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Billionaire’s Guide to Buying Your Kids a Better Shot at Elite Colleges

57 points by gopi 7y ago

kolbe 7y ago
> Shaw has been said to purchase tickets for several different flights on the same day in case his plans change. Hard to reconcile that with David not choosing to fly private. Maybe he has environmental concerns, but I would guess he exclusively flies private, especially since this article claims he's a little OCD about controlling every part of every process. With regards to "buying" his kids' way into college, it doesn't look like there's any evidence that this was David's goal other than coincidental timing. But beyond that, David doesn't need to buy his kids' way into these colleges. Colleges love to accept the children of billionaires. Nothing is better than linking up an intellectual class with the wealthy class, and letting the melding of capital and innovation create powerful and successful alumni.
- gbronner 7y ago
  I recall talking to the chair of special gifts at an elite institution, and him lamenting that the school had rejected the children of multiple billionaires, making his life much harder. Brown traditionally let a few parents buy their kids a spot, but most other Ivy League places can find enough highly qualified kids who happen to be offspring of rich parents to not worry much.
  - ameister14 7y ago
    Yale is pretty famous for pay to play - it also turns out to be where two of Shaw's kids ended up going, and Harvard let in Kushner
    - gbronner 7y ago
      Never heard of the p2p reputation at Yale. May be true, but have never seen it. My understanding is that it would only help if the kids weren't going to get in on their own merits, and by all accounts, this was not an issue. It is a signalling mechanism that they are going to pay full price or more, but I see no evidence that they bought their way in. Kushner offered a lot more than a million a year, and had a politically connected father and it was a generation ago.
      - ameister14 7y ago
        Kushner graduated Harvard in 2003. That wasn't a generation ago.
gbronner 7y ago
Total donations were something like $36 million, and by all accounts, kids were extremely smart and motivated. Honestly seems like a CYA move on behalf of his staff, and not any rational approach to bring his kids' way into a top school.
- pmiller2 7y ago
  $36M doesn't even come close to what this guy is netting on his investments, I'm sure. Honestly, if I had kids going to college and spending $36M was something I could do without thinking about, I'd probably do it too, just in case.
- onetimemanytime 7y ago
  I agree but then it' not like they're suffering. $37million is nothing to them--and they can say they donated to a good cause.
zaroth 7y ago
Here’s a family that donated $37 million to a half dozen schools over several years, ostensibly to increase the odds of his [well qualified] children to be accepted into one or more of those schools. Personally, I think if someone wants to pay the way of, let’s say, 300 students to get full scholarships, so that their child can attend, this seems like a very sustainable model which benefits everyone involved. $37 million buys a lot of resources so arguably this isn’t taking a spot away from anyone, if anything it is enabling these universities to provide more spots to students who deserve them, potentially at zero cost.
- harryh 7y ago
  I generally agree with your comment, but it's worth nothing that despite the US population increasing and the number of kids attenting college increasing even more the top schools have generally not increased enrollment sizes much at all. It's interesting to think about why this might be so.
  - pmiller2 7y ago
    If you're sitting on a minimum of $3.5B in endowment (Brown), up to $34.5B (Harvard), why would you need to expand? Besides, being "elite" is part of the brand. Start letting everyone in, and the Ivy League becomes just another football conference.
    - dcolkitt 7y ago
      > being "elite" is part of the brand. Exactly. And what public policy needs to do is revoke the non-profit status of schools that fail to make any effort to expand despite having an abundance of resources and qualified candidates. Harvard could easily accommodate 20,000 undergrads given the size and quality of its applicant pool. That fact that it doesn't spend a penny of its $30 billion endowment doing so reveals that its mission is brand management, not education. And that's perfectly fine. But it shouldn't enjoy a tax-advantaged status predicated on the make-believe that its a philanthropic organization.
14 7y ago
I have to admit as an average intelligence middle class health care worker I actually assumed the ultra rich 100% did pay for their way into university. WhenI saw the admission scandal break I was actually surprised that these rich people had to go out of their way to craft reasons for their kids to attend like fake sports scholarships and such. It was only after I was made to realize how their actions were illegal.
- deleted 7y ago
  [deleted]
- rolltiide 7y ago
  breaking: world's worst kept secret exposed
- Analemma_ 7y ago
