Where is Cornell headed?

Colleges and Universities A-Z Cornell University
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<p>@ CayugaRed:
I considered entertaining your response, and then I read 'dangerously sophomoric'; just keep up that ad hominem, champ.</p>

<p>Colm, I understand your point, but I disagree with it.I * don't* think that this housing crisis (or the concurrent unemployment crisis) is at all comparable in magnitude of cause or consequence to the Great Depression.</p>

<p>I agree with : "This group is a huge portion of the market that the business community needs in terms of consumer consumption." and "Consequently, it is in the people's, and by extension in the government’s, general interest to keep the bulk of the lower-middle class citizens off the soup and bread lines..."</p>

<p>Absolutely, but the manner that the president has proposed to do won't work. The stimulus package put out by President Bush didn't work, the first bailout didn't work, and this bailout isn't going to work. The credit injections that we've been pumping into the economy's body aren't circulating. We can't revive our consumer market, at least, we can't revive our old model consumer market with 0 and negative savings. My problem with the economic 'blueprint' is that it seems to be motivated by a desire to temporarily get consumer spending started again by relieving the burden of debt on people whose homes will be foreclosed otherwise. I don't think that will happen. The economic stimulus wasn't re-spent by people that received it, and the money in the first bailout that wasn't frittered away was held onto like a life preserver with very little of it becoming loan money. I don't see why people wouldn't use the opportunity of their home loans being refinanced to try and buckle down on their spending.</p>

<p>If I were in danger of losing my home, and the next day I was told, well the loan on it is going to be 'forgiven' - my next course of action wouldn't be to buy an American built car, and fill up on premium at the Texaco. I'm being facetious (hopefully CayugaRed is reading this next bit), but surely you can see my point - people have no incentive to behave differently than lenders that got bailed out, they're just going to hug on to what they have and not spend (in the same way the banks still haven't been lending).</p>

<p>I'd rather see investment in American manufacturing, coupled with realistic union standards: If GM wants to do as well as Toyota, perhaps GM execs/assembly workers should take a look at what Toyota pays. If GM wants to sell cars, maybe they can stop pretending everyone wants to drive an SUV (gas money incentives or otherwise).
The automotive industry is just one place where we could better invest taxpayer dollars with many strings attached so that those dollars are spent wisely.</p>

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<p>
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The credit injections that we've been pumping into the economy's body aren't circulating.

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<p>First of all, much of the “injection” funding still has not yet been dispensed. Second: regarding the portion that has, economic stimulation does not occur overnight, it takes months ... at least. After surviving banks and lending institutions get their sea legs back, and some measure of positive expectation, they will start lending on a wider scale again, although more carefully.</p>

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The economic stimulus wasn't re-spent by people that received it...

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<p>There has not, as of yet, been much receipt of restructured government backed mortgages. These things take time. Even after the minority of struggling homeowners who qualify get newly set up, it is only one portion of a broader stimulus equation.</p>

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I don't see why people wouldn't use the opportunity of their home loans being refinanced to try and buckle down on their spending.

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<p>There will be some hunkering down for a while, and increased saving — for a while — which is not necessarily a negative thing. There will, at the same time, be plenty of people unable to embrace frugality, as there always are, particularly in current day America.</p>

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If I were in danger of losing my home, and the next day I was told, well the loan on it is going to be 'forgiven'...

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<p>If I am not mistaken, there has not been any talk of “forgiving” loans, only the restructuring of them for a certain class of vetted struggling homeowners.</p>

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If GM wants to do as well as Toyota, perhaps GM execs/assembly workers should take a look at what Toyota pays.

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<p>American workers at Japanese companies make a marginally higher salary, but most Japanese plants built in America were opened in states that granted them the ability to set up shop sans unionization. So, the workers lose out on some of the benefits and protection that the unions provide American car maker’s employees. Also, do you realize how involved the Japanese government is in the overarching governance of Japan’s heavy industry? Still, I think you are right that the American automakers could learn a thing or two from Japan’s, as Japan learnt much from us in the 1950’s in terms of quality control. The American, Dr. W. Edwards Deming, who “wrote the book” on quality control, was one of Japanese management's primary gurus. We should have heeded our own industrial prophets long ago.</p>

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The automotive industry is just one place where we could better invest taxpayer dollars with many strings attached so that those dollars are spent wisely.

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<p>This has already occurred for GM and Chrysler to the tune of billions, and they are asking for yet more. Thankfully, the last thing that the current administration wants is for the backbone of our heavy industry to go under.</p>

<p>Collegehopefull, we will just have to agree to disagree on whether or not our government should back the restructuring of a select number of home loans to more-or-less responsible mortgagees caught in the crossfire of the country’s temporarily sagging economy. My stance is that it is one helpful component of the recovery equation. There are many other constituents to the Obama administration’s initial steps as well, but they will take months — years — before we will be able to factually evaluate their efficacy. They inherited one heck of a temporarily foundering economy from the previous administration of eight years.</p>

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<p>
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I considered entertaining your response, and then I read 'dangerously sophomoric';

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<p>That's a shame, as you might have actually learned something. And yes, anybody who considers taxation through representation to be "robbing" is entertaining sophomoric ideas about the way in which we construct ourselves as a society.</p>

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I'd rather see investment in American manufacturing, coupled with realistic union standard.

