Mitch Daniels served as Purdue’s president from 2013-22 and has been recognized by Fortune magazine as one of the 50 “World’s Greatest Leaders.” Jim Bullard, the former president of the Federal Reserve Bank in St. Louis who was ranked as one of the top 10 influential economists in the world, was tabbed in 2023 to become Dr. Samuel R. Allen Dean of the Mitchell E. Daniels, Jr. School of Business. Daniels and Bullard sat down in Krannert Center’s Weiler Lounge for a wide-ranging conversation, covering topics from the Daniels School’s approach to business education to the future of the workforce.
Bullard: Mitch, tell me about life post presidency. How have you been spending your time?
Daniels: It's different, but it's busy. But it's a different kind of busy. I'm happy to say that I'm spending a fair amount of time still up here on campus on call, three days in the week, we happen to be talking here. Board and President Chiang asked me to stay on for at least a while as head of the research foundation. And of course, I've been very interested in entrepreneurism, tech transfer, all the things we do over there now, as well as the economic development that's happening around campus.
So if I can chip in a little that way, I will. After that, it's some writing and some business involvements, enough to keep me out of my wife's hair.
Bullard: You just published the Boiler Up book. It was dedicated to the students at Purdue University. Tell me about the book.
Daniels: It sort of wrote itself over the ten years that I was here. I think the book has two themes or rationale. When people suggested we put it together, one was that we think it's pretty demonstrable that Purdue's reputation rose over the ten years. And I always saw that as one assignment responsibility I had.
Our business students will ask themselves as they start their careers, where can I add value? Is there something I can do that's incremental? And in my case, one of those things was try to take advantage of some head starts I had, places I'd been and jobs I'd held and people I knew to bring more attention to Purdue I always thought it deserved more.
And so I think we had a lot of success doing that, and the book deals with that. In the course of doing that, I hope in an appropriate and selective way, spoke and wrote and was interviewed on topics outside higher education. I always stayed scrupulously away from anything political or partisan politics, but I thought if I could do it in a way that didn't cross any lines, that it would help facilitate the mission of lifting Purdue's recognition around the country.
So I think that's what the book's about, and a lot of it was in being already speeches, columns, interviews, and it was just a matter of annotating it and trying to weave it together.
Bullard: Great.
Daniels: Speaking of transitions, I've frequently described you as one of the five-star recruits of the last ten years. We don't get that many, but we're getting more all the time, and you're certainly one, Jim, I was thrilled that you and your wife seem to like the idea of coming to this part of the country, do you?
Bullard: Absolutely. We love Indiana and we love being in West Lafayette. We think it's a great place. We love college life and Big Ten life. It's really been a lot of fun, a lot of passion behind the Daniels School project and a lot of done great fundraising, lots of new ideas. So it's a very exciting time to be here.
Daniels: Say a little more about it. Granted, you're still only a few months in, but your aspirations for the school, what do you find most promising about the investments and the new direction?
Bullard: I think at a high level the proposition is fantastic. We've got a historic brand in Purdue that is one of the best technology universities in the world and has been on the rise under your leadership in the last decade. And we can integrate the Daniels School more closely than it already is with the many programs on campus and create a kind of distinctive brand around the Daniels School. That will be the integration of technology and business. That is the historic Krannert brand as well. But we're modernizing that for the 21st century.
And I just would stress to people that are listening, technology has eaten the business world. It used to be technology was kind of a sideshow, but there's a lot of management and other things, finance and other traditional business topics, but they have all merged into one thing. And so I think we have to impress that upon our students so that they're prepared for the next couple of decades in business in America.
Mitch, the school is named after you before I arrived. What do you want to see the school -
Daniels: You would have known better than to let them do that!
Bullard: (laughs) What do you want to let the school evolve into over the next decade? What hopes and goals do you have for business education at Purdue?
Daniels: First, let me say that I did argue with the board and others about the name and considered it a poor example to our marketing students. Surely there was something smarter they could have done, but I'm deeply touched by it of course, I do have, however, great excitement and hopes for the program, especially under your leadership Jim, I do think that there's a chance to separate and differentiate our school.
You've mentioned a couple of the primary ways already, but I want our students have a little better grounding than some of their future competitors do in economic history and philosophy. I want them to feel very motivated as they leave here by the knowledge that their success will be the success of others, and that this is not just going to be a remunerative future that their success will bring them, but the satisfaction of knowing that they have helped other people have expanded opportunities in the way that only a free and dynamic economy can.
And for one reason or another, that does not seem to be emphasized, or maybe even, it's being challenged on other business campuses. And I think that gives us a chance to be different in a highly positive way. Let me press you a little more. Your description of the vision you have for the school is one that a lot of us find very powerful and very appealing.
But what are some of the early, specific programs, new initiatives that you see that will give expression to that vision?
