<p>There is a great deal of fat and inefficiency in the administrative side of Harvard. People do not want to harm the educational mission of the institution and are prepared to cut some of the fat. I suspect that some other educational institutions will have similar situations.</p>
<p>In contrast, at Beth Israel Hospital, one of Harvard’s major teaching hospitals, the CEO organized a “town meeting” for suggestions to avoid cutting folks at the lower end of the income distribution and employees took pay cuts and doctors (who are not employees but independent contractors) actually gave money back. That is partly because the hospital had cut out much of the fat already and employees knew that – unlike Arts & Sciences at Harvard, where the professors know how much fat there probably is to cut.</p>