Just found this plea, back in January, for Brown University’s president, Ruth Simmons, to resign as a director of Goldman Sachs. It’s from a group of activists who want, among other things, financial reform.

The writer notes the stupendous hypocrisy of a champion of social justice profiting for a decade from her consort with vampire squids.

A commenter on the post addresses President Simmons directly:

When you resign, please do so in a news conference and articulate clearly in it the offenses of Goldman Sachs that force you to dissociate yourself from it. By doing so, you would use your resignation as a tool to induce Goldman Sachs to improve its business practices.

Of course we know that when Simmons resigned (she’s still on the board of directors for a few months), she merely muttered something about time constraints. She thus missed one of thousands of chances she must have had, given her long-term position at the pinnacle of the organization, to influence Goldman Sachs for the better.

Students at Princeton begin to think about Goldman Sachs in a new way.

My headline is a student’s comment on an article in the Princeton paper. This is how the article concludes:

The charges claim Goldman Sachs led clients to believe that a financial product was high quality while simultaneously betting that the product was low quality. Like a cliche used-car salesman, it sold its clients a lemon. When the housing market collapsed, Goldman got rich and its clients went belly-up.

… [Not] all activities that expand liquidity are good. This point might be easily missed because the people who invented and supported these trades became quite wealthy. And most people who (mis)understand economics believe that it teaches that people get rich because they do valuable work. What the recession shows is that people can earn a lot just by convincing others that their work is valuable, even if it isn’t.

[The gap] between what people think and what is actually true … allowed traders and analysts to do harm to our economy while believing that they were actually doing good.

… So, to my classmates who dream the Wall Street dream, or to those who are willing to defer their own dreams while working on Wall Street, I say only this: Mind the gap.

Salman Rushdie talks about body bags.

… this morning’s Inside Higher Ed.

And, as long as we’re on the subject: The Goldman Sachs Song.

… is the title of my latest Inside Higher Ed post. It’s about the British poet Peter Porter, who has died.

… banning laptops. I link to it only because I link to all of these things.

Oh, wait. There is one wonderful moment in it. A comment from a student explaining one instance of laptop use:

I went through a history class that was just every single day death by PowerPoint. And it just, it was awful.

It’s technology v. technology: An asshole in front of the room is too lazy to teach and students are too afraid or indifferent to protest. So students find their own defensive technology in response to the situation.

The result is what UD has called the Morgue Classroom, or TPD: Total Pedagogical Death.

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By the way, some American university students have formally protested excessive or inept faculty PowerPoint use at a number of campuses.

A word of advice to David Armitage, as he begins his long journey toward titular self-acceptance.

Armitage, the Lloyd Blankfein Professor of History, has by this point received at most a bit of ribbing from friends.

But – if history is anything to go by – the opportunities for ridicule will soon become too big to fail.

UD‘s advice? A self-deprecating sense of humor’s your best bet.

UD knows nothing about Armitage. But if he’s touchy and self-important, he’s toast.

Many at the firm might wish it could go private again and recover its capitalist vim. But after a decade of huge success it is now too big to do that. It is also so dedicated to trading that it cannot go back to being a normal, boring bank. Greed and success … have already pushed Goldman Sachs into a kind of prison.

The legacy of the president of Brown University, a Goldman Sachs director for those ten years.

A local candidate for the Cape Coral city manager position has been ruled ineligible because the master’s degree he claims does not meet the requirements for the position.

… [Tom] Leipold listed a master’s degree from a college that was not accredited. That school was raided by the FBI for presenting fraudulent diplomas. A Florida statute prohibits anyone from claiming an academic degree from a school that is not properly accredited.

… The job requirements for the city manager post include a master’s degree in public administration, business administration, finance, economics or a related field. Leipold’s application lists a master’s degree in hypnotherapy, not considered a related field.

… and the company she keeps as a director of Goldman Sachs:

1.)

Raj Rajaratnam, the founder and head of the hedge fund, Galleon Group, is suspected of being tipped off about the Buffett investment by Goldman director, Rajat Gupta.

2.)

Now that Goldman Sachs director Rajat Gupta is under investigation for passing inside information to Galleon’s Raj Rajaratnam, we might as well get to the bottom of what happened with Goldman board member Stephen Friedman during his tenure on the board of the New York Fed.

Basically what happened is that Friedman suddenly more than doubled his personal stake in Goldman in the middle of the financial crisis.

As chair of the New York Fed, Friedman wasn’t supposed to sit on Goldman’s board OR own Goldman stock, but Tim Geithner gave him a waiver to do both.

And now the question is… Did Friedman have some special inside information about the Buffett deal or Goldman Sachs’ financial strength that wasn’t in the public realm?

3.)

I dunno. Coming up. University Diaries will cover the story of the next one as soon as it breaks.

Oh. And of course there’s this:

Goldman Sachs’s CEO and other top officers are accused in a pair of shareholder lawsuits of lax oversight in deals involving risky mortage-backed securities that later went bad.

The lawsuits filed Thursday in New York State Supreme Court name Lloyd Blankfein and the firm’s entire board of directors as defendants.

The suits follow civil fraud charges filed last week by the Securities and Exchange Commission over the same investments.

The SEC says Goldman committed fraud by failing to disclose important information about the securities that might have scared off investors.

