<p>A local columnist questions when politicians will go after endowments of "Big Education".</p>
<p>Joe</a> Soucheray - TwinCities.com</p>
<p>Do you think it will happen anytime soon???</p>
<p>I pray for it. Daily.</p>
<p>There were a couple of threads on this in early May. Recommended reading.</p>
<p>Only two Big Ten schools have what could be called mega-endowments. This guy is a populist dork.</p>
<p>Actually, no he's not. There's something in the IRS code that schools with big endowments are supposed to follow to retain their tax-exempt status. They have to plow a certain percentage back into scholarships if the money is obtained for scholarships. That's why H,P, etc. are acting now to head off IRS poking noses into their financial doings.</p>
<p>I have been suggesting this would happen for some time. I think it is gaining some purchase. Any institution whose coffers are growing tax-free is accountable to the public for how those tax-free dollars are being used (whether that be church, charity, or well-endowed college). IMO it's a fair requirement that they serve the public good, not just create wealth upon wealth. Most folks know I'm not happy with the state of financial aid at the elites for the non-rich, non-poor. I'm not the only one. Open up the purses, let a few shekels out to the taxpayers (or should I say voters?) or pay taxes like any other business. </p>
<p>Signed, Curmudgeon - the Populist Dork.</p>
<p>He does not mention going after Harvard or Yale but schools with "several hundred million" and The Big Ten schools. If he thinks those schools have huge endowments relative to size and budget he is full of crap.</p>
<p>Most non-profits are not permitted to just keep accumulating large amounts of money without using at least a reasonable percentage of those new funds to further the non-profit's stated charitable objective... and university's should really be no different. I don't know much about this specific proposal, but I would agree in general that taxes should be applied to the organization if they're simply just accumulating huge amounts of money and not doing anything with it. Non-profit's get tax breaks because they're supposed to use the money they save from paying taxes to help further their organization's objectives... just simply just hold onto the extra money and keep building up a massive warchest that's not used for anything. They're 'charitable' organizations... not 'wealth generation' organizations.</p>
<p>I think a lot of people (even here) need to look at the big picture. Even if universities are growing their endowments tax-free, they're essential for creating a well-educated public, attracting international students, the majority of whom stay and work here (brain-gain), and function as sources of much research. Many scientific and medical discoveries have also been in college labs. Isn't that the public good? They also provide huge, huge numbers of stable jobs (often the largest employer in states).</p>
<p>Should they offer more money in FA/scholarships? Sure. But an idiotic way of looking at it is by pure endowment size. You have to consider costs/student and endowment/student too. The first because schooling in Ohio is cheaper than Boston, and the second because some schools have 1 billion+ but very little when considering how huge the university actually is.</p>
<p>Never going to happen, ever.</p>
<p>The financial markets have provided rather phenomenal returns in the past few years. This makes it look like the institutions with large, well-managed endowments are being stingy, when in fact it's difficult to spend the additional money responsibly when they know such returns won't continue forever. In addition to endowment growth from return on investments, new money is being added to these endowments. I suspect this year's returns will pale in comparison and as a result a we will see the percentage of endowment spending increase.</p>
<p>The one constant is that politicians cannot keep their hands off of other people's money, especially where large piles of money exist. There are plenty of opportunities for politicians to show fiscal responsibility. That they would choose to begin with college endowments only breeds cynicism.</p>
<p>@ CollectivSynergy, as faculty and a scientist, let me tell you the colleges and universities do not underwrite the research! We have to beat the bushes to get research money from private foundations, the Federal government, or private industry. That goes for hiring our assistants and buying our equipment. private unviersities are known as "soft money" schools in my line of work, because without the external funding, you are out of a job.</p>
<p>Some do. Wisconsin uses $100 million of it's own money for research grants per year.</p>
<p>You have to know exactly what that means. U WI is no different from any other university. If profs do not get outside grants, they are sunk. The rpofs may have to compete agianst each other for those grants.
Imagine being hired for a job and having to compete against your peers as well as supervisors (dept chairs) for the funds to do your job.</p>
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Imagine being hired for a job and having to compete against your peers as well as supervisors (dept chairs) for the funds to do your job.
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<p>That happens anyway even with outside and government funds. It's all part of the life of an academic... constantly clawing for funds to avoid the always impending 'doom' of running out in the near future.</p>
<p>True, but in many areas funding is not always out there such as liberal arts. Also they provide lots of research start-up funding to young profs until they can get the Federal $$$. UW is #1 in non Fed research funding by far. Makes up for the lower pay.</p>
<p>Curm -- "the" Populist Dork?</p>
<p>Now if universities/colleges spent some endowment bucks on research, it would be a different story. We'd be hard salary professionals. But the fund raising probably talks up the scholarship aspect, so the money should go there. I sure wouldn't complain, after the package I got from D's school!</p>
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<p>Maybe Curmudgeon, "a" populist dork?</p>
<p>no one likes; But even Scooge Mcdork will open his vault to worthy causes. </p>
<p>Andrew Carnegie, Andrew Mellon, Rockefeller, Morgan, and many other tight fisted scrooges realize that their legacy will most be remembered by their ongoing foundations than how they got their wealth.</p>