WEBVTT - Food Fight 0:00:15.356 --> 0:00:15.796 Pushkin. 0:00:18.796 --> 0:00:20.956 The first week I arrived, I was met at the 0:00:20.956 --> 0:00:24.836 back door by local folks who were bringing in flats 0:00:24.876 --> 0:00:27.876 of blueberries, and it was just it was remarkable. 0:00:28.556 --> 0:00:32.276 That's Ken Cardon speaking. He's the executive chef at Bowden 0:00:32.356 --> 0:00:35.756 College in Maine. In the world of American colleges, Chef 0:00:35.796 --> 0:00:38.156 Cardon's food holds a special place. 0:00:38.396 --> 0:00:41.636 So you've consistently make the top nomber one spot on 0:00:41.676 --> 0:00:44.956 the lists of best college food. What are a couple 0:00:44.956 --> 0:00:47.116 of things that you think sets Boden apart? 0:00:47.316 --> 0:00:50.236 And that's Jacob Smith, one of my producers. He went 0:00:50.316 --> 0:00:53.916 up to Maine for Revisionist History's first culinary investigation. 0:00:56.076 --> 0:00:57.796 Can you just describe what we're looking at? Here? 0:00:58.956 --> 0:01:01.636 Directly below us is a salad bar, and you'll notice 0:01:01.636 --> 0:01:06.076 in the center of the salad bar there's several prepared salads, entrees, salads, 0:01:06.236 --> 0:01:08.396 and then you have your make your own areas. To 0:01:08.436 --> 0:01:13.316 the right and left, there's homemade soups in vegan options, 0:01:13.756 --> 0:01:17.036 there's fresh fruits and desserts, and then you'll see there's 0:01:17.356 --> 0:01:20.356 condiments and toppings, and we actually make our own peanut 0:01:20.356 --> 0:01:24.796 butter and bake our own breads, and that's all available 0:01:24.916 --> 0:01:25.716 at every meal. 0:01:25.956 --> 0:01:29.516 My guess is your college wasn't like this. Mine certainly wasn't. 0:01:29.836 --> 0:01:32.716 And as you can see, we always have a vegan 0:01:32.756 --> 0:01:36.756 and vegetarian item for our hot soups, and today a 0:01:36.796 --> 0:01:39.556 favorite for launch is a hot turkey sandwich in arizo 0:01:39.716 --> 0:01:40.836 and tofu salad. 0:01:41.836 --> 0:01:44.756 I worked in my college cafeteria as an undergrad, and 0:01:44.996 --> 0:01:48.556 just remembering that fact now is bringing the smell of 0:01:48.596 --> 0:01:54.076 the dining hall wafting back grease, disinfectant, aging, mayonnaise, cold 0:01:54.116 --> 0:01:58.316 fried eggs, all in some horrible combination that was the 0:01:58.396 --> 0:02:01.756 nineteen eighties. I don't think that anyone properly understood back 0:02:01.756 --> 0:02:05.636 then how crucial healthy eating was to a positive learning environment. 0:02:06.396 --> 0:02:10.036 Bodin is in a whole different class like Paradise. 0:02:10.596 --> 0:02:14.156 The deli special today is a smashed chickpea, avocado and 0:02:14.236 --> 0:02:18.156 pesto sandwich, and we have a faro salad with aspiragus 0:02:18.196 --> 0:02:18.836 and parmesan. 0:02:19.116 --> 0:02:20.636 Cool. So can we take a look at the kitchen? 0:02:20.676 --> 0:02:21.556 Are we able to go back there? 0:02:22.836 --> 0:02:24.676 As you can see if you look down right here 0:02:24.676 --> 0:02:30.476 at at this area, we're preparing fresh rosemary is one 0:02:30.476 --> 0:02:33.396 of the ingredients in tonight's dinner, and they're cutting chicken, 0:02:34.036 --> 0:02:36.396 so everything really is done from scratch. 0:02:37.076 --> 0:02:38.276 It has that for us, all. 0:02:38.156 --> 0:02:45.716 Touch, fresh rosemary and the personal touch. But here's what 0:02:45.756 --> 0:02:48.636 I want to talk about. The food at Bowden is 0:02:48.676 --> 0:02:52.276 actually a problem, a moral problem. I don't mean this 0:02:52.356 --> 0:02:54.836 in any way as a criticism of people like Ken Cardon. 0:02:55.476 --> 0:02:58.476 He's very, very good at what he does. Jacob, my producer, 0:02:58.596 --> 0:03:01.556 is a massive foodie and he was impressed. It takes 0:03:01.596 --> 0:03:04.156 a lot to impress Jacob. Not do I mean that 0:03:04.236 --> 0:03:09.156 people students in particular shouldn't eat properly. They should. The 0:03:09.196 --> 0:03:11.516 point is at every choice we make, even if it's 0:03:11.556 --> 0:03:15.276 the right choice at that moment, has larger consequences, some 0:03:15.316 --> 0:03:19.716 of them unexpected and paradoxical, and Ken Cardon's amazing food 0:03:20.196 --> 0:03:26.276 is one of those things. My name is Malcolm Glauwell. 