Donald Trump late on Tuesday demanded Harvard University give back an $8.6 million grant it received as part of a stimulus package amid co...
Donald Trump late on Tuesday demanded Harvard University give back an $8.6 million grant it received as part of a stimulus package amid coronavirus.
The stand off came amid outrage that well off institutions and companies were taking advantage of the government's $2.3 trillion stimulus, passed at the end of March, despite having reserves of their own.
The president tweeted after the Ivy League school defied his earlier order, saying it plans to keep an $8.6 million grant it received as part of an educational relief program - despite having an eye-watering $40.9 billion endowment
It has also emerged that businesses employing thousands of workers have been awarded grants under the Paycheck Protection Program, was supposed to infuse small businesses with $349 billion in emergency loans.
Large restaurants chains like Potbelly, Ruth's Chris Steak House and Taco Cabana were able to qualify despite employing thousands of workers, getting the maximum $10 million in loans.
Treasury Secretary Steven Mnuchin has demanded the cash is returned.
President Trump said Tuesday that Harvard University would not be getting taxpayer money, citing the Ivy League school's enormous endowment
Speaking at a press briefing on Tuesday, the president demanded the Ivy League school give taxpayer funds back, citing their massive endowment.
'Harvard is going to pay back the money and they shouldn't be taking it,' Trump said, adding that Harvard has one of the largest endowments 'in the country, maybe in the world.'
But in a statement issued moments after the briefing ended Harvard said it planned 'to direct 100 per cent of the funds to financial assistance to students, and will not be using any of the funds to cover institutional costs.'
The university said it received the grant through the educational relief program that was part of the $2.3 trillion stimulus passed at the end of March, which also included a much larger fund aimed at helping small businesses.
Trump then tweeted late on Tuesday, pledging to look at their endowment system. He wrote: 'Harvard should give back the money now. Their whole “endowment” system should be looked at!'
The president said during the daily press briefing: 'They shouldn't be taking it. They have one of the largest endowments anywhere in the history of the country, maybe the world I guess. They're going to pay back that money.'
Donald Trump late on Tuesday demanded Harvard University give back an $8.6 million grant it received as part of a stimulus package amid coronavirus
Harvard, which easily out-guns the other schools with its eye-watering $40.9billion endowment was planning to take $8.6million
Harvard, which planned to utilize $8.6 million of taxpayer funds doled out as part of the CARES Act, is among a number of elite American universities taking advantage of $14 billion allocated to higher education institutions to weather the economic downturn associated with the coronavirus pandemic.
Treasury Secretary Mnuchin, who was speaking from the podium when Trump inserted that he would request the money back, said that other big businesses would be asked to give money back too.
'The intent of this money was not for big public companies that have access to capital,' Mnuchin said.
He praised the restaurant chain Shake Shack for giving money from the Paycheck Protection Program back.
College and universities are facing financial hardship because students have been sent home, and while they may be taking classes remotely, the schools risk not bringing in the totality of tuition fees.
A spokesman for Harvard clarified that the university did not apply for PPP funds, the pot of money Mnuchin was referring to when Trump jumped in and brought up Harvard.
'Harvard did not apply for, nor has it received any funds through the U.S. Small Business Administration's Paycheck Protection Program for small businesses. Reports saying otherwise are inaccurate,' a spokesmans said. 'President Trump is right that it would not have been appropriate for our institution to receive funds that were designated for struggling small businesses.'
'Like most colleges and universities, Harvard has been allocated funds as part of the CARES Act Higher Education Emergency Relief Fund. Harvard has committed that 100% of these emergency higher education funds will be used to provide direct assistance to students facing urgent financial needs due to the COVID-19 pandemic,' the spokesman added.
Of the top private schools, Cornell and Columbia will receive the most at $12.8million each.
Cornell, based in Ithaca in upstate New York, has an endowment of $7.3billion, while New York City-based Columbia boasts $10.9billion.
The University of Pennsylvania, which is Trump's alma mater, will receive $9.9million despite having a $14.7billion endowment.
Sen. Ted Cruz, a Republican from Texas, also blasted Harvard for taking the money, pointing to the school's mammoth money bin.
The one-time Republican presidential contender tweeted: 'This is ridiculous. Taxpayer relief funds should go to those in real need.
'Harvard University has a $41bn endowment—the largest in the world. Put another way, Harvard's endowment is $13mm per student, or $171mm per faculty member.'
Treasury Secretary Steve Mnuchin applauded Shake Shack for giving back funds that were supposed to be for small businesses
'The intent of this money was not for big public companies that have access to capital,' Treasury Secretary Steve Mnuchin said to reporters Tuesday
The university insisted it was using federal funding for 'financial assistance for students to meet their urgent needs in the face of this pandemic'.
Harvard, which is one of the top universities in the world and boasts eight presidents among its alumni, spelled out how it would spend its bailout.
A spokesman for the Massachusetts-based school said: 'Financial assistance will be on top of the significant support the University has already provided to students – including assistance with travel, providing direct aid for living expenses to those with need, and supporting students' transition to online education.'
Yale, the second largest Ivy Leave school, will receive $6.8million and has an endowment of $30.3billion.
Texas senator Ted Cruz has blasted the university for taking the money, pointing to its mammoth endowment chest
Yale, the second largest Ivy Leave school, will receive $6.8million and has an endowment of $30.3billion
University of Pennsylvania will receive $9.9billion despite having a $14.7billion endowment
Cornell, based in Ithaca in upstate New York, has an endowment of $7.3billion and will receive $12.8million
New York City-based Columbia boasts $10.9billion endowment and will receive $12.8million bailout
Brown university, which has $4.2billion endowment, is being bolstered by $4.8 million.
A bailout of $3.4million is being directed towards Dartmouth College, which has an endowment of $5.7billion.
The smallest bailout for Ivy League schools is being sent to $26billion-endowed Princeton, which will receive $2.4million.
The $2trillion Coronavirus Aid Relief and Economic Security Act (CARES) injected $14billion into the Higher Education Emergency Relief Fund.
Institutions were granted these funds based on a formula which combines the number students receiving federal financial aid and the overall number of students enrolled.
At least half of the funding is mandated to be used as financial grants for students, with the remainder to be put towards compensating university losses.
Joel Malina, Vice President for University Relations, at Cornell, said: 'Cornell will use 100 per cent of these CARES Act funds to support students, going beyond the federal requirement that half of the funds be put towards emergency financial assistance to our students.
'We know that many of our students will have increased need as a result of the pandemic.
'Even as our Ithaca campus faces an anticipated Covid-related budget shortfall of over $100 million for the coming fiscal year, we aim to guarantee that every single one, currently enrolled or newly admitted, has the financial resources to complete their Cornell education.'
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