This week my Alma Mater, the University of St. Gallen, announced that Alumnus Joe Ackermann, the former chairman of Deutsche Bank, would sponsor a new chair for “Business Economics and Public Policy”. On 29 September, my other Alma Mater, Yale University, announced the largest donation ever received in its 312-year history, by Alumnus Charles Johnson, former chairman of Franklin Resources Inc. Mr. Ackermann’s gift is worth about 500’000 Swiss francs per year. Mr. Johnson’s gift is worth 250 million US dollars. The reaction of the Yale community was unequivocally marked by excitement and deep gratitude. The reaction of the University of St. Gallen was unemotional and matter-of-fact. Why? Not because it didn’t appreciate the relatively humble gift of Mr. Ackermann. It kept a low profile because a public display of gratitude would have backfired badly. It would have hurt the university’s image and might even have jeopardized the donation itself. Even so, I’m pretty sure that it’s still causing them a major headache.
What seems paradoxical by any standard of reason is in fact completely unsurprising given that public opinion in Switzerland follows a different logic on this subject. You might argue that Mr. Ackermann is a controversial figure, but that’s not the point. Rather, there’s general, deep-seated distrust and resentment against private meddling in the education system. When UBS donated 100 million francs to the University of Zurich’s economics department in early 2012, the fallout was massive. And it hasn’t abated, partly thanks to recent reporting by a German newspaper stating that the university is being whipped into submission by UBS to advance some kind of hidden agenda. If it only were that simple.
Swiss universities are unique in that they are largely publicly funded, charging almost nothing in tuition, yet maintain a very good level of teaching and research despite moderate budgets. That’s why enrollment numbers, including form abroad, keep rising, adding a lot of new costs to the equation that can’t be absorbed by the government alone. In a sense, Swiss universities have become victims of their own success. And that’s where Mr. Ackermann and UBS ride to the rescue, one would assume. Well, most people, including students, seem to think differently. In Zurich, the 100 million bounty was met with protests, conspiracy theories and administrative appeals. It almost seems as if people would rather keep the education system underfunded based on some ludicrous ideological pretexts, than be thankful for much needed financial support. Oh, and besides, students don’t want to pay for it either. That’s the role of government. It is frankly baffling to me that bright people have a sense of entitlement towards higher education that is only matched by their ignorance for the actual privilege (and hence cost) it represents. Maybe it’s the standard of living that’s made them so arrogant and distorted their sense of reality. What’s also poorly understood is the fact that education is a private good: it accrues to the recipient first and foremost, so he should bear at least part of the cost. If he doesn’t, then third party funds need to make up the shortfall, but something’s gotta give.
I don’t contest that conflicts of interest are possible. But there are checks and balances: committees, boards and administrators deliberating extensively on the acceptance of a gift. We should have some faith in them making the right call. After all, this is Switzerland, not Belarus. The notion that private benefactors of higher education have low motives is not only ridiculous, it’s also insulting. It surely is fashionable to take the moral high ground and make a mockery of every ethical, moral and academic principle out there by using it to build a flimsy case against the corporate or private sponsorship of universities. But it’s fanciful and intellectually dishonest. And it’s a sure-fire way to discourage good intentions – in future, benefactors of higher education will think twice before giving, with tangible consequences for everybody involved. It’s about time that free education advocates get educated on their favorite subject. Either pay up for the privilege or stop biting the hand that feeds you.