[OUTLOOK]Higher Ed Inc. and the Money Machine

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[OUTLOOK]Higher Ed Inc. and the Money Machine

Foreign professors have come into great vogue in Korean universities. Seoul National University announced a plan to hire 100 foreign professors each year from 2002 until 2004. Korea University plans to fill 17 percent of its faculty with foreign professors.

In addition, Seoul National University will open its presidency to outside figures, including foreigners. The university reform plan does not care about the president's nationality if he has management ability. Only a few years have passed since Song Ja, former president of Yonsei University, was bitterly insulted for his American citizenship. Much has changed.

Harvard University picked a new president this summer. There were as many as 500 candidates for the 27th president of the 365-year-old university. Among them, were the former U.S. President Bill Clinton and Vice President Al Gore. But Lawrence Summers, former Secretary of the Treasury, won the job. Mr. Summers had become the university's youngest professor at age 28. He was acknowledged as a genius when he received the John Bates Clark Medal for young economists under age 40 - widely regarded as more difficult to win than the Nobel Prize.

Students are clients of the university. If students, as education consumers, cannot benefit from a new president, even a genius labors in vain. Harvard students took little interest in the choice of president; a chicken feather stuck in a pizza made a bigger splash. Students would prefer a mentor like Charles Eliot to a president dialing the telephone all day to collect money. As president, Eliot remade Harvard into an advanced institution by renovating its curriculum. This time Harvard selected a former economic bureaucrat, not an academic scholar. This selection tells where Harvard is headed.

More than 100 U.S. universities are currently seeking new presidents, a difficult task, for the job is no longer as prestigious as before. Universities in Korea also want presidents who can raise a lot of money. But there is one thing we miss when we look carefully at the U.S.-style fund-raising system.

Fund-raising may not be fully solved just by calling a capable president. There is a separate fund-raising machine in universities, which exceeds the corporate one. While Harvard's campus is located in Cambridge, Mass., its fund-raising machine is in New York. The machine operates more than 9,000 accounts, just like a gigantic conglomerate. As it yields profit enough to be ranked in the top six corporations if Forbes evaluated it, directors of the money machine receive larger salaries than Harvard's president. The university's wealth is partly attributable to rich people who don't leave everything to their offspring. But the university treasury prospers mainly due to tax breaks and aggressive asset management, up to and including hedge funds. Harvard's coffers bulge with $19 billion, exceeding the gross domestic product of many small countries.

Harvard's agony is that it has too much money. Intellectual creativity lags behind moneymaking ability. Harvard's lament is that it cannot spend money with flashing ideas, but amasses wealth in storage. In the past universities sought to cover their research costs through contracts commissioned by government agencies. Today, universities are finding ways to get into high-tech start-ups. Business companies have turned from universities' partners to their intellectual rivals.

Universities cannot survive as knowledge silos. This is the age when university presidents churn out ideas on how to spend money rather than simply accumulating funds. Some universities plan to set up a medical school in an underdeveloped country. Others put forth "education contribution theories" by which universities would provide tuition exemptions. Presidents from 28 prestigious private universities, including Yale, Stanford and Cornell, agreed to give financial support to needy students instead of superior students - good news for students who cannot afford college costs exceeding $31,000 a year.

The leading universities are pursuing diversity along with aspirations in the natural sciences and consolidating undergraduate education. Globalization and support for minorities are two pillars for diversity. This provides opportunities for Korean youths. Calling in foreign professors can be considered important. But I think going abroad and absorbing advanced knowledge available to Korean youths is more important. European countries envy the United States for the 500,000 foreign students studying there. The number of South Korean students studying in the United States used to be near the top, but now has fallen rapidly to fourth place. The number of Chinese and Indian students increased by 13 percent recently.

I have heard stories about South Korean high school students who were admitted to Oxford University without taking the College Scholastic Ability Test or who entered Harvard University with only average high school grades. Opportunity waits for a brain bearing a different dream.


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The writer is a columnist living in the United States.

by Choi Kyu-jang

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