If people wanted to contribute directly to a university, they can. Instead they're contributing to the endowment. Respect that choice.
It's pathetic that universities have actually set up a sustainable source for funding scholarships etc indefinitely -- where spending caps are actually restricted -- and the vultures immediately descend to suck it dry and spend it off. And then in a few decades when it's gone: ???
For things like CS, sure - mostly. Excepting for slightly niche areas like embedded programming, you can achieve similar experience for $0.
But for most other [engineering] degrees, this isn't true. You can't tape out a custom integrated circuit (IC) for free, but this is something some EE undergrads get to do at brand-name universities. Even the licensing cost of the software used to design those ICs can reach six figures.
I imagine there are similar things with chemistry, material science students and especially medical students.
But yeah, even in those other engineering fields, the internet has reduced the cost of education.
You are talking about endowments? Ha.
It's not the cut and dry issue you seem to be implying.
Considering long-term real rates of return on a diversified portfolio, a 4% annual withdrawal rate (the "4% rule") is advocated for most retirees- and they only have to make their nest egg last 30 years.
What sort of signal would that give to charitable givers to the university when it decides to start taking 8% per year, and seeing the money exponentially decay? I'm in no position to donate a large amount to a university, but if I were I would imagine that I would like to see it live on, not wither on the vine.
Companies, institutions and even empires come and go. The most successful adhere to conservative governance and plan for the next century, not the next semester.
Harvard was founded in 1636. So far, it has survived 380 years. That's pretty impressive.
What's the point? Well, suppose you have $100. You could spend it all now. Or you could invest at a 7% profit rate, reinvest 2% for inflation, and then spend the remaining 5%. This lets you spend $5 a year, inflation-adjusted, for the foreseeable future -- so if your timeframe is longer than twenty years (20x5 = 100), it makes sense.
That's not to mention that having a lot of money in investments gives a school substantial practical/political power.
Tips welcome.
from 2006-2015 the SP500 had a geometric yearly mean return of 7.25%.
according to http://www.usinflationcalculator.com/inflation/current-infla...
The average inflation for that period is 1.9% so you get roughly 5%.
Still pretty decent.
respectfully, the article paints a much darker and more insidious picture than that.