0:03:26.756 --> 0:03:31.956 Welcome to Revisionist History, my podcast about things forgotten or misunderstood. 0:03:35.076 --> 0:03:38.036 This is actually episode two of a little three part 0:03:38.116 --> 0:03:40.836 mini series I've dropped into the middle of Revisionist History. 0:03:41.556 --> 0:03:44.276 It's a re examination of one of the most fundamental 0:03:44.276 --> 0:03:47.276 ideas in American life that if you have some ability 0:03:47.316 --> 0:03:49.316 and work hard, you can make it to the top. 0:03:50.156 --> 0:03:52.756 The episode before this was about a kid named Carlos, 0:03:53.196 --> 0:03:56.196 a brilliant kid, and just how many obstacles stand in 0:03:56.236 --> 0:03:57.996 the way of his making it out of south central 0:03:58.036 --> 0:04:02.196 Los Angeles. This episode is about what it takes for 0:04:02.276 --> 0:04:04.716 a poor kid to get a good college degree, and 0:04:04.796 --> 0:04:07.276 strange as it may sound, campus food at a place 0:04:07.356 --> 0:04:12.636 like Bowden is a big part of that problem. The 0:04:12.716 --> 0:04:15.316 best way to understand this is to compare Boden with 0:04:15.316 --> 0:04:19.596 one of its competitors, Vassar College. Vassar is in Poughkeepsie, 0:04:19.756 --> 0:04:21.876 just north of New York City. It's a lot like 0:04:21.916 --> 0:04:25.436 Boden in many ways. They're both small, elite Northeastern Liberal 0:04:25.476 --> 0:04:29.356 arts colleges. Lots of students apply to both schools. They're 0:04:29.396 --> 0:04:32.636 in the same category, but there are also some differences. 0:04:33.196 --> 0:04:35.596 Vassar is a little bigger and edgier, a lot more 0:04:35.676 --> 0:04:40.116 dyed hair and tattoos. Boden is smaller and preppier. Boden 0:04:40.156 --> 0:04:43.356 also has more money, not a lot more, but enough 0:04:43.356 --> 0:04:46.596 that it matters. And then there's the issue of food. 0:04:48.996 --> 0:04:52.276 How's the food at Vassar? What you say, food? It 0:04:52.316 --> 0:04:56.236 could be better, you know, there's always room for improvement. 0:04:56.276 --> 0:04:58.676 The Saldar always makes me kind of sad like one 0:04:58.716 --> 0:05:01.876 time I was eating like a spinach kale stirfry that 0:05:01.996 --> 0:05:06.236 was prepared and I may or may not have found 0:05:06.236 --> 0:05:08.036 like an industrial size staple in it. 0:05:10.916 --> 0:05:13.756 The president of Vassar College is a woman named Catherine Hill. 0:05:14.276 --> 0:05:18.476 She's an economist by training. Tall, gracious, distinguished, a touch 0:05:18.476 --> 0:05:21.276 of gray, what you would expect from an academic leader. 0:05:21.876 --> 0:05:24.636 We met in her office on the Vassar campus, which 0:05:24.676 --> 0:05:27.756 is full of lots of Gothic greystone buildings and creaky 0:05:27.796 --> 0:05:32.876 oak staircases, huge double sash windows, ancient rugs, all very 0:05:32.956 --> 0:05:36.436 nineteenth century. Before she was at Vassar, Catherine Hill was 0:05:36.436 --> 0:05:39.916 at Williams College, about two hours north of Poughkeepsie. She 0:05:40.036 --> 0:05:44.236 was the provost. While she was there, Princeton dramatically expanded 0:05:44.276 --> 0:05:47.676 its financial aid, and suddenly every liberal arts college in 0:05:47.676 --> 0:05:50.996 the country felt it had to examine its policies as well. 0:05:51.276 --> 0:05:52.876 So we had to figure out what we were going 0:05:52.916 --> 0:05:56.596 to do in response to Princeton announcing that they were 0:05:56.596 --> 0:05:58.036 going to move away from loans. 0:05:58.236 --> 0:06:01.476 So Hill teams up with another economist and starts digging 0:06:01.556 --> 0:06:03.676 around in the data from the admissions office. 