In Elite Schools' Vast Endowments, Malcolm Gladwell Sees 'Obscene' Inequity
In a sharp-elbowed opinion piece in The New York Times this week, Victor Fleischer, a law professor at the University of San Diego, took several big-name schools to task for the ways that they handle their endowments.
Fleischer cited Harvard, the University of Texas, Stanford and Princeton — but he reserved his harshest criticism for Yale University, which he says pays private equity firms $480 million a year to handle its endowment. Meanwhile, he says the school spends only $170 million dollars on financial aid for students — while tuition often rises.
"As some of these endowments grow larger and larger, the group that benefits the most is not students; it's not faculty. It's the fund managers who manage the money," Fleischer says. "The point is: What is the endowment there to serve? The point is to advance teaching and research and scientific inquiry today."