  The scandal was actually interesting because it showed the gulf between "rich" and "ultra-rich". The ultra-rich have always been able to buy their kids' way into college with 8-digit donations for new buildings; that's so obvious it's hardly even a secret. It's the merely-kinda-rich, who can't throw around that kind of money, who have to resort to the fake scholarships and so on. Which makes it kind of difficult to feel bad for the colleges who were supposedly the "victim" of these scams: they have no problem with bribery, they were just complaining that they didn't get their cut.
  - InitialLastName 7y ago
    Even the rich can donate to the college and have a good chance of getting their kids in. The problem in the admissions scandal was simply that the money wasn't going to the college (which would nominally benefit the whole student body); instead it went into the pocket of an individual.
- soared 7y ago
  Same - I assumed donate over x and your kids get accepted. It turns out that x is exceptionally higher than I thought.
- 7y ago
zarro 7y ago
If rich people want to buy their way into university, why not? I think the argument is really: 1. Arbitrarily small class sizes - the degree is not so much about the education as it is about the prestige of being in small class size. But long term, who cares? There are obviously candidates that have equal or higher capability if the universities can limit the class size. Besides those that don't go have cheaper market rates and are more attractive investments since the universities strategy is pretty much increase the demand by lowering supply arbitrarily. 2. The idea that you buy merit that is undeserved. To be honest, I am not sure why this is a big deal. Its not in the universities long term best interest to give its clients undeserved merit, because the market decides their merit, and if they pump out people that don't have skills over time their "Prestige" doesn't amount to much, and their customers will go elsewhere. To be honest, I think this is already starting to be the case. Really I think this argument boils down to distasteful envy and jealousy of the things rich people can "buy", which if you examine it carefully isn't the case anyway.
- human20190310 7y ago
  > if they pump out people that don't have skills over time their "Prestige" doesn't amount to much I think you're underestimating the degree to which corrupt, inept institutions can maintain their influence over society.
  - zarro 7y ago
    No doubt, but I think the point is to ask the right questions. Its not so much about preventing the inept institutions from maintaining their influence so much its about making sure that competing institutions don't have arbitrary barriers to entry that prevent them from competing in the market, even if initially, people are skeptical of them in comparison to "established" players.
- rb808 7y ago
  Agreed. The reason people want to go to the big famous universities is largely because Wealthy people have donated a lot of money so it has a lot of resources. If you stop them donating, it would just be another school and you probably wouldn't want to go to.
rolltiide 7y ago
I think people should understand how this contributes to the general apathy regarding college tuition and other inequalities. The people with the most influence have so many intertwined unspoken relationships that there is no benefit to addressing whatever the underclass is talking about. Coupled with the idea that many of their own children aren't even aware of what level of skill they demonstrated versus their family's money and clout. Many of them are oblivious to what other people struggle with, even if they are able to apply themselves in the same ways.
joefourier 7y ago
I'm not familiar first-hand with the concept of "elite" colleges in America, but why is it so important for a billionaire's kid to attend them? Does it really give them opportunities that are not already available to them from their parents' wealth and connections? I don't understand how sending your child to those institutions is worth $37 million. Wouldn't it make more sense to give it to them directly, or as funding for one of their ventures? From other articles, their daughter became a comedy writer for Jimmy Fallon - that seems like the last profession to require a diploma from an elite university, or even a college diploma at all.
- toasterlovin 7y ago
  Top tier universities are where the elites go to find spouses.
  - CrazyStat 7y ago
    And future business partners, investors, advisors, etc. etc.
- malkia 7y ago
  I guess, it may be that - you may want your children to be properly educated, and able to accomplish hard tasks (given at university) before handing them down businesses. Probably even working low-paid jobs for a while just to learn all the levels in the company.
  - joefourier 7y ago
    But if you're buying their education anyway, does that really teach them the ability to accomplish hard tasks? I don't imagine the university being especially strict on the students whose parents gave very large donations. I understand the value for an "ordinarily wealthy" individual, who is wealthy enough to give a bit to the university but does not have the sheer amount of connections that a super-wealthy one would have.
    - 7y ago
seltzered_ 7y ago
Previous discussion 1 day ago of the same article, co-published nymag version: https://news.ycombinator.com/item?id=21103345 https://news.ycombinator.com/item?id=21103345
- dang 7y ago
  Right you are. We missed that one. Thanks!
WalterBright 7y ago
I can see a top school accepting billionaires' kids by default, simply because of the prestige it confers on the school.

