endowment to fund more than a third of its operating costs.
But they can pay their money mangers millions.
The five highest-paid executives at Harvard Management Co., which oversees the endowment investments, earned between $3.9 million and $6.4 million each - made up mostly of bonuses - for their performances during the last fiscal year, according to a university announcement last month. During that time, the Harvard endowment earned 8.6 percent. In comparison, college endowments lost an average of 3 percent in that period, according to an industry survey released this week.
The bonuses - paid out over time and subject to so-called clawback provisions if future performance is below market benchmarks - reflect industry standards, said John Longbrake, university spokesman.
Yeah, except I didn't think indoctrina, I mean inculcat, I mean, ejerkashen was an INDUSTRY!
This is not the first time alumni have protested the bonuses. Seven alumni, also from the Class of 1969 - including five who signed this month's letter - brought up similar concerns in a 2003 letter to then Harvard president Lawrence Summers in light of rising tuition. At the time, top managers earned up to $35 million.
Larry always has GREAT IDEAS!
"On December 12, 1991, while serving as chief economist for the World Bank, Summers authored a private memo arguing that the bank should actively encourage the dumping of toxic waste in developing countries, particularly "under populated countries in Africa," which Summers described as "UNDER-polluted."
Since then, Harvard has instituted wide-ranging financial aid policies that ease the burden on students from families making up to $180,000 a year. It has also moved 70 percent of its money to be invested by outside firms, and money managers' compensation figures have declined as a result.
Why is the paper making excuses for Harvard?
You now why, right, readers?
Elites and their agenda-pushers stick together.
The group of alumni has proposed that no employee should be paid in excess of what the university president earns; Summers was paid $611,000 during his last year, the latest presidential salary available. Faust's salary won't be reported until spring.
(Blog author just shaking his head at the unmitigated greed)
David Kaiser, an alumnus and a former Harvard history professor who signed both letters, said the compensation system should be reevaluated. "We are hoping the whole system is changed to put an end to this nonsense once and for all," said Kaiser, who now teaches at the Naval War College in Newport. "They've all just been riding a gigantic bubble, and the chickens have come home to roost."
That's a HARVARD HIPPIE?
Teaching at the WAR COLLEGE?
And isn't that what Malcolm said about JFK's assassination?
