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Saturday, February 11, 2006
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What It Looks Like When a Harvard Professor Is On a Nobel Prize Winning Trajectory UD recalls being confused, after Harvard settled a very expensive and embarrassing lawsuit brought against it by the federal government for a faculty’s member’s illegal conflict of interest activities in Russia (background here -- it's the first post), that the miscreant not only remained in Harvard’s economics department, but retained his named chair status. This man single-handedly cost Harvard dearly, in money and in reputation. Yet not only did the university step right up and pay the almost twenty seven million dollars (about half the yearly salary of one Harvard money manager) the government demanded, it also imposed, far as UD could tell, absolutely no punishment on the guy. Yes, it confused old UD. “I guess tenure really does mean never having to say you’re sorry,” she concluded at the time, and let it drop. But now Harvard’s faculty has picked it up again. A recent magazine article about the scandal, full of gory details, has many wondering if the university’s president had anything to do with the remarkable impunity this particular professor has enjoyed. ‘Tawdry Shleifer Affair’ Stokes Faculty Anger Toward Summers, runs the headline in the Crimson. Six months after the University paid $26.5 million to settle a government lawsuit implicating Harvard economist Andrei Shleifer, controversy over the case has erupted anew and fed the Faculty’s current uprising against Shleifer’s close friend, University President Lawrence H. Summers. There’s a nicely revealing detail about academic culture in the Crimson piece: One of Shleifer’s colleagues, Professor of Economics David I. Laibson, yesterday expressed his department’s support for one of its stars. Here’s a guy who was found guilty of defrauding the US government. Bigtime. His colleagues are salivating at the thought of his proximity to a Nobel Prize and could give a shit about his criminal activity. They’re confident the Nobel committee feels the same. ***************************** UPDATE: [Now that UD has read the II article.] Already a book is forthcoming about the Shleifer case and other events which have made Harvard, as the book’s title has it, a place of Excellence Without a Soul. (Subtitle: How a Great University Forgot Education.) But UD sees movie possibilities too, assuming the account of the scandal in Institutional Investor is correct. For instance, the following sequence would work well as farce: An honest staffer in Russia, Holly Nielsen, started talking about the malfeasance to the authorities. “Shleifer ordered that she be fired. Nielsen informed [Jeffrey] Sachs [back at Harvard, running the larger program of which the Russian project was a part], who countermanded the order. Shleifer reinstated it. …She informed Sachs, who again reinstated Nielson. [Shleifer had] security guards …bar her from the offices…” And this would make a good visual: “A faculty member asked [a dean] why Harvard should defend a professor who had been found liable for conspiring to commit fraud. … [A]nother professor asked [the same dean] why Harvard should pay a settlement of $26.5 million and legal fees estimated at between $10 million and $15 million for legal violations by a single professor and his employee, about which it was unaware. On both occasions [the dean] is said to have turned red in the face and cut off discussion.” $$$$$$$$$$$$$$$$$$$$$$$ UPDATE II: Valuable background at economicprincipals.com. |