0:06:03.796 --> 0:06:06.116 A colleague of mine, Gordon Winston, and I asked the question, 0:06:06.156 --> 0:06:08.556 do we know what we're actually asking families to pay 0:06:09.316 --> 0:06:11.796 to come to Williams. So we'd always assumed that we 0:06:11.796 --> 0:06:14.956 were doing just, you know, a great job with talented 0:06:15.036 --> 0:06:17.996 kids from all different economic backgrounds. And what we found 0:06:18.036 --> 0:06:22.396 out was that we were asking students from lower income 0:06:22.476 --> 0:06:24.716 quintils to pay an awfully high share of their family 0:06:24.756 --> 0:06:27.876 income to come to attend. And we were also finding 0:06:27.916 --> 0:06:30.796 out that we weren't getting many, not surprisingly, you know, 0:06:30.836 --> 0:06:33.196 I think we were finding that we were asking families 0:06:33.196 --> 0:06:35.516 in the bottom forty percent of the income distribution to 0:06:35.556 --> 0:06:38.796 pay about fifty percent of their family incomes free tax. 0:06:39.196 --> 0:06:41.916 He'll saying that at that time, if the family of 0:06:41.956 --> 0:06:44.876 a poor, smart kid wanted their child to go to Williams, 0:06:45.236 --> 0:06:48.716 that have to spend half their income on tuition half. 0:06:49.476 --> 0:06:51.636 That's why there were so few poor kids at Williams. 0:06:52.356 --> 0:06:54.876 So while she's at Williams, the school starts making its 0:06:54.916 --> 0:06:58.596 financial aid a lot more generous, then He'll becomes president 0:06:58.636 --> 0:06:59.076 of Vassar. 0:06:59.356 --> 0:07:01.876 Vasser was an institution that was committed to these kinds 0:07:01.876 --> 0:07:05.436 of issues, and when we looked at the actual data, 0:07:05.476 --> 0:07:07.316 it turned out that compared to some of our peer 0:07:07.316 --> 0:07:10.116 schools we, in fact, weren't all that either in terms 0:07:10.156 --> 0:07:12.436 of socioeconomic diversity or racial diversity. 0:07:12.796 --> 0:07:16.756 So she decides to change Vassar's priorities. Students from the 0:07:16.796 --> 0:07:19.596 poorest families in the United States get a small five 0:07:19.636 --> 0:07:22.236 thousand dollars grand from the federal government called a pel grant. 0:07:23.036 --> 0:07:25.956 Hill decides she wants to accept way more pel grant 0:07:25.956 --> 0:07:28.436 students Advassor. So, what are you spending on financially? 0:07:28.476 --> 0:07:31.516 We're spending about sixty million dollars sixty million. Yeah, and 0:07:31.796 --> 0:07:33.556 when I started to know six it was about twenty 0:07:33.636 --> 0:07:36.876 five million. I see. So it's basically it's about double. 0:07:37.276 --> 0:07:41.116 And we have about twenty three percent pell grant recipients, 0:07:41.156 --> 0:07:44.756 which makes us, I think, the highest amongst a very 0:07:44.836 --> 0:07:47.276 large group of schools and the lowest income. 0:07:47.076 --> 0:07:50.356 Kids and pale. When you started, what was was it? 0:07:50.636 --> 0:07:52.436 I think I read eleven percent when you started. 0:07:52.836 --> 0:07:54.876 Yeah, you know, I'm not I'm not even sure we 0:07:54.876 --> 0:07:57.836 were tracking it, but it was in the low teens. 0:07:58.116 --> 0:08:01.396 That was ten years ago. Since then, Hill has discovered 0:08:01.396 --> 0:08:04.516 two things. The first is exactly what we talked about 0:08:04.556 --> 0:08:07.316 in the last episode. There's a ton of smart, poor 0:08:07.396 --> 0:08:10.316 kids out there. You can easily double the number that 0:08:10.396 --> 0:08:13.276 you accepted a school like Vassar and not compromise your 0:08:13.316 --> 0:08:16.636 academic standards. Okay, that's the first thing, the good news. 0:08:17.076 --> 0:08:18.236 Then there's the bad news. 0:08:18.756 --> 0:08:22.836 I think a lot of school said, okay, so yeah, 0:08:22.916 --> 0:08:24.636 they're out there, let's see if we can find some 0:08:25.156 --> 0:08:28.036 and recruit more. I think over time, I've come to 0:08:28.076 --> 0:08:32.836 realize that the main constraint, despite commitments on the parts 0:08:32.836 --> 0:08:35.676 of schools to do this, the reality is is if 0:08:35.716 --> 0:08:38.636 you take a talented, low income kid, you've got to 0:08:38.676 --> 0:08:41.756 offer significantly more financial aid. And every dollar that you 0:08:41.796 --> 0:08:44.396 spend on financial aid is a dollar that you don't 0:08:44.396 --> 0:08:47.436 have to spend on something else, and that is ultimately 0:08:47.676 --> 0:08:49.116 the real challenge. 