In Inside Higher Ed, Donald E. Heller, a Penn State professor, notes that in late 2007 and early 2008, responding to pressure from Congress to stop sitting on so much of their endowments, “Harvard, Yale and several other highly selective universities enriched their financial aid programs to guarantee that students from families well up the economic ladder would get sizable grants to attend their institutions.”
It’s time to roll back these programs, Heller says. Looking at the numbers, it’s hard to disagree:
Harvard’s program, for example, guarantees that students from families with incomes between $120,000 and $180,000 pay no more than 10 percent of their family’s income to obtain a Harvard education ($180,000 puts one at about the top 10 percent of all families in the country). At this year’s cost of $52,000, this means that Harvard gives every one of these families a grant ranging from $34,000 to $40,000. Yale’s limit of $200,000 reaches families at the 95th percentile.
Few would argue that students from low- and middle-income families should not benefit from the sizable endowments still held by these universities. But no definition of “middle income” would include families in the top 5 or 10 percent of all in the nation.
Yes. Things are very different now, and with their vastly diminished endowments it’s difficult for colleges—even the most wealthy ones—to continue to be generous to those near the top without taking the risk of hurting those near the middle or bottom.