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Harvard has a $53 billion endowment, I doubt they care about federal funding.

jgalt212 3y ago
Yes, they care more about legacy admits than federal funding. And probably only legacy admits for the whales. How many "rich" people brag about giving $1MM to their college, but for the elite colleges even such a big number is an immeasurably small amount.
blindriver 3y ago
The richer you are, the more you demand the government's largesse. The idea they would need to drawdown on their own wealth would probably infuriate Harvard's administrators.
hotpotamus 3y ago
I believe the accounting algorithm is something to the effect of "if my_money < all_the_money then take_more_money".
bradleyjg 3y ago
They very very much care about federal funding. At a perpetual safe withdrawal rate of 2% $53 billion generates $1 billion a year to spend. Federal research grants alone total more than $500M, and federal funding includes much more than just research grants. A dozen or so years back there was an effort by many universities, including Harvard, to keep military recruiters off campus. When the courts ruled that this would endanger federal funding Harvard, like all the others, folded like a cheap suit.
- gumby 3y ago
  > A dozen or so years back there was an effort by many universities, including Harvard, to keep military recruiters off campus. I’m surprised to hear that. I know objection to it went back to the Vietnam war, but didn’t realize there might have been a recent episode. Walt Rostow notoriously set troop levels from his office at MIT when he was “on leave” to work in the White House. That ended up causing the complete banishment of military research from MIT. Absolutely no exceptions, I mean, except that overtly military work can be done by MITRE and Lincoln labs (cough completely owned by MIT), ICBM navigation at Draper, the AI Lab and LCS sharing a building with the CIA for a long time, DARPA funding all over the place, whole departments essentially entirely funded by the Navy and the Air Force, and a continual revolving door between the pentagon and some departments. Harvard still has ROTC students…but they have to get up even earlier and drag themselves over to MIT for early morning drills. I didn’t feel sorry for them; Harvard students don’t have to pull all nighters every week.
  - bradleyjg 3y ago
    As I recall there were two more efforts after that—-one around Don’t Ask, Don’t Tell and the last one centered around the war in Iraq.
gumby 3y ago
MIT’s endowment is half that (but it’s a much smaller institution) and still the bulk of its revenues are from the US government. It’s basically a huge research lab with a small school bolted on. How small? Well last time I looked (2018) tuition was 14% of revenue. TBF spending on education (i.e. everything spent on students except for expenses of undergraduate and graduate students working on faculty research projects) was 16% of expenses. With their grant overhead (north of 70% iirc) they could cut tuition, but why bother? Break even is apparently fine. At least they don’t do legacies. BTW I first looked at these numbers when I was an undergrad in the early 80s and that 14%/16% level has been fairly consistent for the last 40 years.
- madars 3y ago
  MIT grant overhead is definitely less than north of 70%. https://ras.mit.edu/facilities-and-administrative-fa-rates https://ras.mit.edu/facilities-and-administrative-fa-rates says 59%.
  - gumby 3y ago
    Thanks
blululu 3y ago
Plenty of Harvard students take out federal loans to attend. Plenty of professors accept federal grants for their research. While a few alumni donors might give a large amount of cash, the school also likes to brag that 1/6 students receives a Pell grant. The decision might go one way or the other but its outcome is not obvious.
candiddevmike 3y ago
If legacies go away, their endowments might too.
- nemo44x 3y ago
  And there we have it. The part they don't want to say. That you can bribe your way into the school.
thatfrenchguy 3y ago
Ivys get a stupid amount of money from the feds, most Harvard PHD students are funded by federal money, and the university gets ~20-50k a year for each one of them. Just look at https://www.research.gov/grfp/AwardeeList.do;jsessionid=DA66455AEC178BA218FB5841FC40DBE1?method=sort&order=dec&sort=3 https://www.research.gov/grfp/AwardeeList.do;jsessionid=DA66... for a (small) exemple.
DrBenCarson 3y ago
If you don't think Harvard cares about federal funding, you don't know how money in higher education works. Nearly all of that endowment is tied up in long-term investments and funds. It's not liquid. Their cash flows and run rate are made up of a HUGE percentage of federal funds. Government grants and loans, research grants, and special programs. A large percentage of professors spend a large percentage of their time applying for federal money. That's where their operating budgets come from.
deleted 3y ago
[deleted]
jcfrei 3y ago
Harvard has according to their own estimates about $5.4B expenses per year. Their endowment would last about 10 years. Their goal to become completely financially independent (assuming an average annual return of 5% on their assets) would require an endowment just about twice that size.

