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Comment by dartharva | Hacker News Reader

From MIT's financials (https://facts.mit.edu/operating-financials/):

Operating Revenue: $5.07B, out of which - Federal funding (sponsored support): $2.30B

Operating Costs: $4.78B, out of which - Sponsored research expenditure: $2.10B

Additionally, they seem to have $24.57B worth of endowed funds and get gifts and pledges of net ~$0.6B every year.

Looks like they can wane off their dependence on federal funding if only they tried. They don't have to deal with idiot politicians.

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Endowed funds are restricted- the donors can place constraints on how they are spent. They are not fungible and cannot reliably used to pay for a wide range of things that are currently paid for by federal funding.

Personally I would love to see the richest people in the nation contribute a lot more to universities in the form of unrestricted funds, to give these universities some options when it comes to being dependent on federal funding. But I guess you don't get rich by giving unrestricted funds to universities.

I really find it surprising how often people bring up endowments as if they are a resource that can be spent. The purpose of an endowment is to produce revenue via investment income; that investment income is already reflected in the operating revenue under "Investment return to operations". MIT cannot and should not spend their endowment beyond this investment income; doing so would jeopardize the long-term viability of MIT.

I find it surprising that every time endowments come up, there are replies stating it can only be used in very specific tasks. As if they are written in stone and can never change, ever. Or the new money that comes in can't be used for something else.

This is open to debate. Some endowments are intended to be spent directly, and not everybody agrees that spending some fraction of the endowment curses the university to oblivion. Some financial policies can be suspended (they are not absolute, fixed rules). Many at Harvard felt the endowment was far larger than necessary for long-term viability, and wanted to spend money on capital improvements.

In theory they could but in practice they don't want to. No company wants to loose $2B a year of free money.

Suddenly loosing 45% of revenues would be devastating.

And yes, MIT is a company. They have a CEO (under a different name), a board of directors, thousands of employees and they provide a service for a fee.

No one that works for MIT wants to loose that money. Not CEO, not board of directors, not employees.

Maybe they'll put ideology first and $2B second but I doubt it.

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