0:08:49.356 --> 0:08:52.756 Tuition at Vassar including room and board is sixty two 0:08:52.796 --> 0:08:55.836 thousand dollars a year. You let in some poor kid 0:08:55.916 --> 0:08:59.236 for free, you're out somewhin range of sixty two thousand dollars. 0:08:59.756 --> 0:09:00.236 Give me an. 0:09:00.116 --> 0:09:01.836 Example of the kind of trade offs you've had to 0:09:01.876 --> 0:09:05.556 deal with because you wanted to increase your financial aid package. 0:09:05.716 --> 0:09:11.636 It would be spending more to renovate old dormitories and bathrooms. 0:09:12.276 --> 0:09:15.676 It would be better food in the dining hall. You know, 0:09:15.716 --> 0:09:18.716 many of those things are really good things, and you're 0:09:18.716 --> 0:09:19.796 always making trade offs. 0:09:20.076 --> 0:09:23.516 Yeah in the margin, did you catch that better food 0:09:23.636 --> 0:09:29.996 in the dining hall? Right after my producer Jacob went 0:09:30.036 --> 0:09:32.716 to Bowden to check out their food, he went to Vassar. 0:09:33.556 --> 0:09:34.476 How often do you eat there? 0:09:35.396 --> 0:09:36.276 About twice a day? 0:09:36.836 --> 0:09:39.556 Jacob is talking to a sophomore advassor named Amanda. 0:09:40.476 --> 0:09:44.076 So, lunch and dinner usually I do like a quick 0:09:44.116 --> 0:09:47.116 breakfast in the dinner because breakfast is notoriously their best meal. 0:09:47.356 --> 0:09:49.236 And what about dinner? What's dinner look like? 0:09:51.316 --> 0:09:55.356 Pretty terrifying? Sometimes it's weird. It oscillates between Sometimes they 0:09:55.356 --> 0:09:57.996 have really good ethnic food. Actually they'll surprisingly put together 0:09:58.036 --> 0:10:00.756 a very good meal, and then there's other nights where 0:10:00.796 --> 0:10:04.316 you get there and it's kind of like pasta very sad, 0:10:04.556 --> 0:10:07.916 like neat sandwich thing you're not really sure about, and 0:10:07.996 --> 0:10:11.196 like pizza, usually end. 0:10:11.196 --> 0:10:12.036 Up with soup that night. 0:10:12.076 --> 0:10:15.236 It's yeah, what. 0:10:15.116 --> 0:10:15.556 Would you say? 0:10:15.716 --> 0:10:19.836 Like The most common complaints about the food from students. 0:10:21.596 --> 0:10:25.236 Usually lack of variety of taste. Also, some people it's 0:10:25.316 --> 0:10:27.436 kind of gross to talk about, but like claim it 0:10:27.516 --> 0:10:29.836 really gives them indigestion, Like they're not happy with the 0:10:29.876 --> 0:10:30.276 quality of. 0:10:30.236 --> 0:10:33.436 The food by indingestion. Do you mean it has like 0:10:33.476 --> 0:10:36.836 a laxative effect? Is that the complaint because I've heard 0:10:36.876 --> 0:10:37.436 that elsewhere. 0:10:37.756 --> 0:10:41.636 Yeah, that's one hundred percent what I'm talking about. 0:10:42.756 --> 0:10:45.716 If you could step in and make like sweeping changes 0:10:45.756 --> 0:10:48.436 to dining at vast or what would you change. 0:10:50.156 --> 0:10:52.676 Sweeping changes? I mean my thing is like, I know, 0:10:52.836 --> 0:10:54.796 I'm kind of spoiled because I'm from California, so I'm 0:10:54.836 --> 0:10:56.716 used to just a higher quality of food in general, 0:10:56.756 --> 0:10:58.676 because like the soudbar always makes me kind of sad, 0:10:58.756 --> 0:11:01.076 like or like the nights where they're like we have 0:11:01.116 --> 0:11:04.396 guacamolan and it's like literally just like this pasty disgusting, 0:11:04.556 --> 0:11:07.636 like just you know, they obviously just purade some like 0:11:07.916 --> 0:11:08.996 unripe avocados. 