Tag: Princeton University

Harvard’s battle with the Trump administration is creating a thorny financial situation

Harvard University’s Dunster House in Cambridge, Massachusetts.

Blake Nissen for The Boston Globe via Getty Images

Harvard’s brewing conflict with the Trump administration could come at a steep cost — even for the nation’s richest university.

On April 14, Harvard University President Alan Garber announced the institution would not comply with the administration’s demands, including to “audit” Harvard’s students and faculty for “viewpoint diversity.” The federal government, in response, froze $2.2 billion in multi-year grants and $60 million in multi-year contracts with the university.

According to CNN and multiple other news outlets, the Trump administration has now asked the Internal Revenue Service to revoke Harvard’s tax-exempt status. If the IRS follows through, it would have severe consequences for the university. The many benefits of nonprofit status include tax-free income on investments and tax deductions for donors, education historian Bruce Kimball told CNBC.

Bloomberg estimated the value of Harvard’s tax benefits in excess of $465 million in 2023.

Nonprofits can lose their tax exemptions if the IRS determines they are engaging in political campaign activity or earning too much income from unrelated activities. Few universities have lost their non-profit status. One of the few examples was Christian institution Bob Jones University, which lost its tax exemption in 1983 for racially discriminatory policies.

White House spokesperson Harrison Fields told the Washington Post that the IRS started investigating Harvard before President Donald Trump suggested on Truth Social that the university should be taxed as a “political entity.” The Treasury Department did not reply to a request for comment from CNBC.

A Harvard spokesperson told CNBC that the government has “no legal basis to rescind Harvard’s tax exempt status.”

“The government has long exempted universities from taxes in order to support their educational mission,” the spokesperson wrote in a statement. “Such an unprecedented action would endanger our ability to carry out our educational mission. It would result in diminished financial aid for students, abandonment of critical medical research programs, and lost opportunities for innovation. The unlawful use of this instrument more broadly would have grave consequences for the future of higher education in America.”

The federal government has challenged Harvard on yet another front, with the Department of Homeland Security threatening to stop international students from enrolling. The Student and Exchange Visitor Program is administered by Immigration and Customs Enforcement, which falls under the DHS.

International students make up more than a quarter of Harvard’s student body. However, Harvard is less financially dependent on international students than many other U.S. universities as it already offers need-based financial aid to international students in its undergraduate program. Many other universities require international students to pay full tuition.

The Harvard spokesperson declined to comment to CNBC on whether the university would sue the administration over the federal funds or any other grounds. Lawyers Robert Hur of King & Spalding and William Burck of Quinn Emanuel are representing Harvard, stating in a letter to the federal government that its demands violate the First Amendment.

Harvard, the nation’s richest university, has more resources than other academic institutions to fund a long legal battle and weather the storm. However, its massive endowment — which has raised questions during the recent developments — is not a piggy bank.

Why Harvard’s endowment is so large

Harvard has an endowment of nearly $52 billion, averaging $2.1 million in endowed funds per student, according to a study by the National Association of College and University Business Officers, or NACUBO, and asset manager Commonfund.

That size makes it larger than than the GDP of many countries.

The endowment generated a 9.6% return last fiscal year, which ended June 30, according to the university’s latest annual report.

Founded in 1636, Harvard has had more time to accumulate assets as the nation’s oldest university. It also has robust donor base, receiving $368 million in gifts to the endowment in 2024. While the university noted that more than three-quarters of the gifts averaged $150 per donor, Harvard has a history of headline-making donations from ultra-rich alumni.

Kimball, emeritus professor of philosophy and history of education at the Ohio State University, attributes the outsized wealth of elite universities like Harvard to a willingness to invest in riskier assets.

University endowments were traditionally invested very conservatively, but in the early 1950s Harvard shifted its allocation to 60% equities and 40% bonds, taking on more risk and creating the opportunity for more upside.

“Universities that didn’t want to assume the risk fell behind,” Kimball told CNBC in March.

Other universities soon followed suit, with Yale University in the 1990s pioneering what would become the “Yale Model” of investing in alternative assets like hedge funds and natural resources. Though it proved lucrative, only universities with large endowments could afford to take on the risk and due diligence that was needed to succeed in alternative investments, according to Kimball.

