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Why Universities Failed to Build Endowments

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Why Universities Failed to Build Endowments Fundraising and Endowment Building at a Land Grant University During the Critical Period, 1910-1940: The Failure of Ohio State Dissertation Presented in Partial Fulfillment of the Requirements for the Degree Doctor of Philosophy in the Graduate School of The Ohio State University By Benjamin A. Johnson Graduate Program in Education: Policy and Leadership The Ohio State University 2013 Dissertation Committee: Professor Bruce Kimball, Advisor Professor Bryan Warnick Professor Ann Allen Professor Robert Lawson Graduate Faculty Representative: Professor James Lang ii Copyrighted by Benjamin A. Johnson 2013 Abstract The purpose of this research is to provide an understanding of the financial strategy and shortcomings of The Ohio State University (OSU) in the early 1900s. It focuses on key moments in educational philanthropy, particularly endowment building, at OSU, with comparisons to the University of Michigan (U-M), and occasionally Harvard University. Located in the center of the midwestern state of Ohio, OSU might be considered a quintessential public university, facing challenges comparable to other colleges and universities. This dissertation draws on extensive original source material from OSU’s archives to show the dynamic interplay of university leaders in making key financial decisions. A variety of other primary and secondary sources from both OSU and U-M are also used. The chronological narrative presents the slow and halting journey of OSU toward private fundraising, endowment building, and the creation of the OSU Development Fund. To provide background, discussions on the land grant movement and the founding of OSU are included, as well as a description of the Ohio economy in the early 1900s. Key findings in this research are as follows. In the 1920s, Ohio State University was in a prime position to make great strides in fundraising and in building its ii endowment. Ohio was a relatively wealthy state, and several other universities had previously and prominently demonstrated how to begin and conduct fundraising campaigns, including annual alumni campaigns at Harvard and Yale. OSU had merely to keep pace with its contemporaries, such as the University of Michigan, to reach prosperity. But despite the factors working in its favor, OSU actually fell rapidly behind in fundraising and endowment building during the period from 1920 to 1940. Notwithstanding the difficult economic climate of the Great Depression, other universities forged ahead in fundraising through this period. OSU’s alumni leaders pushed heavily for progress in fundraising for over a decade before significant changes were made. It took the devastating state appropriations cuts by Governor Martin L. Davey (Gov. 1935-1939) before OSU adopted fundraising as an important source of university income. Indeed, the most influential factor in the university’s lack of fundraising and endowment building during the period from 1920 to 1940 was undoubtedly the unprogressive presidential leadership of both William Oxley Thompson (Pres. 1899- 1925) and George W. Rightmire (Acting Pres. 1925-1926; Pres. 1926-1938). Both of these presidents, while they had some positive influences on the university, did not embrace private fundraising until the end of their presidencies, which was far too late. A critical period for growing the endowment had passed, and OSU had lost its lead among its peers, never to regain first place. iiiiii Acknowledgments Researching and writing this dissertation has been an exhilarating process. I am deeply grateful for the help I received at The Ohio State University. There are many people who have provided support and assistance. First, I am grateful to Professor Bruce Kimball, who has been an invaluable source of direction, information, and guidance throughout the entire dissertation process. I am grateful for the opportunity to have worked with him as a research associate, to have co-authored articles with him, and to have assisted in his classes as a teaching associate. I appreciate his dedication to superior teaching and scholarship, and I know I have learned much from his example. I am very grateful for Professors Robert Lawson and Bryan Warnick for inviting me to Ohio State University. Bob and Bryan served as advisors to me, helping me to navigate the curriculum and learn valuable professional practices. Both Bryan and Bob opened up office and home and helped me improve as a student, scholar, and educator. Professor Ann Allen has also been a strong source of support from the beginning and has offered critical insight into my projects that has significantly improved my work. My committee members’ insights and feedback significantly helped guide me through this dissertation. iv Other OSU faculty who served