Wednesday, June 27, 2012

Things Said Best By Others

... But the fact is, in all of these cases and many others, the over-activity of the Court, the Fed and the White House has less to do with a Masonic desire to reorder the constitutional status quo than the fact that one of the three vital organs of our nation is intellectually and morally dead.

Which branch? Let me give you a hint: It has 100 blow-dried millionaires living off our taxes in six year increments, and another 465 cosmetically enhanced egotists whose overriding priority is ensuring they will win the right to another two-years at the trough.

The black hole that is Congress has shut down, like a liver ravaged by years of abuse, and the rest of the body is doing all it can to sustain life.

Congress likes to hold hearings about threats to national security – al Qaeda, Iranian nukes, stumpy North Korean dictators, etc., etc. This is truly theater of the absurd at this stage.

No threat foreign or domestic can bring this nation to its knees as quickly as this dysfunctional legislative farce. Sometimes, military strategists are fond of saying, the best course of action is to do nothing.

This ain’t one of those times.

When a person is blinded, or loses their hearing, medical science tells us that this invariably leads to a sharpening of the other senses.

Something very similar is going on in Washington, and you may not like what you hear, see or smell from these hyper-active institutions, but the problem is clear: We must reform Congress, because its dysfunction is now a true national emergency. It forces activism and the bending of constitutional norms just to prevent disaster. It empowers those inside government who view the legislative branch’s abdication of its responsibility as an invitation to fill the vacuum.

If you don't like the Court meddling in health care or abortion, DEMAND that your representatives in Congress deal with the question. If you don't like the Fed unleashing QE3, demand that Congress does something about the anemia affecting our economy.

Vote. Them. Out.

Polls show most Americans abhor Congress. We should be sure to abhor the vacuum its irresponsible leadership has created, too.

How do we fix this? I’ve seen a few good templates – and I’ve suggested a few myself, in particular doing away with mid-term elections and synchronizing our voting to encourage maximum turnout. Former Texas Rep. Mickey Cantor has a good six-point plan for bringing Congress into the 20th Century (which would be progress even if the 21st remains too far a reach).

But the first step is to recognize that Congress and its 19th century dictates has become the primarily source of our national emergency.  Where is the candidate willing to press this agenda?
Our Abhorrent Vacuum (Slate)
In the 19th century, robber barons started their own private universities when they were not satisfied with those already available. But Leland Stanford never assumed his university should be run like his railroad empire. Andrew Carnegie did not design his institute in Pittsburgh to resemble his steel company. The University of Chicago, John D. Rockefeller’s dream come true, assumed neither his stern Baptist values nor his monopolistic strategies. That’s because for all their faults, Stanford, Carnegie, and Rockefeller knew what they didn’t know.

In the 21st century, robber barons try to usurp control of established public universities to impose their will via comical management jargon and massive application of ego and hubris. At least that’s what’s been happening at one of the oldest public universities in the United States—Thomas Jefferson’s dream come true, the University of Virginia.

On Thursday night, a hedge fund billionaire, self-styled intellectual, “radical moderate,” philanthropist, former Goldman Sachs partner, and general bon vivant named Peter Kiernan resigned abruptly from the foundation board of the Darden School of Business at the University of Virginia. He had embarrassed himself by writing an email claiming to have engineered the dismissal of the university president, Teresa Sullivan, ousted by a surprise vote a few days earlier.

The events at UVA raise important questions about the future of higher education, the soul of the academic project, and the way we fund important public services.

Kiernan, who earned his MBA at Darden and sent his children to the university, has been a longtime and generous supporter of both the business school and the College of Arts and Sciences, where I work as a professor. Earlier this year he published a book called—I am not making this up—Becoming China’s Bitch. It purports to guide America through its thorniest problems, from incarceration to education to foreign policy. The spectacle of a rich man telling us how to fix our country was irresistible to the New York Times, which ran a glowing profile of Kiernan and his book on Feb. 29.

At some point in recent American history, we started assuming that if people are rich enough, they must be experts in all things. That’s why we trust Mark Zuckerberg to save Newark schools and Bill Gates to rid the world of malaria. Expertise is so 20th century.
Strategic Mumblespeak (Slate)
We Americans take these institutions for granted. We assume that private enterprise generates what is so casually called “innovation” all by itself. It does not. The Web browser you are using to read this essay was invented at the University of Illinois at Urbana-Champaign. The code that makes this page possible was invented at a publicly funded academic research center in Switzerland. That search engine you use many times a day, Google, was made possible by a grant from the National Science Foundation to support Stanford University. You didn’t get polio in your youth because of research done in the early 1950s at Case Western Reserve. California wine is better because of the University of California at Davis. Hollywood movies are better because of UCLA. And your milk was not spoiled this morning because of work done at the University of Wisconsin at Madison.