According to Harvard’s annual report, the largest chunks of the endowment are allocated to private equity (39%) and hedge funds (32%). Public equities constitute another 14% while real estate and bonds/TIPs make up 5% each. The remainder is divided between cash and other real assets, including natural resources.

The university has made substantial portfolio allocation changes over the past seven years, the report notes. The Harvard Management Company has cut the endowment’s exposure to real estate and natural resources from 25% in 2018 to 6%. These cuts allowed the university to increase its private equity allocation. To limit equity exposure, the endowment has upped its hedge fund investments.

The endowment is not a piggy bank

University endowments, though occasionally staggering in size, are not slush funds. The pools are actually made up of hundreds or even thousands of smaller funds, the majority of which are restricted by donors to be dedicated to areas including professorships, scholarships or research.

Harvard has some 14,600 separate funds, 80% of which are restricted to specific purposes including financial aid and professorships. Last fiscal year, the endowment distributed $2.4 billion, 70% of which was subject to donors’ directives.

“Most of that money was put in for a specific purpose,” Scott Bok, former chairman of the University of Pennsylvania, told CNBC in March. “Universities don’t have the ability to break open the proverbial piggy bank and just grab the money in whatever way they want.”

Some of these restrictions are overplayed, according to former Northwestern University President Morton Schapiro.

“It’s true that a lot of money is restricted, but it’s restricted to things you’re going to spend on already like need-based aid, study abroad, libraries,” Bok said previously.

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How Harvard is shoring up its finances

Harvard has $9.6 billion in endowed funds that are not subject to donor restrictions. The annual report notes that “while the University has no intention of doing so,” these assets “could be liquidated in the event of an unexpected disruption” under certain conditions.

Liquidating $9.6 billion in assets, nearly 20% of total endowed funds, would come at the cost of future cash flow, as the university would have less to invest.

Harvard did not respond to CNBC’s queries about increasing endowment spending. Like most universities, it aims to spend around 5% of its endowment every year. Assuming the fund generates high-single-digit investment returns, spending just 5% allows the principal to grow and keep pace with inflation.

For now, Harvard is taking a hard look at its operating budget. In mid-March, the university started taking austerity measures, including a temporary hiring pause and denying admission to graduate students waitlisted for this upcoming fall.

Harvard is also issuing $750 million in taxable bonds due September 2035. This past February, the university issued $244 million in tax-exempt bonds. A slew of universities including Princeton and Colgate are also raising debt this spring.

So far, Moody’s has not updated its top-tier AAA rating for Harvard’s bonds. However, when it comes to higher education as a whole, the ratings agency isn’t so optimistic, lowering its outlook to negative in March.

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April 17, 2025
Anson Rabinbach, Leading Historian of Nazi Culture, Dies at 79

Anson Rabinbach, the hardscrabble son of radical New York garment workers who paid his own way through college to become one of the world’s leading experts of the Nazi era, died on Sunday in Rome, where he was giving a lecture. He was 79.

His ex-wife, Jessica Benjamin, said the death, in a hospital, was from complications of a heart attack.

Professor Rabinbach (pronounced RAB-in-bock) was among several young scholars in the early 1970s who attempted to bridge the gap between social history and the often abstruse world of intellectual history, especially in the realm of 20th-century Europe.

Following on the groundbreaking work of his mentor at the University of Wisconsin, George Mosse, Professor Rabinbach argued that Nazism was fueled not by a single brute ideology but rather by a loose coalition of ideas, sometimes in competition but united by a vague “ethos” that included violent antisemitism.

“He took seriously that Nazism was a cultural revolution,” Jeffrey Herf, a historian at the University of Maryland, said in an interview.

Such a position put Professor Rabinbach at odds with many older historians of modern Europe, not to mention the intellectual climate in Germany, which was still years away from grappling with the true meaning of the Holocaust. The rise of the Third Reich, many believed, was driven by economics and politics; ideas were irrelevant.

“There was indeed a huge allergy in postwar West Germany among historians to acknowledging things like ideology or antisemitism as being important,” he said in a 2019 interview with the historians Jonathon Catlin, Dagmar Herzog and Stefanos Geroulanos.

Frustrated by a lack of places in which to express his views, in 1973 Professor Rabinbach and three other academics — David Bathrick, Andreas Huyssen and Jack Zipes — founded the journal New German Critique.

