… a New York Times reporter interviews its latest money manager.
The writer describes a recent bit of history quite unfairly:
[Jack] Meyer racked up a stellar record running [Harvard’s] endowment, putting [its] returns second only to Yale’s. But complaints about the size of managers’ pay packages, relative to the academics’ pay, ultimately prompted Mr. Meyer and many of his acolytes to leave in 2005.
The people who protested the thirty million dollar a year salaries of Meyer and his boys were mainly alumni, not faculty. Their argument was not a comparative but an absolute one. No one human being should take away thirty million dollars a year from a job. The word they used was obscene, not relative.
This was not a pay equity case, with professors lusting after their own thirty million. This was a case of a group of alumni whose protest prevailed (Harvard management salaries have been lowered) as soon as the managers’ tens of millions hit the New York Times. Public outrage sealed the deal.
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UPDATE: From Forbes.
Meyer built a Wall Street-like trading operation and managed most of HMC’s money in-house. It looked like a giant hedge fund, and it had paychecks to match. A high-level HMC manager would make as much as $35 million in good years. Those sums triggered what became an annual Harvard tradition: first, the disclosure (compelled by tax laws applying to nonprofits) of the HMC bonuses, followed by an outcry led by the late William Strauss and a group of Harvard alumni from his class of 1969.
What a tangled fuckup we weave, when first we practice to make a university a trading operation… Okay, UD‘s going to help Harvard out here.
Here’s what you do. Figure Meyer plus four other guys each took home … let’s low-ball it… twenty million dollars a year. So… 100 million altogether? Figure they did this for five years… Five years of that and you’re talking about a serious rainy-day fund.
So what you do is ask these people to return as much of this money as seems to them appropriate. No doubt, since they care more about Harvard than personal greed, these people have already approached the university asking what they can do. It’s just a matter of Harvard formalizing the process.