0:11:09.836 --> 0:11:14.396 Vassar has terrible food. Boden practically has a Michelin star. 0:11:15.316 --> 0:11:18.956 Two otherwise almost identical schools that, on this one measure 0:11:19.076 --> 0:11:23.636 couldn't be more different, and why because Boden doesn't spend 0:11:23.796 --> 0:11:32.236 nearly as much on financial aid as Vassar does. Now, 0:11:32.276 --> 0:11:34.236 I don't want to single out Boden as some kind 0:11:34.236 --> 0:11:37.276 of moral villain. There are lots of private colleges in 0:11:37.316 --> 0:11:39.996 the US that do a far worse job than Boden 0:11:40.156 --> 0:11:43.876 at educating low income students. But just listen to these numbers. 0:11:44.476 --> 0:11:48.556 Twenty three percent of Vassar's undergraduates are on pelgrants. That is, 0:11:48.756 --> 0:11:52.236 they come from the poorest part of American society. At Boden, 0:11:52.596 --> 0:11:56.196 just thirteen percent of students are on pelgrants, so just 0:11:56.276 --> 0:11:59.436 over half as many as at Vassar. The New York 0:11:59.476 --> 0:12:03.036 Times does something called an Access Index, which measures how 0:12:03.036 --> 0:12:05.556 good a job a college does at opening its doors 0:12:05.556 --> 0:12:08.676 to low income students. The way the index works, an 0:12:08.716 --> 0:12:11.516 average score is one. If you do better than average, 0:12:11.556 --> 0:12:15.196 your score is greater than one. Among all American universities 0:12:15.196 --> 0:12:19.116 and colleges measured, Vassar comes in eighth with a score 0:12:19.116 --> 0:12:22.236 of one point three six, behind only the University of 0:12:22.276 --> 0:12:25.876 Florida and the big schools in the University of California system, 0:12:26.316 --> 0:12:29.236 it is the most open and accessible private school in 0:12:29.276 --> 0:12:33.756 the land. Boden is fifty first at one point zero five, 0:12:34.316 --> 0:12:37.116 just above average. If you want an example of a 0:12:37.156 --> 0:12:39.636 school that does really badly in the New York Times Index, 0:12:40.156 --> 0:12:43.796 New York University NYU is a point six y five, 0:12:44.116 --> 0:12:52.076 which ranks it one hundred and fifty six, which is appalling. Now, 0:12:52.116 --> 0:12:54.716 why does this matter? We don't want all schools to 0:12:54.756 --> 0:12:57.236 be the same. What's wrong with a system where one 0:12:57.276 --> 0:13:00.996 school spends its marginal dollar on gathering the most interesting 0:13:01.036 --> 0:13:04.876 and diverse group of undergraduates possible, and then another school 0:13:05.036 --> 0:13:09.516 spends its marginal dollar on artisanal cheese. It shouldn't matter, right, 0:13:10.276 --> 0:13:12.356 But if you dig into the way the university system 0:13:12.396 --> 0:13:15.236 works in the United States, you discover that it matters 0:13:15.276 --> 0:13:24.116 a lot. Boden and Vassar are connected. I'm back at Vassar. 0:13:24.796 --> 0:13:27.116 I'm sitting in a small conference room in the main 0:13:27.116 --> 0:13:31.036 administration building. In front of me is Robert Walton, Vassar's 0:13:31.076 --> 0:13:34.236 vice president of finance. Vasser might be the home of 0:13:34.276 --> 0:13:37.276 the edgy and the tattooed, but that's not Robert Walton. 0:13:37.756 --> 0:13:41.596 He's a numbers guy, white hair, carefully trim beard. He's 0:13:41.596 --> 0:13:43.796 got the school's budget open in front of him. 0:13:44.236 --> 0:13:46.836 So if we look at our total budget sort of 0:13:47.036 --> 0:13:49.436 what we actually spend, it's about one hundred and sirventy 0:13:49.436 --> 0:13:52.836 five million dollars. And if you think about it in 0:13:52.956 --> 0:13:56.556 just big groups, about two thirds of that are fees 0:13:56.636 --> 0:13:59.356 that we collect from different sources, and about a one 0:13:59.436 --> 0:14:02.196 third of that budget comes from the endowment. 