Gold in the Ivory Tower - New York Times
Herbert A. Allen knows more than a little about extreme wealth. CEO of the investment firm Allen & Co. and a director at Coca-Cola, he is listed by Forbes as the 133rd richest American with a net worth of $2 billion and guests at his annual retreat in Sun Valley, Idaho include Bill Gates and Warren Buffett.
Today in the New York Times, Mr. Allen remarks that "there’s a particularly corrosive shift that’s taking place, one that has tremendous consequences for the development of America’s best minds: the growing gap between super-wealthy colleges and universities — and the rest of the academic world."
He write that this gap allows the rich schools to "raid poorer colleges and scoop up the best teachers" and "further separate themselves from less fortunate colleges by taking the best high school students and offering them ever richer deals."
His solution - "tax the investment income of the wealthiest colleges", pool this tax revenue, and redistribute it to schools with the lowest endowment per student. "It wouldn’t hurt Harvard to give up $1 billion or so of its gains in order to make the sharing of our intellectual wealth fairer," he claims.
As you might imagine, the comments on this article run the gamut. Regardless of the specific merits of Mr. Allen's premise, it is undeniable that the wealth of Harvard and a small # of other schools is getting more and more public attention. How will these schools react, if at all, out of generosity or desire to protect the status quo?