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<p>The first thing I would say to that is that guys had already done some of this. For example, like I said, HSS did not exist when Caltech was founded: it was added decades later. Hence, I can imagine us going back in time and telling the Caltech administrators of the old days that they should not be hiring Munro and they should not be adding HSS at all, and that those Caltech students of the future who want to study those topics should never come to Caltech. Heck, maybe you could wander over to Baxter Hall right now and tell the people there that HSS should not exist and should never even have been founded and, heck, maybe Caltech should think about shutting down HSS completely because, like you said, people who want to hedge their bets should not come to Caltech at all. Why not just be a HSS-hater? </p>
<p>Now, I suspect you are not that extreme and that you have no problem with HSS existing as it does today. But that just begs the question of why was it OK for Caltech to add HSS majors before, but not OK to do so now? Just because it happened years ago, that makes it OK? What’s the difference? </p>
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<p>Facepalm indeed, on your part, because you concede my central point, which is that Caltech can do many things, it just doesn’t want to do those things. </p>
<p>But that only begs the question of - why? For example, why was Caltech more open to expansion of programs in the past, but not now? More generally speaking, why doesn’t Caltech want to do certain things?.</p>
<p>What I have found in life is that people (and institutions) are rarely ever constrained by what they truly can’t do, but constrained by what they want to do, and self-improvement almost always means first getting people to change their view of what they want to do. Caltech, just like any other institution, will never get better if it doesn’t change what it actually wants to do. </p>
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<p>And should the majority really decide? Let me ask you this. If a vote at Caltech came up to shut down HSS completely and divert its existing funding to science/engineering programs, I suspect that the majority at Caltech would probably vote ‘yes’. So does that really mean that HSS should indeed be shut down and liquidated, as the majority wants? </p>
<p>Look, this is not a democracy here. Institutional change usually requires doing things that the existing majority doesn’t want. When any company is deciding whether to launch a brand new product, the existing employees almost never want that to happen. For example, when Apple was considering launching the Ipod, the existing Mac division managers and engineers clearly did not want that to happen, for they would have obviously preferred that Apple continue to invest in its current products. What mattered is that Apple is not a democracy and Steve Jobs decided that he wanted the Ipod, even though it had nothing to do with its contemporaneous product lines, and in fact, would serve to greatly agitate the power balance of the existing workforce. Similarly, very few existing employees in Microsoft wanted the company to develop Internet Explorer or the Xbox before those divisions were created. Organizational change inevitably means upsetting the established order, otherwise you never change anything. </p>
<p>I explore this notion further below. </p>
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<p>Uh, don’t you realize the utter endogeneity of what you just said? Come on, dude, you go to Caltech, so you’re a smart guy, so you should be able to see this. Of course nobody currently at Caltech wants a business school. After all, everybody who actually wanted one would have simply gone to a place that actually has a business school. Similarly, by definition, there were obviously few if any Ipod supporters within Apple before the Ipod was even started. After all, the people who actually cared about building good digital music players were naturally working for companies that were actually making digital music players. If you cared about digital music players, why would you take a job at Apple back in the days when the company didn’t care a whit about digital music players? </p>
<p>Look, the point of any institution is not just to cater to the people who are already stakeholders, but also to the people who could be stakeholders in the future. For example, no company exists merely to serve only its existing customers and no others. If all you’re going to do is continue to serve your existing customer base, then, frankly, you’re eventually going to die. Companies always have to be searching for new customers, and that, by definition, must mean sometimes ignoring your old customers. </p>
<p>It is simply ridiculous to argue otherwise. One need only look in the past and see that Caltech has indeed changed before and wasn’t a prisoner of its existing student/faculty base. Like I said before, Caltech successfully added HSS despite the fact that the existing students and faculty at that time probably didn’t want it, and, heck, probably would have voted it down if put to a majority vote. Or how I suspect that the majority of existing people at MIT probably would have voted down the Sloan School if it had been put to a vote. Just like how many employees at GM and Ford would rather just keep making big SUV’s and trucks rather than small hybrid cars. Change inherently means doing things that your current people don’t really want. Otherwise, you’re not really changing at all. Institutions that don’t change are the ones that are eventually rent asunder. Again, think of GM and Ford, who would not be facing bankruptcy if they had stepped away from SUV’s and trucks years ago, but of course their employees didn’t want to step away. </p>
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<p>Actually, the opposite is true: it’s ridiculous to think that it wouldn’t increase graduation rates. The simple economics of the situation says so: by giving students more options about what they can study, you increase the chances that they will find something that they really like. I really don’t think this is a difficult concept to grasp. For example, a big library is more likely to have the specific book that I want than will a small library. ITunes is more likely to have the specific album than I want than will a small record store. </p>
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<p>Uh, no, the link you showed me shows no such thing. You have the causality backwards. What it actually shows is that endowments with large returns become big, but not that big endowments will have large returns. I’m sorry that you can’t understand that. </p>
<p>I’m even more sorry that you fail to understand the even more general point which is that you think you have stumbled upon a great secret within the finance community that nobody else seems to have found - that of increasing returns that are actually caused by fund size. I’m perfectly willing to match my CV with yours to determine which of us has a better understanding of modern finance, but if you truly believe in what you are saying, I don’t know what you are doing here, when you could be making a fortune in selling your expertise to the wealth management community. </p>
<p>But it seems to me that you will never understand this point, when all I’m trying to do is help you become rich. ;-)</p>