Loved this article explaining why Harvard is, essentially, a hedge fund… and why that’s problematic. 

The point is that Harvard’s wealth has reached a point where the university primarily expends its resources managing that wealth, not on things like, say, education:

net tuition from [Harvard’s] thousands of students  [is] a mere financial bagatelle, having almost no impact on the university’s cash-flow or balance-sheet position. If all the students disappeared tomorrow—or were forced to pay double their current tuition—the impact would be negligible compared to the crucial fluctuations in the mortgage-derivatives market or the international cost-of-funds index.

A very similar conclusion may be drawn by examining the expense side of the university’s financial statement. Harvard’s Division of Arts and Sciences—the central core of academic activity—contains approximately 450 full professors, whose annual salaries tend to average the highest at any university in America. Each year, these hundreds of great scholars and teachers receive aggregate total pay of around $85 million. But in fiscal 2004, just the five top managers of the Harvard endowment fund shared total compensation of $78 million, an amount which was also roughly 100 times the salary of Harvard’s own president.

My favorite part:

Harvard’s residual and de minimis educational activities provide it with enormous tax advantages, [so] perhaps those activities should be brought into greater alignment with benefit to our society. The typical private foundation is legally required to spend 5 percent of its assets on charitable activities, and with Harvard’s endowment now back over $30 billion, that sum would come to around $1.5 billion annually. This is many times the total amount of undergraduate tuition, which should obviously be eliminated[.]

Read the whole thing