The journal quickly became a leading outlet for scholars of 20th-century German culture, including film, theater and social movements, and it broached the subject of antisemitism — before, during and after the Nazi era — which was still taboo in Germany. It helped introduce Anglophone readers to postwar German thinkers like Theodor Adorno and Walter Benjamin, often by translating their work into English for the first time.

Though he taught at Princeton, held top fellowships and lectured around the world, Professor Rabinbach always considered New German Critique his intellectual “Heimat,” or home, a place where he could express his reflexive antipathy toward orthodoxies on both the left and the right.

“He always hated ideological certainties,” Professor Huyssen, who teaches comparative literature at Columbia, said in an interview. “His irony always served him extremely well to dismantle illusions — political illusions, cultural illusions — of all kinds.”

Professor Rabinbach was perhaps best known for a work that on its face seemed to have little to do with Nazism. “The Human Motor: Energy, Fatigue and the Origins of Modernity” (1990) explored the ways in which ideas about energy, from human to mechanical, across the physical world in the 19th century led to a revolution in how scientists, economists and policymakers addressed human labor.

Professor Rabinbach’s 1990 book explored how ideas about energy in the 19th century led to a revolution in how society addressed human labor.Credit…Basic Books

Such considerations, he showed, fueled progressive reforms, but also the intense focus on health, beauty and racial purity by fascist movements.

“He was very good at combining high intellectual history with cultural history in the broad sense,” Martin Jay, a professor of history at the University of California, Berkeley, said in an interview.

Anson Gilbert Rabinbach, known since childhood as Andy, was born on June 2, 1945, in the Bronx. His parents, Gabriel and Esther (Kleinman) Rabinbach, were Jewish immigrants from what is now Poland.

They, and many of their siblings, worked in Manhattan’s garment district, a hotbed of Jewish leftist activism, and both were members of the Communist Party. Before coming to America, his father took part in the short-lived communist revolution of 1918-19 in Germany and later spent a year in the Soviet Union.

Andy’s family never had much money. To pay for college, he worked summers in the resorts around the Catskill Mountains — including, for a brief time, as a joke thief.

“I worked for a comedian who was not terribly successful,” he said in a 2021 interview for the University of Wisconsin. “She would send me to various hotels or comedy clubs or whatever, mostly hotels, where I would sit with a pad and write down the jokes that the comedian onstage was telling, so that she could use the jokes. It was plagiarism, basically.”

He graduated with a degree in history, then enrolled in the doctoral history program at the University of Wisconsin. He intended to study medieval Europe, but an encounter with a book by Dr. Mosse, “The Crisis of German Ideology” (1964), inspired him to switch to modern Europe.

Professor Rabinbach’s dissertation, on the Social Democratic Party in Austria between the world wars, became his first book, “The Crisis of Austrian Socialism: From Red Vienna to Civil War, 1927-1934” (1983).

Professor Rabinbach turned his doctoral dissertation, at the University of Wisconsin, into his first book, about the Social Democratic Party in Austria between the world wars. Credit…The University of Chicago Press

He taught at Hampshire College in Massachusetts and at the Cooper Union in New York before moving to Princeton in 1996. He took emeritus status in 2019.

He married Dr. Benjamin in 1980. They divorced in 2009. He is survived by their two sons, Jake and Jonah, and three grandchildren.

Professor Rabinbach later wrote about the impact of the world wars on German thought in his book “In the Shadow of Catastrophe: German Intellectuals Between Apocalypse and Enlightenment” (1997). And, with Sander Gilman, he edited “The Third Reich Sourcebook” (2013), a nearly 1,000-page collection of writings by and about the Nazi movement.

Professor Rabinbach’s lifelong study of far-right movements gave him particular insight into the right-wing swerve now underway across the Western world — including, he said, in the United States.

President Trump, he said in the 2019 interview, “is a symptom, and an unoriginal one to boot,” of this ideological shift.

“He is certainly not unique,” he added. “He represents an authoritarian turn that has always been lurking beneath the surface.”

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February 8, 2025
U.S. News’ 2024 college ranking boosts public universities

U.S. News & World Report’s 2024 college rankings features many of the usual prestigious institutions at the top of the list, but also vaults some schools much higher after the publisher revised its grading system to reward different criteria.

