<p>It's "not just the hot breakfasts and shuttles" that will be cut this fall...cuts may affect classrooms and labs....</p>
<p>Harvard</a> classrooms, labs feel pinch of budget cuts - The Boston Globe</p>
<p>"Facing the largest endowment decline in its history, Harvard officials said they can no longer afford to fully replenish the faculty ranks when star professors retire or are wooed away by other universities. Cuts to the number of graduate teaching fellows will mean larger class sizes next fall and, some professors warn, possibly lowered expectations. The university has also rescinded its funding of some research activities and lab equipment, a blow to Harvards goal of ramping up the sciences.</p>
<p>Despite Harvard officials stated intentions to avoid hurting the universitys fundamental purpose, many faculty fear that the cuts, which the officials say will deepen, will leave Harvard a weakened institution in the coming years.</p>
<p>The cuts will absolutely impact academics, said physics professor Eric Mazur. Everyone has said its not going to affect the core mission of the institution - which is teaching - but indirectly, it will. All the things around education might suffer.</p>
<p>While the dismal economy has pummeled university endowments everywhere, Harvard - the worlds wealthiest college - is in a particularly precarious position because it relies heavily on proceeds from the endowment for day-to-day needs. The endowment supports a third of the universitys $3.5 billion operating costs, and more than half of the $1.1 billion operating budget of the Faculty of Arts and Sciences, the largest of Harvards 10 schools…"</p>
<p>Harvards $36.9 billion endowment, as of last June, is expected to drop by at least 30 percent by the end of this month. That would still leave Harvard with about $26 billion, close to 2005 levels. But the university, along with its ambitions and budget, has grown substantially since then as it added faculty, overhauled buildings, and embarked on a groundbreaking - and expensive - financial aid initiative…</p>
<p>That new reality leaves administrators scrambling to scale back. Early retirement, already offered to staff, is now in the works for faculty, professors say. The music department is set to lose the worlds leading Bach scholar when he retires next year. The classics department, already down two classical archeologists, will lose one of two specialists in ancient history.Continued…</p>
<p>Just wanted to add that this situation returns Harvard to 2005, which is not catastrophic by any means.</p>
<p>Returning to 2005 wouldn’t be so bad.
Unfortunately the actual situation is worse:
returning to 2005’s endowment with a larger faculty, sizable interest payments on mortgages for labs built in the hope that donors would turn up, and increased financial aid.
One option would be for the administration to borrow more; this would lower their bond rating but might still be worth doing.</p>
<p>The problem will not go away shortly since many of Harvard’s donors have also suffered due to the current financial situation. So while the endowment shrinks due to the markets, alums are not able to step up to add to it. At the same time Harvard has many more 0-pay students due to the increased financial aid. But meanwhile, the 100 million dollar AIDS vaccine research joint effort among Harvard, MIT and Mass General was just announced.</p>