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<p>I largely agree with this, suffice to say that the union standards haven't been the problem -- management in the American auto companies has been the problem. Seeing as how we will not agree on that, I would love to have seen a much broader investment to retool America and her workers for the type of manufacturing that will be needed in the 21st century, but sadly there just isn't enough funds or political will to do everything that would be wise to do, and as Colm has mentioned, right now we need to concentrate on making certain that otherwise innocent people can stay in their homes.</p>

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<p>if management has been a problem, then arent they free to shut the firm regardless of the workers at stake? </p>

<p>it seems that many argue that the workers are the ones keeping a lackluster firm in business...</p>

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<p>Neither of you mention the moral hazard caused by the implicit government guarantee of the mortgage backed securities sold by F+F. I think if there is one stick in the gears, it is the fact that the risk of loss was essentially negated by this.</p>

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<p>
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Neither of you mention the moral hazard caused by the implicit government guarantee of the mortgage backed securities sold by F+F.

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<p>This is a non-issue relative to the damage that the unregulated segments of the mortgage market had on the economy. As I've maintained, the GSEs always had relatively high credit standards, from a documentation, debt-to-income, loan size, and credit history perspective. It was the unregulated, non-conforming mortgages that caused the massive house price increases in seen in many part of the country -- and it was this house price swing, and subsequent drop, that caused the problems at the GSEs. Absent the non-regulated ABS market, the GSE loans never would have faced any serious problems. </p>

<p>Keep in mind that during the peak of the bubble investors were shirking the implicit guarantees of the GSEs to chase after slightly higher yields in the private-label ABS market. There was no moral-hazard there.</p>

<p>And from a public policy perspective, the potential for moral hazard was deemed an appropriate risk to take in return for the benefits of home-ownership and stable communities. But keep in mind that the product the GSEs were buying was tightly constricted and regulated so that the credit risks were thought to be minimal absent skyrocketing unemployment and house price depreciation.</p>

<p>And if you think about it, the moral hazard you refer to was at play long before the GSEs existed. FDIC-sponsored deposit insurance played the same function for the thrifts since the 30s -- before securitization people would make deposits into their local savings banks, and the banks would make mortgages and keep them on the books. But if the banks made bad loans, your deposits were insured by the federal government.</p>

<p>That said, I frankly wish the GSEs were never privatized and allowed to create profits for their shareholders. If the U.S. taxpayers were assuming the default risk on GSE notes, they should have also enjoyed the upside benefits. But that's another can of worms.</p>

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<p>About 30 years ago, Stanford and Cornell were probably ranked similarly in terms of academics. In fact, Stanford was founded by someone trying to emulate Cornell (true!). But in the past 20 years, Stanford has moved up in the rankings to the point where they are competing with HYP for the same students. How did they do this?</p>

<p>Think Google, Cisco, Yahoo, and the granddaddy of them all, HP. By partnering with industry, and more importantly, fostering an atmosphere of entrepreneurship, Stanford has lifted itself into the upper-upper echelon of American universities. Cornell can achieve this, if its leadership decides this is the direction it wants to take. Just out of curiosity, can anyone name a start-up company that hit the big-time headed up by a Cornell graduate? Peoplesoft comes to mind, first. Any others?</p>

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<p>Qualcomm, Burger King, Coors, Carrier, Palm, Handspring, Citigroup (oops!), Staples, and Grumman Aerospace were all founded by Cornell alumni</p>

<p>I don't think it is anything that Cornell has done wrong per se, but rather the particular characteristics of Stanford's location that make it unique. A) It's much closer to a large population center, B) It's much more focused on graduate research, C) the random luckiness that Hewlett and Packard decided to attend Stanford and subsequently decided to start their company in Palo Alto, and D) there weren't that many top flight private research institutions on the West coast as the population surged out there for the past fifty years.</p>

<p>That said, it's not like Cornell can't improve in this regard, and we're working on it!</p>

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<p>CayugaRed is right...Stanford just stumbled into a most fortunate confluence of demographics, geography, and sheer luck. And apparently the whole Silicon Valley thing got a multiplier effect through massive military-industrial spending in the Cold War... You couldn't replicate Stanford's miracle if you tried...</p>

<p>All the great companies founded by Cornelians just weren't founded in Ithaca, inviting continued collaboration with the University...</p>

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<p>
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In fact, Stanford was founded by someone trying to emulate Cornell (true!).

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<p>Yes — David Starr Jordan, the founding president of Stanford was a Cornellian. Leland Stanford initially wanted Alan Dickson White, who was Cornell’s first president, but White declined the offer as he recommended David Starr Jordan. Jordan had been White’s student. Also, when Stanford first opened its doors in 1891, 7 of its initial 15 professors were Cornellians. So it can be said that the key founding academic members of Stanford were Cornell University alumni and former professors.</p>

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<p>There are no straight lines up or down, with changing times come changing circumstances. In the early years of the 20th century Cornell benefited from it's involvement and proximity to innovation and growth in the use and production of electricity. Later Stanford benefited from its proximity and involvement in Silicon Valley. Cornell could rise from it's involvement in the next big thing or Stanford could sink from having it's name associated with a Giant Ponzi scheme. The only certainty is that things will change.</p>

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Stanford could sink from having it's name associated with a Giant Ponzi scheme.

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<p>It sure would be nice if this whole Stanford thing did Stanford in, wouldn't it? ;)</p>