You discover that one American institution is already undermining the country’s future: the universities.
They have everything you need: a goldmine of intellectual property created by professors with poor op-sec and who are happy to share it for some rubles or yuan deposited directly to their bank accounts; cybersecurity practices that would make a 90s computer hacker blush; sky-high tuitions guaranteeing debt-servitude for all students but those from the wealthiest families; a propensity to take foreign money and set up as many “programs,” “institutes,” and “centers” as they need to to keep getting it; tax-free endowments that you can both fleece through getting to invest in your companies and that you can send your agents to work for; and excellent credentialing abroad so your colleagues can send their children there to train the next generation of mandarins to rule and manage society.
These institutions are a mother load of negative externalities, and a godsend for anybody looking to undermine the American future. And the best part is that the American government props them up with tax-free status and relatively little oversight.
You and your government can profit off these externalities. All you need to do is bribe some professors, infiltrate some security networks, and send your officers to attend as students.
. . .
America’s richest universities are sitting on more than $100 billion in endowments. Those endowments are tax-free but operate essentially the same as a family office or a hedge fund. They have Chief Investment Officers and teams of analysts and associates moving money around between private and public markets. If Harvard’s $40.9 billion endowment were treated as a hedge fund, it would be about the same size as Elliott Management and one of the largest in the world.
David Swensen, the Chief Investment Officer for Yale University (which recently announced it was going on a hiring freeze due to the coronavirus pandemic), admits in his book Pioneering Portfolio Management that he would not be able to get the outsized returns he does for Yale if it were not for the tax-free status the endowment gets. Yale’s endowment is over $30 billion.
With these kinds of numbers, America’s universities are tax-free hedge funds with classrooms attached, as TAC covered in 2012. With $100B+ in their combined endowments, American universities could open a campus in every major American city. But they don’t. They could pay students to work hand-in-hand with Americans in rustbelt cities, advancing sound infrastructure plans for autonomous vehicle proliferation, upgrading American cybersecurity infrastructure, and starting businesses locally. But they don’t. They could pay off the debt of every med school graduate who works in a struggling rural hospital. But they don’t.
Instead, they lay off working class staff and move to glorified Zoom sessions at the first sight of foreign money drying up. All while giving students pass/fail grades for the semester.
. . .
It’s time to give up the romanticized view of American universities as noble institutions of learning that just so happen to have endowments to fund this noble pursuit. It’s time to recognize them as hedge funds that keep students around to maintain a tax-free status. It’s time to tax the endowments.
Random stuff I find interesting and you may not.
