Waste of the Day: Harvard Relies on Government Funds

Topline: Since 2017, Harvard University has received more money from the federal government than from its own students’ tuition, according to OpenTheBooks’ review of spending data.

How Harvard grew dependent on government

Key facts: Harvard actually received more federal grants and contracts during Donald Trump’s first term ($2.4 billion) than Joe Biden’s ($1.9 billion). With another $106.8 million spent already this fiscal year, the university has accepted $4.4 billion in less than nine years.

Harvard’s self-reported charges for tuition and room and board total less than that, not considering loans and financial aid.

The Department of Health and Human Services awarded the most to Harvard by far — $2.6 billion. The National Science Foundation dgave $418 million, and the Department of Defense spent $357 million, among other agencies. 

Harvard has also reported $1.1 billion of foreign contracts and gifts since 2017, including $102 million from China, $78 million from Hong Kong and $1.6 million from entities within the “Palestinian territories.”

The school spent $2.9 billion on payroll in 2022, with 23 employees earning more than $400,000. Then-president Lawrence Bacow took home $1.3 million.

Search all federal, state and local government salaries and vendor spending with the AI search bot, Benjamin, at OpenTheBooks.com. 

With its endowment, Harvard is subject to a new tax

Background: President Donald Trump has already frozen over $2 billion of funding for Harvard and promised to take away the university’s nonprofit status if it does not end diversity, equity and inclusion initiatives, derecognize pro-Palestine student groups and more.

Harvard’s nonprofit status allows it to pay a tax of just 1.4% on gains to its endowment instead of the typical 20% capital gains tax for wealthy individuals. It helped the school grow its endowment from $39.2 billion in 2018 to $53.2 billion in 2024. 

So while the university bills taxpayers, it’s sitting on over $2.5 million per student. The 2017 Tax Cuts and Job Act considers universities with endowments worth more than $500,000 per student as being wealthy enough to pay a new tax.

Supporting quote: A Harvard spokesperson told ABC News there’s no “legal basis” to strip its nonprofit status.

“Such an unprecedented action would endanger our ability to carry out our educational mission,” the spokesperson said. “It would result in diminished financial aid for students, abandonment of critical medical research programs, and lost opportunities for innovation. The unlawful use of this instrument more broadly would have grave consequences for the future of higher education in America.”

Summary: Even though Harvard is a private university, it still has an obligation to the taxpayers who are funding most of its operations.

The #WasteOfTheDay is brought to you by the forensic auditors at OpenTheBooks.com

This article was originally published by RealClearInvestigations and made available via RealClearWire.