The big problem is that universities basically never hire or promote based on a persons teaching ability. One of the best lecturers I had at university was a postdoc who didn't get hired and ended up teaching at a 'third rate' university. One of the worst lecturers I had got head hunted by MIT.

>The big problem is that universities basically never hire or promote based on a persons teaching ability.

Because they aren't intended to be educational. Universities (as they are run today) are primarily grant-revenue capture organizations, secondarily research organizations (at least to the degree necessary that grant money doesn't dry up because of fraudulent spending accusations), and finally after that, a begrudged effort is made at education for optics. If they could ditch the education angle entirely, they'd send the students home tomorrow.

No, even ignoring tuition and fees a huge chunk of the endowment comes from alumni donations. Mostly former undergrads.

There are pure grad institutions, such as UCSF and Baylor College of Medicine

That's not necessarily a problem. There are different options in the marketplace. If you attend an R1 research university then of course hiring decisions will heavily weight research productivity. But many other smaller schools absolutely do look at teaching ability.