President A. Lawrence Lowell, for one, was not particularly concerned about the School's substantial deficits in the early decades of its existence.

"The fact is," he wrote to a friend and advisor just after World War I, "that the other departments of the University have to run on their income. This School has been started on an entirely different basis, that of spending more than it has with an obligation on the Dean to raise the balance. It has worked well."

It was a reasonable summary of the School's business model up to that point—and, unfortunately for HBS deans over ensuing decades, a good prediction of what was to come.