Turkish Daily News, January 25, 2008, Friday

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Copyright 2008 Turkish Daily News, Source: The Financial Times Limited

Turkish Daily News

January 25, 2008, Friday

HEADLINE: US UNIVERSITIES CRITICIZED

BODY:

New figures show that there is a growing group of newly rich U.S. schools that are joining the tiny cadre of ultra-wealthy institutions.

The latest endowment figures from NACUBO, a college business officers group, highlight the growing prosperity but also the stratification among elite universities. That development is creating tension.

There are now 76 colleges and universities with endowments that have passed $1 billion - including 16 new members of that club like Georgetown and the Universities of Oklahoma and Missouri.

But five at the top each have nearly $6 billion more than any school outside that group: Harvard ($35.6 billion), Yale ($22.5 billion), Stanford ($17.2 billion), Princeton ($15.8 billion), and the University of Texas system ($15.6 billion).

The survey marks the end of the most recent fiscal year, which at most schools ended last June 30, so the numbers do not reflect the recent downturn in the stock market.

Among them, Harvard's endowment - the largest overall - expanded by an amount last year that's more than Ivy League rival Cornell has altogether. Princeton now has over $2 million in the bank for every student. Stanford raised nearly $1 billion during its last reported fiscal year alone.

Dispersion of wealth:

There is a "tremendous dispersion in wealth from the people right at the top to the lesser ones," said Ronald Ehrenberg, an expert on higher education economics at Cornell. "It falls off very, very quickly."

The figures come at a time when the advantages of that small group of superrich schools have been a contentious topic.

There's been growing criticism from the public that the wealthiest schools should be dipping deep into their savings to hold down prices. But when Harvard and Yale recently announced they would do so by boosting aid for families earning well into six figures, they were sharply criticized.

Harvard President Drew Gilpin Faust added to the tension by getting into an exchange with Big Ten provosts over whether ambitious science research should be left to the most elite universities. Some objected to her suggestion that it would be better for some institutions to focus on social sciences and humanities.

There's also rising resentment in higher education over faculty raiding, with wealthier colleges offering salaries that poorer schools can't possibly match.

Its not just the richest schools - prosperous public universities raid poorer peers, too. Some argue there's a public benefit when talented scholars gather in one place and collaborate. But there's also a cost when the schools that educate the most people lose their stars. Harvard now pays full professors on average about $177,000, compared to about $106,000 at the average public research university.

The NACUBO survey reports colleges earned on average 17.2 percent on their investments last year, with schools with $1 billion or more returning 21.3 percent, compared to 14.1 percent for schools under $25 million.

LOAD-DATE: January 25, 2008