Yale

According to recent news reports, Yale University gave its former president, Richard Levin, a bonus of $8.5 million after his retirement.  Even in comparison to the stratospheric salaries and perks given to administrators in higher education, this payment stands out.  It appears to be the largest pay out ever to a university administrator, and not by a little. The bonus was in addition to his annual salary that topped $1 million, which also ranks him among the very highest compensated university administrators.

There are all kinds of obvious reasons why this is disturbing and the timing of this revelation could hardly have been worse. Many students and their families all over the country have just committed to colleges and are now scrambling anxiously to find the money to afford it. Tuition continue to soar; wages barely grow; the student loan system has become inadequate; and student debt has become a national issue.  Even for Yale, $8.5 million dollars is not chump change.  It could really have made a difference in the lives of many.

This is hardly news. The cost of higher education, and the spiraling salaries of administrators, has been discussed (rightly) ad nauseam. What really upsets me about this, though, is something different that to my knowledge has been discussed far less: values.

Yale College prides itself (again, rightly) on its liberal arts education. It is an education that, to be sure, is supposed to provide skills to students that will benefit them materially throughout their lives: critical thinking and reasoning; the ability to write and present oneself; quantitative and sometimes technical skills. These are skills prized by future employers. They are also, though, skills that can be obtained at almost any decent university at a fraction of Yale’s price. What sets the liberal arts education at Yale and its peers apart are the two values that lie at its heart: those of meaning and service.

The larger purpose of a liberal arts education is to provide the intellectual resources with which students can construct for themselves meaningful lives. This is not a matter of teaching a magic formula. It is a kind of habit of mind or virtue, gradually and consistently instilled, that drives a person to self-knowledge, critique, and change throughout a lifetime. Meaning is not money and money is not meaning; material goods are necessary and fun, but also a means rather than an end. Worth is measured against other standards.

To receive this kind of education is an unbelievable (and unbelievably expensive) privilege, and that privilege brings with it responsibility. Here, then, is the second value: service. If an elite liberal arts education stands for anything, it is for responsibility to others. Such service is not just the price of privilege, it is also the basis for a life of meaning. The most famous line in Yale’s school song, “For God, for country, and for Yale,” is tongue in cheek, but it also captures something true about the values of the school.

Now, I don’t consider myself to be naive. I was attracted to Yale as an undergraduate for precisely these values but I know that many of my classmates were motivated by the promise of a rich payoff. Nevertheless, when I was there (and I suspect this is still the case) the public discourse was heavily skewed toward these issues of meaning and service. We heard it from the administration constantly; we often more subtly got it out of our classes; and we talked about such issues constantly among ourselves. I am sure that was not everybody’s experience at Yale, but it was that of many.

This is why I found the $8.5 million bonus so disturbing. It was more than a matter of the questionable allocation of resources or poor optics. It was a betrayal of the values that undergird the institution.

Two primary reasons were given to justify the bonus: (1) to retain or compensate him for the money that he could have made had a chosen a job in the for-profit sector, and (2) to reward him for a job well-done. Both of these are problematic.

Presidents of large and complex institutions of higher education such as Yale have difficult jobs. They are demanding and deserve to be well-compensated. But universities cannot, indeed should not, compete with investment banks and corporations. Like leaders in the for-profit sector, university presidents must run large and complex organizations. Unlike CEOs and partners, though, a university president at a place like Yale is a national leader of higher education and has the additional responsibility of promoting its values, both institutionally and personally.

To serve as president of Yale is not a burden that needs high compensation to attract the best candidates. It is in itself a privilege and a service. We want university presidents who serve because they believe in what they are doing and because they feel an obligation to their institutions and the broader public. University administrators, and the bodies that hire them, need to practice the values that they preach.  If the trustees really wanted to reward Mr. Levin, why didn’t they instead use the money to create an academic program or scholarship to honor him?

One need not be a university professor to know that there are few demographic groups more attuned to hypocrisy than college-age students. If a university administration sends the message that meaning and accomplishment is measured in money, it will not be lost on students. With its $32 billion dollar endowment, Yale is almost uniquely positioned to be able to push back against this mentality. It is disappointing that it chose not to.

I of course have no idea what Mr. Levin will choose to do with his windfall. He knows, far better than I, both how capital can best be put to socially productive purposes and that large bequests to heirs are socially corrosive. I assume that he will do the right thing, whatever that might be, even as he brings his expertise to another (this time for-profit) educational venture, Coursera, for which he is being equally well-compensated.

Yale University is not in any substantive way a business.  It is a non-profit institution of higher education, whose purpose (like all non-profits) is to further the public good.  In addition to fostering the creation of new knowledge through research, its goal is is to give the finest possible education to the most possible students, while instilling in them a set of values distinctive to the institution.  Those values, Richard Levin’s bonus suggests, center around money.  I hope that that is not true.