Unless modified by statue, charter, or by laws, the powers of the trustees of an educational, religious or charitable corporation in respect to the administration and investment of the corporation's funds are fundamentaaly no different than that of the directors of a business corporation in respect to the administration of the property held by the corporation...

Next, it can be argued that the manager's obligation to keep his company profitable is, from the point of view of the common law, like the shipowner's obligation to keep his vessel seaworthy. Each is obliged to meet a set of evolving standards defined by trade practice and consideration of economic and legal rationality. In an important sense, seaworthiness "is" the practice of captains and outfitters of shipt; and maximizing profits "is" the business conduct of men of affair. If current trade practice emphatically recommends the use of ship to shore radios, a ship owner can be held liable for neglecting to equip his tugs with them. If businessmen decide that socially responsible investments are indespensible to preserve long-term profits, the courst are likely to agree with them. A recent article in the B.U. Law Review maintains:

Business efforts dealing with this community crisis may not only be reasonably related to the long-term profit-making potential of the corporation and its long-term ability to survive and prosper. They may also reflect the businessman's appraisal of the public acceptance-expectation-demand process and his decision as a business matter that it is 'good business' to assume some responsibility for the community in which the corporation functions.

A number of court decisions in the last years have supported this overarching conception of profits as the social good. (Not that it matters all that much one way or the other. Assuming that morality in this case is something that can be had for nothing, the question of the obligation to profit need never arise--which makes the foregoing something of an exercise in prudence.)

Substantive issues aside, there are broad methodological questions which arise in connection with the political and legal debates about investment policy. The arguments introduced are not tested against some eternal objective standard. Rather, political and legal positions do or do not prevail against the best argument that can be brought against them. The idea that there is an eternal political and legal order in which universities can be nothing but congeries of scholars and investors nothing but sharp-eyed speculators, is but a malicious puff of bourgeois ideology. Can it seriously be supposed that the same kind of men who invented the multinational corporation, the stock option and a thousand such precision instruments could be powerless to put their "own" property to some social use? Or, imagine a world in which all the capital was mediated, that is, owned by pension funds, universities and corporate investors. Would anyone claim that no one had the right to ask industrial enterprises to do other than maximize profits quarter after quarter, on the grounds that all property is held in perpetual trust for the now-defunct, profit-maximizing, private investor?

In fostering these illusions, the University does semi-consciously what it does with deliberation in its policy of budgetary non-disclosure: tactically rationing information. Decisions about budget allocations or investment policy are reached, we are told, by a mysterious but preeminently rational process. Criticism, groping in the dark, is offered a helping hand just after it has fallen off the cliff. A tactical reply to this procedure, of course, is to produce ever more detailed alternatives to those proposed by the University, thereby forcing it to reveal the contraband information in the course of its rebuttal--or else demonstrate its lack of the proverbial good faith in bargaining.

IV

BEYOND THE underlying ideological factors, there is an oft-remarked peculiarity of the Harvard