I was originally going to post that sometimes I wish gifts like this would be given to smaller, less fortunate schools. A top tier school like CMU is always going to be able to find new sources of endowment. I still believe this in general. However before reading the previous comments, I had no idea how small CMU's endowment was compared to other top tier universities. If the numbers I read are correct, CMU's $815 million is only 2.97% of Harvard's $27.4 billion. Not nearly what I assumed it was.
CMU made some very big announcements (big to students at the school) in 2007 when their endowment broke $1 billion for the first time ever. And then 2008 happened.
According to Wikipedia, CMU currently has an endowment of $815m so rather huge donation. I was actually surprised by this. For some reason I thought CMU had one of those endowments where $250m gets a urinal named after you.
I'm a CMU alum, and I asked about that once when they were mentioning "space naming opportunities". Very roughly and unofficially speaking, $50,000 gets you a classroom, $1,000,000 gets you a floor or wing, and $20 million gets you a department. Apparently $265 million gets you a college.
For those interested, here's a list of the actual valued naming opportunities. Although, it doesn't include anything about naming spaces. (Scroll to the bottom) https://www.cmu.edu/campaign/about/endowment.html
The Tepper School of Business is a college at CMU just like the newly-named Marianna Brown Dietrich Humanities and Social Sciences college. The colleges contains departments such as English, Philosophy, etc.
Right. This was something I remember was discussed quite a bit while I was a student there. CMU has a small endowment compared to the more established private colleges it is increasingly competing against.
Harvard: 27.4 billion
Stanford: 13.9 billion
MIT: 8.3 billion
Etc.
They weren't hit as bad yes, but they suffer in many other ways from their small endowment. It's one reason why they have one of the highest tuition costs of any university.
Mayber they "were not hit as bad" in absolute dollars but their endowment was over $1 billion in early 2008. 20% seems like a pretty darn big hit to me.
I don't know about 'official', but it's highly likely that the Chronicle of Higher Ed/Chronicle of Philanthropy are the most referred to. Here's a list from 2008:
I think (and I may be wrong) - he gets to write off the donation now (probably amortized) to help his tax basis even though the $ doesn't go anywhere until he's gone...
Yes, this is something I talked about with an estate attorney when we had kids and were setting up a living trust. Basically you can create an entity called a charitable trust which is a gift to a third party, that transfers on your death, and avoids estate taxes. What is more interesting is that many of these are more durable than language in one's will, specifically the will can be challenged and thrown out but a charitable trust won't get screwed because of it.
From the language I'd guess they might be setting up a charitable lead trust or gift annuity, where he'd actually be giving he money now but will continue to draw an income from it over the rest of his life. I'm fairly far removed at this point from a former career in university advancement though - that would certainly be much much larger than any I'd heard of before. There's probably also a fair chance he's already set up or is now setting up an independent foundation or trust that the money will reside in.
It's (I'd guess) fairly unlikely this is a standard bequest, though, given both the revokability and uncertain future tax status of that option. I imagine it would also take multiple years for an estate of that size to close and the funds to become available to CMU.
In terms of "why" of now, well, he gets to live for however much longer seeing his mom's name on a school that obviously means something to him, and as CMU is doing a big campaign, he gets to be a linchpin of that.
Always amazes me that there are people out there who have $265mil to give that you can barely find anything about on Google. (Bill likely has a lot more too, as he is expected to give a very large gift to the University of Pittsburgh).
What surprised me even more was that it was only the 14th largest donation in history made to higher education. Here's the list if anyone else was wondering: http://chronicle.com/stats/big_gifts.htm
King Abdullah's is not a donation or an endowment. It's a drop in the bucket; the royal family giving to the people less than a fraction of one percent of what they looted from the country, and its wealth.
Wow, just looked at his book, "In the Shadow of the Rising Sun: The Political Roots of American Economic Decline" (published in 1991, at the time when Japan was today's China...), and this guy is about as far away from my libertarian worldview as you can imagine. He believed that America's problem at the time was that it didn't have enough bureaucracy (which is especially ironic given how bureaucratic gerontocracy today is believed to be stifling Japan's growth). Hope his donation will do some good though.
> And this guy is about as far away from my libertarian worldview as you can imagine.
There is something really funny about a guy with a 'not so libertarian' worldview donating 265 million to a university and a guy with a libertarian worldview that probably will never be in a position to do so commenting on that.
People have a horrible misunderstanding of libertarianism. Libertarians believe people should be absolutely free to do what they want with their money. Libertarianism is not a fancy word for narcissistic hedonism. From a philosophical standpoint, libertarians should welcome charity/philanthropy as it is a free market solution to dealing with society's problems. They are merely against forced charity (i.e. welfare, medicaid, etc.). Mr. Dietrich's donation fits perfectly within a libertarian framework. Sorry to ruin the joke, but there's no hidden juxtaposition there.
They spend a lot of time advocating public good solutions I consider unworkable due to free rider problems. I'm cynical enough to be pleasantly surprised when a libertarian demonstrates they aren't hoping to become a free rider.
That's not libertarianism. Libertarianism strongly supports private charity; it's government charity it's opposed to. Private charity is how it's supposed to work.
Well played, sir. A fine and timely rebuttal! Less courageous souls might choose to pick on older material - say from the 60s or 70s - so as not to be accused of carefully picking out material that can be dealt with through the magic of hindsight, but not you.
I will keep a keen eye out for further highly relevant dispatches from your "libertarian worldview" on other recent events, such as Operation Desert Storm, the dissolution of the Soviet Union, the release of not one but two Use Your Illusion albums from Guns 'n' Roses, and the release of the SNES gaming system.
