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February 25, 2016

Opinion: Public Pays Price for Knight's Stanford Largesse

Phil Knight's $400 million gift to fund Stanford University graduate-school scholarships "should reignite a dormant debate" over the cost to taxpayers of elite colleges' burgeoning endowments and massive philanthropic support, a Los Angeles Times columnist writes. Michael Hiltzik estimates that "your share" of Mr. Knight's donation will be $158 million, the size of the Nike chairman's income-tax break if he is charged the top marginal rate.

Taxpayers further subsidize institutions such as Stanford, which has a $22.2 billion endowment, because their property holdings and investment gains are also tax-exempt. "These benefits arguably contribute to America's rising crisis in income and wealth inequality," draining funds from public universities to support elite colleges that "chiefly educate the children of the wealthy and upper middle class," Mr. Hiltzik writes.

Financial writer Felix Salmon offers another highly critical take on the gift at news and culture site Fusion. calling it "a $400 million exercise in sending money where it’s needed least."