Ellie Park, Senior Photographer

For months, Yale researchers in STEM fields have borne the brunt of the destabilizing effects of cuts to federal research funding. Now, faculty members across all disciplines are grappling with the threat of a potential 21 percent tax on Yale’s endowment investment returns.

The proposed tax, part of budget legislation championed by President Donald Trump and passed by the U.S. House of Representatives this month, would mark the first major blow to the University’s internal funding streams under the Trump administration.

Under the tax hike, research in the humanities and social sciences, much of which is financed internally rather than by external grants, may face challenges that faculty have not seen before, several professors told the News.

American studies professor Daniel HoSang, the president of Yale’s chapter of the American Association of University Professors, explained that while research in the natural sciences often relies on outside funding such as federal grants, researchers in the humanities and social science depend more heavily on resources provided by the University. Those internal resources include money drawn from the endowment each year.

“Faculty and graduate students in the humanities and social sciences do need resources to conduct their work,” HoSang said in an interview. “All of that is jeopardized by the endowment tax proposal.”

The humanities and social sciences have already been affected by Trump’s funding cuts, according to Lauren Benton, a professor of history and law, who cited reductions in funding from the National Endowment for the Humanities. Still, the majority of federal cuts up until now have targeted STEM disciplines that depend on resources from the National Institutes of Health and the National Science Foundation.

Across social science departments, funding models vary. According to professor Kenneth Scheve, the dean of social science for the Faculty of Arts and Sciences, each department’s research is supported by a distinct mix of internal and external funding, which determines how vulnerable the department’s research is to endowment tax-related budget cuts.

“The mix of internal and external grants varies significantly across disciplines depending on how available external funding is and the extent of resources needed to do research in each discipline,” Scheve wrote to the News. “For example, psychology relies more on external funding than the other disciplines in the social sciences because the research tends to require a larger scale and the extensive use of relatively expensive equipment.”

A department’s funding model can also depend on the support it has received from past University donors, sometimes for a particular type of research.

Professor Oswaldo Chinchilla Mazariegos, the director of undergraduate studies in archaeology, said that funding for students’ field experience comes from pools of money reserved for the program. Chinchilla expressed worry that these types of restricted funds, which make up around 75 percent of the University endowment, “may be impacted by the taxes.”

Though it is unclear how the proposed tax could affect individual departments at Yale, an overall reduction in research spending is expected if the budget reconciliation bill is passed by the Senate and becomes law. 

In a message to the Yale community on Thursday, May 22, University President Maurie McInnis highlighted Yale’s research output and warned that the University’s “ability to lead and innovate across all fields will be greatly reduced” should the endowment tax increase be enacted.

Five professors across the humanities and social sciences expressed particular concern for graduate studies at Yale.

“Graduate admissions and hiring will be affected, and that will mean a diminishment, very significantly, of the ability of the humanities and social sciences to lead in their fields, to be able to build new subfields, to replace faculty who leave,” Benton said.

For example, graduate students of linguistics are often supported by the MacMillan Center for International and Area Studies, linguistics professor Claire Bowern told the News.

The University endowment provides the majority of the income for the MacMillan Center, as well as the Cowles Center and the Institution for Social and Policy Studies, according to Scheve, the social science dean. Those centers are the “biggest funders of social science research at Yale,” he said.

Jeffrey Alexander, a professor emeritus of sociology, said limitations on funding for graduate students to help with faculty research could leave professors overburdened. That would “make it more difficult for faculty to find time to devote to undergraduates,” Alexander said.

McInnis’ May 22 message on the legislation emphasized Yale’s positive contributions to the world of STEM research. She asked students to write to their legislators about Yale’s global leadership in technology, through advancements in MRIs, the internet, smartphones and quantum computing.

McInnis highlighted the threat to Yale’s “discoveries that strengthen the nation’s economy, competitiveness, and security” presented by the tax increase.

Willie James Jennings, a professor at the Yale Divinity School, told the News that the humanities are vital to the University’s research work.

“The humanities is always pressing the fundamental question, ‘What makes for a good society?’ and all the research builds from trying to answer that question,” Jennings said. “You undermine the common good when you undermine universities and you undermine humanities.”

Yale is one of nine universities that could face a 21 percent endowment tax rate under the legislation passed by the House of Representatives. Its estimated endowment per domestic student rate, at $3.6 million, is the second-highest in the nation. Republican lawmakers have touted the measure as a means both to compensate for tax cuts and to punish universities for campus antisemitism and diversity, equity and inclusion initiatives.

HoSang cast the potential endowment tax increase as a broad attack on institutions of higher education.

“The tax itself is intended to simply disrupt, weaken and throw into chaos these institutions,” HoSang told the News. “This is just a kind of crude and open-ended attack.”

He said he hopes the Yale community can help communicate to the public that Yale is not “a private institution hoarding goods in a society that’s marked by lots of inequality,” but a place which “contributes towards the public good.”

“We can’t just defend it for the sake of defending Yale as an institution,” HoSang said. “We need to be able to speak to the connection between our work and the broader public good.”

The endowment is the University’s largest source of revenue.

Correction, May 31: A previous version of this article misleadingly suggested that President Maurie McInnis sent her University-wide message about the potential endowment tax increase on the most recent Thursday; she sent it on Thursday, May 22.