Home > Uncategorized > As we say, not as we do? Bloomberg has more on university endowments, with emphasis on Ayn Rand

As we say, not as we do? Bloomberg has more on university endowments, with emphasis on Ayn Rand

My reading on the kerfluffle about the Koch brothers’ funding of free market economics programs at FSU turned up an interesting report at Bloomberg.

The Bloomberg report makes discusses funding generally, with a focus on the efforts of John Allison, former chairman of bank holding company BB&T Corp. philanthropist’s efforts to get universities to teach Ayn Rand‘s Atas Shrugged, and makes no mention of the Kochs. FSU apparently has also accepted funds from BB&T.

While I agree that ideas must be fought for, I deplore that the various disputants appear to be ignoring that the very reason for the disputes over ‘private’ donations to universities is the very deep role that governments play in corporations and markets, and the resulting very deep role that corporations play in governments.

Would that ‘capitalists’ had a clearer understanding and more honest acknowledgement of their own unclean hands — then the libertarian message they purport to preach would be less like to be perceived as evil propaganda.

Here’s are excerpts of the report:

Schools Find Ayn Rand Can’t Be Shrugged as Donors Build Courses (Bloomberg Markets Magazine, May 5, 2011) (emphasis added)


John Allison, former chairman of bank holding company BB&T Corp. (BBT), admires author Ayn Rand so much that he devised a strategy to spread her laissez-faire principles on U.S. campuses. Allison, working through the BB&T Charitable Foundation, gives schools grants of as much as $2 million if they agree to create a course on capitalism and make Rand’s masterwork, “Atlas Shrugged,” required reading.

Allison’s crusade to counter what he considers the anti- capitalist orthodoxy at universities has produced results — and controversy. Some 60 schools, including at least four campuses of the University of North Carolina, began teaching Rand’s book after getting the foundation money. Faculty at several schools that have accepted Allison’s terms are protesting, saying donors shouldn’t have the power to set the curriculum to pursue their political agendas, Bloomberg Markets magazine reports in its June issue.

“We have sought out professors who wanted to teach these ideas,” says Allison, now a professor at Wake Forest University’s business school in Winston-Salem, North Carolina. “It’s really a battle of ideas. If the ideas that made America great aren’t heard, then their influence will be destroyed.”

Allison, 62, is one of a number of wealthy philanthropists who are making bold demands on schools as a condition of giving, says Jack Siegel, a lawyer whose Chicago-based Charity Governance Consulting LLC works with colleges and nonprofit groups.

Seeking to leave their imprint on everything from the direction of scientific research to the performance of sports teams, these benefactors are stirring conflicts when their causes don’t fit with the priorities of administrators and faculty.

Strings Attached

The strings attached to the gifts present university presidents with tough choices: While schools suffering from diminished endowments and government funding cuts following the recession need the money, administrators are sometimes forced to reject the offers to avoid a dust-up on campus.

“I have known some gifts in which the university just could not agree to the terms,” Ohio State University President E. Gordon Gee says. “If there are too many strings attached, you have done yourself a disservice. If someone gave me $100 million to start a school of massage at Ohio State University, I’d have to say, ‘Sorry, it’s just not in our strategic plan.’”

Donors as far back as John Harvard, the first benefactor of what was renamed Harvard College after his death in 1638, have gotten their names enshrined on buildings in a quest for immortality. “They’re building a tombstone,” Siegel says.



A C$35 million ($36 million) gift from the family foundation of billionaire Peter Munk has been met with as much scorn as appreciation at the University of Toronto. The money from Munk, chairman of Toronto-based Barrick Gold Corp. (ABX), was used to help create the Munk School of Global Affairs.

Paul Hamel, a professor of medicine, and John Valleau, an emeritus chemistry professor, attacked the university’s agreement to accept the donation in a 7,361-word essay published in February in an online campus magazine. Students also staged protests outside the university’s governing council meetings.

Barrick’s Mines

In the funding deal, the Munk foundation will release the final C$15 million at its own discretion and only if the university meets 23 requirements laid out in a 26-page memorandum of agreement. The professors claim that the structure of the agreement will make scholars at the Munk school reluctant to criticize Barrick, the world’s largest miner of precious metals.

Amnesty International and CorpWatch have alleged that Barrick’s operations have caused pollution and violated the human rights of workers in Papua New Guinea and Australia. In Tanzania, security guards at Barrick’s mines have allegedly shot and killed villagers who scavenge for small pieces of gold. Barrick has publicly denied that it’s responsible for these alleged violations.

“Anti-mining activists frequently make wide-ranging accusations against Barrick, often relying on information that is just plain wrong,” spokesman Andy Lloyd says. “The company is fully committed to responsible environmental stewardship and upholding human rights.”

Front Entrance

The essay also lashes out at the demands attached to Munk’s gift. Among the 23 requirements, the university must stage an opening celebration for the Munk school and hire a media tracking service to evaluate its branding strategy.

The professors were especially incensed at the rule that said lower-level staff will not be allowed to use the front entrance of the building, which they say violates the social norms of a public university.

“The main entrance of the school, remodeled at considerable public expense, is to be restricted to ‘senior staff’ (defined how?), while everyone else, including their assistants and students and even their less-senior faculty colleagues, are to walk around to a back door!” the professors wrote.

President David Naylor posted a spirited defense of the Munk agreement on the university’s website. “Personal attacks such as those we have seen on Peter Munk are a deplorable affront to the values of rational and respectful discourse that are supposed to characterize a university,” Naylor said.

The university also said that critics misinterpreted the requirement about the building’s front entrance, saying everyone was free to use it. Barrick declined to make Munk available for comment.

Exxon Donation

Benefactors rarely deviate from the university’s preferred projects, says Martin Shell, Stanford’s vice president for development. “We want to make sure we understand what the donor has agreed to and what we’ve agreed on, to make sure there’s a meeting of minds so there’s no confusion down the road,” Shell says.

Stanford’s tightly scripted fundraising program didn’t prevent a blowup with Hollywood producer Stephen Bing. After Bing pledged $2.5 million for an undisclosed purpose, he learned that Exxon Mobil Corp. (XOM) was running advertisements touting its earlier promise to donate up to $100 million to Stanford to support climate change and energy research.

Bing, who backs environmental causes, demanded that Stanford prevent Exxon from using the school’s good name in its marketing to promote itself as a green company. A group of alumni rallied to Bing’s cause and lobbied the school’s board of trustees to vote their shares in support of a 2007 Exxon shareholder resolution calling on the oil giant to reduce its contributions to global warming.

But that wasn’t enough for Bing, who rescinded his donation in 2007 because Stanford refused to end its relationship with Exxon. Bing declined to comment.

Ayn Rand

Allison, who promotes Ayn Rand’s writings, will likely generate more conflicts on campuses as he seeks to expand his foundation’s gifts to 200 schools nationwide. In 2006, Meredith College in Raleigh, North Carolina, gave up a seven-year, $420,000 grant from the BB&T foundation after some faculty bristled at the president’s decision to accept the money on the condition that the school teach “Atlas Shrugged.”

After Guilford College in Greensboro, North Carolina, accepted a 10-year, $500,000 grant from Allison’s foundation, Richard Zweigenhaft, a professor of psychology, protested the decision in an article for Academe, a magazine published by the American Association of University Professors. He said the appropriate faculty committees weren’t consulted before the school decided to take the money.

“This deal with BB&T was simply an egregious case of the college administration deciding to sell a chunk of the curriculum,” Zweigenhaft says.

As private donors gain more power on campuses, it’s just the kind of shift away from state control that Rand would applaud.

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