Harvard is a hedge fund with a school attached

Jim Manzi, in a post from back in 2008:

The overall Harvard corporation gets to make money through investment returns on its endowment (or, more precisely, the General Investment Account, which currently includes about $6 billion of investable assets in operational accounts in addition to the $34 billion endowment) that doesn’t get reported as revenue. Last year, Harvard made more than $7 billion of tax-free investment income.

So if you just think about how much cash went into the shoebox and how much came out of it, a more accurate accounting for Harvard for FY 2007 would, in rough numbers, be a lot more like the following:

Receipts = $2 billion of operating revenue + $7.3 billion of investment income + $0.6 billion of gifts to the endowment = ~$10 billion.

Operating costs = ~$3 billion.

Profit = $10 billion – $3 billion = ~$7 billion.

This explains why Harvard’s net assets increased about $7 billion in 2007, from about $35 billion to about $42 billion.

Viewed purely in terms of economics, Harvard is really a $40 billion tax-free hedge fund with a very large marketing and PR arm called Harvard University that has the job of raising the investment capital and protecting the fund’s preferential tax treatment.

Of course, Harvard isn’t doing quite so well as of late. Here’s the chart of the university’s net assets from the latest Harvard University Financial Report:

Screen Shot 2013 07 13 at 4 45 40 PM

The fact that Harvard’s endowment fund isn’t doing well doesn’t mean that the comparison to hedge funds just goes away (hell, if anything it just makes it more apt).

That’s why Reuters’ Felix Salmon suggests that private universities like Harvard should lose their tax-free status:

The dollar value of universities’ tax exemptions is enormous — and it almost goes without saying that if we simply abolished those exemptions, and used the proceeds to spend on higher education, we would get vastly more bang for our buck. The overwhelming majority of the tax expenditures go to the richest universities — the ones who need the money the least. Meanwhile, great institutions like the University of California are slowly starved to death: direct fiscal expenditures, it seems, are much, much easier to cut than more-hidden tax expenditures.

Becoming a scientist isn’t an option for most kids

The Path to Being a Scientist Doesn’t Have to Be So Narrow:

Many American students are all but knocked out of the race toward a graduate science degree before their 13th birthday. To get on the advanced math track in high school, you need to complete algebra in the eighth grade. This is standard practice in affluent communities but rare to nonexistent in many low-income schools. Then students must advance through calculus—another subject more available to the privileged—by their senior year of high school. Then they must navigate the complex college admissions process and come up with an increasingly large amount of money to pay tuition. Then they have to slog through huge, impersonal freshman lecture courses that are designed to weed students out. Only then can the few students who remain advance toward science careers.

While I look forward to online classes making higher education more accessible in the coming years, I also worry about the cultural shifts that need to happen if America is going to stay competitive in the future. Parents need to understand the importance of motivating their children to aspire to bigger and better things. That can’t be taught in the classroom alone. 

If a university-level education can be offered for little-to-no-cost to anyone anywhere in the world, we need to make sure that our kids take advantage of that opportunity because at some point, people won’t need to come to America to be successful.

Rather than increasing focus on technology, states are removing computer requirements altogether

Tech industry gender gap: Closing it starts in the classroom:

Take Kansas, where the education establishment thought it already had computing covered through vocational courses in typing and Microsoft Office. When the state’s Board of Regents realized that most kids learn basic computer skills through other courses, it cut the “computer technology” requirement altogether, instead of updating it to include actual code. (What the board didn’t realize is that many high schools, realizing its students were literate with computers, used the requirement to develop courses involving computer science.) 

“Most people think that our kids are coming out of childhood with computer skills that are relevant and useful,” says Tabitha Hogan, who teaches in a district an hour south of Wichita, Kansas and leads the state’s Computer Science Teachers Association chapter. “That’s what’s hurting us. They might be savvy enough to do something quickly with their friends in social media, but not to really develop their own ideas.”

Introductory computer science courses should be mandatory in every high school in this country. Having a surface-level grasp on programming – even just knowing what can be realistically be done with code – is going to be just as important to workers in the future as knowing proper grammar and basic math is today. 

The fact that Kansas removed the technology requirement altogether is despicable and an embarrassment for everyone in the state.

