As a man who sits on the board of Bear Sterns investment company, Northwestern President Henry Bienen can get passionate when it comes to the numbers. Those numbers are the focus of some contention after some lukewarm receptions of NU’s new financial aid policy.
In January, NU announced that it was expanding its zero-loan program to more students in “greatest need” and capping federal loans at $20,000 for all students.
Bienen said people who criticized the program as conservative did not take a realistic approach to fiscal responsibility. He said the varying amounts of money that a university might receive in a given year – particularly with a market downturn on the horizon – mean that universities have to be careful about increasing spending.
“Particularly with something like financial aid, you can’t ratchet it around every five years,” Bienen said. “You can’t say that you’ll have it this year and then next year not have it.”
Increases in program spending made from the university’s sizable endowment had to be made with the ability to keep the endowment fiscally sound, Bienen said, meaning more had to be lost than spending alone would indicate.
“(At a 5 percent rate of spending) If you spend $3 million, you have to put $60 million aside – forever,” Bienen said. “You can’t take (the $60 million) unless you say, ‘We’re going to close it down.’ “
Finally, Bienen said he thought that people should value their education enough to work toward it.
“I don’t even love the policy of no loans,” Bienen said. “For the competitive marketplace, I feel we have to do it. But I feel it should be some combination of loans, work study and grants.”
But Bienen acknowledged that people would disagree with his point of view.
“Everyone’s entitled to their opinion,” Bienen said. “Good policy, insufficient – I don’t care. I do care about having the facts right.”
