Harvard Talent Flees to the Private Sector
Plus, Israeli minister assails Tucker Carlson; Republican rift on entitlements; PCE
The risk that top intellectual talent will flee universities for private industry has been a running theme here.
In “A Nobel for Google,” I wrote:
People have started to realize that there is competition among institutions and choice for students, so prospective students put off by the campus chaos, antisemitism, and stifling ideological conformity of places such as Harvard or Columbia might choose instead to consider applying to, or attending, alternatives such as the University of Florida, Emory, Dartmouth, Vanderbilt, or the University of Chicago.
Yet there is a market for faculty talent, too, and there the choices include not only the academy but also industry. Just as physician-researchers sometimes leave academic medicine for pharmaceutical companies, the engineers, chemists, physicists, and computer scientists have choices, too. They can make careers in universities or in industry, or try to do both simultaneously. The worse the conditions become in academia—poisonous faculty politics, cancel culture, performative “wokeness,” the decline of meritocracy in favor of other values such as “equity” or bureaucracy—the greater the relative attraction of choosing to make a career instead at Google or some company that will be the next Google. Google parent Alphabet’s market capitalization is on the order of $2 trillion, which makes Harvard’s roughly $50 billion endowment look puny (sorry, President Alan Garber) by comparison.
Perhaps the risk of a talent exodus, “brain drain,” from academia to industry, will put some market pressure on higher education to create conditions that are conducive to scholarship.
In “Wisdom from Harvard’s new president,” I wrote: “the competition for talent extends beyond students. Scientists nowadays might prefer to go work for a pharmaceutical company or a Silicon Valley startup instead of a Harvard lab or the tenure track.”
And in “Harvard Moves to Prevent Professors From Fleeing to Industry,” I wrote, “Harvard’s leadership is concerned enough about the possibility of a talent exodus that it is revising its rules to make it easier for professors to work in the private sector without quitting their Harvard positions altogether.The Harvard provost’s office recently okayed the creation of a new category of academic appointment, to be known as a Catalyst Professor, that will allow faculty members to split their time between Harvard and the private sector.”
Now Harvard Magazine, the official if quasi-independent university alumni publication, has come in on the story with a dispatch headlined “Where The Grass Is Greener: Leaving academia to advance biomedical research.” The magazine’s Jonathan Shaw interviews three professors who moved into the private sector and offered detailed accounts of their frustrations with Harvard’s inflexible, slow, and vast bureaucracy.
Michael Mina was a professor at the Harvard T.H. Chan School of Public Health. “Despite bringing in $10 million in philanthropy and grants, I couldn’t get the school to bend and allow me to hire somebody who could help even with scheduling,” he says. “A donor wanted to give $2 million to my lab, but only wanted to allow a maximum 10 percent to go to indirect cost recovery. And the school declined to receive the $2 million because they wanted at minimum, I believe it was 20 percent. That was one of those moments, when I just said ‘What the hell am I doing?’ … here’s my home department, you know, not allowing my laboratory to take on a $2 million gift. I understand they don’t want to set bad precedent that’s going to make the institution have difficulty getting enough funds in the long run. But there are times when academia should be more flexible. I found that the school was unable to realize that.”
“The paylines of Ph.D. students and postdocs haven’t really changed, and certainly haven’t kept up with inflation. It’s hard to live on $60,000 in Boston. And industry is offering people $120,000 to $150,000 right out of the gate with a Ph.D., if not $300,000,” Mina says. “The average professor is going to have an increasingly difficult time getting the best postdocs because they’re going to go to Biogen, they’re going to go to Genentech, they’re going to go to Thermo Fisher, where they get paid in a way that seems to satisfy them, and they feel like they have opportunity. We’re already seeing that happen.”
