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Over the past few months, congressional scrutiny of elite colleges has helped to push out the top leadership at two major campuses. Now, lawmakers are undertaking efforts that could hit the schools more fundamentally –- in their wallets. 

In December, Republican members of Congress introduced multiple bills that, if passed, would block certain colleges from receiving federal funding and up the taxes some schools pay on their endowments. 

The House Committee on Education and the Workforce also launched an inquiry into the way certain universities handle antisemitism on campus, which has the potential to result in funding consequences for schools, depending on the findings. The efforts come amid focus from the media, business leaders and others on the way colleges, particularly, elite, name-brand schools, have handled campus protests surrounding the Israel-Hamas war. 

The initiatives also come following years-long efforts by conservative lawmakers, both at the state and federal level, to target campus culture, whether it’s schools’ approach to diversity, equity and inclusion, or DEI, the political leanings of faculty and more. Rep. Virginia Foxx, a North Carolina Republican and the chair of the Education and Workforce committee, said in an interview that her panel’s investigation is focused on antisemitism “right now.” But she cited concerns about schools’ approach to DEI and its impact on students and faculty. 

“We know that there’s a lot to be looked at in these institutions and we’re going to follow where they lead us,” she said.  

Among the documents the committee requested from Harvard University’s leadership as part of the inquiry: Materials related to the “madnate, size, budget, agenda and performance metrics of the Harvard Office of Equity, Diversity, Inclusion, & Belonging,” and any similar offices since October 7. 

Perhaps helping lawmakers’ case that elite colleges deserve increased scrutiny: A loss of public confidence in the value of a college degree, amid rising costs and student debt. Just 36% of Americans had a “great deal” or “quite a lot” of confidence in higher education, according to a Gallup poll published in July, down from 57% in 2015. 

Of course, the past few months isn’t the first time colleges have drawn Congress’s ire — think campus protests during the Vietnam era or the Red Scare, when college professors were a target of McCarthyism. 

Still, the focus is “sort of greater in scale than in previous years,” said Chris Marsicano, an assistant professor of education at Davidson College. 

“There is a push among a certain subset of the electorate, not just on the right, but on the left as well, to hold these institutions to greater account,” he said. 

‘Worst fears of lobbyists’

There’s a mix of reasons why that’s the case, said Marsicano, but part of it is that nonprofit colleges enjoy a relatively light regulatory touch as compared to some other large sectors, like the financial or energy industries. Their endowments are generally allowed to grow tax-free and the major lever the government can use to change their behavior is a threat to withhold federal funds, whether research or financial aid dollars — which rarely materializes. 

The first major incursion in recent years into this regulation-free status was the Tax Cuts and Jobs Act signed by then-President Donald Trump in 2017, according to Marsicano. That law subjected universities to a 1.4% tax on their net investment income if they enroll 500 students and have an endowment value that exceeds $500,000 per student. 

In 2017, higher education lobbyists worried that the law would “open Pandora’s Box” for regulation on colleges, Marsicano said. 

“The worst fears of lobbyists for higher education institutions back in 2017 are coming to fruition,” he said. 

The bills introduced recently include a measure from Rep. Dan Crenshaw, a Texas Republican, to ban colleges that require students to write DEI statements from receiving federal funding and legislation from Senator Tom Cotton, an Arkansas Republican, to levy a 6% tax on the endowments of ten elite private colleges, and use the money to provide military funding to Israel and Ukraine. 

Senator J.D. Vance, an Ohio Republican, also introduced a bill that would raise the excise tax on university endowments with at least $10 billion in assets under management from 1.4% to 35%. 

Foxx said that depending on the findings of the committee’s investigation they will be in communication with the Department of Education’s Office of Civil Rights. That office can issue enforcement actions in cases where they find institutions violating a law requiring that schools that receive federal funding create an environment that is free from discrimination. Those enforcement actions can include financial consequences for schools. 

