Our View – College Giving
We’ve seen the good and bad of donations to higher education in recent weeks in Jewish community member Mike Leven’s $5 million gift to Kennesaw State University’s School of Culinary Sustainability and Hospitality and John Paulson’s $400 million donation to Harvard University’s School of Engineering and Applied Sciences.
Each donation was the largest single gift the receiving university has gotten from an individual, but the smaller of the two is the one Jewish donors should emulate.
Harvard, as of last June, had an endowment of more than $36 billion. That’s larger than the gross domestic product of Jordan. A 3 percent annual return on that endowment would give Harvard nearly $1.1 billion a year — more than $161,000 for every undergraduate the university enrolls.
Paulson’s donation represents just over 1 percent of that endowment.
Kennesaw State’s endowment last June totaled just over $36 million, 0.1 percent of Harvard’s, so Leven’s gift represents nearly a 14 percent boost. On numbers alone, the Leven gift has a bigger impact.
But the difference goes deeper than numbers. Kennesaw State will put Leven’s gift to immediate use to build and grow an academic program that is innovative and has an immediate impact on the economy by providing trained, creative employees and by developing new ideas for the vital hospitality industry. A large percentage of the students will be lifting themselves from low- and middle-income families, and they’ll have the advantage of the Leven name, well-known and respected in the hospitality industry.
Harvard’s SEAS offers the potential to benefit society, someday, somehow, through innovations and engineering marvels. And maybe some of those developments wouldn’t have occurred anyway at nearby MIT or Georgia Tech or Caltech or any of the other universities already doing great work in engineering and applied sciences. Certainly some of the students coming through SEAS will be from middle- and low-income families, and they’ll benefit from being Harvard grads, although the Paulson name won’t do them any good (he’s a financier, not an engineer).
But when it comes to societal benefits, Leven’s gift is a sure thing, and Paulson’s is a long shot.
Anyone who has money is free to do what he wants with it. If Paulson wanted to set fire to $400 million, that’s his business.
But no one gets a tax deduction for a $400 million bonfire.
Deductions are worthwhile for donations like Leven’s to innovative programs at underfunded public universities that are affordable for most if not all qualified students, but we’re not sure we as a society are getting our money’s worth with donations to private universities sitting on massive endowments.
We wish Harvard would take seriously its public service mission and stop asking for massive donations it doesn’t need. Meanwhile, we urge Jewish donors, who give to higher education at six or seven times our proportion of the U.S. population, to think hard about where their gifts can do the most tikkun olam.