The Faculty Discusses South Africa:

The following text is a transcript of yesterday's full Faculty meeting, where 11 Faculty members discussed University policy toward its South African-related investments. The transcript will continue in tomorrow's Crimson.

STANLEY H. HOFFMANN:

Mr. President, the remarks I would like to make are aimed to explain both the background of the open letter that some of us have signed and my own position in this debate. What I would like to do is to continue where the last debate had left the issue. I'd like to express some doubts about the effectiveness of the present policy insofar as I understand it and also about its overall validity.

The first critique I would like to make concerns the effectiveness of the policy even if one accepts the ends as you have spelled them out. I'm not sure that the means are always adequate. As I understand the policy, it seems to consist of the following pieces. First of all, a recognition--which incidentally is neither left or right--of the basic injustice of the South African regime for the reasons which were given in the ACSR report of 1978 and endorsed a year ago by the Corporation. Secondly, a refusal to divest now as a form of mere posturing or copout because divestiture will make it impossible for us to affect the behavior of companies while exposing Harvard to serious financial losses. And thirdly, a policy which is being advocated is in the terms of my old friend Albert Hirshman a policy of exerting voice rather than exit, voice within the corporations whose stocks Harvard owns to affect the corporations' behavior.

Well, if the purpose is to help the Corporation decide whether to support resolutions advocating corporate withdrawal, within the categories defined in the statement of the President and Fellows of April 1978, which say that such resolutions would be supported in the cases of companies which do not disclose information, do not demonstrate within a reasonable period of time that their employment practices follow the Sullivan principles, or which sell strategic goods and services to the South African government, I'm not sure that the method of case-by-case review which has been adopted will really allow the Corporation to make those decisions, for reasons which I think are made crystal clear in the last ACSR report, which was published in the Gazette of April 6.

What do we find in this report? We find statements which show that the reports we have obtained from companies about employment are not sufficient to give a full picture, that we cannot assess trends, that it is difficult to obtain information about sales, production lines, and customers, and in fact that equal treatment of blacks and whites with respect to wages is not the same thing as promotion of blacks to higher level jobs.

Now, I think even if one believes in the ends of the present policy and in the wisdom of the present course, there is a need for an approach which would be tougher and less time-consuming. As was said in an editorial in the Globe of April 19, I think there would be a need to set specific goals and timetables including for the promotion of blacks, quantifiable and measurable standards of behavior, and there is a need for a much more precise definition of the cases which, to use Brandeis University's language, constitute social injury. The recommendations which have been endorsed by the Corporation case by case are commendable. But I think a case by case process without precise guidelines about what one wants to find in each case is really a hopeless task.

The second problem I find with the policy has to do with the flaws of voice as defined by the Corporation. It seems to me that voice as defined so far is very seriously flawed. First of all, why should Harvard never initiate resolutions in those cases where it finds that the corporations do not meet the criteria which the Corporation has set up? Secondly, what happens if, as the February or January report of the ACSR predicted with a kind of sigh, voice gets us nowhere.

In your second open letter, Mr. President, you suggested that recommendations of withdrawal would be very infrequent. But that suggests a policy which reminds me of the horse in Animal Farm--after each failure one would try again, and one would try again without ever concluding. Now given the very premise of injustice on which the whole operation is based, it seems to me that this kind of policy of just exposing oneself to getting nowhere either because of difficulties of information or because one keeps hoping that the corporations in question will change their behavior, also looks a little bit like a copout. And also on this point, what hope of effectiveness is there for a policy of voice if there isn't a threat if exit in the background, if one does not let companies know that if they do not provide satisfactory answers there is a possibility of divestiture?

In this respect I think there was a contradiction in the remarks made by Professor Spence at the last meeting, because on the one hand he said the first question, which was whether U.S. companies with South African operations should withdraw from South Africa, the answer was yes within three conditions with which I heartily agree; but then when he came to the third question, which is whether Harvard should sell its stock, the answer should be no for a whole series of reasons.

Now I think one can argue whether Harvard should sell it now or later, but it seems to me that if one accepts the first position, which is that the companies should withdraw, one cannot reach a kind of peremptory no on the last question. And that brings me to my point about the end of the policy itself. The objective, I gather from reading the President's second letter, is to make the firms desist from forms of behavior that depart from ethical standards and values of the University. Well, in other words what we would like to do is force the various corporations to act in a way which would mitigate or reverse apartheid. Fine, but if the corporations in question, precisely because they employ only a very small fraction of the work force in South Africa, are unlikely to have much of an impact, shouldn't we really redefine the end of our policy? And shouldn't it be redefined in the way which Professor Walzer suggested six weeks ago, as corporate withdrawal except in those circumstances in which the corporations can actually show significant progress? In other words, reverse the presumption, and the burden of proof.

And if the corporations fail to provide that proof, then it seems to me we need not only to have in our arsenal the threat of divestiture, but in fact a policy of selective divestiture. I don't see what would be wrong with it then. It won't end apartheid, that is clear, but nor will staying, and simply hoping that sooner or later some shareholder resolution will prevail won't end it either.

In fact as you say yourself, Mr. President, in your letter, it may be nothing American firms can do will have a perceptible effect on the outcome. Would it be washing our hands of evil? Well, it seems to me there are two ways of washing one's hands of evil. One is to walk away immediately without a fight, but the other one is to stay and pretend that there is a chance of getting anywhere long after one has in fact come to the conclusion that there isn't much of a chance.

Would the reason to argue against divestiture be that the certain injury caused to Harvard by divestiture would exceed any dubious gain from divestiture? In other words, would what the President himself calls the continued financial stake in the perpetration of an immoral regime be so small in these cases as to require that we continue to have this stake, given the interest of the University itself? Well, if this is a reason why the President's statements are in fact so open-ended about the outcome of the policy, if the reason is the calculation of respective evils, then I think one should say so clearly.

And even if this were a reason, it seems to me that it is not decisive, first of all because the damage can be minimized, which is precisely why I along with many of my colleagues recommend at the end of the process selective or strategic divestiture, rather than presuming at the outset that there is nothing one can do, and one should sell everything immediately. And even a small contribution to injustice is something which is not terribly easy to tolerate in a case like this.