Rich get richer: largest gift in Harvard's history a hefty $150 million
Elise Amendola, Associated Press
Harvard University, already awash in assets with a $32 billion endowment, just received a commitment from Kevin Griffin, a hedge fund managing alumnus. The gift totals $150 million, most of which will go to defray tuition for students. Middle-class students at Harvard already pay little or no tuition, and some are questioning the rationality of offering tax deductions for such donations to super wealthy institutions while students elsewhere struggle with tuition and student debt.
“This was an opportunity to make a statement about Harvard as one of the most important higher education institutions in the world,” Griffin said in an interview with the New York Times.
"Other universities have drawn bigger individual donations," the Times noted. "Michael R. Bloomberg pledged $350 million to Johns Hopkins University last year, the latest in a one-man $1.1 billion capital campaign. John W. Kluge, a former television mogul, donated $400 million to Columbia University’s financial aid program seven years ago."
"Harvard boasts that its bountiful financial aid means that 90 percent of American families would pay the same, or less, for a Harvard degree as they would pay for state school tuition," the Boston Globe reports. "Families making up to $65,000 a year pay nothing, while those with incomes up to $150,000 pay between zero and 10 percent of their income. Sixty percent of undergraduates received financial aid, and among those who do, the average family pays $12,000 a year for tuition, room, and board."
Large donations to universities are in vogue, Business Week reports. "Higher education endowments continue to grow as alums and others direct charity toward schools. Graduates of Harvard broke gift-giving records for the school last year. As a whole, school donations have swelled: U.S. colleges and universities received $33.8 billion in gifts in 2013, a 10 percent increase over 2012. That’s the most the industry has raised on record, according to the Council for Aid to Education, a nonprofit that studies higher education fundraising."
But Slate's Matt Yglesias thinks the gift to Harvard is absurd, calling Harvard the "Bill Gates of universities."
"Harvard's $32 billion endowment is about 50 percent larger than Yale's," Yglesias writes. "Don't get me wrong, giving money to Yale is ridiculous. But giving money to Harvard is doubly ridiculous. And note that when it comes to these fancy universities the official endowment figures are a drastic understatement of the real wealth of the university. Harvard's real-estate assets are mind-bogglingly valuable, for example, but not part of the endowment."
The Economist agrees, noting that "Mr Griffin's gift looks like a good occasion to revisit the sense of giving tax-advantaged status to charitable donations to phenomenally rich universities."
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