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Scrooge U: The Illusion of Generosity
Capital Research Center ^ | April 2008 | Lynne Munson

Posted on 04/02/2008 8:35:20 AM PDT by vadum

Colleges and universities are the richest institutions in the history of our nation --136 U.S.c olleges and universities have endowments larger than $500 million, 74 of which top $1 billion-- yet tuition continues to skyrocket while tax-free school endowments grow ever fatter. Lawmakers now question whether school endowments should remain unregulated and exempt from taxes, and are considering requiring schools to spend a percentage of their value each year, as private foundations must. Several schools have announced plans to dip into their endowments to defray students’ tuition expenses, but are they doing as much as they should in the area of financial aid? And are they violating donor intent by sitting on funds for generations?......

But a close look reveals that these schools are doing little different than they have for years, despite the fact that their endowment wealth has increased to a point that would allow some colleges and universities to eliminate—and many to substantially alleviate—the tuition burden for tens of thousands of undergraduates...... Harvard’s annual aid to undergraduates will now total $120 million—a $22 million increase over last year...... With a $34.9 billion endowment, Harvard sits on the LARGEST FORTUNE AMASSED BY ANY INSTITUTION IN THE HISTORY OF OUR NATION...... Harvard is so wealthy that it would take less than 1% endowment spending for its students to attend tuition-free. But at its current rate of spending, billions of dollars in donations that Harvard promised donors it would spend on aid will just sit unused for generations, serving no purpose. And, all the while the university will keep charging tuition, raising tuition, and even continue to charge an application fee. These schools are thumbing their noses at the wishes of alumni who have donated billions in the hope that universities will truly throw open their doors......

(Excerpt) Read more at capitalresearch.org ...


TOPICS: Culture/Society; Front Page News
KEYWORDS: endowment; harvard; tuition; yale
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To: Zhang Fei
I think if people are going to get tax deductions from donating to these things - tax deductions that get them tangible things like preferential admissions for their children, the taxpaying public has an interest in regulating what goes on behind the curtain

Your conclusion only makes sense if you postulate some sort of effect on your tzx costs by someone else's tax aviodance. Just isn't so. Government spending is not a zero sum game where every dollar spent is offset by a dollar plundered from the taxpayers. That would be bad enough, but the federal government always spends in excess of its revenue, by borrowing and inflating. So you could possibly make the argument that cutting government revenue cuts spending because there is less money to spend and borrowing gets harder as more and more money is borrowed.

21 posted on 04/02/2008 10:26:56 AM PDT by from occupied ga (Your most dangerous enemy is your own government,)
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To: riverdawg

There are a number of books that show this, but you don’t need anything except a history book to get the general idea.


22 posted on 04/02/2008 10:45:00 AM PDT by from occupied ga (Your most dangerous enemy is your own government,)
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To: wbill

“Sunlight is an excellent disinfectant. Perhaps more alums will think twice before writing a large check for the Universities to just sit upon and collect interest”

That’s assuming these alumi write the checks for the noble purpose of expanding higher education. No doubt that many of them do have that goal, but I would suggest that many see their contributions as membership dues in an exclusive club. The more they give, the higher they go in the club. It really doesn’t matter to them whether the money they give is spent on scholarships, buildings, sports, or Wall Street.


23 posted on 04/03/2008 4:46:44 AM PDT by bobjam
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