yes @bronze2 a little optimization suggests, they could probably raise more money with fewer “hooked” donor slots or full pay slots if they wanted to. However, as I’ve argued on another thread opacity/secrecy is a feature not a bug.
Also, while 75,000$ dollars a year seems like a lot of tuition 15% of harvard comes from families making >$630,000 a year, every year - from a market standpoint they should raise tuition and offer more financial aid.
However, if there was an open bidding process, they might have to publicly defend giving a slot to the kid of a third world dictator or unsavory figure rather than doing that quietly like THEY DO NOW. Kushner’s dad did jail time and I’m sure Harvard didn’t want to defend hiring a prostitute to seduce his sister’s husband to entrap him. https://en.wikipedia.org/wiki/Charles_Kushner
True, legit mega donors donate huge amounts. My point is about selling the brand to those vain enough to want to buy it. So make them pay, and take their money.
Legit or not legit, if one’s alma mater can raise a billion year after year by effectively outright selling diplomas to just very few people (not dozens or hundreds of people), and really get to enrich the place with facilities, dorms, scholarships, more money for teaching staff and endow more chairs, isn’t that a win for everyone? Would many alums complain? Would it much degrade the place? Bear in mind this would be unrestricted money, whereas most of the endowments and the income therefrom is restricted.
Let’s get this thread back to Varsity Blues. Otherwise, it becomes a free for all for every single thing one can imagine, directed at the big bad unis.
Good point @anon145 and wow about the prostitute… One can’t help but think about how no matter how you cut it this is really nothing but a fraction of the tip of a giant iceberg. The sad part is seeing kids being being hurt when underneath it there is so much more. I listened to this on the radio a couple days ago, although not mentioned it is related to this conversation as Singer was basically just a cog in what the author calls “moneyland” (note how Singer was a standard referal of Morgan Stanley LA or as the author describes one of the capitals of “moneyland”)…
I agree with the auction approach, also. And it could easily mimic what the admissions offices do now and say a student has to be “qualified”. The NY Times says the Stanford student – purely on her own merits – got into multiple top universities. From the article:
"She said that she had been a mediocre student in elementary school and that her first ACT score had been unimpressive.
“A lot of people told me, ‘You still want to get into Stanford, but, look, the entry rate for it is just 4 percent — just forget it,’” she said. After a year of strenuous study, she said, she took the test again and got a score of 33 out of 36."
Since being “qualified” academically isn’t the same as being the most accomplished or deserving academically, the students who get in via the auction would all be “qualified” just like they are when they are admitted from the dean’s special list.
@lookingforward “The amounts to have legit admissions attention are freaking huge, well over 6.5mil.”
I don’t understand how the university pretends this so-called “legal” system is not corrupting. Giving an admissions advantage when the donation is excessively large but not giving it when it is merely a a few million is exactly the kind of culture that breeds this.
This is incredibly easy to solve. Stop giving these preferences. Think about how irrational the argument is. We must continue to give admissions preferences to people who give enormous amounts of money to our university because we don’t have any faith they will continue to give if we don’t give admissions preferences but they are not giving expecting any admissions advantage at all, so it’s all charitable and they should be able to deduct it from their taxes.
Have some faith that you graduated alumni who actually are donating ONLY for the charitable purpose they claim they are donating for when they take a tax deduction for that donation.
Just consider this: over 50% of the students at these tippy top schools get an average scholarship of over $50k a year. The point is that one $6.5m donation can fund 100 kids free college education. These schools have no choice but to aggressively seek out those donations to fund the student class profiles they advertise.
@jzducol "These schools have no choice but to aggressively seek out those donations to fund the student class profiles they advertise. "
And I am all for fundraising! But surely you aren’t suggesting that the colleges need to offer something in return for a tax deductible donation when the donor would be making that donation regardless because they believe in that college’s mission.
And if the donor wouldn’t be making that donation without getting something in return from the college, then it shouldn’t be tax deductible. But I certainly have the same faith that the Harvard administration has that Jared Kushner’s dad and the Harvard fencer’s dad would have donated (or purchased a coach’s house for $300,000 more than it is worth) simply because they wanted to support the university’s mission and they would have done so even if their child’s application went into a big pile where they were only admitted if their credentials clearly made them more outstanding than 95% of the other applicants.
