Is Giving to a Rich University Really a "Moral Injustice?"

Every movement needs a spokesperson, and the school of "effective altruism," which argues that the most meaningful metric for weighing the value of a philanthropic gift is "lives saved per dollar" is no exception.

We see this argument played out frequently in the arts world, where effective altruists will ask, "How many lives does the opera save?"

Bill Gates, in an interview with the Financial Times, asked why anyone would donate money to build a new museum wing rather than to prevent illnesses that can lead to blindness. And then there's the father of effective altruism himself, Australian ethicist Peter Singer, who has said,

I don't think we should give money to the arts. Yes, it's fine to help community projects to help kids express themselves artistically; that's a different matter. But giving tens of millions of dollars to established institutions like the Metropolitan Museum of Art? I think there are better things you can do with that money.

Arts funding isn't the only target of effective altruists, lately. We've also seen an increasing amount of ire about giving to elite universities.

The logic sounds familiar. For example: Why does Yale, with an endowment of $26 billion, need a $16 million contribution from the Starr Foundation to, among other things, rename its signature leadership education initiative the Maurice R. Greenberg World Fellows Program? Couldn't that $16 million be put to better use elsewhere?

Enter Malcolm Gladwell.

Gladwell, the bestselling author of books like The Tipping Point, Blink, David and Goliath, and Outliers, believes that giving gifts to rich universities like Princeton or Stanford is a "moral injustice."

His crusade traces its roots back to John Paulson's $400 million gift to Harvard last year.

At the time, Gladwell tweeted, "It came down to helping the poor or giving the world's richest university $400 mil (sic) it doesn't need. Wise choice John!" (Not to be outdone, Vox columnist Dylan Matthews wrote, "There is a special plaque in philanthropist hell for John Paulson.")

Matthews also scorched Phil Knight's $400 million give to Stanford for a graduate fellowship program, calling it "an offensive waste of money," since "Stanford grad students are already richer than average, smarter than average, and more socially connected than average." He went on to calculate how many thousands of lives that money could save if it were channeled instead to malaria prevention. (You don't want to hear the number.) The title of Matthews' article: "For the love of god, rich people, stop giving Stanford money."

Matthews had even harsher words for David Geffen's $100 million gift to UCLA to set up a private elementary and middle school on UCLA's campus, calling it "philanthropy as its absolute worst." Again, he mentioned how many lives could be saved if that money instead went to malaria bed nets, or to anti-poverty efforts in sub-Saharan Africa.

We're of two minds about these kinds of critiques at Inside Philanthropy. Part of us says, "Yeah, let 'em have it!" And we've appreciated that incisive thinkers like Gladwell and Matthews are turning their flamethrowers in the direction of big philanthropy. Keep it coming!

But a second part of us says, "Hey, wait a minute, there's another side to the story, here." Namely, that it's simplistic to think of America's top universities mainly as bastions of privilege and to see every big check written to these places as a gift to rich kids. In fact, these institutions are all-important engines of American progress in both science and ideas, undertaking research and development that benefits us all. Check out this exhaustive rundown of discoveries that have come out of U.S. universities, especially the elite ones, just in the field of biomedical science. You'll see quite a few that have affected your own life. You could compile another endless list in the physical and social sciences.

The central role of universities in innovation is why the federal government sent $30.7 billion in research funds to these institutions in 2014. Harvard and Stanford collected over a half billion dollars each in such federal funds.

You don't hear people like Gladwell and Matthews complaining about this kind of funding. Quite the opposite: Most of the intelligentsia cheers federal R&D spending and voices outrage when it's cut by Neanderthals in Congress.

So why not also cheer a gift like Paulson's, which went toward research and science education, namely to endow the School of Engineering and Applied Sciences (SEAS)? That gift, we should add, was not so uncommon in its focus on research. Many of the biggest gifts we see going to elite universities are for this same purpose, particularly in the life sciences. The three biggest living donors to higher education—Michael Bloomberg, Gordon Moore and Chuck Feeney—have all targeted their giving on supporting research.

To be sure, we see plenty of dubious campus gifts, and we'd include the Phil Knight and Geffen gifts in that category. On the other hand, even these don't irk us all that much, given that they're broadly pumping up critical institutions in U.S. society. If Geffen's private campus school helps UCLA, which has been battered by budget cuts, to attract better faculty or conduct new education research (which is part of its mission), that's okay with us. Yes, we'd rather the money go to prevent malaria deaths, but we could say the same thing about the few thousand bucks Dylan Matthews probably spends eating out in restaurants every year. If you go with Peter Singer's logic, any spare cash that doesn't go to saving lives is being used frivolously.

That logic is compelling, and more philanthropists should heed Singer's ideas. But we're not keen on heavy-handed attacks on donors who simply have different interests, such as in the arts. After all, where does that kind of moral judging end? Is it OK for social workers and inner city school teachers to harangue artists or writers of trendy books at dinner parties because they're not devoting their lives to helping the poor? Does Malcolm Gladwell really want effective altruists to conduct an audit of how he spends his time and extra money? Probably not.

One last thing: The argument that private elite universities are hogging all the campus giving is not exactly correct. Surging giving has also created huge endowments at some public universities. The University of Texas system has the largest endowment in the U.S. after Harvard. The University of Michigan is No. 8 on the list, while the UC system is No. 14. Ohio State University has a bigger endowment than Brown, while the University of Minnesota has a larger stash than NYU. In 2015, six of the top 20 fundraising institutions in 2015 were public universities—including four University of California schools.

That said, these are tough times for public universities and community colleges, given budget squeezes of recent years. If you're worried about the fate of lower-income kids trying to get a college education, this is the real issue. And there's no question that many of today's wealthy have helped create this situation by pushing for lower taxes and less government. That's where critics like Gladwell really need to direct their attention. (Matthews, to his credit, has long been on this case.)