Last Sunday, President Peter Salovey announced one of the most extraordinary gifts in Yale history. Charles B. Johnson ’54, a billionaire investor from California, gave a mind-blowing $250 million to support the two new residential colleges. This gift was, to be sure, a remarkably generous act from a remarkable man.

scott_stern_headshot_peter_tianYet even as I thank and praise Johnson, I find myself disconcerted by the response to his gift. The story I keep hearing seems too easy. I have always been taught — by some of the best professors in the world, no less — to challenge simple, one-sided narratives. Like everything else, Johnson’s donation deserves deeper scrutiny.

For more than half a century, Charles Johnson ran Franklin Resources, a mutual fund that has more than $815 billion in assets. Worth somewhere between $4 and $6 billion, Johnson is listed on the Class of 1954 website as “our class’s only billionaire.” Even before his record-setting gift last week, Johnson had given millions of dollars to Yale.

But Johnson’s financial support for education is not so simple. He was the largest single donor in the movement opposing California’s Proposition 30, which would raise income taxes on the mega-rich like Johnson by 3 percent, leaving taxes unchanged for most Californians (along with raising sales tax by a quarter of a percent). The revenue generated by the slight tax increase was needed to fund state colleges and universities. The easy premise that Johnson is simply a generous individual is more complicated than it seems.

Unqualified praise further obscures the fact that this donation was also part of a larger, and potentially disturbing, trend. In the last couple decades, the largest donators to education went from nonprofit institutions to privately funded foundations. Education, public and private, is increasingly funded by billionaire philanthropists such as the Gates and Walton families.

While few are denying the generosity of these individuals, their influence is extremely troubling. The rise of private philanthropy in education is the rise of very few people having an inordinately loud voice in setting policy. The Gates Foundation, for instance, has no public accountability at all and has a specific political agenda; the Foundation opposes teacher tenure and strongly supports charter schools. Because of the massive amounts of money given, these positions tend to become increasingly adopted by both the public and policymakers, including by the Obama administration. Thus, a very few well-heeled individuals steer national policy. And as the gap between the poor and the uber-wealthy gets larger and larger, fewer and fewer people will have a say.

The fact that no one has any check on how these billionaire philanthropists spend their money has generated many skeptics, even when the philanthropy is undeniably generous. When a Filipino businessman named Fred Uytengsu gave $8 million to the University of Southern California, his praises were widely sung. Yet a few critics raised the idea that Uytengsu lives in the Philippines, and, while USC has an endowment of $3.5 billion, the best Filipino schools have endowments closer to $8 or $10 million. Wouldn’t Uytengsu’s money have meant more closer to his home? It is, of course, Uytengsu’s money to do with what he wants, but it is also worth pausing just a moment to consider the consequences of this philanthropic-educational complex.

Uytengsu’s donation and countless others like it are part of a trend in which the big money in education is concentrated at the very top. From 2011 to 2012, half of all donations from philanthropists to British universities went to just Oxford and Cambridge. In the United States as well, the big stories of philanthropy in education were concentrated at schools that already have tons of money. Places like Yale receive hundreds of millions of dollars a year, while schools with smaller endowments receive fewer and less noteworthy donations.

It is, then, possible to see Johnson as a single exceptionally wealthy man trying to steer an educational institution already flush with money. Johnson never asked Yale students if they wanted him to spend $250 million on the new residential colleges. In fact, the only times Yale students were ever asked about the new residential colleges, they openly detested the idea. When the new colleges were being debated in 2007 and 2008, two polls were conducted that found that about half of all students opposed them, while only a quarter or less supported the expansion. Faculty, too, vocally opposed the new colleges.

So while we praise Johnson for his generosity, we should also note that his money allows him to wield unusual power in concretizing a policy so many Yalies oppose. Big philanthropy and Yale are so firmly enmeshed that we embrace names like Harkness, Bass, Sterling — and now Johnson — without thinking enough about who they are, what motivates them and the startling power they hold over us.

Scott Stern is a junior in Branford College. Contact him at scott.stern@yale.edu.

  • yalemarxist

    It is indeed important that the masses not be lulled into submission and complacency by the “gifts” of their oppressors. These gifts, from welfare checks to philanthropy, seek to heal the alienation of the worker from the capitalist, but cannot do so. A large donation from a rich man will only hold off the revolution for a few more years.

