Harry Binswanger, Peter Schwartz and Mike Berliner
The Ayn Rand Institute
Dear Harry, Peter and Mike:
As I told you in Boston, I agree with Jerry's letters of October 26 and November 2, 1993. But both Jerry and I would be happy to know that ARI is in better hands than we fear that it is. Thus, I challenge you to prove Jerry's letters mistaken, by answering his arguments:
1. Get it in writing from a lawyer specializing in non-profit corporations that it is legal for 100% of the board of directors to have a monetary interest in the corporation's activities. (Jerry's raising of this issue is hardly arbitrary – he provides written evidence of the law. Moreover, he informed only you and your board of advisors of this – not the public; that is the act of someone concerned for the welfare of ARI, not hostile to it.)
2. Explain why having Harry (who may receive money for speaking and teaching) and Peter (who may receive money for speaking and teaching, and also, I understand, does business with ARI in his capacity as owner of Second Renaissance Books) as the only two members of the governing board of ARI poses no danger of a conflict of interest. (I don't see why Jerry's past suggestion of this issue was taken as such an insult – it is not a question of Harry's or Peter's integrity, but of the facts of the situation. And if there is no such danger, then why did you have to appoint a committee to decide the salaries of Harry and Peter? By the way, and Mike can either confirm or refute this, I have heard "through the grapevine" that it has even been discussed among ARI employees that there have already been transactions in which the interests of Peter's Second Renaissance and ARI positions appeared to conflict.)
3. Prove that there is business professionalism at ARI (and that you are spending contributors' money in the best possible way) by providing long-term, formal business plans both for ARI as a whole and for the proposed Objectivist Graduate Center. Then prove that you do consider yourselves agents of ARI's contributors by distributing these plans (and income-and-expense-type statements for past years) to contributors, so that they will know fully the nature of the product they are buying. (I trust none of you will prove himself a bureaucrat – and commit verecundiam – by saying, "But other non-profit corporations don't do this.")
4. In the business plan for the OGC, prove that the proposal for the spring of 1994 is the best use of ARI money. Show that you have considered various alternatives for training graduate students – types of courses, different teachers, types of students, how many students, etc.– and the relative costs and probable results of these various alternatives. Show that you have made a study of potential students for the OGC, their backgrounds, goals, etc., and thus what would best promote their careers as Objectivist intellectuals for the least cost. Say in more detail what Harry and Peter will be teaching. Above all, define the long-term aims of the OGC, and the reasons which make you think they are achievable. Get feedback on the plan from people who may be able to point out things that you forgot to consider. Etc.
5. Show that your primary interest is facts by being willing to listen to advice from other people who share your goals and may have knowledge or understanding that you don't. Be interested in criticisms of ARI activities, and willing to respond to them with arguments, rather than defensiveness.
Of course ARI has done some very valuable things. Both Jerry and I have been loyal supporters of the Institute since '85. However, we have been shocked by several different statements or actions by the three of you over the last six months. I have already discussed with you: your initial choice of TJS scholarship students; your lack of encouragement last spring for Gary's attempt to expand his job at Claremont; Mike's criticisms of Gary, George Reisman and Dave Harriman for not speaking out about their views in some academic situation; and, especially, Harry's statements about the OGC being an alternative to academia. I have also been quite upset over Peter's lecturing on psychology – which I regard as rationalistic on the face of it; and over all of your vendetta against Edith and George. This last has been particularly painful to me. The three of you have been my friends; and I have very much valued both Harry and Peter as my teachers. I have known for a long time that Mike and Peter did not get along with Edith and George. I thought I could understand that. But what I absolutely cannot understand is the three of you dropping the context of George's and Edith's accomplishments, stature, and complete integrity and loyalty to Objectivism, and becoming their enemies simply because they have criticized you. I also do not see why you are all so resistant to having another person such as Peter Leport on the board. Why don't you admit that the present board has a tendency toward rationalism, and that a more down-to-earth person could help you to do a better job? I am certainly willing to admit my rationalism – why can't you admit yours?
In short, I think you should be grateful to Jerry for his letters. A paraphrase of a quote from Roark's speech keeps running through my head: "It had to be said. The Institute is perishing from an orgy of rationalism and defensiveness."
P.P.S. (November 15th) I heard yesterday that the three of you, with Leonard's concurrence, have kicked George and Edith off the ARI board. I actually spent the day yesterday debating whether or not I should send this letter, in order not to be forced out of my job as editor of TIA. If it really has come to this – that I have to fear for my job because I have some significant criticisms of the way you are running ARI (and because I respect and value Edith and George) – then I want no part of any of it.