How Cooper Union’s Endowment Failed in Its Mission

Parents Forum
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<p><a href="http://www.nytimes.com/2013/05/11/business/how-cooper-unions-endowment-failed-in-its-mission.html?_r=0&pagewanted=all%5B/url%5D"&gt;http://www.nytimes.com/2013/05/11/business/how-cooper-unions-endowment-failed-in-its-mission.html?_r=0&pagewanted=all&lt;/a&gt;&lt;/p>

<p>Today’s crisis has been brewing for decades if not longer, and comes after years of what looks like bad management decisions with little accountability or supervision by New York’s attorney general, who oversees nonprofit institutions. Over the decades, Cooper Union has sold off assets piecemeal, failed to diversify its endowment, taken on debt and built a lavish new building. After the 2000-1 stock market plunge, the managed endowment, excluding the Chrysler Building, lost half its value. The school never cultivated its potential donor base, leaving most graduates with the impression that it was wealthy and didn’t need alumni contributions.</p>

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<p>Interesting article. The comparison to the way Emory handled its Coke stock was instructive.</p>

<p>Free education sounds great, but sometimes people don’t value what they get for free. Oxford University is now trying an American-style cultivation of alumni donors because they can no longer rely solely on one source of money (in their case, the government). There is no huge culture of alumni giving in the UK because education is seen as a service paid for by taxes. People don’t feel any obligation to “pay it forward” when they can. Was the culture at Cooper similar, based on an assumption that the money would always be there?</p>

<p>I wonder what Olin thinks of this development.</p>

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<p>some schools like harvard have plenty of money, other schools are in really bad need. if you have $$$ to give away a donation to a lesser known but important part of the college ecosystem is better served. a 25 million or more donation to say yale or harvard just gets sucked into the black hole. where at another school it could really shore them up for a while and make a major difference. a little off topic but this article reminds me of this disparity. (yes I know donations and where they go is up to the donor)</p>

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<p>Absolutely agree. It’s basically giving a donation to a place that’s already wealthy.</p>

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<p>I understand what you’re saying, but people like to invest in places where the money won’t be lost. Colleges should not depend on one, or a small few, of donors for endowment, nor should they depend on one source of income, whether that’s tuition fees alone, or endowment alone.</p>