President Trump’s threat to remove Harvard’s ability to take international students is appropriate. The university has admitted far too many dozy offspring of the Chinese Politburo and has allowed intellectual standards to collapse into a morass of woke incoherence. The first sign of sharp decline, as far back as 2006, was the university’s firing of its then President, former Treasury Secretary Larry Summers, for offenses against wokery. The quickest and least painful way for Harvard to recover its intellectual rigor would be to hire him back forthwith – he’s only 70 – with a free rein to discipline its recalcitrant faculty and slash its bloated and useless administration.

I hold no particular brief for Summers – he terminated my contract as U.S. Treasury Advisor in Croatia in 1997 and later referred to my writings for Reuters Breakingviews as “unacceptably Austrian.” However, he was a distinguished Treasury Secretary in one of the better Democrat administrations, whose combination of intellectual and real-world attainments superbly qualified him for Harvard’s Presidency when he was appointed in 2001. Indeed, in terms of outside distinction, Summers was the best qualified Harvard President since Edward Everett (President, 1846-48) and Everett’s distinctions came mostly after his service at Harvard.

Summers’ contested remarks in 2005 about the under-representation of women in high-end science jobs were thoughtful and backed by a considerable body of research. His forced resignation from the Harvard Presidency after the shortest tenure since the Civil War showed that a mainstream Democrat like Summers was now too moderate for the “wokies” who dominate the Harvard faculty, so that only a hardline and intolerant leftist would fit the bill. Drew Gilpin Faust, Lawrence Bacow, Claudine Gay and now Alan Garber, Summers’ successors, have all fallen basically in that category without any especial distinction or ability to justify their appointment.

Harvard has the reputation as the United States’ best university, but apart from it having the largest endowment at $53 billion, that reputation is not entirely deserved. Even in its early days, Harvard was more notable for Puritan bigotry than excellence of scholarship. While my other alma mater, Trinity College Cambridge was seeing Isaac Newton invent calculus, the theory of gravitation and much of optics, Harvard under its President Increase Mather (President, 1685-1701) was busily supervising the burning of witches in Salem.

In my own tenure in Harvard Business School’s MBA program, I found the course work very much easier than Cambridge Mathematics (perhaps a high bar to leap). However, I have also noticed that since HBS’s appointment of two successive woke Indian Deans since 2010 intellectual standards, as measured by the cases submitted to reunion classes, appear to have significantly declined as political correctness (climate change, ESG and DEI primarily) has infested the syllabus. As for the international students, even in my time there were a number who had got there because of their uber-wealthy or politically connected parents, and this emphasis has undoubtedly increased further, particularly for students from totalitarian states such as China. The Wall Street Journal whines that Trump is forcing Harvard to “turn away the world’s brightest” but that is notably not the case.

In terms of attractiveness to employers, whereas the cutting-edge entrepreneurial Silicon Valley firms had a high regard for Harvard graduates with technical skills in 1998-2011, I have the distinct if anecdotal impression that several other colleges are now much higher ranked there. Doubtless Wall Street still takes its share of Harvard graduates, but Wall Street has always emphasized social and political connections over raw ability.

Naturally, the problem of hard-left college administrations goes far beyond Harvard, which is merely the worst example of the disease, with the least excuse for its follies. All the Ivy League are infected by wokery (which includes but is in no way limited to anti-Semitism) while both universities as a whole and even high schools have recently seen a sharp decline in intellectual standards, especially in arts subjects and the humanities, notably economics. At the same time, the advent of Artificial Intelligence, which perhaps over the next decade will start matching human abilities across a wide range of cognitive tasks, calls into question the value of universities and the maintainability of their current model.

It must now be clear that the vast expansion of university education from around 10% of the population in 1950 to more than 50% today has been a dreadful mistake, which must be reversed as soon as possible. It has been unspeakably expensive, both for the students undergoing 4-year courses in politically driven rubbish of no market value, but also for society which is forced to subsidize this nonsense through ever-increasing college fees and student loan defaults. Now even the simplest AI enables students to cheat on their college coursework and their exams and, human nature being what it is, thereby makes it vanishingly unlikely that they will come out of their 4-year college course with the knowledge they are supposed to have gained. The value of college, always much less than its cost for most students, has through AI become nugatory.

In the market, the dozier kinds of intellectual tasks, those to which most college graduates are limited by their intellectual mediocrity and that of their education, are going to be eliminated, being replaced with AI that can draft a simple contract far more quickly than can a junior lawyer. There will also be a need for truly superior creative intellects, whether in the arts, the research sciences, the very top end of our corporate behemoths or in genuine entrepreneurship, but that need does not represent 10% or even 5% of each age cohort, it is at most 1% or less. Beyond that top 1%, college is a luxury, a finishing school for those whose parents have money and who have ambitions for careers in journalism, academia, think tanks, public-sector consultancies, Congressional staffs or anywhere else that provides social cachet and modest remuneration without heavy lifting, physical, intellectual or metaphorical.

The main essential in the jobs market is to end the farce of “credentialism” whereby dozy employers hand out well-paying, high-status jobs to students with the right college diploma. There is negative economic value in a system where rent-seeking colleges can waste four years of their students’ time and effort because foolish employers demand their diplomas. College diplomas being mostly worth little, employers who demand them are like grannies being taken advantage of in a flea market – albeit at the expense of young people rather than the granny cohort.

In a world of AI and online learning, students must show themselves self-motivated to excel. Employers offering high-intellect jobs should demand from them evidence of written work of the quality they demand; whether a piece of software, a mathematical or scientific demonstration or a legal treatise. Thereby, employers will obtain the best employees and save those employees from wasting a huge amount of time and effort at a superfluous college.

Trump is right to suggest redirecting $3 billion of Harvard’s funding to trade schools. As anyone can see who has bought a Roomba to clean their house or apartment, physical tasks in the real world are far more difficult to automate than routine intellectual busywork. Furthermore, because most people are not good with vast arrays of buttons and automated instructions, many personal service tasks will still be carried out by humans, because AI robots cannot communicate effectively with normal human beings. Thus plumbers, HVAC specialists, landscapers, hairdressers, housepainters and interior decorators will always be in demand until not only has AI improved further but the servo-mechanics of domestic chores and the human-machine interface have also been revolutionized. Like nuclear fusion and the genetic engineering of superior human offspring, the AI revolution that replaces plumbers may be one that never actually arrives.

The eminent Mr. Summers may fear that an enthusiastic recommendation from this column risks putting the Black Spot on his job prospects in top-level academic administration. Nevertheless, we call them as we see them. Harvard does not really need a reincarnation of Lord Liverpool, a keen-eyed devotee of economic and political truth, but it does need a boss who will cut out its massive intellectual dead wood and recognize that a university that cannot communicate effectively with a new majority-elected Republican administration has lost its ability to function in the real world.

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(The Bear’s Lair is a weekly column that is intended to appear each Monday, an appropriately gloomy day of the week. Its rationale is that the proportion of “sell” recommendations put out by Wall Street houses remains far below that of “buy” recommendations. Accordingly, investors have an excess of positive information and very little negative information. The column thus takes the ursine view of life and the market, in the hope that it may be usefully different from what investors see elsewhere.)