Bullard: Well, I think any big endeavor like this, you want to try new things, and if it doesn't work, you want to adjust and go in a different direction. So I think that's one thing, be innovative, fail fast.
If it's not working, that's okay. And empower the leadership and the students and anyone involved with the enterprise to try to go ahead and innovate on their own and try to get things to align as best they can. So I think to the extent we can do that, we'll have a lot of success.
In my previous life, we had a lot of innovation within the enterprise, even though we were just one part of a bigger system, and even though there was a lot of matrix management and so on, we found ways to innovate within the box. And I think the same is true here. You're one entity on a big campus, but by working well with the rest of campus and having lots of good ideas, understanding where they're coming from, we can really get something to work well here.
Daniels: You've talked a lot, and we have here too, about data science and about data-driven business education. We're hardly the only place thinking about that. We may have, as you pointed out earlier, some advantages, given the technology strengths of Purdue in achieving that. Can you say a little bit more about what that might mean?
Bullard: I think when I think of a great technology university, it means the whole gamut, everything from robotics, pharmaceuticals, biology, but also information technology.
And a lot of business has been about information technology in the last 20 years or so. But computer science is excellent on campus and one of the most powerful in the country and in the world. There's no reason why we can't integrate very very well with that. We're living in an algorithm-driven world in basically all aspects of business.
We want our students to understand how that works and how it's going to change in the future. One of the things I'd like to do is get this idea of understanding the technological landscape. There are many ideas are out there, budding technologies of various kinds, I think a really good business student at any level would understand, okay, I see that that's happening over there, I see that that's happening over there.
That thing that's happening over there might come and impact what I'm doing in the future. So you get a more aware type of student that doesn't get disrupted, but is the disruptor as we're going forward. So hopefully we can get that going.
Daniels: One of the early initiatives, the Integrated Business and Engineering degree, was immediately swamped with more demand than could be handled. And I know you're scrambling to meet that demand. Can you imagine similar joint degrees following on maybe computer science, for instance?
Bullard: Absolutely. I think that we have Integrated Business Engineering, it's working out fantastically well. We're only constrained by how many classes we can offer, how many professors we have.
But we've also got Business Analytics, also extremely popular, also have that at the grad level, also extremely popular. So I think there's a lot of room here. We're also working on a Master's of Business and Technology, which I would see as adjacent to an MBA. The MBA degree has declined some in the last couple of decades, I think, in desirability, because it's a little too general.
But the future is that your business plan will involve technology at a level that you have to understand. You can't just stand back and say, I'm going to manage other people that are going to know the technology you have to get knee deep or deeper maybe into the technology in order to understand your product and in order to understand how the marketplace might be changing for your product.
So the virtual world in particular is one place where you see that, but all areas really across the board.
Daniels: You just mentioned the new hiring that our planned growth and our current growth is going to require. I've already bragged about my great new hire of the last year, which is you -
Bullard: What you didn’t mention is that it’s five stars out of ten.
Daniels: (laughs) Not in my rating. But tell us, you've already had some successful new recruits, tell us about a couple of them.
Bullard: We do have a dream hires program going on that's a campus-wide program. We have several hires that joined this year already.
Allie Gabriel is one working on work life balance. Jeffrey Hu came in, Gus De Franco came into our accounting department. We also got David Malpass, former president of the World Bank, to be an executive assistant sort of to us. And so I think that'll be helpful as well, also moves us a little bit into the policy world. He's worked a lot on global infrastructure issues in recent years with the World Bank, so a fascinating background for us.
Mitch, I know that toward the end of your term here, you've emphasized both Indianapolis and Washington, D.C., as places where Purdue needs to have a bigger presence. What's your thinking there?
Daniels: The D.C. aspect is, I think first and foremost of the Krach Institute on Technology Diplomacy and the leadership of our former board chair and outstanding alum, Keith Krach.
Indianapolis is a different, and I think at least equally exciting prospect. Very, very pleased that we were able to bring it off. The ambition there, we'll have to see. The student demand and the market will tell us. But what I think many of us hope is that over time, thousands of Purdue students will spend at least some of their time, maybe just their final year there, linking up in internships and first jobs and so forth with outstanding Indiana companies.
We'll give our students an option of an urban setting, for part, if not all, of their Purdue experience. It'll allow us to grow further as a university without expanding the capacity footprint further on this campus, where we're getting a little tight. And although the initial pitch has always been to build on the engineering and computer science departments which were already there, I absolutely see business students being eager to have a similar opportunity, and I hope we can get it ready for them as quickly as possible.
Bullard: Mitch, you're famous for having frozen tuition at Purdue for over a decade. Why did you think that was important?
Daniels: First of all, let's just say Purdue and its board froze tuition. I led cheers for that. I was coming from an experience of the last, really, ten years all over this state, staying overnight in way over 100 homes, seeing citizens of a very diverse state becoming more and more concerned and stretched by the cost.