57 points by gopi 7y ago

> Shaw has been said to purchase tickets for several different flights on the same day in case his plans change. Hard to reconcile that with David not choosing to fly private. Maybe he has environmental concerns, but I would guess he exclusively flies private, especially since this article claims he's a little OCD about controlling every part of every process. With regards to "buying" his kids' way into college, it doesn't look like there's any evidence that this was David's goal other than coincidental timing. But beyond that, David doesn't need to buy his kids' way into these colleges. Colleges love to accept the children of billionaires. Nothing is better than linking up an intellectual class with the wealthy class, and letting the melding of capital and innovation create powerful and successful alumni.

gbronner 7y ago
I recall talking to the chair of special gifts at an elite institution, and him lamenting that the school had rejected the children of multiple billionaires, making his life much harder. Brown traditionally let a few parents buy their kids a spot, but most other Ivy League places can find enough highly qualified kids who happen to be offspring of rich parents to not worry much.
- ameister14 7y ago
  Yale is pretty famous for pay to play - it also turns out to be where two of Shaw's kids ended up going, and Harvard let in Kushner
  - gbronner 7y ago
    Never heard of the p2p reputation at Yale. May be true, but have never seen it. My understanding is that it would only help if the kids weren't going to get in on their own merits, and by all accounts, this was not an issue. It is a signalling mechanism that they are going to pay full price or more, but I see no evidence that they bought their way in. Kushner offered a lot more than a million a year, and had a politically connected father and it was a generation ago.
    - ameister14 7y ago
      Kushner graduated Harvard in 2003. That wasn't a generation ago.

gbronner 7y ago

Total donations were something like $36 million, and by all accounts, kids were extremely smart and motivated. Honestly seems like a CYA move on behalf of his staff, and not any rational approach to bring his kids' way into a top school.

pmiller2 7y ago
$36M doesn't even come close to what this guy is netting on his investments, I'm sure. Honestly, if I had kids going to college and spending $36M was something I could do without thinking about, I'd probably do it too, just in case.
onetimemanytime 7y ago
I agree but then it' not like they're suffering. $37million is nothing to them--and they can say they donated to a good cause.

zaroth 7y ago

Here’s a family that donated $37 million to a half dozen schools over several years, ostensibly to increase the odds of his [well qualified] children to be accepted into one or more of those schools. Personally, I think if someone wants to pay the way of, let’s say, 300 students to get full scholarships, so that their child can attend, this seems like a very sustainable model which benefits everyone involved. $37 million buys a lot of resources so arguably this isn’t taking a spot away from anyone, if anything it is enabling these universities to provide more spots to students who deserve them, potentially at zero cost.

harryh 7y ago
I generally agree with your comment, but it's worth nothing that despite the US population increasing and the number of kids attenting college increasing even more the top schools have generally not increased enrollment sizes much at all. It's interesting to think about why this might be so.
- pmiller2 7y ago
  If you're sitting on a minimum of $3.5B in endowment (Brown), up to $34.5B (Harvard), why would you need to expand? Besides, being "elite" is part of the brand. Start letting everyone in, and the Ivy League becomes just another football conference.
  - dcolkitt 7y ago
    > being "elite" is part of the brand. Exactly. And what public policy needs to do is revoke the non-profit status of schools that fail to make any effort to expand despite having an abundance of resources and qualified candidates. Harvard could easily accommodate 20,000 undergrads given the size and quality of its applicant pool. That fact that it doesn't spend a penny of its $30 billion endowment doing so reveals that its mission is brand management, not education. And that's perfectly fine. But it shouldn't enjoy a tax-advantaged status predicated on the make-believe that its a philanthropic organization.

