"If hedge funds could buy universities and then split them up so that the HF keeps the sports programs and they sell off the academic departments, they would most definitely do that"
Universities are already doing this. Those with modestly large endowments are functionally private equity firms whose job is to generate enough cash flow to pay themselves, top admins, sports coaches and profs.
Academics, research, govt grants etc. are all means to that end.
In my opinion, this is like complaining that the US Postal Service isn't profitable. It isn't a business, framing it in terms of profitability is missing the whole reason it exists. No one expects a middle school soccer team or a university's drama department to be profitable, but we still invest in those things because we as a society think it is valuable for students. College sports has value beyond the money people pay to watch it.
"College sports has value beyond the money people pay to watch it."
Debatable. Any college sports program could be dialed back to point where it isn't being subsidized by the primary mission of the university. American college sports is a global outlier. On that basis alone, I would bet that arguments for the value of college sports don't hold water.
I'm sorry, it's not debatable. People who don't like sports tend to really struggle to actually consider the larger ecosystem that exists around sports and sports fandom. For example, there is a widely studied phenomenon that a successful sports team leads to increased applications, which in turn allows a school to be more selective and thereby increases the school's academic standing[1]. You can make all sorts of debates over how strong this impact is or whether it is a particularly efficient way to raise a school's standing, but there is clearly some value here being generated "beyond the money people pay to watch it."
Are selectivity and academic standing beneficial to society overall? Maybe we'd be better off more broadly supporting higher education rather than turning it into a weird competition based on non-academically-related marketing.
Maybe we'd be better off more broadly supporting trade schools. There are way too many people attending college who don't really belong there and are just going through the motions.
I actually do favor paying more attention to the public education system in general.
Don't get me wrong, I love Harvard, but at the same time, our hybrid of quasi public / private higher education reminds me a lot of our health care system, and I wonder if in a century, we'll look back on both as weird anachronisms.
This is fundamentally a critique of capitalism. And if we are honestly opening this up to a discussion of the ways capitalism damages this country, I don't think higher education is either the best example or the one most urgently needing a fix.
"Capitalism" wouldn't have occurred to me here. I live in the shadow of a Big Ten university that's a government institution. And this will reveal my ignorance about sports, but I don't know of any private university that's at the championship level in football at the present time.
Disclosure: Notre Dame won the championship when I was in grad school there.
I was more remarking on your criticism of competition as an appropriate way to deal with scarcity and/or try to maximize societal benefit.
Although now that you mention the public/private distinction, the difference in that has been drastically reduced over the years as state appropriations have shrunk as a percentage of overall funding. You mentioned the Big Ten and "championship level in football", so let's look at Ohio State as an example since they won the last championship (and for what it is worth, they beat Notre Dame in the title game). They get only 10% of their revenue via state appropriations[1]. For sake of comparison, the OSU athletic department brought in a little over half that in revenue[2]. Meanwhile, 21% of the school's revenue comes from "tuition and fees", so offering an appealing product in the competitive market of higher education is incredibly important to their long term mission.
It's always hilarious to see people who are ignorant about the basics of history and economics whining about the evils of capitalism — on a web forum run by capitalists no less. Free market capitalism has been the best thing ever for this country.
It's always hilarious to see people who are so defensive about capitalism that the mention of any flaw is received as a total and complete condemnation. It is noticeable that you didn't try to refute any specific point made, you are simply objecting to the idea of someone criticizing capitalism. I guess the one market that we can't trust is the marketplace of ideas.
Long live American exceptionalism. Our colleges are global outliers in many ways, and this is why we have the best higher education system in the world. Don't presume to know how to make systemic improvements: you're not smart enough to predict the impact of major changes.
You don't pay the director of a university's drama department millions of dollars per year. Successful football and basketball coaches get paid those kind of sums.
What specifically is the problem with that? Do you think a "director of a university's drama department" brings the same value to a university as "Successful football and basketball coaches"?
Mainstream economics operates with a subjective idea of value. The previous poster can think whatever he wants about the drama vs sports, there's no objective right or wrong.
What does exist is an outcome about who gets paid.
There seems to be a large segment of HN users with an irrational distaste for sports. I suspect it's because they lacked the work ethic and pain tolerance to ever become good at any sport. So they denigrate sports in general as a mental coping mechanism.
CMU for example, is known for the school of computer science, and the arts, especially drama, though some people might know it better for Andy Warhol having been an alum.
That's how an elite university should operate. Sport is fine. It's healthy. But warping the educational mission to feed the maw of an exploitative sports economy is something no university should be involved in.
What next? MMA as a college sport? It's a free country: beat each other's brains out. But to pretend that US college sports is anything but a grotesque distortion is disingenuous.
What's happened with Division-1 college revenue sports is that the word "students" has been mangled beyond recognition. Meanwhile the investment in the drama department is in perpetual decline.
