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Why Not Use Record Endowment Returns to Promote Equity?

Given their endowments’ soaring value, elite universities have a moral duty to expand access and do more to contribute to the public good.

October 25, 2021
 
 

Jaw-dropping. Eye-popping. Mind-blowing. I can’t think of any better words to describe my reaction to the soaring value of the endowments of the nation’s wealthiest colleges and universities.

Washington University in St. Louis saw a 65 percent return. Duke, 56 percent. MIT, 55.5 percent (after completing a $6 billion capital campaign). Brown, 51.5 percent. Dartmouth, 46.5 percent. Yale, 40.2 percent.

These figures strike me as incredible.

It’s not just the percentage growth that is striking, but the actual dollars involved. MIT saw its endowment soar by $9 billion -- which was the size of Columbia’s entire endowment just five years ago.

Yale’s endowment grew by an astonishing $12.1 billion.

What, we might well ask, should these moneyed institutions do with this record windfall?

My advice: don’t think small. This is not the moment to enhance an already gold-plated experience.

Rather, it’s an unmatched opportunity to maximize these campuses’ impact and take tangible steps to increase educational equity.

Here are seven ways that these institutions could use their resources to advance the public good.

1. Grow.

Each year, more than 118,000 high school seniors score over 1400 on the SATs. But the nation’s 16 most selective colleges and universities only admit about 24,000 students total. Shouldn’t these elite institutions do more to expand access to their hallowed halls? It’s certainly not impossible or cost prohibitive. Nor does it require expanding facilities. Require juniors and seniors to live off campus. Enroll students year-round. Incentivize three-year graduation.

It will require more faculty -- which is unequivocally a good thing. Just do it.

2. Spawn satellite campuses.

Why not develop specialized campuses across the country and perhaps internationally? Elite universities already have existing initiatives that could serve as a model, like Duke or Stanford in New York City, which offer programs that focus on finance and on the arts and media.

But rather than simply augmenting the experience of existing undergraduates, create degree programs to serve local populations. These need not be residential campuses. Instead, use financial aid to allow the students to attend college full-time.

3. Create a truly robust online presence.

How about a Harvard or Yale or Princeton in the cloud, offering not MOOCs, but rigorous, highly interactive degree programs with a high faculty-to-student ratio?

Right now, the decision by Harvard and MIT to sell edX quickly, without consulting with their partners, looks even shakier than it did at the time.

What was the rush? The nominal justification -- mounting deficits and ongoing subsidies -- seems pretty trivial when compared to their endowments’ phenomenal growth. Wouldn’t it make more sense to strengthen and expand their online offerings, including at the undergraduate level, and set the bar for a quality and affordable online experience?

4. Establish talent-development programs targeting underserved high school students.

Imagine a host of outreach initiatives, sprinkled across the country, targeting gifted underserved high school students nationwide. These might be after-school programs or summer bridge programs or weekend “colleges.” But I can assure you: intensive, immersive talent-development programs hold out the promise of fundamentally altering the life trajectories of low-income and diverse students.

5. Substantially expand research programs targeting talented undergraduates and graduate students from underresourced colleges and universities.

I had the great honor of co-directing a Mellon-funded Summer Research/Leadership Alliance program that prepared talented undergraduates from underresourced institutions for doctoral programs. I can personally testify to the program’s effectiveness.

At the University of Houston, my department established a series of annual workshops, where advanced graduate students and junior faculty working in African American and Mexican American history presented papers to distinguished visiting scholars. These workshops, too, helped forged intellectual networks that have persisted years later.

What if the elites used part of their funds to greatly expand similar opportunities for undergraduates, graduates and postdocs?

6. Develop an NSF for educational innovation.

Elite institutions might solicit applications for funding from faculty nationwide to support the development of content and tools that will enhance student learning and then make these resources widely available.

Since the wealthiest institutions train a grossly disproportionate share of faculty across the country, wouldn’t it make sense for them to do more to support those faculty who are in the field?

7. Pilot new models of undergraduate education.

A course-centered curriculum isn’t the only effective model. Think here of the co-op model at Drexel and Northeastern or Minerva’s online approach, which allows its undergraduates to reside in a series of cities worldwide.

Enormously wealthy institutions might tap their resources to experiment with a variety of fresh educational approaches, such as a low-residency model that combines an online and an on-campus experience, a next-generation flipped classroom approach that couples a project-focused education with online dissemination of content, and an approach that emphasizes service learning and community engagement and local problem solving.

The elites have hit the jackpot. While it’s a myth that most jackpot winners go bankrupt within five to seven years, it is certainly the case that many do squander their riches and, worse, gain no satisfaction or happiness as a result of their success.

I’d urge these wealthy institutions to ponder a March 1991 Simpsons episode. Grandpa Simpson has unexpectedly inherited $106,000. At first, he wants to spend the money on himself, but thanks to Lisa’s urging, he decides to put the money to good use and benefit those in need.

He soon discovers that the bequest is not enough to solve all the social problems that Lisa identifies. But, in the end, it is enough to improve the quality of life in the retirement home.

I hope that our wealthiest private institutions will take that episode’s lesson to heart. Don’t spend your newfound wealth simply on your existing campuses. Use it for the broader good.

It’s past time to tackle educational equity head-on.

Steven Mintz is professor of history at the University of Texas at Austin.

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