Shots in the Dark

More than halfway through the academic year, I write again with some thoughts on our work together in these unusually challenging times.

Every morning’s headlines, every day’s conversations remind us that we remain in the midst of an economic downturn unlike any in decades. Uncertainty sometimes seems our only certainty. But what has become clear is that we are living through much more than a bump in the road. Our economic landscape has fundamentally changed.

For Harvard, as for many other colleges and universities, our challenge is to confront the new economic realities and intelligently adapt ourselves to them, while at the same time affirming and strengthening the enterprise of learning and discovery that lies at the heart of what we do.

Doing so will mean taking some difficult steps. At a time of new constraint, it will involve discipline and sacrifice. It will entail hard choices about what matters most — not an easy exercise for a university like ours, where local autonomy is prized, where our many programs operate at a remarkable level of quality, and where we each have our own view of what is essential.

This challenge can seem particularly daunting after a period of extended growth and expansive opportunities. But we live in the moment that history has presented to us, and I am confident we will rise to this occasion as Harvard has so many times before. It is our collective obligation to face the situation with the right balance of short-term focus and long-term ambition, for ourselves and for the generations whose opportunities will be shaped by our choices.

Wherever we work or study within Harvard, whatever the demands of our present moment, we share enduring ideals. We are committed to attracting the most able and creative community of scholars in the world, and pursuing new knowledge and ideas with all the imagination and rigor we can summon. We are committed to opening our doors to students of the highest caliber, and offering them an education worthy of the talents they bring to us. We are committed, as part of a nation and a world vexed with complex problems, to seeking new understandings and solutions informed by serious research. And we are committed to upholding the values of free inquiry and expression, of excellence and innovation across the domains of knowledge that shape our university.

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We confront sobering financial conditions as we pursue these commitments. As we reported in December, our planning for 2009-10 assumes that our endowment will have lost roughly 30% of its value in 2008-09 — before subtracting the additional $1.4 billion that will go toward current operations. Such a significant decrease presents us with difficult tradeoffs — all the more so when our other major revenue sources are also under strain. The endowment has come to support more than a third of our annual operating budget. The current yearly endowment distribution — the dollars we take out of the endowment to support activities across the University — is approximately 50% higher than it was when the endowment was last at the value we expect as of next June 30. Tinkering around the edges will not be enough.

I am grateful to faculty, staff, and students across Harvard who are working hard to consider how we can reduce budgets and how we can explore new ways of doing things that not only save costs but enhance our operations. These efforts will likely become more difficult, not less, as things move from plan to reality. What is more, our conscious avoidance of “one size fits all” solutions means that not everyone is going to be happy with every outcome.

Mindful that compensation accounts for roughly half of our annual university-wide expenses, the deans, the provost, and I have agreed that salaries for faculty and exempt staff will be held flat in the next academic year. In addition, we are this week launching a voluntary early retirement program for which some 1,600 of our staff members will be eligible.

Our planning includes an intensive, ongoing review of the University’s portfolio of capital projects and a reconsideration of the pace and scale of our physical expansion in Allston. Our task is to make sure that we avoid overextending the University’s near-term financial commitments, while assuring the vitality of our academic programs and respecting the important interests of our neighboring communities.

In a separate letter today (www.president.harvard.edu/r/r/allston.php), I have described our intention to slow the construction of the Allston science complex and to reassess our plans beyond the current phase of construction This is a difficult step, for both Harvard and our neighbors, but I am convinced it is a necessary one. From now until the end of the calendar year, we will complete the science complex’s foundation and bring the structure to ground level — a requirement under any scenario. Meanwhile, we will explore whether there are feasible ways to lessen the complex’s cost, through design changes or other means. This approach will give us further time to consider, when the first phase of construction nears completion, whether reduced expense or improved economic conditions will enable us to proceed with above-ground construction on an adjusted pace, or whether we will pause construction after the foundation is complete.

As we recalibrate our near-range Allston plans, we will sustain our momentum in spurring cross-school and interdisciplinary science. We have been able to identify excellent alternative space for programs that had planned to occupy the Allston science complex upon its completion in 2011. Our new Department of Stem Cell and Regenerative Biology, and the associated Harvard Stem Cell Institute, will take up residence in renovated space in Cambridge — indeed sooner than would have been possible in Allston. This will allow our extraordinary group of stem-cell scientists from the FAS, the Medical School, and our affiliated hospitals to come together more rapidly; it will also help assure that our undergraduates have ready access to work at one of science’s most promising frontiers. A second major cross-school initiative, the Wyss Institute for Biologically Inspired Engineering — launched with an extraordinary gift from Hansjoerg Wyss — will make its initial home in Longwood, with additional space in Cambridge near SEAS and FAS science departments. This new venture at the nexus of engineering and the life sciences has already begun its exciting work.