U.S News’ ranking algorithm now based more than 50% of an institution’s score on what it describes as “success in enrolling and graduating students from all backgrounds with manageable debt and post-graduate success.” The system also places greater emphasis on “social mobility,” which generally refers to an individual making gains in education, income and other markers of socioeconomic status.

Overall, more than a dozen public universities shot up 50 spots on the annual list of the U.S.’ best colleges, while several elite private schools largely held their ground, the new report shows.

“The significant changes in this year’s methodology are part of the ongoing evolution to make sure our rankings capture what is most important for students as they compare colleges and select the school that is right for them,” U.S. News CEO Eric Gertler said in a statement.

The change comes after a chorus of critics complained that the publication’s rankings reinforce elitism and do little to help students find schools that suit their academic needs and financial circumstances. A growing number of schools, including elite institutions such as Columbia University and the Harvard and Yale law schools, also have stopped participating in the ranking and publicly criticized U.S. News’ methodology.

Public schools score better

Public institutions notched some of the biggest gains on U.S. News’ ranking, which many students and families use to help guide their choice of where to matriculate. For example, the University of Texas at San Antonio and California State University, East Bay, jumped 92 and 88 spots up the list, respectively. Other well-known public universities, like Rutgers University in New Jersey, saw its three campuses rise at least 15 places each.

Meanwhile, private Christian institutions such as Gwynedd Mercy University and the Southeastern Baptist Theological Seminary, rose 71 and 106 spots in the ranking, respectively.

Despite the new ranking system, the top 10 universities on U.S. News’ list barely budged. Princeton notched the No. 1 spot for the new academic year, followed by the Massachusetts Institute of Technology, Harvard, Stanford and Yale — the same positions as last year. Among schools focused on liberal arts, Massachusetts’ Williams College was ranked No. 1, with Amherst, the U.S. Naval Academy, California’s Pomona College and Swarthmore in Pennsylvania rounded out the top 5.

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U.S. News’ overhauled ranking formula uses 19 measures of academic quality to asses schools. It also dropped five factors that affected a college’s ranking: class size; faculty with terminal degrees; alumni giving; high school class standing; and the proportion of graduates who borrow federal loans.

Perhaps not surprisingly, some universities are now objecting to the latest ranking. Tennessee’s Vanderbilt University, which fell to No. 18 from No. 13 the previous year, attacked U.S. News’ revised approach as flawed, Bloomberg reported.

“U.S. News’s change in methodology has led to dramatic movement in the rankings overall, disadvantaging many private research universities while privileging large public institutions,” Chancellor Daniel Diermeier and Provost C. Cybele Raver wrote in an email to alumni, according to the news service.

The most recent data was collected through surveys sent to schools in the spring and summer of 2023. Roughly 44% of colleges that received the surveys completed them, according to U.S. News.

U.S. News’ previous college rankings did not give enough weight to whether colleges provide students with the tools they need to climb the socioeconomic ladder after graduation, experts have told CBS MoneyWatch. The media company’s system also factored in more intangible metrics like “reputation” and considered such factors as “faculty compensation” — criteria that critics say have little to do with the quality of education a school provides.

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September 18, 2023
New superconductor claim sparks frenzy online, but scientists are sceptical – Times of India

An unusual material, named LK-99, has been presented to the world as a superconductor that would carry electricity at room temperatures with zero resistance. On Twitter — or X, “LK-99” has been a trending topic in recent days, and enthusiasts have hailed what they believe to be a longsought holy grail of physics, one that would transform everyday life with new technologies to solve climate change and make levitating trains commonplace.

Superconducting materials already exist in places like MRI machinesand some quantum computers, but only display their superconducting properties at extremely low temperatures, making them impractical for wide use.
The saga started when a team of South Korean scientists, most working for a tiny startup company, posted two reports that described their technique for making LK-99 and the measurements that they said showed the material’s superconducting prowess. (The name of the material comes from the initials of the surnames of two of the scientists — Sukbae Lee and Ji-Hoon Kim — and the year 1999, when they say they first synthesised LK-99.)

