Let's just go ahead and get this out of the way. The University of Chicago plans on forming a new research institute on economics with Milton Friedman's name, and many faculty are opposed.
I was excited to see this idea, because Universities are generally such poor stewards of their endowments and intellectual capital. Compare, as Brad DeLong once did, the decisions made by the heads of the University of California system and Harvard during the 1960s. Harvard increased in size, but not by much, becoming essentially a highly profitable hedge fund with some land in Cambridge for tax purposes. The Cal system drastically expanded to cover over a hundred thousand people with high-quality college education. It's hard to imagine that Harvard made the better choice from the point of view of the public, but it's their viewpoint which is universal. If you believe that higher education is worthwhile, then it's bad that top institutions are doing so little to spread knowledge, improve teaching, or jump-start massive research projects (MIT's OCW aside). Are the liberals who run these places so elitist that they believe that knowledge should be restricted? Or are they unable to seriously consider educating more than a few thousand souls a year?
In any case, the MFI was a great way to capitalize on one of the University's core strength's--economics--and dramatically advance the cause of outreach and research (and at low cost to the University, too). You can disagree with the choice of naming it after Friedman, but it was a natural fit given his stature and connection with the University.
This move caused a wave of ill-will and poorly reasoned diatribes. Supposedly the plan would "reinforce among the public a perception that the university’s faculty lacks intellectual and ideological diversity." So the University should not develop one of the few right-of-center departments in economics, let alone academia, out of concerns for perceived intellectual diversity? Set aside for the moment issues of the quality of output (if work is done by University faculty and the charter written by prominent economists--unlike Hoover--then I personally have few concerns). What entitles academics the right to silence the research of others? Have any of the points the critics made justify that?
I don't want to be a scold on this issue. Others do that better than me anyway. I just want to point out the ways in which this employer-run institution fails students, teachers, and the public. Administration is hampered in promoting their key function--research and teaching--by faculty for whom the allocation of power and money between disciplines is more important than agumenting and disseminating knowledge. Expanding college education is essential to reducing inequality, and research is also useful. Unfortunately, we can expect no large initiatives on these goals as long as Administrators cater to the needs of entrenched academic interests. What about Chicago campuses overseas to spread a distinctive form of thinking? The focus could even be on Humanities subjects that are often overlooked elsewhere, or on contructing "Cores" for cultures other than the Western European. Why should it be that expansion and innovation are not even an option for a Chicago-based University, but basically required for a Chicago-based firm? Maybe the people over at the MFI could figure this out.
I am more hopeful for Colleges in the developing world, where hope is more audacious and the do-nothing dons fewer. The Gulf has many proposed institutions and is attracting a lot of interest, there are some interesting Indian proposals, and many Chinese Universities lack the tenure model. And that's not even getting to practices inside the classroom. As Matt Yglesias points out, either lectures are effective at imparting knowledge--in which case we should find the best professors and have them reach the most people --or they're not, in which case we should find a better way.