Kenneth Griffin went to Harvard. Then he became wealthy running a hedge fund called Citadel. Now, he is generously giving $150 million of his fortune to Harvard, and I think this is a fantastic idea.
The observations made in Matthew Yglesias’ recent Slate article are misguided and myopic, implying that the current size of Harvard’s endowment makes any addition to it superfluous, and minimizing the impact of the College’s Financial Aid Initiative. Yglesias employs emotional yet empty arguments to undermine the fact that he is denouncing a donation that will “fund 200 new scholarships… and create a fund to match other donations in support of 600 additional scholarships.”
Firstly, we must clarify what meaning the endowment carries. Universities bring in money by charging tuition to students, receiving grants from the government, and licensing patents to private companies and donations. However, all of this covers no more than about 60 to 70 percent of their budgets. The rest comes from their endowments. Harvard uses this revenue to reduce the financial burden on its students and provide better resources for its scholars. The large dollar value that is attached to Harvard reflects the sizes of the operations it conducts, and the vast scope in which they do this.
What is apparently worthy of only passing recognition by Yglesias is the core of the donation, which expands the reach of Harvard’s massive Financial Aid Initiative. The FAI works on removing economic barriers for students who want to attend Harvard, greatly expanding financial aid to families who earn less than $80,000 and covering tuition for those families who make under $60,000.
As a beneficiary of the FIA myself, I can attest to the impact that it has made on my life. The opportunities that I enjoy at Harvard far surpass the grim realities attached to my family’s income bracket. My family, along the families of the 10,000 other students who have been helped by the FIA, would gladly turn down the $100,000 check alternative proposed by Yglesias. The ability for money to do good does not depend on arbitrary distribution. Griffin’s donation will help provide a better future for thousands of families, an impact that a mere lump sum cannot impart.
There is no doubt that every one of us should take the time to make use of websites such as GiveDirectly (as mentioned in Yglesias’ article) or donate to Amnesty International. The problems facing the world are indeed extensive and there is often too little done to address them. Yet, I don’t see Yglesias and other critics taking the time to lambast Texas A&M’s $450 million expansion of Kyle Field. Does the construction of a $68 million dollar state-of-the-art football facility at Oregon University somehow not merit condemnation? What about Notre Dame’s $400 million dollar renovation of their stadium? Or $3.2 billion spent developing an immobile mobile cannon? Indeed, the negative focus on this recent donation to Harvard is not rooted in an enlightened sense of activism; it is merely the crucifixion of a famous brand, with the detractors benefiting from the glory that comes with attacking a giant, albeit with limited provocation on the side of Goliath.