Most strikingly, they provided a video showing a small sample partially levitating over a magnet. The levitation, they said, demonstrated the Meissner effect, which ensures zero magnetic field inside a superconductor.
Alex Kaplan, who had majored in physics at Princeton University, found out about LK-99 on Hacker News, a news aggregation website. “I was just shocked,” Kaplan said. That night, he shared his excitement on Twitter. With that tweet, which has received more than 132,000 likes, Kaplan joined a group of LK-99 fans who propelled excitement on social media over the past week. Most of the enthusiasts are not experts, however. Kaplan, for example, works as the head of a coffee product.
The scientists who study super conductivity have been quieter. The scepticism remains, because the data provided thus far falls short of being convincing, many experts say. “That data is extremely suggestive,” said Sankar Das Sarma, director of the Condensed Matter Theory Center at the University of Maryland. He pointed out, for instance, that at the temperature that Korean scientists claim LK-99 turns into a superconductor, the electrical resistance drops, but not to zero. The resistance of the material, made of the mineral apatite with some of the lead atoms replaced by copper, is about 100 times higher than pure copper and other good conducting metals. The video is also not definitive, because non-superconducting materials including graphite can also partially float in the same way. The Korean Society of Superconductivity and Cryogenics has convened a panel to verify the findings.

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August 5, 2023
Is your university profiting from climate change?
While many universities are proud to talk about how they fight climate change, some also invest in and accept donations from the same oil companies that drive global warming. Experts and students are calling those schools hypocritical and are demanding change.

CBS News’ “On the Dot” environmental series investigates the scope of the problem, starting with the University of Texas System, which collected $2.2 billion in oil and gas royalties last year.

Drill ‘Em Horns

When it comes to sustainability, the UT Austin campus promotes itself as a leader among universities by reducing emissions and waste, conserving energy and water resources and building green buildings.

“I still want to give credit to the university for taking action on reducing emissions on campus. But that’s only a small part of the picture,” said Ella Hammersly, a student and climate activist at the university.

The bigger picture comes into focus hundreds of miles from the Austin campus, in the Permian Basin oil fields of West Texas, where 30% of the America’s oil is drilled. That’s where the UT System owns 3,000 square miles of property.

On the property energy companies lease land, extract oil and gas and pay royalties to the university system, which includes Austin and 12 other locations.

Oil revenue has helped make the University of Texas the richest public university system in America, with an endowment of $42.7 billion, according to a report by The National Association of College and University Business Officers. Number two is the Texas A&M System, with $18.2 billion, which also gets a cut of oil royalties from university properties in West Texas.

The scope of the emissions that come from burning the oil and gas drilled on university land has never been calculated before.

Oil wells dot the landscape on a plot of land owned by the University of Texas system in West Texas.

For this story, CBS News asked the McGuire Energy Institute at Southern Methodist University to run those numbers for the first time and found those emissions are 20 times higher than they are on campus.

“UT has a sustainability symposium every year. We have a sustainability master plan. All of these things are going on while at the same time billions of dollars are being invested into oil and gas,” Hammersly said.

Under Texas law, the money generated from oil and gas royalties is primarily used for campus construction projects across the state. Less than 1% goes toward financial aid.

UT student activist Anya Gandavadi says it’s time to update the law and its emphasis on oil profits.

“I think that investing in the future of the country, in the world, involves taking into account what science says, what people say, what communities say are hurting them and rewriting those laws,” she said.

For the world to limit the worst effects of climate change, nations will have to drastically reduce their carbon emissions. The International Energy Agency, a global group with a mandate of ensuring energy security, in 2021 called for an end to investment in new oil and rapid transition to renewable energy sources.

That’s not happening on university property in the West Texas oil fields where new lands are being leased and new wells are being drilled.

Dr. Michael Mann, climatologist at the University of Pennsylvania and a critic of the fossil fuel industry, is calling for change, even in Texas.

“What more influential message would it send if the flagship university of one of our most fossil fuel-driven states, Texas, were to take true leadership when it comes to the clean energy transition? It would impact the entire conversation here in the United States and around the world,” Mann said.

The University of Texas system declined to be interviewed for this story and provided this statement:

“The oil and gas production in the Permian Basin is responsible in large part for the United States’ remarkable energy independence, and it is a strategic national resource that would be tapped regardless of ownership.

Through ownership of the University Lands, beginning with the Texas Constitution of 1876, royalties received by the University of Texas System and the Texas A&M System have positively impacted millions of people who have benefitted from historic investments in financial aid, faculty support, teaching, research, medical buildings and more.”