Don’t go to grad school in the humanities

There are no academic jobs and getting a Ph.D. will make you into a horrible person: A jeremiad.:

Well, what if I told you that by “five hours” I mean “80 hours,” and by “summers off” I mean “two months of unpaid research sequestration and curriculum planning”? What if you’ll never have time to read books, and when you talk about them, you’ll mostly be using made-up words like “deterritorialization” and “Othering”—because, as Ron Rosenbaum pointed out recently, the “dusty seminar rooms” of academia have the chief aim of theorizing every great book to death? And I can’t even tell you what kind of ass you have to kiss these days to get tenure—largely because, like most professors, I’m not on the tenure track, so I don’t know.

Don’t do it. Just don’t. I deeply regret going to graduate school, but not, Ron Rosenbaum, because my doctorate ruined books and made me obnoxious. (Granted, maybe it did: My dissertation involved subjecting the work of Franz Kafka to first-order logic.) No, I now realize graduate school was a terrible idea because the full-time, tenure-track literature professorship is extinct. After four years of trying, I’ve finally gotten it through my thick head that I will not get a job—and if you go to graduate school, neither will you.

Rebecca paints a very bleak picture of what the job market is like for those who decide to follow the academia route. Glad I’m taking a different path.

The CMED Act: tax oil companies to provide quality education, aid cities, and create jobs

oil drilling california

In 2011 alone, California produced a grand total of approximately 200 million barrels of oil and 230 billion cubic feet of natural gas, making our state the fourth largest producer of oil and the tenth largest producer of natural gas in the country.

Yet, despite this, California does not get a dime for the resources that are extracted from our state and sold on the global market. This is because, unlike every other major oil and natural gas producing state in the nation, California has not enacted an extraction fee on the energy that is taken right from under our feet.

Let’s think about this for a moment.

California, the ninth largest economy in the world, is ranked 43rd in the country in terms of K-12 spending per pupil. The University of California, the flagship public university system of the nation, has seen a 14% decrease in funding since 2010.

And at a time when a quality college education has never been more important, tuition is skyrocketing, making a diploma unaffordable for an increasing number of young Californians. Meanwhile, at 9.8% unemployment, even those who have graduated from college find themselves without work or working at jobs they are tremendously over-qualified for. The appalling disrepair of our municipal infrastructure only discourages employers from bringing more jobs to our state. But our state government has its hands tied behind its back. The $250 billion dollar state debt all but assures that there will be no additional funding for education and infrastructure in the near future.

And we are giving away our oil and natural gas. We have the wealth to fund the investments that California needs and deserves and we are giving it away. This is to say nothing of that fact that by not charging an extraction fee on oil and natural gas, our state, which prides itself as a leader of reducing CO2 emissions, is not putting a price on the CO2 that eventually makes its way into the atmosphere. To say this is ridiculous would be an understatement. It is an outrage.

The California Modernization and Economic Development Act (or CMED) would put an end to it. By implementing a modest 9.5% extraction fee on oil and natural gas (Alaska, hardly an enemy of big oil, has implemented a fee of 24% on oil and natural gas that’s extracted from the state), CMED would raise between 2 and 2.5 billion dollars in revenue for California. A little more than half, 1.2 billion dollars, would be allocated in four equal parts for K-12, California Community Colleges, Cal State Universities, and the University of California for the purposes of increasing quality and restoring tuition to 2010 levels. 400 million dollars will be used to support small businesses by aiding their transition to cheaper, carbon-free and carbon-reduced forms of energy, which would in turn empower them to expand, hire additional workers, and reinvest. An additional 300 million dollars would be apportioned to the general funds of California County Governments for the purpose of upgrading and better maintaining municipal infrastructure, funding the conservation of regional park land and providing a multitude of other public services.

These are more than investments, they constitute a complete vision for responsible economic development in California. Making that vision a reality is as easy as ending the giveaway of our oil and natural gas, but it’ll take a popular movement if we truly want to realign the policies in Sacramento with the wishes and desires of Californians. Simply by taking a few moments, right now, and visiting www.cmedact.org, liking our Facebook, following us on Twitter, telling your friends or donating anything you can, even $5, you can provide the crucial grassroots support we need. It’s that easy. You could be the difference between failing to qualify and qualifying CMED on the 2014 ballot, so that Californians can have a chance to pass it democratically.

