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Comment by prasadjoglekar | Hacker News Reader

Universities are already doing this. Those with modestly large endowments are functionally private equity firms whose job is to generate enough cash flow to pay themselves, top admins, sports coaches and profs.

Academics, research, govt grants etc. are all means to that end.

https://www.harvardmagazine.com/2025/05/harvard-salaries-top...

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Sports programs don't always or even usually make a profit.

https://www.bestcolleges.com/news/analysis/2020/11/20/do-col...

They don't return a net gain to the university, perhaps, but the people running them and advocating them are profiting nicely.

In my opinion, this is like complaining that the US Postal Service isn't profitable. It isn't a business, framing it in terms of profitability is missing the whole reason it exists. No one expects a middle school soccer team or a university's drama department to be profitable, but we still invest in those things because we as a society think it is valuable for students. College sports has value beyond the money people pay to watch it.

"College sports has value beyond the money people pay to watch it."

Debatable. Any college sports program could be dialed back to point where it isn't being subsidized by the primary mission of the university. American college sports is a global outlier. On that basis alone, I would bet that arguments for the value of college sports don't hold water.

I'm sorry, it's not debatable. People who don't like sports tend to really struggle to actually consider the larger ecosystem that exists around sports and sports fandom. For example, there is a widely studied phenomenon that a successful sports team leads to increased applications, which in turn allows a school to be more selective and thereby increases the school's academic standing[1]. You can make all sorts of debates over how strong this impact is or whether it is a particularly efficient way to raise a school's standing, but there is clearly some value here being generated "beyond the money people pay to watch it."

[1] - https://www.forbes.com/sites/hbsworkingknowledge/2013/04/29/...

Are selectivity and academic standing beneficial to society overall? Maybe we'd be better off more broadly supporting higher education rather than turning it into a weird competition based on non-academically-related marketing.

Maybe we'd be better off more broadly supporting trade schools. There are way too many people attending college who don't really belong there and are just going through the motions.

I actually do favor paying more attention to the public education system in general.

Don't get me wrong, I love Harvard, but at the same time, our hybrid of quasi public / private higher education reminds me a lot of our health care system, and I wonder if in a century, we'll look back on both as weird anachronisms.

Both of my kids attended public universities.

This is fundamentally a critique of capitalism. And if we are honestly opening this up to a discussion of the ways capitalism damages this country, I don't think higher education is either the best example or the one most urgently needing a fix.

"Capitalism" wouldn't have occurred to me here. I live in the shadow of a Big Ten university that's a government institution. And this will reveal my ignorance about sports, but I don't know of any private university that's at the championship level in football at the present time.

Disclosure: Notre Dame won the championship when I was in grad school there.

I was more remarking on your criticism of competition as an appropriate way to deal with scarcity and/or try to maximize societal benefit.

Although now that you mention the public/private distinction, the difference in that has been drastically reduced over the years as state appropriations have shrunk as a percentage of overall funding. You mentioned the Big Ten and "championship level in football", so let's look at Ohio State as an example since they won the last championship (and for what it is worth, they beat Notre Dame in the title game). They get only 10% of their revenue via state appropriations[1]. For sake of comparison, the OSU athletic department brought in a little over half that in revenue[2]. Meanwhile, 21% of the school's revenue comes from "tuition and fees", so offering an appealing product in the competitive market of higher education is incredibly important to their long term mission.

[1] - https://cga.ct.gov/2025/rpt/pdf/2025-R-0074.pdf

[2] - https://www.elevenwarriors.com/ohio-state-athletics/2024/01/...

I’m a fellow Notre Dame alumnus, and would point you to our university competing in the College Football National Championship just five months ago.

Go Irish.

It's always hilarious to see people who are ignorant about the basics of history and economics whining about the evils of capitalism — on a web forum run by capitalists no less. Free market capitalism has been the best thing ever for this country.

It's always hilarious to see people who are so defensive about capitalism that the mention of any flaw is received as a total and complete condemnation. It is noticeable that you didn't try to refute any specific point made, you are simply objecting to the idea of someone criticizing capitalism. I guess the one market that we can't trust is the marketplace of ideas.

And especially when the person didn't criticize capitalism.

Long live American exceptionalism. Our colleges are global outliers in many ways, and this is why we have the best higher education system in the world. Don't presume to know how to make systemic improvements: you're not smart enough to predict the impact of major changes.

You don't pay the director of a university's drama department millions of dollars per year. Successful football and basketball coaches get paid those kind of sums.

What specifically is the problem with that? Do you think a "director of a university's drama department" brings the same value to a university as "Successful football and basketball coaches"?

No, I think the director of the drama department brings more value.

And is this opinion supported by anything beyond a distaste for sports? Because it is objectively wrong at the extremes.[1]

[1] - https://www.al.com/news/2024/01/what-economic-impact-has-nic...

Mainstream economics operates with a subjective idea of value. The previous poster can think whatever he wants about the drama vs sports, there's no objective right or wrong.

What does exist is an outcome about who gets paid.

There seems to be a large segment of HN users with an irrational distaste for sports. I suspect it's because they lacked the work ethic and pain tolerance to ever become good at any sport. So they denigrate sports in general as a mental coping mechanism.

CMU for example, is known for the school of computer science, and the arts, especially drama, though some people might know it better for Andy Warhol having been an alum.

That's how an elite university should operate. Sport is fine. It's healthy. But warping the educational mission to feed the maw of an exploitative sports economy is something no university should be involved in.

What next? MMA as a college sport? It's a free country: beat each other's brains out. But to pretend that US college sports is anything but a grotesque distortion is disingenuous.

What's happened with Division-1 college revenue sports is that the word "students" has been mangled beyond recognition. Meanwhile the investment in the drama department is in perpetual decline.

The question in my mind is if society would be better off recognizing the athletes as "workers" instead of as "students."

To offer a bit of contrast, I attended a Division-3 college where the starting quarterback was a physics major, and the captain of the basketball team majored in chemistry. When a Divsion-1 football player majors in a substantive discipline, it makes the national news.

Why should universities focus on drama? People can learn acting at their local community theater.

To be clear I'm not in favor of eliminating college drama departments. But it's rather silly and arbitrary to claim that drama is somehow more important than sports.

Even less reason for them to exist then.

Is there any evidence that universities with large endowments are paying coaches with them?

Money is fungible, doesn't really matter what source the money comes from other than optics.

Maybe but most endowments actually have "legally?" bound or otherwise contracted uses in universities. Thats why Harvard can't just tap it's endowment to fund research the current Admin has cut. So I'm doubting that endowments are being used in this way to pay coaches.

Sure, but if an endowment is paying for, say, the football coaching staff, then that leaves that much more money free in the general fund to pay for other things.

If the endowment is paying for something that otherwise wouldn't be paid for generally, that's a different story.

This isn't really fair I think. Academic money is actually not fungible - it can't be used to fund athletics, and vice versa. Just because both pots are relatively large doesn't mean that the money itself is fungible.

https://news.ycombinator.com/item?id=44328786 nailed it.

How is that the same thing?

How are college endowments similar to hedge funds?

For one, they put money into hedge funds as investors. And broadly, they're long on illiquid investments but have short term obligations for salaries, pensions etc. That's a hedge fund with a slightly different time horizon and intent.

Some of those short term obligations are covered thru grants, fed money. But when that dries up (eg, Harvard and Trump), you're squeezed.

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