Douglas Melton quit a University Professorship at Harvard to go work at Vertex, where Harvard president Alan Garber is a director. “Principal investigator biologists now spend up to 40 percent of their time—it’s a shocking number, 40 percent of their time—writing grants,” says Melton, who is still involved at Harvard in a reduced capacity. “In industry, the funding allows for very rapid change. There’s no writing a grant and waiting six months to see if it could get funded, and then waiting another six months for the university to make arrangements to receive the funds. The speed with which you can move into a new area is not comparable.” He says that in the private sector, “Everything gets done much quicker.”
Republican rift on entitlements: A rift is opening up within the Republican Party over whether to attempt to curb federal spending on “entitlements”—Social Security, Medicare, and Medicaid—that drive much of the federal government’s deficit and debt issues.
One of my favorite members of Congress, Tom Cole, a Republican from Oklahoma who is chairman of the House Appropriations Committee, makes news on the issue in a Wall Street Journal opinion piece today that argues for taking on the issue now.
“We can’t change our fiscal trajectory without addressing mandatory spending. That doesn’t mean eliminating the entitlement programs that enrich Americans’ lives. On the contrary, our efforts are geared toward saving them for future generations. Without action, the combined Social Security trust funds will go insolvent by 2035 and Medicare payments will be cut as soon as 2036. The longer we wait, the harder and more austere the choices become,” Cole writes.
On the other side is Trump’s nominee for Treasury Secretary, Scott Bessent. The print New York Times today quotes him as follows:
“These entitlements are massive — I think the next four years isn’t the time to deal with them,” Mr. Bessent said, explaining that confronting the cost of entitlements needs to be a gradual process. “The next step is for a future administration to have the confidence to deal with the entitlements.”
Bessent’s advice echoes that from conservative editor and publisher Roger Kimball, who wrote, “It would be a mistake to talk about cutting Social Security, Medicare, or Veterans’ benefits. These programs help the people who voted for you; they will peel off if they think benefits will be cut (the press will be more than happy to tell them). There are ways to reform these programs without cutting benefits and services, but it will take some time to get there. Hit the ‘low-hanging fruit’ (as above) before thinking about addressing the big programs.”
Kimball’s piece was published at American Greatness, which is published by Chris Buskirk, part of the Omeed Malik-Donald Trump Jr. team at 1789 Capital.
People worry about the “third rail” politics of this stuff. A president who campaigned and got elected promising to tackle it might be better set up for substantive and political success on it. Pro-growth tax and regulation policies can improve the debt-deficit picture up to a point, and the Federal Reserve can also game or accommodate some of it in various ways if it wants to.
Yet a debt crisis of the sort that the prescient Michael Mandelbaum warned about or that James Grant refers to when he writes of “the gravity of America’s debt predicament” would have substantive and political costs so staggering that they are worth acting to prevent sooner, rather than later. That doesn’t mean a surrender to the green-eyeshade accountant or Paul Ryan PowerPoint presentation wing of the Republican Party. It would, though, mean taking an approach closer to Cole’s than to that sketched by Bessent and Kimball.
Israeli cabinet minister assails Tucker Carlson: An Israeli cabinet minister is joining the furor over Tucker Carlson’s video interview with a Columbia University professor, Jeff Sachs, who says that Israeli Prime Minister Netanyahu and “neocons in the U.S.” are “dragging the United States into countless wars in the Middle East.”
“Congratulations to Tucker Carlson for becoming the leading platform for fringe Holocaust deniers, conspiracy theorists, and blood libel enthusiasts who oppose the State of Israel,” Israel’s cabinet minister for diaspora affairs and combating antisemitism, Amichai Chikli, said in a post on X.
PCE: Two days after the Federal Reserve jolted the stock market by signaling that it’d be cutting rates less under Trump than it would have under Harris, a key monthly measure of inflation came in below the Fed’s 2 percent target. Personal Consumption Expenditures, or PCE, measures more closely what consumers actually spend, as opposed to the Consumer Price Index, or CPI, which measures prices. The Bureau of Economic Analysis released the PCE this morning and for the month of November both the PCE price index and the PCE price index excluding food and energy came in at 0.1 percent change from the preceding month, lower than the October figures.
