This past January, Columbia Law School suddenly realized that it had lost $3 million to Bernie Madoff's dark dealings. How this happened is no mystery—anonymous donors wished to retain the right to invest their gifts independently, and the University, after some consideration, allowed this. In the big picture of a $5.7 billion endowment (by June 2009 preliminary unaudited figures), a $3 million hit does not seem so horrible. However, when one looks a little more closely at the system of gifts and donations at Columbia, the individually logical and straight strings mix and mash into a nauseatingly intractable Gordian knot.
While the losses to Madoff may not seem to amount to much in absolute terms, the simple fact is this: we do not know the actual impact of the losses. Columbia does not offer a breakdown of its endowment allocations by school. Gift-givers also retain certain rights to attach strings to their donations—often just scholarship or naming directions, but there are notable exceptions. Namely, certain institutes or programs of research at the University may be funded in part or primarily by gifts (by 2007 numbers, only approximately $355 million of the endowment is spent yearly to maintain such programs, accounting for less than13% of the University's funding).
Granted, universities often choose to turn down gifts with strings shaped as nooses—Yale is a notorious example, having turned down $20 million in 1995 for a Western civilizations program when the donor stipulated that he would review all professorial candidates. But often gifts are simply accepted and become the basis for nascent and innovative university programs, as in June 2008 when Leonard Tow offered a possible $5 million for the Journalism School to sink into a new program on Internet journalism. By Columbia's own policy, a donation of $1 million is enough to garner naming rights and to institute basic programs at the University. This is also, conveniently, the average level at which, according to Charles Gordon of Bank of New York's Planned Giving Services in 2006, donors begin to attach serious strings to their money.
Three points here trouble me.
One: Even before the recession, the trends shown by the Council for Aid to Education indicated that the value of donations to universities was increasing, but that fewer people were making donations. Now, I worry that with a smaller pool of donors the University may see fit to court tricky, picky, and stringy donors for the large sums needed for certain programs. Could it be that the continual need, decreased pool, and trend towards restrictions will limit or alter Columbia's path as an institution? Probably not in any major way—we do have a cushion for vital programs. Still, the observant student will notice that EMS, among other small and unique programs, took a serious financial hit this year.
Two: Columbia, to my understanding, seemed to find out about its Madoff losses considerably after the fact. The managers of Columbia's gifts seem extraordinarily slow to act. Consider the discouraging case of the Wallach Art Gallery (thanks to my friends at The Blue and White for this reporting) . Hidden somewhere under Uris, the art gallery is the symbol of slow gift action and, consequently, of donor dissatisfaction. In the 1960s, Columbia's donated arts collection was amassing into a planned museum, but the 1968 riots shut down the program and now many pieces donated under the assumption of the museum's completion sit in grim isolation beneath the earth. I cannot speak with certainty, but I am willing to bet that this inability to react and to satisfy donor assumptions has stunted certain acquisitions programs.
Three: Columbia, for the most part, rightly hides openly or by omission the identities of certain donors. This may be a reasonable bit of privacy in some instances, but there is a balancing act. Consider the case of Casa Italiana—myth has it that the building was created with Mussolini's money. Or the 2004 rumors that anti-Semitic Arab parties were anonymously funding the Edward Said Chair of Middle East Studies. In both cases, anonymity hurts Columbia, adversely affecting our chances of garnering future donations.
It's a tough routine, balancing current need with donor limits and trying to maintain total control of one's own institution. Still, to strum my old harp, a little transparency in the University's dealings—say, the release of an itemized list of declassified gifts and acquisitions made to Columbia over the last year—could certainly help in image control, in popular understanding, and in lighting a fire under some bureaucrat's ass to liberate the Wallach Art Gallery.
Mark Hay is a Columbia College sophomore. Unusual, Unseemly, or Unnoticed runs alternate Fridays. firstname.lastname@example.org