These things did not just happen because someone saw a market opportunity and investors and inventors rushed off to meet it. That’s what happens in business-school textbooks. In the real world, we roll along, healthy and strong, in the richest nation in the world because some very wise people decided decades ago to invest in institutions that serve no obvious short-term purpose. The results of the work we do can take decades to matter—if at all. Most of what we do fails. Some succeeds. The system is terribly inefficient. And it’s supposed to be that way.

We hear every day from higher-education pundits who can’t seem to express themselves in anything other than jargon and buzzwords that American higher education is “unsustainable.” No. It’s just not adequately sustained. There is a big difference. We could choose to invest in people. We could choose to invest in culture. We could choose to invest in science and technology. We choose instead to imagine that there are quick technological fixes or commercial interventions that can “transform” universities into digital diploma mills. Pundits blame professors for fighting “change.” But they ignore the fact that universities are the chief site of innovation and experimentation in digital teaching and research and that professors might actually know what works and what does not.

Instead of holding up their responsibility, states are divesting themselves of the commitment to help their young people achieve social mobility. States are rigging the system so that only the wealthy can compete for slots in the best universities. States shift the cost of higher education from taxpayers—all of whom benefit from living in a wiser, more creative society—to the students themselves. Yet students keep coming, desperate to enter the privileged classes, unable to imagine a different way through a cruel economy that has no use for the uneducated any more.

Universities are supposed to be special places where we let young people imagine a better world. They are supposed to be able to delay the pressures of the daily grind for a few years. They are supposed to be able to aspire to greatness and inspire each other. A tiny few will aspire to be poets. Many more will aspire to be engineers. Some will become both. Along the way they will bond with friends, meet lovers, experience hangovers, make mistakes, and read some mind-blowing books.

Does that sound wasteful? Does that sound inefficient? Nostalgic? Out-of-sync with the times? Damn right it does. But if we don’t want young people of all backgrounds to experiment with ideas and identities because it seems too expensive to support, we have to ask ourselves what sort of society we are trying to become.
A Much Higher Education (Slate) Excellent articles on the UVA putch. Worth reading in full. What institution aren't the rich trying to corrupt? Case in point:
In support of their political strategy, global megabanks also run a highly sophisticated disinformation/propaganda operation, with the goal of creating at least a veneer of respectability for the subsidies that they receive. This is where universities come in.

At a recent Commodity Futures Trading Commission roundtable, the banking-sector representative sitting next to me cited a paper by a prominent Stanford University finance professor to support his position against a particular regulation. The banker neglected to mention that the professor was paid $50,000 for the paper by the Securities Industry and Financial Markets Association, SIFMA, a lobby group. (The professor, Darrell Duffie, disclosed the size of this fee and donated it to charity.)

Why should we take such work seriously – or any more seriously than other paid consulting work, for example, by a law firm or someone else working for the industry?

The answer presumably is that Stanford University is very prestigious. As an institution, it has done great things. And its faculty is one of the best in the world. When a professor writes a paper on behalf of an industry group, the industry benefits from – and is, in a sense, renting – the university’s name and reputation. Naturally, the banker at the CFTC roundtable stressed “Stanford” when he cited the paper. (I’m not criticizing that particular university; in fact, other Stanford faculty, including Anat Admati, are at the forefront of pushing for sensible reform.)

Ferguson believes that this form of academic “consulting” is generally out of control. I agree, but reining it in will be difficult as long as the universities and “too big to fail” banks remain so intertwined.

In this context, I was recently disappointed to read in The Wall Street Journal an interview with Lee Bollinger, President of Columbia University. Bollinger is a “class C” director of the Federal Reserve Bank of New York – appointed by the Board of Governors of the Federal System to represent the public interest.

In what was apparently his first-ever interview or public statement on banking-reform issues (or even finance), Bollinger’s main point was that Dimon should continue to serve on the board of the New York Fed. He used surprisingly nonacademic language – stating that “foolish” people who suggest that Dimon should resign or be replaced have a “false understanding” of how the system really works.
Predators and Professors, Simon Jonson, Project Syndicate.

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