I'll say that it started simply as the idea that we ought to send at least a signal. I had no idea, of course, that we could go even a second year, let alone 12 or 13, as it seemed to be. But it just started as an idea of this is a right thing to do if we can manage it.
Over the course of the next two or three years, however, it began to turn into a smart business decision. It became a brand. You say we're known around the country for it. We are because other schools, to my surprise, did not moderate their tuition policies very much. And after a few years, we were what every marketer hopes to be, a unique proposition in the marketplace.
And I hadn't foreseen that either. But it absolutely began in business terms, to create a virtuous cycle in which, by surveying our incoming students, we know that our reputation for affordability, ability, their knowledge that they were much less likely to get socked with a surprise. Surprising increase year on year was a material factor in attracting students, growing Purdue, and the revenue from that growth made it easier to hold the line.
Bullard: Just as a corollary to that, Purdue students end up with much less debt than others, can you talk about that a little?
Daniels: Obviously, it's natural consequence, but something I think all Boilermakers should feel very good about, very proud. Jim, I said so often, I know you have the same feeling, that one of the things I love most about Purdue is that it has always been a place not, by and large, for the children of wealthy families and high-status families. But for children from anywhere. Young people from small towns and inner cities and farms. And we want to always be that kind of place. And so, I just feel that what is in keeping with our character, our historic character, has turned into an important, positive differentiator for us in the world we're living in.
And student debt, I've gotten asked all the time for my views on that. I always said, well, as a starting point, you could charge a little less. If you weren't charging so darn much, young people wouldn't have to borrow so much. And that's the big driver, really, of the statistic that you referenced.
Bullard: Mitch, what are you most excited about for the next generation of business professionals? What strengths does the next generation bring to the business world, and what shortfalls do they need to overcome?
Daniels: Jim, you already did a great job of answering the first part of that question. More than anything else, the next cohort of business professionals – it’s not going to suffice to be people who can hire talented technologists and people to explain a technology to them. They're gonna have to understand a lot of it themselves, even to make those personnel choices, let alone resource decisions. So, again, the Purdue opportunity to send out business talent who already know or can quickly grasp the technological challenges and opportunities they're gonna face is a real plus for us, I think.
In terms of shortcomings, one you and I have talked about is the ability to communicate more effectively. For years and years here, I heard from businesses, as we were recruited – we’re perhaps the most recruited campus in absolute numbers in the country. And I heard so many times, businesses say, we really value your students.
We love to hire them. They've actually learned what the diploma says they learned. They have a great work ethic. The one question I always heard was, it'd sure be nice if they could communicate a little better than they do. If they could present to a team more articulately. In particular, if they could write a memo and share their insights or their suggestions more clearly with other people.
So, I know that under your leadership, this will be a little bigger part of a Purdue business education. In the process of learning a little more about economic history, reflecting a little more on competing views of what is effective and what is just, in an economy.
They'll get a little more practice reading and writing. And I guarantee you this will set them a little bit apart from the graduates of other schools.
Bullard: Yeah, I love it. We have a Cornerstone for Business program, which is building on Purdue's cornerstone program. But the Cornerstone for Business does have more philosophy of economics, does have more emphasis on why the supply side of the economy is so important.
That you've got this idea of the noble profession, where you're providing goods and services that people want and desire. You're doing this in an ethical way that retains customers and builds reputation over time. And I think you're exactly right that communication skills are essential to future success for the students.
So, the ability to present complicated ideas in a concise way, the ability to write, which you wonder these days, everybody's doing tweets and everything. But the ability to put all that together and communicate effectively, I think, is one of the keys to success.
Daniels: No, exactly, I mean, we're talking now about what people refer to as generation Z.
I don't know what comes next. Do we start over at A? I don't-
Bullard: (laughs) Double Z.
Daniels: I’m not sure how that’s supposed to work! But no, they've grown up in a very different environment, and they arrive on campus, and they'll arrive in the workforce with different expectations and attitudes. What do you see as different? And how do we need to respond to the characteristics of this group?
Bullard: Of course, we love technology, I think mobile technology has changed the world, and there are lots of ways to use that technology for good business decision-making. So, we're certainly not against technology.
But still, I think true intellectual interchange takes place in small groups, where you can convince a smaller group of decision makers about a complicated decision one way or the other. Probably infused with some technological aspects that are complicated. To get the pitch right and to get the level right for the audience is just essential in the business world. And we're going to teach our students to be able to do that so that they can be successful.
Bullard: Prior to becoming president of Purdue, you had a long career in business and government, what sorts of people and events helped you along the way to be so successful?
Daniel: There were so many moments of good fortune, and I would start with the terrific set of leaders I had the chance to work under or in proximity to in all those other jobs that came along. And I'm sure I absorbed things almost subconsciously from watching them and assisting them.
