Some college endowments reach into the billions and because they’re non-profits they get tax breaks.

Minding the Campus notes that endowments are becoming political targets.

Top College Endowments Are Political Targets Now

One of the pillars of our education establishment, The Education Trust, recently published a report meant to pressure colleges and universities with large endowments into spending more of their earnings on one of its pet causes – very low or even free tuition for students from poorer families. The study, “A Glimpse Inside the Coffers: Endowment Spending at Wealthy Colleges and Universities,” claims to show that these institutions “aren’t doing nearly enough” to help such students.

To cite just one example from the report, suppose that the University of Pennsylvania were to raise its endowment spending up to Education Trust’s recommended five percent level – and spent all of the additional money on reducing tuition for poor students. By doing that, Penn could double the number of low-income students entering the school, from 109 per year to 218 per year.

Now, I am no fan of the way our colleges and universities that have gigantic endowments choose to spend their money. I think that too much goes toward the student amenities arms race, toward the hiring of unnecessary administrators who have to pretend to be busy at jobs such as “Vice President for Diversity and Inclusion,” and toward luring “star” faculty members who don’t teach much, away from other schools. But just because they waste a lot of money already is no reason to favor Education Trust’s plan.

Here is the fatal flaw. Going to an elite, high-cost college is little or no better than going to a lower-cost, non-elite one. Sometimes, in fact, students (no matter their family’s finances) get a superior education at a non-prestige school where there are fewer distractions and where the faculty pays more attention to the undergraduates.