14 7y ago

I have to admit as an average intelligence middle class health care worker I actually assumed the ultra rich 100% did pay for their way into university. WhenI saw the admission scandal break I was actually surprised that these rich people had to go out of their way to craft reasons for their kids to attend like fake sports scholarships and such. It was only after I was made to realize how their actions were illegal.

deleted 7y ago
[deleted]
rolltiide 7y ago
breaking: world's worst kept secret exposed
Analemma_ 7y ago
The scandal was actually interesting because it showed the gulf between "rich" and "ultra-rich". The ultra-rich have always been able to buy their kids' way into college with 8-digit donations for new buildings; that's so obvious it's hardly even a secret. It's the merely-kinda-rich, who can't throw around that kind of money, who have to resort to the fake scholarships and so on. Which makes it kind of difficult to feel bad for the colleges who were supposedly the "victim" of these scams: they have no problem with bribery, they were just complaining that they didn't get their cut.
- InitialLastName 7y ago
  Even the rich can donate to the college and have a good chance of getting their kids in. The problem in the admissions scandal was simply that the money wasn't going to the college (which would nominally benefit the whole student body); instead it went into the pocket of an individual.
soared 7y ago
Same - I assumed donate over x and your kids get accepted. It turns out that x is exceptionally higher than I thought.
7y ago

zarro 7y ago

If rich people want to buy their way into university, why not? I think the argument is really: 1. Arbitrarily small class sizes - the degree is not so much about the education as it is about the prestige of being in small class size. But long term, who cares? There are obviously candidates that have equal or higher capability if the universities can limit the class size. Besides those that don't go have cheaper market rates and are more attractive investments since the universities strategy is pretty much increase the demand by lowering supply arbitrarily. 2. The idea that you buy merit that is undeserved. To be honest, I am not sure why this is a big deal. Its not in the universities long term best interest to give its clients undeserved merit, because the market decides their merit, and if they pump out people that don't have skills over time their "Prestige" doesn't amount to much, and their customers will go elsewhere. To be honest, I think this is already starting to be the case. Really I think this argument boils down to distasteful envy and jealousy of the things rich people can "buy", which if you examine it carefully isn't the case anyway.

human20190310 7y ago
> if they pump out people that don't have skills over time their "Prestige" doesn't amount to much I think you're underestimating the degree to which corrupt, inept institutions can maintain their influence over society.
- zarro 7y ago
  No doubt, but I think the point is to ask the right questions. Its not so much about preventing the inept institutions from maintaining their influence so much its about making sure that competing institutions don't have arbitrary barriers to entry that prevent them from competing in the market, even if initially, people are skeptical of them in comparison to "established" players.
rb808 7y ago
Agreed. The reason people want to go to the big famous universities is largely because Wealthy people have donated a lot of money so it has a lot of resources. If you stop them donating, it would just be another school and you probably wouldn't want to go to.

rolltiide 7y ago

I think people should understand how this contributes to the general apathy regarding college tuition and other inequalities. The people with the most influence have so many intertwined unspoken relationships that there is no benefit to addressing whatever the underclass is talking about. Coupled with the idea that many of their own children aren't even aware of what level of skill they demonstrated versus their family's money and clout. Many of them are oblivious to what other people struggle with, even if they are able to apply themselves in the same ways.

joefourier 7y ago

I'm not familiar first-hand with the concept of "elite" colleges in America, but why is it so important for a billionaire's kid to attend them? Does it really give them opportunities that are not already available to them from their parents' wealth and connections? I don't understand how sending your child to those institutions is worth $37 million. Wouldn't it make more sense to give it to them directly, or as funding for one of their ventures? From other articles, their daughter became a comedy writer for Jimmy Fallon - that seems like the last profession to require a diploma from an elite university, or even a college diploma at all.

toasterlovin 7y ago
Top tier universities are where the elites go to find spouses.
- CrazyStat 7y ago
  And future business partners, investors, advisors, etc. etc.
malkia 7y ago
I guess, it may be that - you may want your children to be properly educated, and able to accomplish hard tasks (given at university) before handing them down businesses. Probably even working low-paid jobs for a while just to learn all the levels in the company.
- joefourier 7y ago
  But if you're buying their education anyway, does that really teach them the ability to accomplish hard tasks? I don't imagine the university being especially strict on the students whose parents gave very large donations. I understand the value for an "ordinarily wealthy" individual, who is wealthy enough to give a bit to the university but does not have the sheer amount of connections that a super-wealthy one would have.
  - 7y ago

seltzered_ 7y ago

Previous discussion 1 day ago of the same article, co-published nymag version: https://news.ycombinator.com/item?id=21103345 https://news.ycombinator.com/item?id=21103345

dang 7y ago
Right you are. We missed that one. Thanks!

WalterBright 7y ago

I can see a top school accepting billionaires' kids by default, simply because of the prestige it confers on the school.