September 29, 2003
GIVING, AND TAKING AWAY
A controversy at Princeton offers broad lessons
JOHN J. MILLER
In 1961, Charles and Marie Robertson gave one of the largest gifts ever made to higher education. Today, their heirs are trying to take it back, in an unprecedented lawsuit that carries major implications for conservative philanthropy.
The Robertsons’ donation, coming from the fortune of the A&P grocery-store chain, was worth $35 million to Princeton University. It created the Robertson Foundation, which was known as the “X Foundation” for more than a decade because the Robertsons wished to remain anonymous. Over the course of 40 years and under the dual management of the family and the university, the foundation has dispersed more than $200 million to Princeton. The endowment itself is now worth about $600 million, supposedly for the purpose of helping graduate students “prepare themselves for careers in government service, with particular emphasis on the education of such persons for careers in those areas of the Federal Government that are concerned with international relations and affairs.”
In 2002, Princeton used the foundation’s vast wealth to produce exactly three students who fit this description.
“Princeton has lost the right to have these funds,” says Bill Robertson, the son of the original patrons. “The university isn’t abiding by the mission of the foundation.” Last year, he and four relatives filed a lawsuit that has become a critical battleground in the national fight over donor intent.
Over the years, violations of donor intent have caused conservatives great harm. The Left has captured billions of dollars in financial resources by seizing control of philanthropic foundations and ignoring the wishes of the people who endowed them. The Ford Foundation is perhaps the best-known example of this — Henry Ford II famously resigned from its board in 1977, complaining that the foundation started by his grandfather had turned against the capitalist system that made its very creation possible. Other egregious offenders include the MacArthur Foundation and the Pew Charitable Trusts.
Conservatives don’t always lose these struggles. In 1995, Yale University returned a $20 million gift from Lee Bass following a four-year scrap: Bass tried to fund a program in Western civilization, the school delayed implementing his conditions, and Bass finally succeeded in getting his money back. Yet the Robertson case, which has received less attention, is almost certainly more important. Although the money Bass wanted to give is nothing to sniff at, it doesn’t match the amount of cash the Robertson endowment throws off each year in interest alone. What’s more, the Bass dispute quickly became politicized in ways that complicated the broader goals of conservatives. Perhaps they stopped a bunch of left-wing professors from running away with a particular piggy bank — but Yale came off looking pretty good among different audiences for protecting academic freedom from a right-wing insurgency.
The Princeton case, in contrast, can’t be politicized, because the Robertsons’ money never was earmarked for conservative purposes. “My parents made this gift because they believed training students for careers in security matters and international affairs was necessary to protect democracy,” says Bill Robertson. The foundation’s charter is clear on this point: “Its objective is to strengthen the Government of the United States and increase the ability and determination to defend and extend freedom throughout the world.” That was a useful project during the Cold War and it remains one today, especially given the War on Terror. The foundation promises to keep its charge by helping students earn graduate degrees at Princeton’s Woodrow Wilson School (WWS).
To Princeton, however, the Robertson Foundation’s expression of donor intent has become a nuisance. Indeed, the university’s briefs in the litigation scoff at the plaintiffs’ claims: “Alleged expressions of donative intent are legally insignificant.” What’s more, the foundation is said to have an “evolving mission” and the specific objectives outlined in the foundation’s incorporating articles are merely “aspirational goals.”
Princeton’s lawyers resort to such dismissive language in part because they can’t defend the university on the merits. In 2002, according to Princeton’s own data, the program funded by the Robertson Foundation produced 63 graduates. Of these, only 9 took positions with the federal government. What’s more, only 3 of these 9 students had an international focus to their studies. Most of the rest taking jobs went to work for NGOs, foreign governments, and the private sector. “That’s not what my parents envisioned,” notes Bill Robertson.
The numbers from earlier years aren’t much different, and Robertsons have grumbled about them before. In 1970, Charles Robertson wrote that Princeton was producing “a disappointing number of MPA degree holders in public service particularly in the international agencies.” He called it “a small output from large resources.”
Marie Robertson died in 1972 and Charles in 1981, but their children and other relatives have remained involved in the activities of the foundation — its governing structure, in fact, reserves spots on the board of trustees for members of the family. They don’t control the foundation, but they have a strong say in what it does — and everybody, including board members appointed by the Princeton administration, is supposed to abide by the foundation’s charter and guard its independence.
This isn’t how things have worked out in practice. In 1997, for instance, the university informed the Robertson board that it planned to construct Wallace Hall, a new building that would allow for the expansion of the WWS. Princeton said it would try to raise all the money for the project, but that the Robertson Foundation might be asked to make a contribution if the fundraising fell short of the $25 million needed. Bill Robertson wasn’t pleased about this, as an e-mail WWS dean Michael Rothschild sent to Princeton president Harold Shapiro acknowledged: “He is unhappy and if we use large amounts of Robertson money to pay for the building he will be more so.”
But the happiness of the Robertson clan has not been a Princeton priority. In 2001, the university withdrew more than $13 million from the foundation’s account to meet the budget for Wallace Hall. Today, the WWS occupies a chunk of the building, but so do the sociology department, the Office of Population Research, and something called the Center for Research on Child Wellbeing (whose advisory board includes former Democratic congresswoman Patricia Schroeder). “These programs have nothing to do with what the foundation is supposed to support,” says Bill Robertson.
He’s even more upset by Princeton’s attempt to commingle the foundation’s assets with the school’s general endowment. Since the early 1980s, the foundation’s independent investments have outperformed Princeton’s funds, earning about $150 million more than they would have under university management. Yet the school is eager to deposit the foundation’s cash into its own $8.3 billion endowment — and no doubt wait for the day when it doesn’t have to put up with those pesky Robertsons anymore.
On ethical grounds, the Robertsons appear to have a strong case. Whether they’ll prevail in their legal dispute is another matter, though they did win an important victory in June when a judge refused Princeton’s motion to have the case dismissed. The two sides have now entered a period of pre-trial investigation that’s expected to last at least a year.
No matter what happens, some good may come of the case if it creates skepticism among donors and leads to smarter philanthropy. “There’s always a concern that litigation like this can generate unfavorable publicity,” says Doug Eakeley, a lawyer for Princeton. This, of course, is Princeton’s point of view. For others, the “unfavorable publicity” can amount to a worthwhile education. Somewhere right now, there is perhaps a wealthy Princeton alumnus who has considered endowing a chair in the history department at his alma mater because he once enjoyed a class on the Civil War — but the Robertson case has convinced him that there’s a decent chance the administration will just grab his cash and fill the professorship with a feminist whose main research interest is cross-dressing in 17th-century Amsterdam.
Too many benefactors write checks to universities and simply assume the recipients will channel the money in wise directions. “Making unrestricted gifts to endowments is the worst thing you can do,” says Martin Morse Wooster of the Capital Research Center, a conservative watchdog group. Instead, donors should make their wishes explicit — perhaps putting a time limit on the spending commitment, or targeting the funding to specific individuals and organizations within universities whose ongoing work meets certain criteria.
The alternative is to lose more than your money. “My family used to have the highest regard for Princeton. It bordered on idolatry,” says Bill Robertson. “But now all those old school ties are gone and I don’t think we’ll ever get them back.”