NPR logo

Yale to Tap Its Endowment in Student Aid Overhaul

  • Download
  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript
Yale to Tap Its Endowment in Student Aid Overhaul


Yale to Tap Its Endowment in Student Aid Overhaul

  • Download
  • <iframe src="" width="100%" height="290" frameborder="0" scrolling="no" title="NPR embedded audio player">
  • Transcript


Changing the subject now - more good news today from middle-class families hoping to finance an Ivy League education. Yale University has announced that it will follow Harvard's lead and overhaul its financial aid system. Like Harvard, Yale plans to dip into its multi-billion dollar endowment to do it. And the plan is expected to resemble Harvard's, which caps tuition for families earning up to $180,000 at 10 percent of their entire earnings. A number of elite schools are making changes in their financial aid plans. I asked Eric Hoover of the Chronicle of Education, why.

ERIC HOOVER: One answer is simply that there is genuine concern. There is a concern about the future of higher education, about the future of classes - what are they going to look like, are they going to be representative more so or less so of the diversity of the United States at a time when the population is becoming more and more diversed.

NORRIS: So a concern about what some might call the bow tie effect. That you have a lot of students who are on full financial aid, a lot of wealthy students, but not a lot of students in that little category of the middle class.

HOOVER: Absolutely. A number of admission deans have cited quite publicly about that shrinking middle or the pinch in the middle, however you want to define it. Certainly, that concern is genuine. At the same time, there are other issues in play. Here in Washington, the United States Senate recently held a hearing on endowment spending rates. And so there's interest on Capitol Hill in how colleges and universities spend their money.

BLOCK: So Eric, if the schools are sitting on these big fat endowments, why don't they just lower tuition for everybody?

HOOVER: That's a very good question. I think in this country, there's a - and in Harvard, there's an old soul that's hard to let go of and that is you get what you pay for.

NORRIS: So there might be this perception that if Harvard lowered its tuition that the quality of the education would diminish as well.

HOOVER: I think there's something to that because, you know, Harvard and Yale are the Rolls-Royces of what they do, and they spend a lot of money recruiting the best faculty and scholars to do research and to teach at their institution. They spend a lot of money to build the best facilities to house that research and to house their students and provide the best experience they can, not only to their students but to their faculty and staff, and those things cost a lot of money. So I do think there is something to that idea that if we were to roll back the price tag that you see dangling from these elite institutions, well, would that compromise quality in any way?

I think - as with many things, perceptions in higher ed shape a great deal of reality.

NORRIS: Will this make it hard for small, private little art schools to compete with Harvard now?

HOOVER: I think that is a real concern. And some officials from smaller institutions, less wealthy institutions have expressed that concern. And some experts believe strongly that while this may be good for Harvard and Yale and their ilk, it puts other institutions in a bind, and that's simply because they do not have the resources to compete across the board in the financial aid packaging game with the richest colleges.

NORRIS: So what can schools do? I mean, it sounds like it is having a catalytic effect - some schools are making changes.

HOOVER: Some schools are making changes. I think it's just a matter of scale. I think those schools that can afford to use their endowments in a way to provide better opportunities for lower and also middle-income students, they will do that. But again, you know, schools that just can't, that operate with much, much smaller endowments, who are much more dependent on their tuition and/or from state assistance, they're going to have to make hard choices because it's going to go harder in competing for more top students, by putting more money in to merit(ph) awards.

That money that they're putting out is going to come out of other places. That's why you hear, not necessarily resentment, but some healthy skepticism or at least plea for perspective from the presidents and admissions deans at schools who are just below or well below that top wealth tier that Harvard and Yale are in.

NORRIS: Eric, thanks so much for talking to us.

HOOVER: Okay. Thank you for having me on.

NORRIS: That was Eric Hoover, he's a writer with the Chronicle of Higher Education.


You're listening to ALL THINGS CONSIDERED from NPR News.

Copyright © 2008 NPR. All rights reserved. Visit our website terms of use and permissions pages at for further information.

NPR transcripts are created on a rush deadline by Verb8tm, Inc., an NPR contractor, and produced using a proprietary transcription process developed with NPR. This text may not be in its final form and may be updated or revised in the future. Accuracy and availability may vary. The authoritative record of NPR’s programming is the audio record.