<p>Cash is fungible. </p>
<p>To make give an example in less theoretical terms, look at Pell Grants for undergrad. Every time the Pell is increased, Harvard can raise the need-based aid to the near-wealthy ($180k income levels) bcos the increased Pell is less aid that Harvard has to provide to the low income students out of its own endowment. Similarly, an increase in the Pell easily allows Harvard to raise tuition since it has no impact on the poor, and thus the press won’t care.</p>