We can do this California, but not without your support. If you think it’s ridiculous that we are giving away our oil and natural gas at a time when California is more cash-strapped than ever, join our cause. It won’t be easy, but together we will qualify and pass the California Modernization and Economic Development Act and put our state back on the right track.

Do the Chinese want to create a generation of geniuses?

chinese education

Chinese genetic researching firm, BGI (previously known as Beijing Genomics Institute) has been compiling the DNA of 2,000 of the world’s brightest individuals.

Vice reporter, Aleks Eror, recently had a chance to speak with NYU professor and evolutionary psychologist, Geoffrey Miller, about his experiences with the project.

What is BGI looking for with their microscopic library of genius genes? They plan to sequence them and identify genetic markers for intelligence.

Intelligence is an abstract trait, which makes this a monumental challenge.

Once they can identify the genetic markers, they can move on to ensuring soon-to-be parents have the most intelligent child they can out of their genetic possibilities.

Miller explains:

“Once you’ve got that information and a fertilized egg that’s divided into a few cells, you can sample one of the cells to figure out the expected intelligence if it’s implanted and becomes a person.”

And for those of us who have forgotten all our biology:

“Any given couple could potentially have several eggs fertilized in the lab with the dad’s sperm and the mom’s eggs.

Then you can test multiple embryos and analyze which one’s going to be the smartest. That kid would belong to that couple as if they had it naturally, but it would be the smartest a couple would be able to produce if they had 100 kids. It’s not genetic engineering or adding new genes, it’s the genes that couples already have.”

This is certainly a possible way for China to jump into–what it feels is–it’s rightful place in the global pecking order, though it could also go wrong as well. Time will tell though, because if you had any doubts about their desire to move forward, BGI just acquired Complete Genomics, a firm which possesses cutting edge human genome sequencing technology.

 

This man is on the House Science Committee

Talking Points Memo:

“All that stuff I was taught about evolution and embryology and the Big Bang Theory, all that is lies straight from the pit of Hell,” Broun said at a banquet for a church sporting club. “And it’s lies to try to keep me and all the folks who were taught that from understanding that they need a savior.”

Broun, who added that “I don’t believe that the Earth’s but about 9,000 years old,” will remain on the science committee in the 113th Congress.

Okay.

26 reported killed in Newtown, Conn., school shooting

USA Today:

Groups of students — some crying, some holding hands — were escorted from the school by teachers. Some witnesses reported of up to 100 shots. There were unconfirmed reports that the assailant, dressed in military style assault gear, shot most of the victims in a kindergarten classroom.

[…]

Alexis Wasik, a third-grader at the school, said police were checking everybody inside the school before they were escorted to the firehouse. She said she heard shots and saw her former nursery school teacher being taken out of the building on a stretcher, but didn’t know if the woman had been shot.

Tragic. My thoughts are with the families of the victims.

 

Catcher in the Rye dropped from US school curriculum

From The Telegraph: 

A new school curriculum which will affect 46 out of 50 states will make it compulsory for at least 70 per cent of books studied to be non-fiction, in an effort to ready pupils for the workplace.

Books such as JD Salinger’s Catcher in the Rye and Harper Lee’s To Kill a Mockingbird will be replaced by “informational texts” approved by the Common Core State Standards.

This sounds pretty bad at first glance. Well, I’m going to play the devil’s advocate for a minute. Here’s Apple’s CEO Tim Cook on education in the US:

Given that, why doesn’t Apple leave China entirely and manufacture everything in the U.S.? “It’s not so much about price, it’s about the skills,” Cook told Williams.

Echoing a theme stated by many other companies, Cook said he believes the U.S. education system is failing to produce enough people with the skills needed for modern manufacturing processes. He added, however, that he hopes the new Mac project will help spur others to bring manufacturing back to the U.S.

Maybe a greater focus on practical education would be a good thing in the U.S. With that said, the piece I linked to from The Telegraph has no citation that I can see, so I’m hoping this isn’t actually a thing. Especially this part:

Suggested non-fiction texts include Recommended Levels of Insulation by the the US Environmental Protection Agency, and the Invasive Plant Inventory, by California’s Invasive Plant Council.

That doesn’t sound like it could actually be a thing, right? Right?