Slated to get $9 million in coronavirus relief funds, Haravard University denied that it applied for the funds, prompting 73-year-old President Donald Trump to tell the nation’s richest university to give it back. Harvard contends that at least half of the $8,655, 748 will be reserved for emergency financial aid and grants to students. What’s ironic about that is that Harvard provides mostly free tuition to students with any financial need at all, using funds from the university’s $40 billion endowment, the largest in the country. Watching Harvard receive any money irks anyone paying attention to how the government’s March 27 $2.2 trillion relief bills is spent, reminding folks that there are lacunae in the system deciding who receives cash payments. Harvard receiving a bailout payment is like Microsoft founder Bill Gates getting his $1200 individual relief payment designed for people under $75,000 a year.
When Trump signed the CARES Act [Coronavirus Aid, Relief, and Economic Security Act], it earmarked $14 billion for the nations colleges and universities, setting no financial litmus test for academic institutions. Everyone knows that Harvard has the largest endowment in the nation, not needing any money from the government. When the Financial Crisis happened in 2008, Ford Motor Company refused any bailout money while General Motors and Chrysler had their hands out. Unlike Trump demanding Harvard return the money, 62-year-old Education Secretary Betsy DeVos urged Harvard April 9 to set the money aside for “student aid and grants,” even though Trump asked for the money back. DeVos confirmed that she agreed that giving well-endowed institutions like Harvard CARES funds “is a poor use of taxpayer money,” asking schools to send the cash to more needy schools.
Part of the problems with massive government bailouts or relief bills is that it’s difficult, no matter who’s auditing, to track where the funds go. DeVos didn’t go a far as Trump demanding that the money’s returned to government, rather than given to more needy institutions. “DeVos “shares her concerns” but stopped short of demanding that the money’s returned to the government. “We hope that the presidents of these schools will take the Secretary’s advice and direct CARSS Act funds to students in need, no matter where those students are enrolled,” said DeVos’ spokesman. If there’s any blame to go around, DeVos pointed fingers at Congress for failing to set up a proper litmus test to screen out well-endowed institutions. Harvard’s Crimson newspaper reported that salary and hiring freezes were underway, including salary cuts and spending reductions, before any talk of CARES funds.
Harvard’s spokesperson made things worse sayings the CARES funds would “address student needs, as well as impact of Covid-19 pandemic on colleges and universities,” repeating the government’s own talking points. What the government didn’t say is that universities or colleges with large endowments should not take government funds for any reason, when they have plenty of money to deal with “student needs or impact of Covid-19 pandemic on universities or colleges.” Taking the CARES aid shows how utterly tone-deaf certain institutions are when it comes to taking government money. “Harvard is actually allocating 100% of the funds to financial assistance for students to meet their urgent needs in the face of the pandemic,” said Jason Newton, Associate Director, Media Relations and Communications said in a statement, making Harvard look worse.
Trump was right to call out any institution, academic or otherwise, on whether or not to accept government aid. No institution should accept government largess if they have the resources to manage to the crisis on its own. If Harvard received $9 million how many wealthy companies received CARES funds when they didn’t need it? With electronic funds transfers and checks going out willy-nilly, it’s likely other mistakes have been made. As Trump said, Harvard needs to return the funds, regardless of whether Congress failed in the CARES bill to provide a litmus test for institutions that don’t need the funds. Other Ivy Leagues schools with large endowments including Columbia University [$10.8 billion] and Cornell University [$7.33 billion] are expected to get $12.8 million in CARES cash. Yale University [$30.31 billion] and Princeton [$25.9 billion] expect to get $7 million and $2,5 million.
Showing there’s no shame in higher education, universities and colleges with large endowments shouldn’t take one penny from the CARES act, regardless of how slapdash the bill was written. Everyone knows that there’s was pressure to get a relief package out to financially strapped businesses and citizens. No one expects rich institutions, whether academic or not, to take government money, when there are so many needy businesses and schools that can’t keep the lights on, facing possible defaults and bankruptcies. “Harvard will allocate the funds based on student financial need,” Newton said. Newton’s message could not be worse for Harvard, saying, in effect, the nation’s oldest university has no scruples. Whatever money Harvard received from CARES or expects to receive, Newton should say clearly the university expects to return the funds back to the government.
