Creative Destruction Comes to Universities

The recent rather brutal attacks on some of America’s most prestigious universities by the president of the United States are the culmination of years of a wanton disregard by these institutions of public opinion and support. American higher education is now reaping what it has sowed in recent years — and it is a bitter harvest as a consequence of indifference or hostility to the views of the American people in general, and especially to the millions — students, alumni, politicians, major donors, taxpayers — that provide the funds that sustain them. (RELATED: The Fall of Harvard: How America’s Oldest University Became Its Most Expensive Liability)

On Tuesday, the last of a trilogy of books that I have written on higher education, Let Colleges Fail: The Power of Creative Destruction in Higher Education, was released, arguing that the American private sector’s great success is a result of its constant battling for survival, sometimes unsuccessfully. Mistakes have big consequences in business, but far, far less so in higher education. What happened to Enron? Why is Eastman Kodak a shadow of its former self? But Harvard, Yale, and Princeton have been at the top of the academic heap in 2025, 1925, and even 1825.

Higher education is different, but not necessarily in a good way. Hence, the Trump administration is creating some previously unprecedented destruction of its own, upending America’s most elite colleges and universities.

The culmination of this drama is its actions against Ivy League schools, most recently and importantly Harvard, a school that is facing one of its most serious threats in its 389-year history. Harvard’s president du jour, Alan Garber, strikes me as one of the more reasonable of the recent academic leaders permeating Harvard Yard, but he even waxes indignant over an attempt by the federal government to alter its behavior, arguing indignantly that it is a private school. (RELATED: The Fall of Harvard: How America’s Oldest University Became Its Most Expensive Liability)

But “private” in what sense? It directly or indirectly receives hundreds of millions, if not billions, of dollars in government (almost entirely federal) funds annually, far more on a per student basis than such so-called public or “state” universities as nearby Bridgewater State. How dare you freeze our research grants or threaten our tax-exempt status! To borrow from the late Leona Helmsley, taxes are for the little people, the ones owning automobile body shops or beauty parlors who dropped out of Bridgewater State after two years, not for the Anointed who went to Harvard. (RELATED: Progressives’ Aversion to Private Industry Does Not Extend to Private Universities)

Full disclosure: a few generations ago, I was accepted at Harvard but even at 17 years old wisely realized that I was a somewhat more egalitarian Midwesterner than the future bien-pensant and wannabe Philosopher King typically found in Cambridge.

The arrogance, the smugness, and even the lies and dishonesty of the Ivy League and its close cousins, so stunningly demonstrated at congressional hearings in December 2023 by the presidents of Harvard, Penn, and MIT, actually has been around for years, but getting stronger by the year for a simple reason: there are often few if any negative consequences of inappropriate behavior in academia, unless one bucks the prevailing leftish, Woke Supremacy dominating campuses.

An early example of the power of the Woke Supremacy came two decades ago when Harvard President Larry Summers probably accurately stated that it appeared to him that, on average, males have a greater affinity and competence for mathematical oriented study than do females. That was intolerable sexism in Cambridge, so the Arts and Sciences faculty raised such a fuss that Summers resigned. I often disagree with Summers (once rather publicly at a congressional hearing at which we both testified), but he is a serious scholar who has recently himself appropriately shown chagrin at the antisemitic and other antics of members of the Harvard community.

Increasingly, colleges and universities, including Harvard, have engaged in academic theft, with reports of plagiarism or fraudulent research results appearing with embarrassing frequency. Francesca Gino, Tandon Family Professor of Administration at Harvard, made a name for herself writing about academic integrity and honesty, only to be accused by several scholars at other universities of falsifying results in some of her own research, with recent accusations of plagiarism in the prestigious journal Science adding to her alleged sins. (RELATED: The Appalling Tunnels Beneath Our Universities)

But Gino is a small fish compared to former Harvard President Claudine Gay, known for her spectacular insensitivity to well-founded accusations of antisemitic behavior on Harvard’s campus that was revealed at a congressional hearing. Gay also, according to numerous news reports, plagiarized some of her rather meager (by Harvard standards) research results in her career as a scholar. Her ascendancy to the Harvard presidency was clearly the result of identity politics rather than traditional academic assessment of potential for university leadership. (RELATED: College Courses Stay as DEI-Obsessed as Ever)

These mounting concerns about dishonesty and academic fraud are on top of a broader concern that Harvard, and other elite schools as well, have an overwhelming leftish faculty that seem unconcerned about the lack of intellectual diversity on campus, even aggressively working to maintain a Wokish Monopoly reminiscent of the uniformity of approved thinking in universities in the Soviet Union in, say, 1940 or even 1980.

The Ivy League schools were already paying a price for their Public Be Damned attitude, with major donors to schools like Penn and Harvard announcing their plans to stop donating. Even rich so-called private schools are utterly dependent on outsiders — alumni, government grants, foundations — for funds to survive. A recent Wall Street Journal analysis said that Harvard’s tuition and other student-related fees only cover 21 percent of the cost of running the institution. Moreover, most endowment funds are earmarked by donors for specific purposes and cannot be reallocated without violating donor intent and legal agreements.

Then comes Donald Trump. Many of the pronouncements of the administration regarding universities, including Harvard, show a narcissistic and arguably unconstitutional show of power by the president. It is not an orderly and reasoned reassessment of public policy, and needs to be modified. But in terms of demonstrating seriousness of concern and intent, it is masterful theatrical Shock and Awe. (RELATED: Is Georgetown on the Verge of a Financial Breakdown?)

The basic problem in higher education today is that the incentive system is not working properly. You plagiarize something, and maybe you are chastised by the administration, but you usually keep your job. After you are tenured, you might work a 30-hour week for 35 weeks a year, except, of course, the year you go on paid sabbatical leave, and life goes on.

There is no incentive to use buildings much more than about eight months a year, and never on weekends. That is not true in the private sector. You fail to outwit your competitor, disregard new trends and technologies, you go bankrupt. Most of the companies in the top 25 of the Fortune 500 today were not there, at least in the same form, in 2000. Yet most of the top 25 universities today, as ranked by, say, U.S. News, were also there in 2000. And Harvard was at or near the top in 2025, 1925, 1825, and 1725 — no business can match that.

Colleges act like they have tenure — a permanence impervious to acts of severe transgression that would kill or severely damage companies competing in markets.

The Harvard community needs to be frightened. Above all, some adults need to take charge. Private university governing boards are usually a joke, exercising no power, unwieldy in size, without consequence. That needs to change. Who really “owns” Harvard? The multiple (in Harvard’s case) governing boards? The faculty? Wealthy donors? It is nebulous, unsettled, and thus invites takeover attempts — by the federal government.

READ MORE from Richard Vedder:

Higher Education’s 7 Deadly Sins

Adam Smith Is a Better Economist Than Donald Trump

Progressives’ Aversion to Private Industry Does Not Extend to Private Universities

Richard Vedder is a distinguished professor of economics emeritus at Ohio University, senior fellow at the Independent Institute, and author of Let Colleges Fail: The Power of Creative Destruction in Higher Education.

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