US Higher Education's Great Robber Barons - OZY | A Modern Media Company

US Higher Education's Great Robber Barons

US Higher Education's Great Robber Barons

By Sean Braswell

Statue of John Harvard


College students learning to question authority should start with those responsible for building the hallowed halls through which they pass.

By Sean Braswell

By day, the statue of founder John Harvard presiding over Harvard Yard is a magnet for camera-wielding tourists. But by night, it turns into a “glorified outhouse,” decorated by the micturition of the world’s future leaders and visionaries.

Pissing on John Harvard may be a rite of passage at the college that bears his name, but when it comes to criticizing the distinguished founders of America’s colleges and universities, the majority of students are content to hold their fire. 

Many of America’s best colleges … are the well-endowed, insouciant offspring of a young nation’s wealthiest men.

As founders of major American universities go, Harvard — a childless clergyman who died from TB at age 30 — is a relative anomaly. Many of the country’s best colleges, from Yale to Stanford to Duke, are the well-endowed, insouciant offspring of a young nation’s wealthiest men — the great titans of industry whose grit, foresight and willingness to bend, and sometimes break, both the law and those in their employ helped them to accumulate massive fortunes.


The munificence of these philanthropists has educated millions, funded countless research grants and made the American higher education system the best in the world, but they were far, far from saints. To wit: 

1. Elihu Yale

Yale University’s endowment may be worth almost $20.8 billion, but in order to get his name stamped on the former Collegiate School of Connecticut in 1718, Elihu Yale — once hailed as the “most overrated philanthropist” in U.S. history — donated just the “proceeds from the sale of nine bales of goods together with 417 books and a portrait of King George I.”

Yale, a pudgy colonial governor for the British East India Co. in Madras, left America for good at age 3 and built his fortune and personal fiefdom in India by redirecting the company’s funds toward his private enterprises and ruling the local population with an iron fist. A New England preacher named Jeremiah Dummer arguably contributed far more than Yale toward the Collegiate School in New Haven. But if there’s anything worse than being named after a colonial profiteer, it’s being known as Dummer College.

2. Leland Stanford

Railroad magnate, senator, governor, university founder — Leland Stanford collected a host of illustrious titles. But to those investigating the sources of the California tycoon’s enormous wealth, he was, in the words of Lewis D. McKisick, special counsel for the U.S. Justice Department, the “most conspicuous criminal of the (19th) Century.”

Stanford, a New York lawyer who followed his nose west during the 1850s gold rush, made his fortune as one of the “Big Four” founders of the Central Pacific Railroad, which relied on the back-breaking labor of 12,000 low-paid Chinese immigrants to turn the transcontinental railroad from high-risk proposition to unadulterated success. Despite receiving massive government subsidies and reaping millions in profits, Central Pacific pleaded poverty when the federal government asked that it make good on the taxes and loan repayments it owed.

As part of the lawsuit filed to recover those funds, Leland Stanford Junior University — founded in 1885 with about $5 million and 8,000 acres from the allegedly impoverished industrialist — was Exhibit A in the government’s case against the railroad barons who had lived large while their company skirted its responsibilities. The Supreme Court ultimately ruled that the government could not recover the company’s debts from its biggest shareholders, saving the young university from an early demise.

3. James B. Duke

For most Americans, particularly basketball fans, the term “Tobacco Road” is synonymous with the heated rivalry between Duke University in Durham and its fellow North Carolina universities. But what drew the U.S. Justice Department to Tobacco Road in 1908 was not the quality of the competition, but the lack of it. Decades before tobacco tycoon James Buchanan “Buck” Duke endowed Trinity College (now Duke University) with $40 million in 1924, he was secretly acquiring rival tobacco firms to form a “tobacco trust” known as the American Tobacco Co.

By 1906, Duke’s company controlled 80 percent of all tobacco products except for cigars, a monopoly that even the trust-friendly U.S. Supreme Court felt obliged to break up in 1911. By this time Buck Duke, who was rarely seen without a cigar and who insisted that Southern comforts like cornmeal, chicken and hams be brought to his Fifth Avenue mansion on Millionaire’s Row in New York, had moved on to other things, including becoming a first-time father at age 57 and later dominating North Carolina’s energy sector.

The list of higher education’s robber barons doesn’t end there — it includes such noteworthies as shipping magnate Cornelius Vanderbilt (Vanderbilt University, 1873), oil tycoon John D. Rockefeller (University of Chicago, 1890), steel mogul Andrew Carnegie (Carnegie Mellon University, 1900) and Texas merchant William Marsh Rice (Rice University, 1912).

To this day, many American universities are riding a prodigious wave of capital that originated in distant, and somewhat unseemly, waters. Some of the scholars today leading the “post-Picketty” debate on income inequality in the U.S. are housed in progressive academic institutions whose lifeblood stems from transfusions of wealth generated by leveraging some of the greatest inequality the industrial world has ever known.

John Harvard probably deserves better than the golden showers that comprise his earthly dividend, but his fellow founding fathers of America’s pre-eminent higher education system — purchased in no small part by exploited labor and corporate misdeeds — would have little defense against a similar show(er) of disrespect for how they accrued their vast fortunes.


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