About 30% of American college students attend so-called private colleges and universities, most of which are non-profit institutions. In reality, however, with very few exceptions, all of them are heavily dependent directly or indirectly on governments for support. Federal student loans allow them to raise fees much higher than they otherwise would be able to charge, as do tuition tax credits and Pell Grants. The tax-deductible treatment of private donations helps fund new buildings. Universities rarely appropriately provide for the depreciation or construction of facilities in their accounting of revenues and expenses, implicitly assuming they are gifts from God. State and local government exemption of facilities from property and sometimes sales taxes provide further assistance. The federal government hands out research grants, with generous (probably overly generous) provision for overhead expenses. Endowments are also advantaged enormously by tax privileges, even for the few dozen schools that will now have to pay an endowment tax. Public school guidance counselors and teachers tell students that to be successful in life they need to go to college and that the extremely successful go to elite private schools.
I once estimated all the various government benefits received by so-called private Princeton University were vastly greater (at least 10 times as much per student) than those conferred on a so-called public or state university, the College of New Jersey, located a mere 10 miles away. Is the public/private distinction meaningful in any real sense?
Being a “private” school allows universities some freedom from governmental interference. While most Americans are generally skeptical of most government intrusions into our lives, the enforcement of constitutional rights is probably an exception. It is the job of the government to create and enforce laws, and none historically have been more sacrosanct than the Bill of Rights. It is generally accepted that so-called public universities must honor the First Amendment and that restricting the speech of students is generally constitutionally impermissible, but that does not apply to private schools. Since some private schools (e.g., Johns Hopkins University) literally receive over one billion dollars of federal (and thus “public”) money annually, the private-public distinction no longer makes much sense.
So constitutionally suspect speech codes or attempts to restrict free oral expression to very narrow free speech zones probably should have no place on any campuses directly or indirectly receiving any governmental support. There are a handful of exceptions: Hillsdale College in Michigan, for example, not only does not directly take federal financial aid but does not allow its students to take federal loans or grants. It is truly private in every sense, and can act as any private club or organization does, restricting the composition or nature of its student body, faculty or curriculum anyway it wants. But Hillsdale is nearly unique.
Aside from First Amendment issues, organizations accepting, directly or indirectly, federal support are not dallowed to discriminate on the basis of race or gender, and the feds until recently largely dictated standards for assessing allegations for sexual assault. If they do this, why should schools be allowed to discriminate on the basis of family background, as many schools do, giving preference to legacy admissions (children and grandchildren of alumni)? It can be argued that these preferences perpetuate an elite sort of intellectual aristocracy that if perfectly privately funded might make sense legally, but where it is dependent on public funds violates the American sense of fairness and emphasis on meritorious criteria with respect to admissions.
In this writer’s opinion, enhanced federal involvement in our universities on balance has had adverse effects, reducing their freedom to do their own thing, somewhat homogenizing our marvelously competitive system of vastly differing institutions. But perhaps universities should not be able to have it both ways, getting all sorts of public privileges in the form of tax preferences, research subsidies and the like, as well as an ability to shield themselves from some dimensions of federal control by claiming that they are “private.”
