Balk
Trustees botch pick-off attempt
With their November 28 press release the Princeton trustees attempted a deceptive move, but it was transparent. They announced that beginning next year “financial aid will be calculated assuming a board rate” approximately $2,000 higher than the assumption for this year and that spending from the investment return on the endowment will be increased to fund this change. The deception is that although this is meant to appear to be a large benefit for students, and a measurable increase in endowment spending, it actually is imperceptibly small. Fewer than 30% of the students will be affected, and even for them the increase in aid will be less than $2,000--compared to the $1,450 increase in tuition, as previously announced by the trustees. The increase in endowment spending that will result from the new board rate “assumption” for financial aid calculation is absurdly insignificant. The total impact will be less than $2,000,000, which is less than one-one thousandth of the investment return on the endowment (if performance this year is comparable to last year). In other words, the amount of reinvested return might be reduced from approximately $1.400 billion to $1.398 billion—the relative magnitude of another sunflower seed on the dugout floor. Although my base-running may have been the target of the trustees’ pick-off attempt, because my 6-12-06 blog note protested the omission of students from the list of beneficiaries of proposed increases in endowment spending, a sandlot balk rarely will catch me leaning the wrong way. But if the trustees re-toe the rubber and eliminate tuition as their next move, I’ll be frozen flat-footed between bases. They can walk over and tag me out.
With their November 28 press release the Princeton trustees attempted a deceptive move, but it was transparent. They announced that beginning next year “financial aid will be calculated assuming a board rate” approximately $2,000 higher than the assumption for this year and that spending from the investment return on the endowment will be increased to fund this change. The deception is that although this is meant to appear to be a large benefit for students, and a measurable increase in endowment spending, it actually is imperceptibly small. Fewer than 30% of the students will be affected, and even for them the increase in aid will be less than $2,000--compared to the $1,450 increase in tuition, as previously announced by the trustees. The increase in endowment spending that will result from the new board rate “assumption” for financial aid calculation is absurdly insignificant. The total impact will be less than $2,000,000, which is less than one-one thousandth of the investment return on the endowment (if performance this year is comparable to last year). In other words, the amount of reinvested return might be reduced from approximately $1.400 billion to $1.398 billion—the relative magnitude of another sunflower seed on the dugout floor. Although my base-running may have been the target of the trustees’ pick-off attempt, because my 6-12-06 blog note protested the omission of students from the list of beneficiaries of proposed increases in endowment spending, a sandlot balk rarely will catch me leaning the wrong way. But if the trustees re-toe the rubber and eliminate tuition as their next move, I’ll be frozen flat-footed between bases. They can walk over and tag me out.
posted by mcd at 9:37 AM
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