While the university does lease some land for wind and solar farms, those projects account for 0.2% of its 2022 revenue from university property. Mann believes that the state of Texas, blessed with wind, sun and wealth, can and should lead on America’s energy transition.

“So that little sliver has to become the full thing. It has to become 100% and they need to move dramatically away from using that land to worsen the climate crisis, to using that land to make a profit in helping lead us down this path of clean energy,” he said.

University research and fossil fuel donations

A university doesn’t have to own its own oil fields to benefit from the fossil fuel money. Many schools, including Stanford University in Palo Alto, California, accept donations from oil and gas companies to support climate change research.

Between 2010 and 2020, Stanford accepted $56.6 million in donations from oil and gas companies, according to research by the progressive think tank Data for Progress. That puts Stanford in the Top 10 of universities accepting fossil fuel donations.

June Choi is a PhD student who came to Stanford to study at the new, $1.7 billion Doerr School of Sustainability. She was angry to learn the school would accept funding from fossil fuel industry partners.

“A total contradiction,” she called it.

In response, Choi and other students and faculty created a group called the Coalition for a True School of Sustainability and protested last year’s ribbon-cutting celebration at Stanford’s Doerr School.

“We were kind of crashing the party, really. And there was just so much energy. So, it created a lot of excitement,” she said.

Mann, at Penn, says when universities accept fossil fuel company donations for climate change research, it can cast a positive light on the very industry that’s at the root of the problem.

“[The fossil fuel companies] are purchasing the name Stanford University, and that is worth a lot to a fossil fuel industry that’s trying to purchase credibility. ‘Hey look, we’re trying to solve the problem and we’re working with the greatest universities around to do so,’” he said.

Protesters at Stanford believe their efforts have led to a more open dialogue with the university about the funding of research through donations from fossil fuel companies.

Philippe Roberge

What the Stanford activists want is a university ban on those donations, like the policy Princeton University in New Jersey was the first and only university to implement in 2022. Princeton created a list of 90 fossil fuel companies from which it will not accept donations.

In a process called dissociation, Princeton targeted companies involved in the “most-polluting segments of the industry” and a history of spreading “corporate disinformation” about climate change.

The biggest corporation on the list is ExxonMobil, which says it had donated $12 million to Princeton. In a statement to CBS, ExxonMobil wrote: “Close collaboration between industry and academia is essential to finding practical solutions to climate change.”

Princeton’s policy allows for companies to re-associate with the university in the future if they can meet the school’s criteria.

“And that’s great because then the university is really in a position to say, look like we are really constructively engaging with these companies and contributing to shifting the needle on their actions, Choi said.

The work of student organizers at Stanford is beginning to pay off. The university, which declined to be interviewed for this story, recently formed a committee to “review fossil fuel funding of research.”

“It’s a very positive sign, because that is exactly the beginning of a transparent process that we’ve been asking for,” Choi added.

Exiting fossil fuel investments

Many large institutional investors, including universities, buy stock in fossil fuel companies. In a nationwide movement, 50 universities or university systems have exited those investments. It’s a process called divestment.

Rutgers University is the largest state university system in New Jersey. After years of pressure from students and faculty, Rutgers announced in 2021 that it would permanently sell off those investments.

“I think you’re seeing increasingly universities becoming uncomfortable trying to pursue revenue streams in these industries that they know are punishing the earth,” Rutgers President Jonathan Holloway said.

According the Global Fossil Fuel Divestment Commitments Database, of the 10 largest endowments in the America:
- Six universities have fully exited their investments: Harvard University, Yale University, Stanford University, Princeton University, Massachusetts Institute of Technology, and the University of Michigan.
- One has partially exited: University of Pennsylvania.
- Three maintain their fossil fuel investments: Notre Dame University, University of Texas and Texas A&M University.
At Rutgers, a committee of faculty, students and staff helped create a divestment policy that put an end to all investments in fossil fuels, moved those investments to environmentally friendly index funds which actively seek investments in renewable energy.

“If we don’t do this work for the future that we’re not going to see, the one thing we know is the future will be worse. We know that. So, if we know that, don’t we have an obligation to do something about it? I think we do,” Holloway said.

Protecting the Planet: Climate Change News & Features

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May 16, 2023