Planning for other Allston development will continue, but it will happen at a slower pace. I have asked our planning team to develop options for interim improvements to Harvard’s existing properties, and to continue to engage in community improvement efforts in Allston-Brighton. As we gauge our capacity to mount new projects over time, we will also aim to think in more integrated ways about the University’s space needs in Allston, Cambridge, and Longwood. No less than before, what we do in Allston remains a vital part of Harvard’s future. While the economic downturn necessitates a change of pace, we remain committed to a long-term vision of Allston that will take full advantage of the historic opportunity it represents — as a home for innovative education and research, and as a crossroads for programs that would benefit from closer interplay.

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The economic crisis, of course, has stressed the resources of many of our students and their families. With that in mind, we are working to make sure we restrain growth in tuition and fees for next year, while affirming our robust commitment to financial aid. Our various graduate and professional schools plan to maintain their strong student aid and fellowship budgets for 2009-10. For undergraduates in Harvard College, the package of tuition and fees will increase by 3.5% next year — at the same time we carry forward in full the financial-aid initiatives we have introduced in recent years to ensure that a Harvard College education is affordable for families across the income spectrum. Since 2004, we have doubled the amount we spend on undergraduate financial aid. (See the related news release at www.news.harvard.edu/r/tuition.html.)

We have received a record-setting number of applications for the College class of 2013 — more than 29,000 for a class that will number roughly 1,650 students. Next fall’s freshmen will arrive to a new General Education curriculum, replacing the Core, and I appreciate the efforts of the many faculty who are working to populate the revised curricular framework with a new generation of compelling courses.

Following a number of years of significant increases in the number of faculty university-wide, growth has slowed, but searches remain in progress to fill more than fifty open faculty positions across Harvard. They range from South Asia studies to human genetics, from urban planning to contemporary Islam, from fluid mechanics to law and public health. We continue to plan for intensified efforts in select areas of academic priority, both within schools and for the University more broadly. As president, I will continue to devote special attention to those areas that enable Harvard to mobilize its extraordinary intellectual resources across fields and across schools — areas like energy and the environment and global health, which involve students, faculty, and staff from every part of Harvard in activities ranging from courses for undergraduates to research activities in sites around the globe.

In December, the University’s Task Force on the Arts issued a report that calls for Harvard to make arts practice and performance an “integral part of the cognitive life of the University.” I urge you to read the report, and especially the eloquent introductory statement about the place of the arts in a research university and in a liberal arts education (see www.harvard.edu/r/arts_report.pdf). Many of the task force’s recommendations depend less on enhanced resources than on a rethinking of the curricular role of the arts and a more positive embrace of the many types of arts practice and activity that already occur on our campus. Thus, we are working to bring a number of the recommendations to fruition soon, and others will unfold over time. Yo-Yo Ma’s remarks and performance on February 6 — part of a two-day event highlighting opportunities and encouraging careers in the arts and the humanities — remind us what a singular source of inspiration and insight the arts can be during uncertain times.

We are also considering how to make the most of a moment in which interest in public service is on the rise. A remarkable number of Harvard faculty — in law, economics, science, health policy, and other fields — have been chosen to serve in the new administration. Harvard alumni will hold an array of senior posts in the White House, the Cabinet, and beyond. And it was striking to watch an inauguration in which three Harvard graduates — the President, the First Lady, and the Chief Justice of the United States — stood together to mark a historic transition in our nation’s leadership. The new administration has made clear that science and knowledge are central tools of government and public policy. We at Harvard have critical contributions to make in such a time, to ensure, as our new dean of public health, Julio Frenk, recently put it, that the “power of ideas” has its fullest impact on “the ideas of power.” David Ellwood, dean of the Kennedy School, describes the present moment as an almost unprecedented opportunity for Harvard to contribute both to public service and to public solutions in a time of global crisis. We must work to help our students pursue careers that aim to serve the common good, in government and other fields. No less, as we face our own hard choices, we must keep in mind how our work here — across many fields of knowledge — can best contribute to informed debate on the hard choices facing the commonwealth, the nation, and the world.

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In a time of dramatic and often disquieting change, it is important that all of us remember the enduring purposes of universities and the enduring legacy of this one in particular. We are a community of distinguished scholars, talented students, and dedicated staff — teachers and learners defined by our ideas and discoveries, not by our financial resources. Let us keep those purposes foremost in our minds as we pursue our work together in changing ways for changing times.