as unofficial advisors and offered important insight include: Harvey Graff, Phil Smith, Scott Sweetland, Jackie Blount, and Tatiana Suspitsyna. Peers provided valuable advice and encouragement: Brian Janssen, Lauren Hensley, Doug Gill, Brad Rowe, Travis Helm, Sang Hyun Kim, Danielle Terrance, Stephanie Drotos, Sam Rocha, Melissa Newberry, Tom Falk, Mike Yough, among others. I would also like to thank my new department chair, Marinda Ashman, at Utah Valley University for her support. For assistance with the project I am grateful to The Ohio State University Archives staff, particularly Bertha Ihnat, Tamar Chute, Lindy Smith, and Raimund Goerler. At the University of Michigan, I need to thank James Duderstadt, Margaret Steneck, Margaret Leary, and the Bentley Historical Library staff, particularly William Wallach, who helped me obtain an archival fellowship. I am most grateful for the steady support, love, and assurance offered by my wife, Taralyn. Wes and Marian, my scholarly parents (with Columbia and Stanford Ph.D.s), planted and nurtured the idea of getting a Ph.D. and have been phenomenal mentors throughout the whole process. I am also indebted to my family and friends for their continued support and encouragement. v Vita 2004 ............................................................ B.A. History, Brigham Young University 2007 ............................................................ M.A. History, Brigham Young University 2010 ............................................................ M.A. Education, The Ohio State University Publications Peer-Reviewed Journal Articles: “The Inception of the Meaning and Significance of Endowment in American Higher Education, 1890-1930,” Bruce A. Kimball and Benjamin A. Johnson, Teachers College Record 114, no. 10 (2012): http://www.tcrecord.org/content.asp?contentid=16669 “Nurturing Independent Learning in the Undergraduate Student in History: A Faculty- Student Mentoring Experience,” Benjamin A. Johnson and Donald J. Harreld, Mentoring & Tutoring: Partnership in Learning 20, no. 3 (August 2012): 361- 378. “The Beginning of ‘Free Money’ Ideology in American Universities: Charles W. Eliot at Harvard, 1869-1909,” Bruce A. Kimball and Benjamin A. Johnson, History of Education Quarterly 52, no. 2 (May 2012): 222-250. “The Ethics of Corporatization: Competing Visions for University Leadership,” Benjamin A. Johnson, Philosophical Studies in Education 41 (2010): 95-105. vi “Sustaining Higher Learning: Endowment Building and Financing Higher Education,” Benjamin A. Johnson, Comparative & International Higher Education 2, no. 2 (2010): 33-36. “Tragedy and the Meaning of School Shootings,” Bryan R. Warnick, Benjamin A. Johnson, and Samuel Rocha, Educational Theory 60, no. 3 (June 2010): 371-390. Book Reviews: American Higher Education Transformed, 1940-2005: Documenting the National Discourse by Wilson Smith and Thomas Bender, Journal of Higher Education 82, no. 1 (January/February 2011): 114-117. (Benjamin A. Johnson and Bruce A. Kimball) After the Harkness Gift: A History of Phillips Exeter Academy Since 1930 by Julia Heskel and Davis Dyer, History of Education Quarterly 50, no. 4 (November 2010): 562- 564. (Benjamin A. Johnson) The Standardization of American Schooling: Linking Secondary and Higher Education, 1870-1910 by Marc A. VanOverbeke, Education Review (8 May 2010): http://edrev.asu.edu/reviews/rev915.pdf. (Benjamin A. Johnson) Fields of Study Major Field: Education: Policy and Leadership Keywords: Higher Education, History of Education, Philosophy of Education, Public Universities, American History, American Studies, Leadership, Policy Studies, Economics, Fundraising, Endowments, and Private Giving. vii Table of Contents Abstract .......................................................................................................................... ii Acknowledgments ......................................................................................................... iv Vita ............................................................................................................................... vi Publications ................................................................................................................... vi Fields of Study ............................................................................................................. vii Table of Contents ........................................................................................................ viii List of Tables................................................................................................................. xi List of Figures ............................................................................................................. xiii Introduction .....................................................................................................................1
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