The Shleifer Affair
From the Chronicle of Higher Education piece announcing the Summers resignation:
"The key fact pushing the pace of events this week, according to the professor, is that today is the last day the agenda can be changed for a meeting, scheduled for next Tuesday, of Harvard's Faculty of Arts and Sciences. At the meeting, faculty members had planned to vote on a motion of no confidence in Mr. Summers's leadership. The faculty, which includes Harvard's undergraduate and graduate divisions and is the largest academic unit on the campus, passed a similar no-confidence measure last March.
Next Tuesday's meeting could have proved exceptionally embarrassing to Harvard and to the Harvard Corporation, its seven-member governing board, the professor said, because of other items on the agenda.
Chief among them was to be a motion to censure Mr. Summers for his role in what has become known as the "Shleifer Affair," the professor said. Andrei Shleifer, a prominent Harvard economist and personal friend of Mr. Summers, was a defendant in a lawsuit alleging that he and a former staff member had defrauded the U.S. government through a program intended to help Russia make the transition to a market economy.
Harvard defended Mr. Shleifer throughout the litigation and last August agreed to settle the case by paying a $26.5-million penalty. Mr. Shleifer has never been disciplined by Harvard, and in fact was awarded a new chair during the litigation, said the professor who spoke to The Chronicle. As a result, Mr. Shleifer's relationship with Mr. Summers has drawn increasing criticism. The professor said the combination of the penalty and legal fees had cost Harvard $44-million."
|