0:14:02.596 --> 0:14:06.796 Yeah, now the tuition bucket. How does that break down? 0:14:07.116 --> 0:14:09.556 You know, we are like many schools like we have 0:14:09.636 --> 0:14:14.076 sort of a barbell effect. That's a slightly inelegant metaphor, 0:14:14.156 --> 0:14:17.596 but it works. We tend to have a grouping at 0:14:17.596 --> 0:14:20.196 each end, those who have a full ability to pay 0:14:20.236 --> 0:14:22.436 and those who have low ability to pay. 0:14:23.476 --> 0:14:27.036 The math looks like this. There are two four hundred 0:14:27.036 --> 0:14:30.996 and fifty undergraduates Advassor. A thousand of them are on 0:14:31.036 --> 0:14:33.876 the wealthy end of the barbell. They pay full tuition 0:14:34.196 --> 0:14:37.116 or close to it. That comes to sixty million dollars 0:14:37.116 --> 0:14:39.956 a year in revenue. The rest of the students at 0:14:39.996 --> 0:14:42.676 the other end of the barbell pay about half that much. 0:14:43.436 --> 0:14:46.356 They're the ones receiving some kind of financial aid. There's 0:14:46.476 --> 0:14:49.156 way more of them, but they contribute much less to 0:14:49.196 --> 0:14:52.156 the bottom line. So Vassor makes up for that lost 0:14:52.196 --> 0:14:56.116 revenue with money drawn from the endowment. I've grossly simplified 0:14:56.156 --> 0:14:58.716 matters to the point where if Robert Walton hears this, 0:14:58.956 --> 0:15:02.596 he'll cringe. But that's basically how the finances at Vassor work. 0:15:02.756 --> 0:15:06.556 A couple of questions before you went, you made this shift, 0:15:06.596 --> 0:15:08.916 which was what roughly ten. 0:15:08.876 --> 0:15:12.156 Years ago, roughly two thousand and seven. It happened mid 0:15:12.236 --> 0:15:13.356 year sort of so so hard. 0:15:13.556 --> 0:15:17.476 That's Marian Begemann, Vassar's head of strategic planning. She's sitting 0:15:17.516 --> 0:15:21.076 next to Walton formal business suit. What would your percentage 0:15:21.116 --> 0:15:24.636 of full pay have been back then? In the earlier era, roughly. 0:15:24.316 --> 0:15:28.756 We were around eighty, no, seventy five to eighty let's. 0:15:28.516 --> 0:15:31.676 Say, seventy five to eighty percent of students paid full 0:15:31.716 --> 0:15:35.836 tuition back then. This is an important point. The Barbelle 0:15:35.916 --> 0:15:38.596 used to be heavily weighted on the high full paying 0:15:38.716 --> 0:15:41.956 end and have almost nothing on the other end. When 0:15:41.996 --> 0:15:46.476 President Hill transforms Vassar a decade ago, she basically switches that. 0:15:47.356 --> 0:15:50.876 She replaces hundreds of full paying students with students who 0:15:50.956 --> 0:15:53.876 pay very little. As a result, Vassar goes from a 0:15:53.876 --> 0:15:57.836 place that quite comfortably supported itself on tuition revenue to 0:15:57.916 --> 0:16:00.276 a place that has to rely really heavily on its 0:16:00.396 --> 0:16:04.196 endowment to make the numbers work. Now, Vassar is wealthy 0:16:04.276 --> 0:16:07.436 enough to pull that off. It all adds up, but barely. 0:16:08.156 --> 0:16:11.236 They have no wiggle room. So the one thousand kids 0:16:11.276 --> 0:16:16.236 who pay full tuition Vasser needs every single one. Without them, 0:16:16.476 --> 0:16:20.356 everything falls apart financially. I asked Walton, what would happen 0:16:20.556 --> 0:16:23.396 if the number of full paying students dropped? If even 0:16:23.516 --> 0:16:26.236 fifty of that one thousand went elsewhere. 0:16:25.916 --> 0:16:27.956 That would be bad. That would be bad. 0:16:29.956 --> 0:16:37.476 No wiggle room. Okay, now about the endowment once again. 0:16:37.556 --> 0:16:41.596 Boden College is a good comparison. Boden starts twenty fifteen 0:16:41.676 --> 0:16:44.836 with an endowment of one point four billion dollars. They 0:16:44.836 --> 0:16:47.356 make a healthy return on that, which they divide up. 0:16:47.876 --> 0:16:49.996 A quarter of it goes to pay for financial aid, 0:16:50.356 --> 0:16:53.636 three quarters of it goes back into the endowment. That 0:16:53.756 --> 0:16:57.396 three quarters incidentally comes to one hundred and twenty million dollars. 