The Purpose of Harvard is Not to Educate People: http://blogs.discovermagazine.com/cosmicvariance/2008/05/29/...
State universities, yes, those are supposed to educate people. But not Ivy League schools. Their purpose is to produce new knowledge.
The authors of the OP article then conflate two discussions: (1) Should private research universities focus on education instead of research? (I would give that a resounding no.) (2) Are the private research universities actually producing useful knowledge? (Here, I would be somewhat negative, but probably not for the trite reasons cited by the authors.)
Those are completely different questions, especially since one is empirical and one is normative. And it is a hallmark of poor editorializing to try to address both an empirical question and a normative question in the same small space.