The two suits, filed by shareholders Robert Rosinek and Morton Spiegel, accuse Blankfein and other officers of “systematic failure” over 3 1/2 years for not properly vetting 23 mortgage-linked deals at the center of the SEC suit. Those deals, called Abacus, led to $1 billion in losses.

Brown University’s president resigns from Goldman Sachs at the end of this year I think. I don’t know the exact date. And I don’t know if that means she’ll be included in this and no doubt other lawsuits against the firm.

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Simon Johnson offers a larger view of the world historical events of which Brown University is a part:

[Goldman Sachs head Lloyd] Blankfein is starting to sound – and act – a lot like Nicolas Biddle, head of the Second Bank of the United States (by far the most powerful commercial bank of the day), during his confrontation with President Andrew Jackson in the early 1830s.

When Jackson first challenged the Second Bank, many people thought his concerns about the bank’s powers were excessive. But then Biddle started to fight back, spending money freely to buy congressional affection (and even leading orators) and attempting to contract credit in order to demonstrate that Jackson was hurting America.

At that point, people understood that Jackson was essentially right. The Second Bank had become so powerful that it could challenge elected executive authority and, if Biddle won, the consequences for democracy would be dire.

We are now in the phase when the most dangerous of our banks – and the people behind them – will go to any lengths to distort the realities and completely mislead people. The only way to deal with this is to do what Andrew Jackson would have done – attack, in no uncertain terms, misrepresentation wherever we find it.

… We should now view Goldman Sachs and our other five megabanks in the same terms that Andrew Jackson’s secretary used for the Second Bank of the United States, “Independently of its misdeeds, the mere power, – the bare existence of such a power – is a thing irreconcilable with the nature and spirit of our institutions.”

And she couldn’t be more thrilled.

A student writes in the SUNY Binghamton newspaper:

WHY GO TO CLASS WHEN THE NOTES ARE ON WIKI?

Academics, you would think, are totally above copying and pasting information from a lowly source such as Wikipedia. However, when I was reviewing a professor’s PowerPoint last week prior to a quiz, I came across something shocking.

It seems that there aren’t as many checks on our educators as we would like.

I briefly thought that my professor had made a mistake, so I consulted Wikipedia to double-check the information. Lo and behold, the text on the PowerPoint slides was identical to the Wikipedia page. I was absolutely dumbfounded. How could someone who took 20 minutes during the first class to warn us of the ramifications of plagiarism actually plagiarize herself?…

It’s such a smooth transaction, and neither student nor teacher needs to move a muscle or learn anything.

The class is entirely composed of text transfer.

She transfers it to a slide; you transfer it from the slide to a paper or an exam. Then she gives you an A.

… what Paul Krugman said today.

Duflo:

What the crisis has made bluntly apparent is that all this intelligence is not employed in a particularly productive way. Admittedly, a financial sector is necessary to act as the intermediary between entrepreneurs and investors. But the sector seems to have taken a quasi-autonomous existence without close connection with the financing requirements of the real economy. Thomas Philippon calculates that the financial sector, which accounts for 8% of GDP in 2006, is probably at least 2% above the size required by this intermediation.3 Worse, the sub-prime crisis is almost certainly in part linked to the fact the needs of the financial markets (the insatiable demand from banks for the famous “mortgage backed securities”) led to excessive borrowing and a housing bubble.

Duflo got the Clark Award today.

Paul Krugman, in today’s New York Times:

… Capital was channeled not to job-creating innovators, but into an unsustainable housing bubble; risk was concentrated, not spread; and when the housing bubble burst, the supposedly stable financial system imploded, with the worst global slump since the Great Depression as collateral damage.

So why were bankers raking it in? My take, reflecting the efforts of financial economists to make sense of the catastrophe, is that it was mainly about gambling with other people’s money. The financial industry took big, risky bets with borrowed funds — bets that paid high returns until they went bad — but was able to borrow cheaply because investors didn’t understand how fragile the industry was.

And what about the much-touted benefits of financial innovation? … [A] lot of that innovation was about creating the illusion of safety, providing investors with “false substitutes” for old-fashioned assets like bank deposits. Eventually the illusion failed — and the result was a disastrous financial crisis.

… An intriguing proposal is about to be unveiled from, of all places, the International Monetary Fund. In a leaked paper prepared for a meeting this weekend, the fund calls for a Financial Activity Tax — yes, FAT — levied on financial-industry profits and remuneration.

Such a tax, the fund argues, could “mitigate excessive risk-taking.” It could also “tend to reduce the size of the financial sector,” which the fund presents as a good thing…

University Diaries proposes CAT – a Corporate Activities Tax – to be levied on universities whose presidents and other administrators (and professors) sit on the boards of corporations like Goldman Sachs and thereby bring shame and ridicule to their schools.

Let Ruth Simmons and Mark Emmert and Phyllis Wise enrich themselves as corporate stooges. But make their universities pay a price for it.

After threatening colleagues, literary journals and newspapers with legal action last week, Orlando Figes has revealed this morning that it was not his wife who anonymously rubbished fellow historians in comments on Amazon: it was him.

In a statement released to the Daily Mail the professor of history at London’s Birkbeck College said that he takes “full responsibility” for what he called “foolish errors”….

UD thanks Dave for the link.

Background here.