Lots of Money, Little Return


Lots of Money, Little Return

Oct 15th, 2003 2 min read
Edwin J. Feulner, Ph.D.


Edwin J. Feulner is the founder and president of The Heritage Foundation.
Caveat Emptor. Let the buyer beware.

These have always been sensible words when shopping for a car. But these days, sadly, they also apply to charitable giving.

Consider the case of William Robertson, who is suing his alma mater, Princeton University, over the school's handling of the $525 million Robertson Foundation.

Robertson's parents set up the foundation at Princeton in 1961 with an initial gift of $35 million. Their objective: "to strengthen the government of the United States and increase the ability and determination to defend and extend freedom throughout the world by improving the facilities for the training and education of men and women for government service."

The amount of money in the foundation has grown substantially over the years-but not the number of Princeton students entering government service.

These days, the university says only about 44 percent of foundation-supported students who earn master's degrees accept public-sector jobs. But even that number is inflated. Princeton reaches it by including jobs in journalism, academia and non-profit organizations in its tally.

In reality, only nine of the 63 students who graduated from the program last year entered government service. Just three of those students had majored in international studies. Clearly the program isn't paying the dividends its founders intended.

That's all right with Princeton. In court documents, the university claims the foundation has an "evolving mission."

But it's not acceptable to William Robertson. That's why he's gone to court. He wants to regain control of this fortune and distribute it to other colleges and universities that will use it for its original purpose.

Princeton, it would appear, just wants the money.

The university would like to roll the foundation's cash into its $8.3 billion endowment. In fact, Princeton has already used the foundation as its own piggy bank.

In 1997, the university spent more than $13 million of foundation money to build Wallace Hall. Today that building houses segments of the Woodrow Wilson School, but also the sociology department, the "Office of Population Research" and the "Center for Research on Child Wellbeing."

All these may (or may not) be worthwhile programs. But as William Robertson points out, "if my parents had intended the money to go to Princeton University, they would have given it directly to Princeton." They clearly wanted the money to be invested in government service, and it's not being used that way.

This isn't the first time that a Robertson has questioned Princeton's motives. William's father Charles complained repeatedly in letters to Princeton officials that too few graduates were going into government service. The school managed to placate Charles, but not his son. He has gone to court in order to redeem his parents' legacy.

Good for him. These days, the only way for donors to make sure their wishes are respected is to personally check out how their money is being used. Consider one of the most effective charitable organizations, the Bill and Melinda Gates Foundation. It's focusing its work on Africa, so the Gates' traveled there recently to make sure their money was being well invested.

On the other hand, look at the Ford Foundation. In 1977, Henry Ford II resigned from its board, because he believed it was no longer working toward the goals his grandfather founded it to achieve.

Instead of stepping down, William Robertson has decided to stand and fight-and insist that a powerful university respect his parents' wishes. It should serve as an example for all of us. These days, buyers-and donors-must be as tenacious as they are wary.

Ed Feulner is the president of The Heritage Foundation.