In January, writing for the Chronicle of Philanthropy, Gates Foundation CEO Mark Suzman lamented that a high percentage of giving in the U.S. goes to wealthy, elite colleges and universities, often at the expense of programs aiding the poor. But donors don’t need to choose between giving to wealthy institutions and giving to areas of the “highest need,” he advised. Instead, they can take a “yes, and” approach. “If donors make a gift to their alma mater, they should pair it with an equally large gift to a program that makes online textbooks free to all college students. Or they could pair a gift to a research institution in a wealthy country with a gift to fund research on infectious diseases that primarily affect poor people in developing countries.”
In a subsequent article, Benjamin Soskis of the Urban Institute added that colleges themselves could facilitate this “pairing” of donations—acting as philanthropic “sommeliers”—by advising donors on how to give elsewhere, too. Schools truly committed to this idea, writes Soskis, could “make such pairings a condition of major gifts—those who want to give a million dollars or more to Yale would need to also donate to one of the university’s equity partners.”
The level of chutzpah such an arrangement would require might challenge even the boldest development officer. But the philanthropic sommelier idea is a possible solution to a dilemma that elite universities confront today. College administrators want to keep raising piles of money from wealthy donors, while at the same time signaling that they are truly concerned about the poor and oppressed. And they want to earn the approbation of leftists on campus without antagonizing donors. In that circumstance, they might take the money, while advising donors how they might “launder” it via gifts to other charities.
Colleges and universities now hear demands from campus groups to withdraw investments from companies doing business with Israel, as part of the Boycott, Divest, and Sanction (BDS) movement. University endowments have grown dramatically in recent decades, thanks to the stock market boom beginning in the 1980s. They have added thousands upon thousands of administrative positions and made campus life more luxurious for students and professors alike. (Perhaps the only people who have not benefited are the adjunct faculty now tasked with doing the bulk of teaching on many campuses.)
This wealth was made possible by the freedom to invest in profitable firms around the world. Some endowments have done better than others, but schools have largely resisted calls to stop putting their money into, say, fossil fuels. It’s one thing to take the name Sackler off a building to express concern about the role the family’s drug company played in the opioid crisis. It is another to say that concerns about ties to the military will stop you from investing in Boeing or Google.
But by agreeing to protesters’ demands to make endowment investments open and even agreeing to a board vote on divestment, as Brown University just did, schools are going down a dangerous road. Of course, the anti-Israel movement on campus is well organized, and the BDS campaign has been going on for some time. But it would not take long for environmental organizations to see the opening here and begin to demand that schools invest only in solar and wind energy or stay away from companies that, by their lights, contribute to global warming or clear-cut forests. And that’s only the beginning. Maybe universities should invest only in women-led companies, or ones where a majority of board members are racial minorities?
University leaders have been speaking out of both sides of their mouths for long while. They are amassing huge sums of money while also claiming to be nonprofits worthy of tax exemptions. They are charging high tuitions while claiming they need federal government subsidies for students to be able to afford them. They are behaving, for all intents and purposes, like for-profit corporations while at the same time disparaging capitalism and its fruits.
The past six months have laid bare for many donors how these universities really operate and the level of moral bankruptcy they are willing to tolerate and even encourage among their students and faculty. When the radicals whom university leaders have cultivated demand that they choose one or the other—their so-called principles or their pocketbooks—they won’t be able to say “yes, and.”
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