Okay, I know it's a naive question, but why did universities decide that their presses should be profit centers, or should at the very least make enough revenue to cover their expenses? Libraries aren't asked to make enough money to pay for themselves. Libraries and university presses both exist to further knowledge - so why the difference? Why do universities accept the idea that libraries cost money, but assume that disseminating research and sharing knowledge should pay for itself or even be profitable?
I suspect a part of the answer lies in the parochial nature of libraries. We serve our local students and faculty. If we're public institutions, we probably are expected to serve our state populations in some way; if we house federal document depositories, we are required to be open to the public and offer some assistance regardless of institutional affiliation. But we tend to think of the local students and faculty as our clientele and allocate resources and energies accordingly. We're presented on admissions tours as a kind of member benefit.
University presses aren't so local. They don't promote their institutions by publishing the work of the faculty. They serve a greater purpose: to contribute to knowledge by selecting, vetting, improving, and disseminating scholarship wherever it comes from. Yet that value isn't ... valued, not as a fundamental mission of the institution.
A little while ago , I riffed on Dorothea Salo's idea  that libraries need to be ready to support open access even if it means cutting back on business as usual - purchasing information and making it discoverable. For some folks, this is heretical: why should we spend money on people other than our primary clientele? But why shouldn't we? Don't libraries have a higher calling? We're pretty darned good at sharing resources through interlibrary loan. Why not put our money into making information available to everyone?
I'm not suggesting that libraries should start publishing stuff in their spare time. But I am wondering why we in higher education can't acknowledge that the knowledge we produce is for the betterment of the world, and that this important mission shouldn't be left to the marketplace. As Peter Suber wrote last March ,"should scholarly publishing, with all of its mixed incentives and hard choices, migrate closer to market-oriented end of the spectrum or to the mission-oriented end of the spectrum? For me the answer depends on a prior question. Do we want scholarly publishing to serve a certain function in the community?"
I think we do, and I have a feeling that if we redirected a lot of the money spent on libraries toward making this knowledge widely available, we'd all be better off.