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Looking Forward II

FINANCIAL FUTURE

NO WRITER ATTRIBUTED

If Harvard loses its financial angels, both those who give libraries and those who spend $8,000 on a son's education, it will find that maintaining its existence is an even tougher job than it is today. A rapid glance at Mr. Morse's amusing "Pardon My Harvard Accent" might indicate that all the University has to do is to look around for crackpot ways its money is being spent, cut them out, and save millions each year. Unfortunately, although there are many frills in the environs of the Yard, most either are uncuttable because of endowment bequests or are assets too desirable to be reduced. People who leave money to Harvard usually tie it up for definite ends, such as museums and rare book libraries. These are luxuries, but the terms of the gifts preclude the use of the axe. Besides, although they are luxuries they are the element of the University which sets it apart from other institutions.

In the same way, eliminating frills from the curriculum and from research allotments would destroy its own purpose. Harvard's goal must be to preserve high standards of education. An over-enthusiastic use of the budgetary shears would lower those standards until we would be competing on intellectually even terms with state universities instead of offering customers a superior brand of education. Since the University's only bargaining point is its educational advantages, it cannot afford to slice out of its budget more than the most lacy of frills. Even the ten per cent cut last spring weakened the props of the tutorial system, the basis of the College's superiority.

There are two cheerful aspects of the situation, however. The first is that no matter how heavy taxes the Government slaps on private fortunes, there will still be a generation with millions of dollars already salted down and intended for gifts. Even though the end of the fifty year era of substantial bequests is in sight, there will be a few more sizable endowments. Unfortunately, donors often lay such costly luxuries in the University's lap that it doesn't pay to accept. Harvard's job as long as the flow of gifts keeps coming will be to sort the useful from the over-expensive, and to try to convince people who do have money to give away that what we need is general University funds, not specially-tagged and designated gifts.

The second basis for a limited optimism is the ability of the University, in the event not too many factors go wrong, to exist on its tuition and its income from investments alone without any further additions to the $161,148,961.65 capital which Harvard has now. The ifs involved are chiefly the maintenance of the level of income from investments on a reasonably stable level and the ability of the University to continue as it has for three hundred years to entice students into its halls.

Without a steady flow of investments, it is true, Harvard will not be able to expand further. With a few extra million dollars and the prospects of more in the offing, the Administration could draw up a scholarship program that would reach an entirely untouched stratum of the population. Such worthy experiments as the Nieman Fellowships and the Littauer Center would profit by enlargement. But, possibly with a longing sigh for the glories that it might achieve, the Administration must forget expansion and stick to balancing the budget. With only tuition and income to go on, it will have plenty to worry about just doing that.

The rate of income from the University's present endowments depends on more factors than anyone, let alone the Crimson, can foresee. Dividends from the half of University investments in stocks, for instance, probably won't go up despite the defense boom. In fact, they're likely to go down on account of increased taxes. As for the bonds, which comprise the other half, not even the Harvard Economics Department knows what is going to happen to their interest rate. Suffice it to say that the University doesn't seem to be worried on the score of its invested funds.

Maintenance of a full quota of students is certainly the major problem. So far the draft has radically affected only the Law School, which unfortunately depends more on tuition than any other branch of the University, and the Graduate School of Arts and Sciences. What will happen to enrollment in case of war, nobody can even guess, although the example of England leaves hope that the College will not be too hard hit. But all during the emergency and after it as well, the problem will be one of lowering expenses so that tax-hit fathers will be able to stand up under term bills. The anti-draft shortening of the collegiate four years to three has hardly begun to be recognized as a potential permanent means of lowering costs and saving time. Living costs, the major bloc in a student's expenses, can take some severe cuts; the dining hall price reduction is barely a beginning. This subject, however, will entail a separate discussion.

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