When Wells Professor of Political Economy Jerry R. Green officially takes office as provost on July 1, he will bring his formidable economic skills to bear on Harvard.
As the University's chief planning officer, and the only University-wide academic officer besides the president, the 45-year-old former chair of the Economics Department will have a lot to say about the distribution of Harvard's billions of dollars.
The modest Green downplays the importance of his financial acumen.
"It helps me think about the basic concepts, but I think any good academic administrator would learn that within a year," Green says.
Still, Green seems to think of things in terms of, well economics. Asked what he has learned so far in the Mass Hall headquarters of Harvard's central administration, the first item he mentions is the budget.
"It's very complicated," Green says," There are more than 9000 endowment funds, each of which has its own set of restrictions...they come in about 12 different flavors." He goes on to explain the differences between gifts and endowment, internal and outside financing of construction projects.
A solid grasp of the University's finances should come in handy for a Harvard administrator these days. Ironically, the central administration is under fire both for alleged mismanagement and for allegedly covering up sound management.
Boston University President John R. Silver told Time magazine in April that "Harvard doesn't have a financial problem, it has a management problem."
Green contends that the University has neither. "We're not running down our total stock of capital," says Green, explaining that the University has assets, such as the goodwill of alumni, that don't appear on any balance sheet.
"It's a very well managed institution," he says.
But if Harvard is so well managed, why did it declare a $42 million deficit last year?
The answer, according to Forbes magazine, is that Harvard uses shifty accounting practices to make it look poorer than it actually is. That illusion of need will help bring in money from wealthy alumni, Forbes reported.
Harvard President Neil L. Rudenstine is fond of tough talk about spending. "Those deficits have to come down," he said recently. "We're using up unrestricted reserves, especially in Arts and Sciences, at an unsustainable pace."
But Green sees some wiggle room. "There's even some question about how red the ink is," Green says. "The opportunity of doing things in the future is an asset that's not recognized."
Amidst the questions about the University bottom line, it will be helpful to have an eminent economist along for the ride. Last year, Baker Professor of Economics Martin s. Feldstein '61 reached the final round of Harvard's presidential search, only to be passed over the Rudenstine. Green will take what would have been Feldstein's place as Mass Hall's economist in residence.