Harvard professor and former Obama administration official Jason Furman, whose X account offers useful and free analysis of these numbers when they are released, boils the figures down: “Core PCE annual rate: 1 month: 1.4% 3 months: 2.5% 6 months: 2.4% 12 months: 2.8%.”
There are quirks to some of these measurements. For example, the government press release says, “Within services, the largest contributors to the increase were spending for financial services and insurance (led by financial service charges, fees, and commissions).”
For an example of what that means, think about a hypothetical person with a million dollar account at a wealth manager who pays pay one percent, or $10,000 a year, in fees. Imagine the stock market goes up ten percent in anticipation of a pro-growth president and Congress implementing business-friendly tax and regulatory policies. The account is now $1.1 million, and the “financial service charges, fees, and commissions,” are now $11,000 a year.
To the government that looks like personal consumption expenditures on financial service charges, fees, and commissions are soaring at an inflationary rate of ten percent a year. But the account holder isn’t complaining that he’s spending $1,000 a year more on his money manager. Instead, the account holder is happy that he’s $100,000 richer. This particular dynamic mainly affects PCE, not the PCE price index, but it’s the sort of granular detail (such as price increases on cigarettes or landline telephone service in an environment where many fewer people are using either) that frequently gets missed in talking about inflation.
Anyway, overall this is a data release that supports the Alan Reynolds/Scott Grannis “inflation is over” camp rather than the Wall Street Journal editorial page/Joe Sternberg “inflation isn’t over yet” view. I’ve tended to be more in the “inflation is over” camp, writing those words in a March 19, 2023 New York Sun column that appeared under the headline “Pervasive Bearishness Looks to be Unwarranted.” The S&P 500 Index is up about 48 percent since then. The point isn’t that the Fed technocrats have masterfully and flawlessly achieved a soft landing (they haven’t quite yet exactly), but more that markets have a way, eventually, of dynamically adjusting. That is a point also made in the November 8, 2023, post “Apartment Rents Are Moderating. Will the Fed Notice?” at FutureOfCapitalism, a predecessor site to this one.
Always the inequality: A New York Times news article about where new episodes of “Sesame Street” will air concludes with these two paragraphs:
Sesame Workshop and HBO were previously accused of contributing to inequality by allowing families who can afford premium cable to get new episodes of the show before others. In 2022, nearly 200 episodes of the show were pulled from Max.
“HBO is holding hostage underprivileged families from having access to timely first-run episodes of perhaps the single most educational children’s franchise in the history of electronic media,” Tim Winter, who was then the president of the Parents Television Council, said in a statement in 2019.
That seems a strange interpretation. Is the Times itself “holding hostage underprivileged families” by putting its content behind a paywall and making it available in print primarily to paid subscribers? Are the Boston Celtics and Boston Red Sox holding hostage underprivileged families by making their game broadcasts, with some exceptions, available also only to paying subscribers of premium sports channels? Is everyone who doesn’t immediately give their entire product away immediately free of charge, everyone in all of capitalism who charges a fee for a product or service, “contributing to inequality” and “holding hostage underprivileged families”?
Maybe I am missing something. It's been quite some time since I watched a full “Sesame Street” episode, though they are still available on PBS. Or maybe it is the Times and the source it quotes who are missing something. If providing early access to new “Sesame Street” episodes to paying customers generates revenue that supports the creation of the content, it seems like it could be a reasonable tradeoff. Of all the inequalities in the world to get riled up about, this one seems low on the list.
David Brooks on finding faith: David Brooks has a long essay in the New York Times about his religious awakening: “these days I’m enchanted by both Judaism and Christianity. I assent to the whole shebang. My Jewish friends, who have been universally generous and forbearing, point out that when you believe in both the Old and New Testaments, you’ve crossed over to Team Christian, which is a fair point.”
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