0:16:57.836 --> 0:17:00.196 So to put it another way, Boden had one hundred 0:17:00.236 --> 0:17:03.436 and twenty million dollar cushion last year. What I've just 0:17:03.476 --> 0:17:07.716 described explains how endowments et elite universities keep getting bigger 0:17:07.756 --> 0:17:11.516 and bigger. They earn way more on their endowment every 0:17:11.556 --> 0:17:15.116 year than they need to balance the books. This is 0:17:15.156 --> 0:17:17.916 a bit of an aside, but here's a really extreme 0:17:17.956 --> 0:17:22.356 example of the endowment cushion. Princeton. They start twenty fourteen 0:17:22.436 --> 0:17:25.916 with twenty point six billion dollars in the bank. Let 0:17:25.956 --> 0:17:29.956 me repeat that, twenty point six billion dollars in the bank. 0:17:30.596 --> 0:17:33.876 They make two point one billion on their investments over 0:17:33.876 --> 0:17:36.796 the course of the year. After they've covered their costs 0:17:36.916 --> 0:17:39.756 and paid for all their financial aid, they had seven 0:17:39.916 --> 0:17:43.036 hundred million dollars left over, and after you add in 0:17:43.156 --> 0:17:45.836 all the other money they raised, Princeton ends the year 0:17:46.036 --> 0:17:49.436 with an endowment of twenty two point seven billion dollars. 0:17:49.716 --> 0:17:54.036 Princeton is a perpetual motion cash machine. There is literally 0:17:54.276 --> 0:17:57.756 no way they can ever run out of money. If 0:17:57.756 --> 0:18:01.316 they wanted to build a half a billion dollar dormitory 0:18:01.596 --> 0:18:06.756 with marble staircases, mahogany floors, and solid gold bathroom fixtures, 0:18:06.916 --> 0:18:09.036 they could pay for it aut of petty cash and 0:18:09.236 --> 0:18:16.076 still bank two hundred million dollars. That's wiggle room. By 0:18:16.116 --> 0:18:18.996 the way, given that fact, you might wonder why anyone 0:18:19.036 --> 0:18:22.996 would ever give money to Princeton. Good question. I have 0:18:23.156 --> 0:18:26.356 way more to say about this subject. That's what next 0:18:26.396 --> 0:18:29.756 week's episode is about. But let's go back to Vassar. 0:18:32.116 --> 0:18:36.116 Things are a lot more complicated there. They have about 0:18:36.156 --> 0:18:39.116 a billion dollars in their endowment. That's less than Boden, 0:18:39.876 --> 0:18:42.396 but for Vassor. To cover their expenses, they need to 0:18:42.436 --> 0:18:46.316 take out significantly more from their endowment than Boden does, 0:18:46.596 --> 0:18:49.916 so they don't have the same kind of cushion. Last year, 0:18:49.956 --> 0:18:52.316 In fact, Vassar had a bad year and they ended 0:18:52.396 --> 0:18:55.556 up withdrawing more than they earned. You can't keep doing 0:18:55.596 --> 0:18:58.316 that year in and year out and survive as an institution. 0:18:59.236 --> 0:19:03.996 No wiggle room. So what are Vassor's other options. Well, 0:19:04.316 --> 0:19:07.276 they could get smaller. One of the reasons Boden is 0:19:07.316 --> 0:19:09.316 in such better shape is that Boden has a only 0:19:09.356 --> 0:19:12.876 eighteen hundred students. Vassar is more than a third larger. 0:19:13.236 --> 0:19:16.036 If Vasser were boded in size, then suddenly they have 0:19:16.156 --> 0:19:19.636 six hundred and fifty fewer students to subsidize with their endowment. 0:19:20.036 --> 0:19:23.756 If I said to you, completely hypothetically, I want you 0:19:23.796 --> 0:19:26.516 to run this college in such a way as to 0:19:26.596 --> 0:19:31.796 maximize the amount of financial resources available, would you shrink 0:19:31.836 --> 0:19:33.476 the student body? 0:19:33.916 --> 0:19:36.076 In a perfect world, that would be the technique I 0:19:36.116 --> 0:19:36.716 would prefer. 0:19:37.036 --> 0:19:40.556 That's Vassar's VP Robert Walton. Again Note that he says 0:19:40.796 --> 0:19:43.916 in a perfect world, but of course that's the last 0:19:43.916 --> 0:19:47.196 thing Vasser would ever do. It would be totally self defeating. 0:19:47.636 --> 0:19:51.116 The whole point of Catherine Hill's transformation of Vasser was 0:19:51.156 --> 0:19:54.196 to try and educate as many poor smart kids as possible, 0:19:54.596 --> 0:19:58.156 because America has a huge problem with not providing opportunity 0:19:58.196 --> 0:20:01.596 for poor smart kids. If you cut six hundred and 0:20:01.596 --> 0:20:03.996 fifty spots, then you're part of the problem. 