The question in my mind is if society would be better off recognizing the athletes as "workers" instead of as "students."
To offer a bit of contrast, I attended a Division-3 college where the starting quarterback was a physics major, and the captain of the basketball team majored in chemistry. When a Divsion-1 football player majors in a substantive discipline, it makes the national news.
Why should universities focus on drama? People can learn acting at their local community theater.
To be clear I'm not in favor of eliminating college drama departments. But it's rather silly and arbitrary to claim that drama is somehow more important than sports.
Maybe but most endowments actually have "legally?" bound or otherwise contracted uses in universities. Thats why Harvard can't just tap it's endowment to fund research the current Admin has cut. So I'm doubting that endowments are being used in this way to pay coaches.
Sure, but if an endowment is paying for, say, the football coaching staff, then that leaves that much more money free in the general fund to pay for other things.
If the endowment is paying for something that otherwise wouldn't be paid for generally, that's a different story.
This isn't really fair I think. Academic money is actually not fungible - it can't be used to fund athletics, and vice versa. Just because both pots are relatively large doesn't mean that the money itself is fungible.
How are college endowments similar to hedge funds?
For one, they put money into hedge funds as investors. And broadly, they're long on illiquid investments but have short term obligations for salaries, pensions etc. That's a hedge fund with a slightly different time horizon and intent.
Some of those short term obligations are covered thru grants, fed money. But when that dries up (eg, Harvard and Trump), you're squeezed.
Some universities with large endowments used to be referred to as hedge funds that happened to have professors. Now they happen to have pro sports teams too.
Honestly, even from a non-financial perspective, splitting them up just makes sense to me. It's baffling to me that we've come up with a system that essentially combines minor league sports teams with academic institutions of higher learning.
Except it's sort of a poor correlation. Without making a study of it the best US collegiate football programs at least tend to be large state universities--which, don't get me wrong, are often good schools if you want them to be for you--but tend not to be the schools that come up in discussions of large endowments and the like. Basketball is more of a mixed bag in that it can rely on one or two star players and hockey, as I wrote elsewhere, is very regional and relatively small schools in the North have very good teams from time to time.
The GP says it's baffling to combine sports teams with academic institutions, and you're saying it's not because those that do tend to have smaller endowments? Talk about a non sequitur
I do think that sports are part of the college/university experience which you are of course free to disagree with. There are, of course, smaller schools that have relatively minimal athletic programs. Without making a scientific study of it, I also don't think the biggest endowments really correlate to the biggest and most successful sports programs, especially in football.
As the person you originally responded to, I have to agree with the one who you're responding to now; I don't really understand at all what endowments have to do with any of this. My argument is that the goal of education isn't helped by being intrinsically tied to a large amateur sports league. If you're trying to argue that public schools require sports teams in order to succeed financially due to them not having endowments, I think you skipped a few logical steps that I'd disagree with before you got to the question of endowments, e.g. the premise that being profitable is a primary goal of public universities.
As for sports being part of the college experience, I don't disagree with you that they are right now, but I don't see why that would have to be the case, since it certainly didn't use to be the case historically and still isn't the case in many parts of the world. From my perspective, they're so far removed from the actual purpose of universities that they've essentially marginalized the actual point of them for many schools, and the idea that they're integral to the experience is a sign of how much they've failed at their actual goal.
>As for sports being part of the college experience, I don't disagree with you that they are right now, but I don't see why that would have to be the case, since it certainly didn't use to be the case historically and still isn't the case in many parts of the world.
I think it tends to be in the Anglosphere at least. I won't really argue for the big college football etc. programs which has been an ongoing debate in the US for decades for Top 10 schools and related. James Michener wrote a book in the 70s or so. But athletic activities in various more or less organized forms are pretty established at many US schools and eliminating them would bring a pretty wide revolt (and not just talking about football).
You're not thinking things through. Splitting off sports from academics would wreck alumni fundraising for a lot of schools. For better or worse, when the team wins the alumni open their wallets. And the less lucrative sports would essentially disappear (especially for women).
I'm not sure how much sense this argument makes. Most of the big sports schools are public, and I'd argue the budgets for academics at public schools should come from the states they're in, not from donations. I don't think it's obvious that private universities are raising that much money from their sports programs, but I'm open to being convinced if you have sources indicating this isn't the case.
As an aside, I don't think telling people that they haven't thought of things sufficiently is a particularly effective way of convincing them. There are a lot of potential other reasons someone might not agree with your point of view, and it's a bit hypocritical to tell someone else they're "not thinking things through" when you haven't actually figured out the reasoning behind their opinions.
You're not thinking things through, or doing even the bare minimum research. Financial data on sports revenue for most colleges is out there for anyone who cares to look. It's not my job to convince you of anything, I'm simply telling you how it works.
"If hedge funds could buy universities and then split them up so that the HF keeps the sports programs and they sell off the academic departments, they would most definitely do that"