Harvard University has the largest endowment of any school in the world, last estimated at $40.9 billion. Yet it took a presidential scolding and nationwide criticism for the school to promise that the funds it receives from the federal government’s coronavirus relief package will be used directly for the benefit of Harvard’s current and future students.
President Trump criticized the university during Tuesday’s press briefing for accepting funds through the U.S. Small Business Administration’s Paycheck Protection Program. Trump’s allegation wasn’t quite accurate — Harvard had not applied for, nor would it have been accepted into the PPP — but the crux of Trump’s complaint was still true. Harvard did receive nearly $9 million in federal funds through Congress’s $2.2 trillion relief package. It wasn’t until the school began facing social media backlash that Harvard announced it would allocate its relief check to students who receive financial aid.
Harvard should never have accepted government money in the first place. It is an independently wealthy institution (the wealthiest in the world) easily able to provide for its students and staff without taxpayer assistance. Smaller, less affluent institutions, such as struggling community colleges and trade schools, are wondering if they’ll be able to open their doors this fall.
Harvard’s own staff would agree: “This $9 million should go to small businesses and out of work people,” said Eric Feigl-Ding, an epidemiologist at the Harvard School of Public Health. “C’mon Harvard, do the right thing & donate it to the community. People are suffering!”
Congress could have introduced means-testing to its higher education assistance without much controversy. This would likely have prevented Harvard and other well-endowed schools, such as Yale and Stanford, from receiving millions of dollars. But Harvard should have decided not to accept additional assistance on its own. Instead, the school accepted Congress’s check while laying off hundreds of subcontracted employees and asking wealthy donors and alumni to continue donating to its emergency fund.
Harvard’s hands are somewhat tied, given the nature of its endowment. A spokesman for the school, Jason Newton, said that 80% of its $40.9 billion endowment is “restricted,” which means it “must be spent in accordance with terms set forth by the donor.” So, for example, if a donor gives Harvard $1 million and specifically requests that that $1 million be used for the school’s football program, Harvard cannot spend that $1 million on anything but its football program.
That other 20%, though, is “unrestricted,” Newton said. That means Harvard has $8 billion in discretionary funds to aid its staff and students. And that doesn’t include Harvard’s 2019 budget surplus, which was upwards of $298 million. Despite this, Harvard announced it would not provide paid leave for its subcontracted employees last month — a decision the school later walked back after facing pressure from labor unions and alumni.
Again, it should not have taken a national scolding for Harvard to reach the conclusion that caring for its staff members should be a priority. But it’s obvious that Harvard’s priorities are not what they should be. And it’s worth asking: Would Harvard had dedicated the $9 million relief check to its financial aid department had Trump not said anything? Would Harvard had agreed to provide paid leave for its subcontracted employees had there not been backlash? Probably not.
Harvard’s actions and its subsequent explanations over the past few months suggest that the school is concerned about its optics more than character. The school only does the right thing when publicly embarrassed or otherwise compelled to do so. A good university would have done the opposite; it would have led by example, sacrificing whatever was required for the sake of its students and staff and encouraging them to do the same for their neighbors, friends, and family.
There are many top-tier schools that have done just that, such as the University of Chicago, which has only one-fifth of the endowment Harvard has. But then again, some schools truly put education first.
