Yeah, but wouldn’t the money being used from the endowment would ultimately mean that the university would need less money from Tuition to make ends meet?
In theory it should, but often these funds are misused. When the financial crisis broke in 2007/2008, wealthy donors (or their descendants) checked on the impact on their endowments and often found the funds were being used for purposes completely outside the scope of the written intention. Schools actually had to return money to the donors (or those responsible for the donations many years later).