    • ldffly

      Well, you’re orthodox on philanthropy.

    • branford73

      LOL, well played. Money . . . the opiate of the masses.

  • disqus_f3Gqo4uR2r

    You are so right to raise these questions, both about the new wave of plutocratic philanthropy in society at large and its impact on Yale. These people should not have nearly so much money; it should be spread around more widely through taxes. That way society gets to decide what happens, not just these few men. (Yes, men).

    Case in point: think about what that $250M could do to help alleviate this problem, reported in the YDN: http://yaledailynews.com/blog/2013/10/04/elm-city-disparities-persist/

    And as for the new colleges, there is no rationale except the silly excuse that “more” students will benefit. In that case, why not four new colleges? Six?

    • yalie

      Yale’s student population has trended upwards for more or less its entire existence. Why shouldn’t more students benefit? After all, there are more people around to supply them. What is “silly” about desiring to provide more of them with a Yale education?

    • sy

      Four new colleges would be good. Six better. The students in new colleges won’t “detest the idea” of not being squeezed into other suites, off campus, or out of Yale. Current students opposing 180 more students per class will be aging alumni when the colleges open. They will need legacy admissions if any offspring inherit the economics and tax/spending policy mental deficiencies of this article (e.g., state income tax increases “fund state colleges and universities” instead of funding fungible increases in all state spending, such as more government employees and pension benefits).

    • branford73

      **And as for the new colleges, there is no rationale except the silly excuse that “more” students will benefit. In that case, why not four new colleges? Six?**

      Not silly at all, consistent with the mission of the university and benefits the university in many ways. What’s silly is the opposition to the new colleges on grounds that they’re too far away from the current center of gravity of undergraduate life or that Yale’s financial resources for the colleges should be diverted from higher education to feed the poor.

      Why not four or six new colleges? Because the cost and energy consumed in doing that all at once is impractical and would seriously damage the university’s current mission, not because that increase in size would be bad in itself.

      BTW, I think support for the new colleges from alums because of their desire for more legacy admits is overrated. Both my kids are out of college and neither applied to Yale.

  • br2013

    Scott there has clearly not been an upward trend in monolithic donations to Yale or universities in general. The Sterling and Harkness donations were probably the pinnacle of that. Private philanthropy has always been central to major educational institutions. In fact the state funded schools established by the Morrill Act of 1862 were a break from the norm.

    Johnson was one of the major donors in the Class of 1954 Environmental Science Center and you don’t even know about that because it wasn’t named after him. The university is clearly taking a very different approach to handling major donations than it did then. I don’t see a Johnson College being developed in the near future which would fit in line with the “startling power” you bring up in the OpEd.

    The argument that Johnson’s lobbying activity is troubling is absurd. Individuals are allowed to donate to whatever institutions they would like to donate to. Doesn’t Yale (with its generous financial aid) fulfill a similar public good in educating its students as any public university his taxes would fund?

    • OYaleWhereArtThou

      Ummm…what? We do see a Brady-Johnson Grand Strategy program and the Johnson Center for Diplomacy, so he’s clearly getting his name on plenty of stuff. And saying things like “private philanthropy has always been central” is just wrong; it represents a fundamental misunderstanding of how education was funded after the end of the Gilded Age. From the Progressive Era until about 2000, education was much more likely to be funded by either the government or non-profits. The rise of “Big Philanthropy” is pretty recent, and it came right along with this idiotic idea that the richest of the rich should be taxed the least.

      Stern is pretty explicit that “individuals are allowed to donate to whatever institutions they would like to”–he said, “It is, of course, Uytengsu’s money to do with what he wants, but it is also worth pausing just a moment to consider the consequences of this philanthropic-educational complex.”

      And Yale certainly does a similar public good compared with other universities, but other universities aren’t getting the donations Yale is; it’s not even close. With money only concentrating at the top, we’re witnessing an increasing divide between top, top, top schools like Yale (and Oxford, Cambridge, Stanford etc.) and every other school. Is this degree of stratification really what we want?

      • br2013

        I’m sorry but sure he had GS named after him sure and we also have a ton of endowed professorships named after donors (in reality who actually knows those names is close to zero).