0:20:03.996 --> 0:20:08.556 Again, I'm a fiscal conservative, but she's convinced me. We 0:20:08.596 --> 0:20:11.796 don't pay any taxes in terms of to the fads 0:20:11.836 --> 0:20:15.116 of the states, so we are a tax subsidized entity. 0:20:15.836 --> 0:20:19.116 So one would logically conclude then if you have a 0:20:19.196 --> 0:20:21.756 large endowment, you really have an obligation to provide a 0:20:21.836 --> 0:20:24.436 public good, not just to educate the rich. 0:20:25.036 --> 0:20:29.036 This is something people always forget. Universities don't pay taxes. 0:20:29.596 --> 0:20:33.756 We subsidize them. You and I. When Princeton makes that 0:20:33.836 --> 0:20:37.156 two point four billion dollars return on their endowment, they 0:20:37.196 --> 0:20:39.596 don't pay a dime of capital gains taxes on it. 0:20:40.036 --> 0:20:43.956 And Walton's pointing out something really really crucial, which is 0:20:44.076 --> 0:20:46.836 that if you get that kind of subsidy from society, 0:20:47.076 --> 0:20:50.556 you're supposed to give back. Cutting six hundred and fifty 0:20:50.556 --> 0:20:54.396 spots is not giving back. All right, how about this 0:20:54.796 --> 0:20:59.796 cut back on faculty, bigger classes. No no, no, that 0:20:59.876 --> 0:21:03.356 also defeats the purpose. The whole point of the Vasser 0:21:03.396 --> 0:21:06.876 experiment is to give students of all backgrounds the best 0:21:07.036 --> 0:21:10.916 possible education. If you make the education worse in order 0:21:10.956 --> 0:21:12.956 to pay for the students who need a good education, 0:21:13.396 --> 0:21:15.956 then you're right back where you started from. The point 0:21:15.996 --> 0:21:19.316 of Vasser is that the best education comes when you 0:21:19.436 --> 0:21:23.196 mix students from all backgrounds. When the child of an 0:21:23.196 --> 0:21:26.076 investment banker sits in class next to the child of 0:21:26.116 --> 0:21:29.036 a janitor, the two of them have a learning experience 0:21:29.236 --> 0:21:32.236 that they could not have amongst people just like themselves. 0:21:32.876 --> 0:21:35.756 That's what they're trying to protect. So what do you 0:21:35.796 --> 0:21:38.196 do if you're Vassar and you're trying to protect that 0:21:38.276 --> 0:21:42.156 idea of what an education is. You have only one option. 0:21:42.916 --> 0:21:46.156 You tighten your belt as tight as you can. You 0:21:46.236 --> 0:21:48.556 don't do anything extravagant. 0:21:48.956 --> 0:21:50.876 I worked with a college at one time, it was 0:21:50.876 --> 0:21:53.116 sure going name that opened a new residence hall in 0:21:53.156 --> 0:21:56.596 the last five years that was all singles that had 0:21:56.636 --> 0:21:57.636 double beds. 0:21:58.156 --> 0:22:00.556 Basically, the dorm was a high end hotel. 0:22:01.076 --> 0:22:03.276 You know, there are these amenities that some schools do 0:22:03.316 --> 0:22:05.156 that are just kind of crazy and over the top. 0:22:05.396 --> 0:22:08.516 But they do all kinds of things. You know, they 0:22:08.556 --> 0:22:12.676 have more money for speaker series than we do. We 0:22:12.756 --> 0:22:14.876 can't pay Bill Clinton to come and speak for three 0:22:14.956 --> 0:22:18.276 hundred thousand that more. Prior institution did things like that. 0:22:18.836 --> 0:22:23.836 Bill Clinton the ultimate college amenity. The problem with belt tightening, though, 0:22:24.116 --> 0:22:27.316 is attracting those one thousand full pay students, the ones 0:22:27.316 --> 0:22:31.236 whose money Vassar desperately needs. Who are they They're the 0:22:31.316 --> 0:22:35.436 children of professionals, upper middle class and upper class Manhattan, 0:22:35.556 --> 0:22:39.876 Beverly Hills, Boston, San Francisco. They grew up privileged. They 0:22:39.876 --> 0:22:44.316 have certain expectations about lifestyle. Those amenities that Bob Walton 0:22:44.316 --> 0:22:47.036 says are kind of crazy and over the top. That's 0:22:47.076 --> 0:22:50.596