Sunday, August 03, 2008


With a $1.1 billion endowment, Berea College in Kentucky accepts only low-income applicants who pay no tuition. Berea is unusual in its mission, but there is increased pressure for all colleges and universities with large endowments to spend a set percentage each year to make college tuition more affordable. Tax-exempt foundations are required to spend 5 percent of their endowments each year, and some argue that colleges and universities should be required to do the same.

As reported in The New York Times, Sen. Charles Grassley (R.-Iowa) said that large, tax-free endowments "should mean affordable education for more students, not just a security blanket for colleges."

Are colleges and universities ethically obliged to spend part of their endowments each year to make college tuition more affordable? Or are they morally, as well as legally, entitled to do what they like with their money?

Post your thoughts here by clicking on "comments" or "post a comment" below. Please include your name, hometown, and state, province, or country. Readers' comments may appear in an upcoming column. Or e-mail your comments to me at

You can also respond to the poll about this question that will appear on the right-hand side of the blog until polling is closed.

Jeffrey L. Seglin, author of The Right Thing: Conscience, Profit and Personal Responsibility in Today's Business (Smith Kerr, 2006), is an associate professor at Emerson College in Boston, where he teaches writing and ethics. He is also the administrator of The Right Thing, a Web log focused on ethical issues.

Do you have ethical questions that you need answered? Send them to or to "The Right Thing," The New York Times Syndicate, 500 Seventh Avenue, 8th floor, New York, NY 10018. Please remember to tell me who you are, where you're from, as well as where you read the column.

c.2008 The New York Times Syndicate (Distributed by The New York Times Syndicate)


Listener said...

I absolutely believe colleges should spend part of their endowments to off set student tuition. It's ridiculous to have schools ask alumni for donations when they're sitting in millions for who knows what. Many young people are finishing school in debt, if they finish at all...while their almamater receives millions from generous donor. I believe donors would prefer to know their money helped someone in need get an education. At this point, requiring 5% would be better than nothing; tax-exempt status should also benefit the public.

Anonymous said...

I'm not an expert, but even with my limited knowledge, I am convinced that endowments at colleges are not intended to play like Democrat give-away programs to pay tuition for needy students. As we progress through the current presidential election process, it behooves all of us to decide if we are going to support the give-away programs so loved by our Democrat friends or to remember this is a country which depends on its citizens to take care of their financial arrangements even for college tuition based on their own efforts. The endowments of colleges provide for allowing the institution to continue to exist and grow in these troubled financial times, not to provide tuition for needy students.



Anonymous said...

The ethical action for these educational institutions is to promote education and its role in improving each individual's quality of life. One way to do that is for richly endowed colleges and universities to set up an online university that offers completely free undergraduate and graduate degrees to qualified applicants (details TBD.) The cost of teachers, online materials, ebooks, whatever would be necessary, would be shared equally amongst participating institutions. Joining would be voluntary. This university would offer bona fide degrees of very high caliber, inasmuch as the requirements would be especially challenging to compensate for the lack of face to face interaction. The university would promote access and educational materials in as many venues as feasible, such as an "on demand" cable feature for a multiplicity of instructional videos. You get the gist. The name of this university would be: ________ (here there is room for a worldwide contest... I offer the name "Kingston University.")

Anonymous said...

My first (admittedly uninformed) reaction is “why the heck wouldn’t schools of higher learning want to spend at least 5% of their endowment to help lower the cost of tuition?” But then, why should the state or federal government require anybody to do anything with funds that they privately and legitimately raised, as long as the contributors know how the money is being spent? Endowments can come with conditions (like only x% can be spent on leadership salaries, say, or y% must be spent on baboon research, or z% must be spent on lowering tuition costs). Universities are free to accept or reject the conditions, just as the donors are free to set them. Let their consciences be their guide.

Phil Clutts
Harrisburg, NC