        The majority of major donations to Yale occured during the progressive era and the years after that (the same is true of Harvard and other peer institutions).

        What exactly are you categorizing as non profits by the way? Yale is a “non-profit” that gets much of its funding from returns on its endowment but that money is there because of private donations. I would love to know where you have evidence that “Big Philanthropy” is a recent advent because I am fairly certain that Carnegie was doing it back in the 19th century.

        As far as stratification, I think that there was always quite a large divide between “top schools” and other schools. With the exception of the flagship universities of states that has always been prevalent and this stratification doesn’t translate into anything other than at the institutional level. It’s not as if the children of the wealthy and privileged are the only ones going to them–the comprehensive financial packages now available (which we only have because of private funding) go long way toward making this education accessible.

        • OYaleWhereArtThou

          Evidence: “The Death and Life of the Great American School System” by Diane Ravitch, “Beware Big Donors” by Stanley Katz, also Warren Buffett’s son’s NYTimes op-ed. Check out the stuff about the rapid transition that happened between 1998 and 2002. Also, there was only one “progressive era.” And yes, Carnegie was doing it back in the Gilded Age, as I said. Things changed when it ended, as I said. And then they reverted back pretty recently. Educate yourself.

          • br2013

            That was an error on my part (the plural era).There are so many contradictions in your argument. You can’t say it’s a relatively new development and then point to the gilded era (when it was happening). Second, the donations from the Sterling and Harkness were in the midst of the Progressive era!

            Educate yourself on the history of this institution you affiliate with.

          • jsalisburysteak

            Yale actually is an anomaly in this respect (unusually rich alums, founding the residential college system in the 30s, etc). In the wider world, I think the OYale is right.

          • carl

            The Harkness donations were in the 1920s and 1930s.

            That is not the Progressive Era, which ended with WWI.

          • br2013

            Actually the first Harkness donation that resulted in the construction of the Memorial Quadrangle (now Branford and Saybrook) was made in 1916.

            The Vanderbilt’s donated the Vanderbilt-Sheffield Dormitories and Towers (the white stone side of Silliman) in the first decade of the 1900s, the list goes on…

  • phantomllama

    Perhaps Charles Johnson thinks that he is more qualified and capable of judging how to spend his money than the State of California, hence his support for this project but opposition to state tax hikes. I fail to see the inconsistency.

    • OYaleWhereArtThou

      But has he given money to California state schools? Or does only Yale deserve his millions?

      • phantomllama

        Why does he have any particular obligation to donate to CA state schools?

        • OYaleWhereArtThou

          Well, saying that he can spend his money better than the government can is pretty damn weak, because the UC schools are in such financial ruin, while Yale is so flush with cash. Yeah, I this shows poor judgment on his part.

          • phantomllama

            Well, I’m sure that the CA state schools are in a better financial state than, say, many in Africa. It seems we could continue with your line of argument ad aeternum…

            Perhaps he thinks that the UC schools and the state itself have mismanaged their finances and are likely to mismanage his donations, whereas he trusts Yale not to. Clearly he considers the benefit of giving 300 or so more students each year a Yale education to outweigh that of donating elsewhere. What qualifies you to claim otherwise?

          • OYaleWhereArtThou

            Well, he’s a resident of California and not Africa (just as that Filipino guy is a resident of the Philippines), so he might conceivably feel some loyalty. But you’re right, it’s currently no one’s right to say what he should donate to. (Which is exactly what Stern said.) On the other hand, if we taxed him more (say, let’s return to Nixon-era levels), we could all have more of a say.

            And, for what it’s worth, $250 million to Africa would do much more net good than to Yale.

          • phantomllama

            “On the other hand, if we taxed him more (say, let’s return to Nixon-era levels), we could all have more of a say.”

            We might have “more of a say” in where a very small proportion of his money went. At the same time, we’d discourage his philanthropy, thus reducing the probability that he’d donate $250 million anywhere, and encourage him to reconsider the way in which he currently manages his money, likely resulting in lower long-term tax revenues despite the higher marginal rates.

            The ironic thing is that we wouldn’t even be having this conversation if Johnson hadn’t made an incredibly generous gesture. To expose him to increased scrutiny because of the donation – let’s face it, Stern was hardly about to write a piece entitled “Why Hasn’t Rich Man Johnson Donated £250m To Anything Recently?” – strikes me as remarkably uncharitable.

