<p>The financial markets have provided rather phenomenal returns in the past few years. This makes it look like the institutions with large, well-managed endowments are being stingy, when in fact it’s difficult to spend the additional money responsibly when they know such returns won’t continue forever. In addition to endowment growth from return on investments, new money is being added to these endowments. I suspect this year’s returns will pale in comparison and as a result a we will see the percentage of endowment spending increase.</p>
<p>The one constant is that politicians cannot keep their hands off of other people’s money, especially where large piles of money exist. There are plenty of opportunities for politicians to show fiscal responsibility. That they would choose to begin with college endowments only breeds cynicism.</p>