@observer12 Tax deduction is just extra incentive as it is all factored into donors calculation. For example, if the donor can afford making $4m donation without the tax deduction now he/she would be making a $6.5m with one. In the Stanford case however, I am not sure if tax incentive matters since the donor draws his income outside of US. But I agree that the “going” rate would not have been that high if there were no such tax incentive, which is needed for supporting low income students.
@jzducol “Just consider this: over 50% of the students at these tippy top schools get an average scholarship of over $50k a year. The point is that one $6.5m donation can fund 100 kids free college education. These schools have no choice but to aggressively seek out those donations to fund the student class profiles they advertise.”
To be clear just as those 6.5 million are chump change for a billionaire they are nothing but a tiny drop in the bucket for these schools as well. Stanford’s endowment I think is close to 30 billion by now and just like its peer schools its return on investment is very good:
^^^ Last year alone their return on investment was around $3 billion dollars (Harvard was more). Using only that amount (returns for one year) and leaving their endowment untouched they could fund the average scholarship you mentioned (50% get 50% or about $33K per year per student…) for the next 25 years or more.
They do have a choice NOT to aggressively seek out those donations.
I don’t know how much $3b is earmarked for undergrad scholarships, but I do know these schools will not survive on endowment returns alone without significant donations every year.
^ There’s a percentage factor, established annually and within some standards. Not all profit generated goes to current expenses. And the % that does, can go to many needs. Ucbalumnus or Data10 could find you online references to this.
It does take some looking but is accessible for many colleges. Took me one sec to find the page. One really doesn’t have to rely on the common media (they’re what I tend to distrust. Their frequent headline grabbing so often misleads.)
@lookingforward Thanks for sharing the source. If students families pay 50% of total Stanford undergrad expense then the gift portion would be roughly 20% (=50%x(6%/15%)), and endowment portion would be about 30%. (I am making an assumption that gift to tuition ratio is the same (6/15) across all schools within Stanford.) So, without donations the Stanford undergrad would have a 20% shortfall in funding. Can they increase the percentage of full pay students from 50% to 70%? I suppose they could, but not without political difficulties.
I am fully aware there is more to it. My back of napkin analysis was an oversimplification to drive the point across that these schools don’t need to get dirty (by getting entangled with conflict of interest or worse…) in order to meet their financial aid offerings.
Are they getting dirty? Most schools that offer generous-enough Meet Full Need aid have that money or (like some after 2008,) would change their aid and/or review policies (eg, to a version of need aware.)
The frequent assumption on CC is that schools offer a quid pro quo for mega donations. As we discussed earlier here, it’s not a definite.
Only a few schools have those level of assets. It also represents hundreds or a hundred years of development efforts.
These high profile development candidates offer more than just the funds. If we can step away from our righteous indignation for a moment and think about social currency for the other students and the school.
Internships, post grad alumni connections at powerful and important companies and access to research opportunities, foreign governments and visiting diplomats. Etc.
This level of donor is often the chair of the next capital campaign and moves the needle with a set of phone calls or private party.
And the Jared Kushner thing is really starting to rub me the wrong way. He’s actually a pretty bright guy, which surprised me. I don’t know anything about his credentials other than a few haters from high school. Posters here are too smart to buy that low level sniping and jealousy.
Just like the pole vaulter didn’t take my spot. It would have gone to another pole vaulter. The development spots are a percentage of all applicants and they aren’t taking anything from me or my student.
It’s also assumed that these really smart parents breed noting but imbeciles? They go to the best schools and have the same test prep. And they might be nice.
It’s just as judgmental as any other prejudice or stereotype.
I think it has been alluded to in another post, but most of the Chinese students whose parents paid big money realized that their kids would not get a qualifying score on the Gaokao.
ACT/SAT is way easier to hack/cheat than the Chinese National College Examinations. I have heard that the test start time is a mandatory time set by the Chinese Ministry of Education and there are no deviations from that. Since China is on one giant time zone regardless of the vast distances, that makes things easier.