          • OYaleWhereArtThou

            It’s uncharitable just to give “deeper scrutiny”?

          • phantomllama

            In my view, yes, because Johnson is far less deserving of “deeper scrutiny” than those who accumulate wealth and never spend any of it on philanthropic ends. Stern’s talking about him because it’s easy to, but I don’t see the intellectual case for “scrutinising” Johnson instead of countless others.

          • jsalisburysteak

            I think the comments here reveal it’s not too easy to take on someone everyone else is drooling over…just my two cents…and he’s talking about Johnson because everyone else is; it would be irresponsible not to

          • ELJEFENUEVO

            Yes, so he should give his money to a bunch of poor money-managers? You clearly don’t understand business

          • carl

            You clearly do not understand modern conservatism. To starve government of resources, and then to accuse government of “mismanagement,” is a favorite conservative tactic. Especially in California in the 1970s.

          • ELJEFENUEVO

            CA is hardly starved. Just wasteful

  • lakia

    I’m thinking every last one of you needs to go back and reread Animal Farm.

    • everyone

      and learn how Trotsky was right all along…?

  • ELJEFENUEVO

    Hey, Scott, how about you go around and individually tell all your friends and classmates on financial aid that the influence of wealthy people is extremely troubling and they don’t deserve their Yale educations?

    • jsalisburysteak

      Ok, so I’m new to this convo, but I wasn’t aware Johnson had ever funded financial aid in any way. I also don’t really think that is what this column is about…

    • oliviagriffin95

      Not a single penny of Johnson’s donation went towards scholarship or financial aid programs. Currently, it appears that the $250 million will go solely towards the creation of the two new residential colleges. Stern’s main argument against Johnson’s donation was the fact that it is funding something that Yale doesn’t even need, instead of being used more productively for programs such as financial aid and scholarships for students.

  • eli1

    Literally the stupidest column I’ve read in the YDN…which is saying something. Mr. Stern has hit a new low with this one. I can’t wait to see what ridiculous thing this young many will complain about next week. Stay tuned…

    • jsalisburysteak

      Again, I don’t want to start anything, but this is pretty damn uncalled for. I’m sorry if this “young many” isn’t smart enough for you, but I thought this column was absolutely fascinating. It’s unusual, actually, that the YDN runs something so provocative and intellectually refined. It’s really gonna get people thinking, which is wonderful. I guess you just really don’t want to challenge the status quo. But even great things can be looked at in new ways, so I think I get why you’re having trouble with this.

      The YDN has a pattern where liberal trolls attack conservative columns and conservative trolls attack liberal columns, which would be fine, but then all trolls attack staff columnists. It’s quite telling you don’t tell us, at all, why this is so dumb. Maybe it’s not the column or Mr. Stern that is stupid…

      • branford73

        When I read your first paragraph I thought it was almost as good an ironic post as yalemarxist’s which led off the comments. But then the second paragraph showed you’re serious.

        I favor a higher graduated tax on upper incomes or a reduction of favorable capital gains taxes, but an opposition to tax hikes is not trading in blood diamonds.

        Johnson’s gift is not an unsolicited conditional gift to Influence Yale to do something it doesn’t want to do. Yale has been soliciting donations for the new colleges for awhile.

        • jsalisburysteak

          Yeah…so what? It doesn’t matter whether it was solicited or not. I have no idea what no comment means, but it seems to miss the basic point of this column: we should think about this thing in a more nuanced way

          • branford73

            One of Mr. Stern’s points was that it is regrettable that people wealth use it to influence the direction of education, implying that Johnson was trying to do this with his gift. I suppose Stern was trying to raise the memory of the Bass $20 gift in the early 90’s and the strings he attempted to attach. Since Johnson appears to be contributing to a project Yale has already decided to do, there is no evidence I know of, and Stern doesn’t cite any, that Johnson is trying to influence educational policy through this gift. That was the point I was trying to make by using the solicited vs. unsolicited dichotomy.