I would say that – I’ve gotten asked very often at each stop, but especially here at Purdue, since I was brand new to higher ed and had everything to learn, was still learning my last day on the job, but – I always singled out from the previous experiences, my years in business, especially the years I spent in a large global business, where the skills of, not simply the administrative skills of making ends meet and making tough decisions about resources, all that of course. But also about trying to get large numbers of people headed in a common direction, enthusiastic about doing so. About identifying big goals, trying to decide those things which would be most valuable to the enterprise, and staying on them till you’ve got them done.
So, I was very, very lucky to have had, I think, a diversity of prior experiences, but if I had to pick one that made the most difference – by the way, in my previous job, too, in public life, it would be the incredibly stretching and broadening years I had at Eli Lilly and Company, which are the kind of years I think your graduates are destined to have.
Let me turn the personal background question around a little bit, Jim. Some people might say, ‘what's a banker from the Federal Reserve know about higher education?’ Now, actually, you had a life in higher ed before that time, but coming to know you, the intersection and the commonalities between all your years as the longest serving Federal Reserve president and the job you have here are more than some people might expect.
Bullard: The first half of my career at the Fed, 18 years, was on the research staff. And that job is very much to write papers. You have coauthors, you're trying to get citations, you're trying to put these papers into the top journals. You're going to the top conferences around the world and talking about issues in macroeconomics and monetary policy.
It's a very technical field and heavily analyzed field, so you have to keep up with what everyone is doing.
Daniels: Like a faculty job without the nuisance of students.
Bullard: (laughs) Yeah, well, and I supplemented that by teaching at local universities, including Washington University, I taught in the graduate sequence there.
So I really have more of an academic background than it may seem. And I do have a long publication record. As president, I had to back off some of the research, but I tried to stay active. I have papers that I presented even last summer. I still have lots of interest in the research world.
But I would just have to echo what you said about running into, during my career, all these successful people. I would say the FOMC in particular draws up really talented people from all kind of different walks of life, and they're just so impressive. And you can learn so much just by being around and watching them, listening to them.
And I just think that's been really helpful to me. And then my management teams and my boards of directors, have been another source of mentorship and learning for me. So just being surrounded by so many talented people that had solved so many other types of problems that I wouldn't even know how to start. It's humbling, but it's also a great learning experience you can learn from those around you.
Mitch, we talked about student debt a little bit already, but what are your thoughts on the student debt forgiveness programs that have been knocked around in Washington?
Daniels: I've been maybe too outspoken in saying I think they're really a bad idea in multiple ways.
First of all, it's a misnomer. Debt wouldn't be forgiven. It would be transferred from people who borrowed it to people who didn't taxpayers in the main. I really couldn't find a redeeming feature in it, Jim. First of all, it's regressive any way they've tried to twist it and torture it, it rewards people of higher incomes and higher means far more than those of lesser economic status.
It's incredibly unfair. From our university, 99 plus percent of the graduates pay back any student loan they took out. And how incredibly unfair to them to then let subsequent borrowers out of those very same obligations. Fiscally, it's a catastrophe we're already facing, I'm sad to say, a grim, grim reckoning in a few years when the debt we've already piled up, and here would come several hundred billion more worse than that at the stroke of a president's pen.
If you have any respect for the constitution at all, you know where the power of the purse is supposed to rest, and it's just a direct violation of that. Unfortunately, the courts have seen that and smacked it down each way the proponents have tried to devise it. So first of all, I think it's a terribly flawed and unfair policy.
I think there are far better ways. I've always thought the right way to do this was to put the schools who benefit from these loans and all this subsidy at some risk. They would work a lot harder than they do to keep costs down and to make sure that their graduates, like Purdue graduates, are really ready for a productive life.
Well, we can't let a former member of the Open Market Committee and a long standing Federal Reserve president go without giving us all some clue as to what you think's coming. Give us a little economic prediction.
Bullard: Yeah, I've been pretty optimistic. I am tracking the economy every day, as I always have, and commenting on the economy.
I'm pretty optimistic that we can attain a soft landing. I think the economy should grow at a trend pace in 2024. I think inflation will continue to come down. I think that's the best guess right now. And so that suggests that the labor market will remain pretty strong.
National unemployment rate still below 4%, very low number for the U.S. economy. So I think we're in pretty good shape. Things can happen. You've got a lot of global risk out there with two wars going on. You've got a slowdown in China, which is a head scratcher. So there are always risks out there, but I think we're looking pretty good for 2024.
Daniels: Well, here's a risk for you. By the time this interview gets seen, we might be a few months down the line and people can check on the accuracy of your work.
Bullard: I'd prefer that they not check too closely. (laughs)
Daniels: My guess is you'll be right.
