Posted on 10/06/2015 10:46:28 AM PDT by reaganaut1
The gigantic endowments that a few universities hold inevitably attract attention. (Harvard leads the pack at around $33 billion and there are 19 schools and systems with endowments in excess of $5 billion).
That attention usually comes from people who think that the institutions are not using their endowments in the best way. They berate universities for “hoarding” money when they could be spending much more to reduce or even eliminate tuition for their students.
One such critic is University of San Diego law professor Victor Fleischer, who recently penned an op-ed for the New York Times entitled “Stop Universities From Hoarding Money.”
Fleischer begins by pointing out that in 2014, Yale paid some $480 million to fund managers who handled only $8 billion of the university’s $20 billion endowment. But in that same year, it devoted only $170 million of its spending to tuition assistance, fellowships and prizes. The comparison—spending two and a half times as much to maximize the endowment’s growth as to help students—leads him to state, “Instead of holding down tuition or expanding faculty research, endowments are hoarding money.”
Fleischer is voicing a complaint that we have often heard before.
Back in 2008, for instance, Lynne Munson, now executive director of Common Core, decried “the illusion of generosity” in this paper for Capital Research Center’s Foundation Watch. She opened with an attack on Columbia for announcing with fanfare that it was increasing financial aid to undergraduates. The problem, in Munson’s view, was that the increase was so small compared with the growth of the university’s endowment.
(Excerpt) Read more at forbes.com ...
IIRC, Harvard’s endowment was north of $70B a few years ago.
How about taxing “for profits” like “nonprofits”—and then letting them do whatever the heck they want with their money?
The universities with big funds....are mostly private, and I don’t see any reason to screw with them. If a state-run university has deep pockets....a different matter, and they ought to be forced into moderate spending by their state governors (if they had the guts to force the issue).
Rich universities rake in the billions and use it for leftist causes. If they are forced to spend it they will use it for leftist causes.
As much as I despise rich leftist universities, the government has no right to tell them what to do with their money.
I would just as soon close down all “Ivy” universities, and confiscate their wealth....like they would do to us if they could pull it off..
Because that money belongs to the university?
How about admitting that attending these universities means you have been deprogrammed as a God believing America loving citizen and you now believe in the Elites of the New World Order?
It’s a tax thing; give lots of money to a university; in turn the university invests in your hedge fund; you earn money and tax deductions several ways...
From Forbes:
“The 832 institutions participating in this year’s Study represented $516.0 billion in endowment assets.”
$516,000,000,000.00
College tuition rates are a national scandal. Since these institutions are so reliably LIBERAL, no one makes a peep.
Let ATM fees go up a $1 and the Congress wants to pass a law.
I have no problem with private universities doing whatever they want with private funding. For public universities, they should have a choice, take state money or private funding. Cannot have both.
“IIRC, Harvard’s endowment was north of $70B a few years ago.”
I have a friend who works at the Harvard endowment. When he went to work there in the early 90’s it was at $10 billion. The highest it got was $37B in 2008 right before the crash. It finally reached this number again in 2014 and now it is at its peak again. It has never been higher than $40B.
“I have no problem with private universities doing whatever they want with private funding.”
Fine, but lets stop calling them “nonprofit” Harvard doesn’t even pay its fair share of property taxes. Enough is enough.
(Obviously, the money men had a reason to manage higher fund levels...)
As for tuition assistance, Harvard had, at some point, stopped charging tuition for students with family incomes of less than $60K.
Thanks for the correction.
Agreed Private vs. Public.
More FUN facts:
“As Washington lawmakers scramble to reach a last-minute budget deal before the end of the year, HARVARD and other research universities are BRACING(!!) for what would be the most dramatic cut in federal research funding in recent history.
Failure to come up with a compromise to avert the so-called fiscal cliff by midnight Monday will trigger an 8.2 percent across-the-board cut in non-defense discretionary spending. As a result, HARVARD will lose out on millions of dollars in promised federal grant money for the 2013 fiscal year.
Because the cuts will be applied to the current fiscal year, which began July 1, the loss in sponsorship will be compounded onto the second half of the fiscal year, worsening the blow for the remainder of the 2013 fiscal calendar.
The University received roughly $656 million in federal sponsorship during the 2012 fiscal year.”
HARVARD has $30,000,000,000.00 in ENDOWMENTS.
HARVARD gets $656,000,000.00 in FEDERAL SUPPORT
No one even blinks.
Why spend their own money when the government throws our money at them as fast as they can catch it?
Some state universities, like Michigan and Virginia, have been operating like semi-private universities for many years. For example, the Commonwealth of Virginia provides less than 8% of the operating budget of UVA, down from 30% a couple of decades ago. There are basically four sources of funds for a state university: endowment income, overhead from research grants, tuition and fees, and state subsidies. Grants have been stagnant and state subsidies have declined substantially at many public universities. So, that leaves increased tuition charges and higher endowment income to cover the difference.
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