          • MiddleageLiberal

            Correction — Bass $20 million gift

  • oliviagriffin95

    What an incredibly eye-opening perspective. To play devil’s advocate, I will say that Johnson’s choice to make a significant donation to his alma mater seems appropriate and even expected of him (it would be a bit hypocritical of him to donate to a Californian school such as Stanford, UCLA, or Berkeley rather than Yale). However, I completely understand your perspective that $250 million is a lot of money for something that Yale’s community neither needs nor really wants, and if he truly wanted to do something that would benefit the school, he would have listened to the opinions of students and faculty. It seems as though his money would have been more efficiently utilized if it were invested in research at Yale, scholarship programs, or even improving underfunded high schools so that their students have a better shot of attending Yale or another similar school. Great article, though!

  • dedwards

    Things only a delusional liberal would say:

    “While few are denying the generosity of these individuals, their influence is extremely troubling.”
    ==> You don’t sound ungrateful at all.

    “The fact that no one has any check on how these billionaire philanthropists spend their money has generated many skeptics, even when the philanthropy is undeniably generous.”
    ==> Among the most inane things anyone has ever said.

    “The Gates Foundation, for instance, has no public accountability at all and has a specific political agenda; the Foundation opposes teacher tenure and strongly supports charter schools.”
    ==> What, and teachers’ unions aren’t political?? LOL

    “Uytengsu’s donation and countless others like it are part of a trend in which the big money in education is concentrated at the very top.”
    ==> So you’re saying we need to not only socialize this man’s income via taxes, but also his donations because you don’t like that he can choose where he donates?

    “Johnson never asked Yale students if they wanted him to spend $250 million on the new residential colleges.”
    ==> Should he have to? Next time you win the lottery, I’ll be sure to write an op-ed outlining why you shouldn’t receive the money.

    “In fact, the only times Yale students were ever asked about the new residential colleges, they openly detested the idea.”
    ==> The delusional liberal is all about openness and inclusion except when he wants to exclude others. Share the wealth, bro. Don’t be afraid to dilute the Yale “brand.” You’re already doing so with op-eds like these.

    “Big philanthropy and Yale are so firmly enmeshed that we embrace names like Harkness, Bass, Sterling — and now Johnson — without thinking enough about who they are, what motivates them and the startling power they hold over us.”
    ==> Sounds like we need a panel of liberal administrators to regulate donations going forward… wuddaya think?

    • branford73

      Hey, I’m a liberal and I thought the column was idiocy.

      • jsalisburysteak

        Ok, not to be rude, but you’re probably not a liberal. You’re a Yale “liberal”–you support gay marriage and pot legalization, but whoa if someone critiques capitalism or big money at all, you’re all like, hey, that’s my dad you’re talking about.

        In any other time, in any other society, the idea of like 10 guys steering all of education policy would scare the crap out of everyone. Now, because of “liberals” like you, we think that’s the realization of the American dream.

        That’s idiocy.

    • jsalisburysteak

      This wins as the least coherent comment yet. The point of this column isn’t to sound ungrateful, which I think Stern makes pretty clear, but, even if he does, that’s not too relevant to its logic. Again, who cares whether teachers’ unions are political; that’s not relevant to the point of this column. And on an on.

      Maybe be a little more constructive/make a little more sense, instead of just going, gosh guys aren’t liberals the worst

  • dedwards

    Is it possible to downvote this whole article?

  • simpsone4

    “….leaving taxes unchanged for most Californians (along with raising sales tax by a quarter of a percent)”

    …so, in other words, raising taxes on all Californians? The sales tax is a regressive tax. Putting it in parentheses doesn’t make it go away.

  • theantiyale

    This isn’t exactly looking a gift horse in the mouth, but it is pulling his tail. The guy is old and wants a flashy tombstone in a prestigious cemetery.

    Nothing wrong with that as long as he doesn’t tell Harold Bloom what to teach–or think.

    After last night’s NOVA on PBS about the water damage to New York and New Jersey and the rising sea level predictions, Mr. Johnson may have chosen the wrong spot at Yale.

    New Haven harbor will reach the bottom of Prospect Hill .

    Recall the sea shells they found when they dug the foundation for the present Shubert Theatre twenty-five years ago? The harbor extended that far WITHOUT climate change.

    Mr. Johnson may have just funded the new Atlantis.

    PK
    M. Div. ’80

  • MiddleageLiberal

    Next up for Mr. Stern: “Rethinking Pilot Sullenberger’s Landing an Airliner in the Hudson River.” I mean, what about the pollution!?