When asked whether schools could face financial penalties as a result of enforcement actions that arise from the panel’s inquiry, Foxx said, “there could be.” 

“We’ve got to let these investigations play to see how much we can find out about what’s been happening,” on campus, she said. 

The House Ways and Means Committee also recently requested information from the leadership at Harvard, MIT, the University of Pennsylvania and Cornell, citing concern about the schools’ approach to anti semitism on campus, DEI initiatives and free speech. 

“These specific incidents add to ongoing concerns that ‘elite’ American universities are failing to provide instruction beneficial to individuals or the community and are instead instructing students to have disdain for the United States and the very communities they live in,” the letter reads. “Ultimately, as the U.S. House Committee with primary jurisdiction over tax-exempt institutions and the treatment of their endowments, we are left to wonder whether reexamining the current benefits and tax treatment afforded to your institutions is necessary.”

Finally, the current version of a bill to expand the Pell-grant program, which provides money to low-income students to attend college, to include short-term career training programs would block colleges subject to the endowment tax from receiving federal student loan money. The bill has bipartisan support. 

Partisan divide

Given the partisan nature of some of these measures, it’s unlikely they’ll actually make it into law. Nonetheless, the intensity and the amount of attention from lawmakers on colleges right now is “significant,” said Jon Fansmith, senior vice president, government relations and national engagement at the American Council on Education, a higher education lobby. 

He sees it as part of a partisan divide around higher education that’s grown over the past decade. While Democrats have been focused on the cost of college and student debt, Republican lawmakers have pointed to campuses as sights of culture war battles. 

“Some of that combined,” with the debates on campus surrounding the Israel-Hamas war, “in some cases has probably given rise to expressing [legitimate] concerns, in other cases provided an opening for people who are already critical of higher education to find a target to go after.”  

A recent Trump campaign ad highlighted the ways in which worries about antisemitism on campus, college diversity initiatives and the cost of college can combine to create a potent political message. Trump proposed taxing university endowments to create a new institution called the American Academy that would award bachelor’s degrees and other credentials free of charge. 

“In recent weeks as Americans have been horrified to see students and faculty at Harvard and other other once-respected universities expressing support for the savages and jihadists who attacked Israel,” Trump said in November. “We spend more money on higher education than any other country and yet, they’re turning our students into communists and sympathizers of many many different dimensions. We can’t let this happen, it’s time to offer something dramatically different.” 

Colleges and universities aren’t above reproach, according to Fansmith, but what lawmakers are focused on in this “current moment is this handling of free speech and debate on campus,” and how schools draw the line between what is protected free speech and what could create an unsafe environment for students on campus. 

“There are some very, very unfair efforts to try and oversimplify these incredibly difficult things,” he said. 

Still, there is an audience for this approach. Given Americans’ current ambivalence about higher education, criticizing the sector broadly and elite colleges specifically can help lawmakers score political wins. 

Maraschino noted that there have been incidents of alleged anti semitism at a wide swath of campuses in recent months, but there’s a reason lawmakers focused their attention on the presidents of a handful of institutions at a recent congressional hearing on campus antisemitism. 

These presidents were selected in part because they are the elite, they are the institutions that most people look to and are interested in seeing in the U.S. News rankings,” he said. 

The focus on a small group of institutions both at the hearings and in the legislation belies how little they represent the experience of college students and faculty across the country, Fansmith said. 

The schools “are used because they are seen as different,” he said. “That’s why we see so much of the attacks directed there.”  

By contrast, Americans tend to think fondly of colleges they have experience with, whether it’s their state or local public college, or the school they attended. 

And if pressed, they would likely support the schools that are targets of attack under some circumstances. 

“If you ask most families in America whether they want their kid to go to Harvard, to be accepted to Harvard, the answer is probably yes,” Marisicino said, noting that some of the lawmakers sponsoring bills targeting elite colleges attended institutions like Harvard and Yale. “Many of those attacking Harvard, in fact, went to Harvard, many of those attacking higher education institutions attended higher education institutions.” 


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