Yes, they care more about legacy admits than federal funding. And probably only legacy admits for the whales. How many "rich" people brag about giving $1MM to their college, but for the elite colleges even such a big number is an immeasurably small amount.

blindriver 3y ago

The richer you are, the more you demand the government's largesse. The idea they would need to drawdown on their own wealth would probably infuriate Harvard's administrators.

hotpotamus 3y ago

I believe the accounting algorithm is something to the effect of "if my_money < all_the_money then take_more_money".

bradleyjg 3y ago

They very very much care about federal funding. At a perpetual safe withdrawal rate of 2% $53 billion generates $1 billion a year to spend. Federal research grants alone total more than $500M, and federal funding includes much more than just research grants. A dozen or so years back there was an effort by many universities, including Harvard, to keep military recruiters off campus. When the courts ruled that this would endanger federal funding Harvard, like all the others, folded like a cheap suit.

gumby 3y ago
> A dozen or so years back there was an effort by many universities, including Harvard, to keep military recruiters off campus. I’m surprised to hear that. I know objection to it went back to the Vietnam war, but didn’t realize there might have been a recent episode. Walt Rostow notoriously set troop levels from his office at MIT when he was “on leave” to work in the White House. That ended up causing the complete banishment of military research from MIT. Absolutely no exceptions, I mean, except that overtly military work can be done by MITRE and Lincoln labs (cough completely owned by MIT), ICBM navigation at Draper, the AI Lab and LCS sharing a building with the CIA for a long time, DARPA funding all over the place, whole departments essentially entirely funded by the Navy and the Air Force, and a continual revolving door between the pentagon and some departments. Harvard still has ROTC students…but they have to get up even earlier and drag themselves over to MIT for early morning drills. I didn’t feel sorry for them; Harvard students don’t have to pull all nighters every week.
- bradleyjg 3y ago
  As I recall there were two more efforts after that—-one around Don’t Ask, Don’t Tell and the last one centered around the war in Iraq.

gumby 3y ago

MIT’s endowment is half that (but it’s a much smaller institution) and still the bulk of its revenues are from the US government. It’s basically a huge research lab with a small school bolted on. How small? Well last time I looked (2018) tuition was 14% of revenue. TBF spending on education (i.e. everything spent on students except for expenses of undergraduate and graduate students working on faculty research projects) was 16% of expenses. With their grant overhead (north of 70% iirc) they could cut tuition, but why bother? Break even is apparently fine. At least they don’t do legacies. BTW I first looked at these numbers when I was an undergrad in the early 80s and that 14%/16% level has been fairly consistent for the last 40 years.

madars 3y ago
MIT grant overhead is definitely less than north of 70%. https://ras.mit.edu/facilities-and-administrative-fa-rates https://ras.mit.edu/facilities-and-administrative-fa-rates says 59%.
- gumby 3y ago
  Thanks

blululu 3y ago

Plenty of Harvard students take out federal loans to attend. Plenty of professors accept federal grants for their research. While a few alumni donors might give a large amount of cash, the school also likes to brag that 1/6 students receives a Pell grant. The decision might go one way or the other but its outcome is not obvious.

candiddevmike 3y ago

If legacies go away, their endowments might too.

nemo44x 3y ago
And there we have it. The part they don't want to say. That you can bribe your way into the school.

thatfrenchguy 3y ago

Ivys get a stupid amount of money from the feds, most Harvard PHD students are funded by federal money, and the university gets ~20-50k a year for each one of them. Just look at https://www.research.gov/grfp/AwardeeList.do;jsessionid=DA66455AEC178BA218FB5841FC40DBE1?method=sort&order=dec&sort=3 https://www.research.gov/grfp/AwardeeList.do;jsessionid=DA66... for a (small) exemple.

DrBenCarson 3y ago

If you don't think Harvard cares about federal funding, you don't know how money in higher education works. Nearly all of that endowment is tied up in long-term investments and funds. It's not liquid. Their cash flows and run rate are made up of a HUGE percentage of federal funds. Government grants and loans, research grants, and special programs. A large percentage of professors spend a large percentage of their time applying for federal money. That's where their operating budgets come from.

deleted 3y ago

[deleted]

jcfrei 3y ago

Harvard has according to their own estimates about $5.4B expenses per year. Their endowment would last about 10 years. Their goal to become completely financially independent (assuming an average annual return of 5% on their assets) would require an endowment just about twice that size.