“Harvard Watch, in case you don’t know, is [was] a group of academics who were formed ostensibly to be the conscience of the ultra secretive Harvard Corporation, whose 7 members have included the likes of Lawrence Summers, Robert Rubin and Dyn Corp.’s Mr. Pug Winokur.
“>The Harvard Corporation administers the ‘not for profit’ [now] 28 billion dollar Harvard Endowment Fund.  The largest such pool of capital this side of the Roman Catholic Church. This fund has been intimately linked to such financial fiascos as Bush/Harken Energy and Enron/California energy debacle.”

“When the Harvard Watch did their own investigations back in 2003 / 2004, here are a few snippets of what they found.  In addition to giving guidance, such as choosing outside money managers, to Harvard’s 21 billion [at the time] dollar Endowment fund, Pug Winokur was the Chairman of Enron’s audit committee.

At the same time one of the Endowment Fund’s biggest outside money managers was Highfields Capital.  This is a hedge fund run by John Jacobson – a former member of the seven-man Harvard Corp.  He left the Corp. in 1996 with 500 million of Harvard money to start his own financial advisory/absolute return fund.

According to Harvard University 1999 tax returns Highfields topped the pay list of advisories at 30 million in management fees for the year. In fact Highfields did so well making money for Harvard, the Harvard Magazine was crowing about the job they did and they were reportedly awarded additional billions of Harvard money to manage.

Now, I’ll bet none of you will ever guess how Highfields made their astonishing returns for Harvard in 1999? This long/short fund only had 3 equity shorts (put options). Enron just happened to be the biggest – and the Enron short was 47 times the size of the next biggest short.

Of course, no guilt was ever found implicating Mr. Winokur or Highfields – because the SEC was on the job!!  Highfields’ 5000 foot grand salami of a homerun simply got chalked up to “pure brilliance”.

Now, for those of you who are not aware; Enron funded research centers at Harvard. This allegedly objective research – incubated at Harvard – was instrumental in legitimizing energy deregulation in California and defending energy industry monoliths against assertions of price manipulation. Nothing stinky here, eh?

Well, apparently something didn’t exactly smell quite right; because it was soon after these facts came to light that Mr. Winokur had sufficiently spread an aroma of his doings about Harvard that his presence was no longer required and he resigned his post to make room for none other than Mr. Robert Rubin. Here’s a snippet of the statement the Harvard Watch published at the time regarding the changing of the guard.

“Winokur’s departure from the Corporation, however, represents only a first step in cutting Harvard’s ties to Enron. There remain multiple Harvard research initiatives funded by and effectively functioning for Enron and its executives. Notable examples include the Harvard Electric Policy Group, the Belfer Center, and the Winokur Public Policy Fund. Moreover, the Harvard Corporation’s remaining members include several Enron insiders. D. Ronald Daniel, for instance, was Jeffrey Skilling’s boss at McKinsey during the 1980s, when Skilling consulted with Enron to design the energy giant’s unsustainable business model. Because of the work of Daniel and Skilling, McKinsey is now a defendant in the largest suit against Enron. Moreover, it is remarkably telling that just as the university prepares to bid farewell to one of the Enron club, it has already announced the entry of another one. Robert Rubin, the Corporation’s latest addition, is a director of Citigroup, Enron’s largest creditor. Rubin attempted to obtain a Federal bailout for Enron as it approached collapse-while its top executives cashed in on Enron’s falling stock and drained the pension funds of thousands of their employees”:
Admittedly, the Enron / Gibson’s Paradox Harvard guffaws occurred before Niall Ferguson’s tenure at Harvard [began in 2004]; but with him being such a sharp economic historian – he probably knew all this stuff anyway….”

—  Ronald Kirby