On Sunday, hundreds of students completed their undergraduate studies and became Morehouse Men and Spelman Women. It was only two years ago, during the same occasion, President Barack Obama delivered the Morehouse College commencement address. But by August of that year, Morehouse was in a state of serious financial crisis.
John S. Wilson, then the newly elected Morehouse president and former executive director of the White House Initiative on Historically Black Colleges and Universities, announced a $2.5 million cut from the school’s operating budget and the elimination or downgrading of 75 administrative positions.
Many public HBCUs were founded under the insidious Jim Crow system intended to enable historically white institutions to avoid desegregation. HBCUs have continued to disproportionately serve many low-income and first-generation college students well into the post-civil rights era. The schools have been a vital source of black professionals, including physicians and scholars.
While most state colleges can experience ebbs and flows of financial challenges tied to federal funding cuts in higher education, HBCUs have been particularly vulnerable in the era of austerity politics. Their situation has become grim over the last five years.
After the U.S. Department of Education made changes in 2011 to the length of time Pell Grants can be used by college students, followed by more stringent parameters attached to the Parent Plus Loan program in 2012, the damage to HBCUs had already been done. Not only were enrollment figures adversely affected, with some students forced to drop out mid-semester, but the changes may end up costing HBCUs’ limited school endowments hundreds of millions of dollars.
As punitive reforms continue to permeate U.S. education policy, the general attitude seems to be if HBCUs cannot support themselves independently, they should just be eliminated entirely. If they are to survive, the underlying sentiment is to rely on alumni giving to avoid financial disaster.
But a look at the top 10 HBCU versus endowments at historically white colleges reveals staggering differences. The top 10 HBCU endowments range from $38 million to $586 million, while the top 10 historically white college endowments range from $6 billion to $32 billion. The endowment gap between historically white colleges and universities and HBCUs has doubled in the last 20 years.
The overwhelmingly black alumni base does not have the wealth capacity to “save” HBCUs. The typical black family holds about $7,113 in net worth, more than $100,000 less than the typical white family and a mere 6 cents for every dollar of wealth held by the average white family.
In his aptly titled book, “When Affirmative Action Was White,” historian Ira Katznelson documents the great political compromise that led to the wide-scale, intentional exclusion of blacks from New Deal Post-Depression and World War II public policies that were largely responsible for the asset development of the white American middle class.
The compromise to persuade white Southern Democratic legislators to vote for transformative New Deal policies while maintaining a system of apartheid and white privilege included the exclusion of overwhelmingly black-dominated agricultural and domestic occupations from eligibility, the placement of benefit administration in the hands of local authorities hostile toward blacks, and the refusal of Congress to include anti-discrimination clauses in the administration of benefits.
As long as the dramatic racial wealth gap persists, enhanced black alumni-giving will not solve the HBCU financial crisis. Rather than empty rhetorical devices that burden low-resourced blacks to give more than they actually have, what is needed is a reversal of financial austerity policies that divert resources away from HBCUs, including punitive No Child Left Behind-like reform and more rigid eligibility standards in Pell Grants and Parent Plus Loans.
Indeed, full restoration of the Pell Grants alone would have a far greater positive impact on the health of HBCUs than placing a still harsher strain on their alumni’s limited resources.
Carolyn Ash is managing director of Ash Consulting Group, which helps guide the efforts of schools committed to diversity, equity and inclusion. Darrick Hamilton is in the Milano School for International Affairs, Management and Urban Policy and the Department of Economics at the New School and president-elect of the National Economic Association. Also contributing were Alan A. Aja, deputy chair in the Brooklyn College Department of Puerto Rican and Latino Studies, and William Darity of the Sanford School of Public Policy and the Departments of African and African American Studies and Economics at Duke University.
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