Rally Caps
Why you need to move up to the top step of the dugout—
Because there are several serious problems caused or exacerbated by Princeton’s runaway endowment, the following being foremost among them:
(1) There is no end-game plan for disposition of the ultimately unusable endowment money.
(2) The university spends irresponsibly because it can—in a way, must. (Note that the university refuses to disclose the details of its spending. The line-by-line compensation paid to faculty and administration is secret.)
(3) Those who receive compensation from management of the endowment have a vested interest in ignoring the problem, and in refusing to reveal the amounts and recipients of that compensation, or the relationships, if any, between managers and the university trustees and administrators (All of this is secret).
(4) A substantial portion of the endowment apparently is invested in high-risk, illiquid investments (possibly hedge-funds, private equity positions, real estate lending, or investment partnerships), for two reasons: first, there is little concern about potential losses, which, in a perverse way, actually would be beneficial in slowing the runaway endowment, and second, the endowment growth rate is viewed as a contest among elite schools. (Note the “apparently” and “possibly” in this statement, which are necessary because the university refuses to disclose the specific investments that comprise the endowment. That is secret.)
(5) Princeton alumni could give more to worthy charities if they gave less to Princeton.
(6) Taxpayers subsidize the problem, by government making grants to students and the university, and declining to collect taxes on the gains and earnings that generate endowment growth (even though the student families pay taxes on their earnings before having to pay their university charges).
Because there are several serious problems caused or exacerbated by Princeton’s runaway endowment, the following being foremost among them:
(1) There is no end-game plan for disposition of the ultimately unusable endowment money.
(2) The university spends irresponsibly because it can—in a way, must. (Note that the university refuses to disclose the details of its spending. The line-by-line compensation paid to faculty and administration is secret.)
(3) Those who receive compensation from management of the endowment have a vested interest in ignoring the problem, and in refusing to reveal the amounts and recipients of that compensation, or the relationships, if any, between managers and the university trustees and administrators (All of this is secret).
(4) A substantial portion of the endowment apparently is invested in high-risk, illiquid investments (possibly hedge-funds, private equity positions, real estate lending, or investment partnerships), for two reasons: first, there is little concern about potential losses, which, in a perverse way, actually would be beneficial in slowing the runaway endowment, and second, the endowment growth rate is viewed as a contest among elite schools. (Note the “apparently” and “possibly” in this statement, which are necessary because the university refuses to disclose the specific investments that comprise the endowment. That is secret.)
(5) Princeton alumni could give more to worthy charities if they gave less to Princeton.
(6) Taxpayers subsidize the problem, by government making grants to students and the university, and declining to collect taxes on the gains and earnings that generate endowment growth (even though the student families pay taxes on their earnings before having to pay their university charges).
posted by mcd at 9:32 AM
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