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Disclose! Divest!: Behind the Fight Over College Endowments

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A child running through the Stanford Divestment Encampment

A child running through the Stanford Divestment Encampment. Credit: RJ Lozada.

As graduation approached this year, students around the country began protests after calls for divestment from Israel were initially ignored by university leadership. The campus encampments were met with physical violence and the mainstream press dismissed the students’ demands as naive and immature. But, it turns out that there’s a lot we should be asking about college endowments. 

We take a look at what an endowment is and how they’re invested. Then we learn why transparency around the endowment (and divestment!) might actually benefit the entire college community. 

We talk to Kelly Grotke, a financial researcher from Pattern Recognition, a research collective focused on financialized higher education. And, with Andrea Pritchett, we look at the links between the encampments today, and those from the 80s, when students protested South African Apartheid. 


  • Kelly Grotke, co-founder of Pattern Recognition, a research collective
  • Andrea Pritchett, former student organizer against South African Apartheid. Currently a middle school teacher and co-founder of Berkeley Cop Watch

Episode Credits:

  • Host: Salima Hamirani
  • Producers: Anita Johnson, Salima Hamirani, Amy Gastelum, and Lucy Kang
  • Executive Director: Jina Chung
  • Editor: Adwoa Gyimah-Brempong
  • Engineer: Jeff Emtman 
  • Digital Media Marketing: Anubhuti Kumar


  • Robert John – “Slinky”
  • Chris Zabinske – “Take Off and Shoot a Zero”
  • Doctor Turtle – “Leap Second”
  • Komiku – “Blue”


(fade in sound of protest and music)

Encampment protest speaker: While it’s difficult, while it’s crushing, it’s also a moment of hope…

Salima Hamirani: You’re listening to sound from the student encampment at the University of California Berkeley on the anniversary of the Nakbha

Encampment protest speaker: This movement, this student movement, this alumni movement,..

Salima Hamirani: The students main demand: Disclose and then divest all university funds in the endowment from Israel – including arms manufacturers.

Encampment protest speaker: It echoed into the offices of Chancellor Christ. It echoed in the Berkeley Foundation, the offices of the regents, the president of Berkeley…

 (fade out sound of protest)

Salima Hamirani: It’s not the first time student encampments have called for divestment. In the 70s and 80s students protested, successfully, against South African Apartheid, and there’s an ongoing campaign to force universities to divest from fossil fuels, which has also been partially successful.

But What is an endowment? and what does it mean to divest from them? Well,that’s the topic of today’s shows. You’ll hear from Kelly Grotke, about how universities have changed the way they invest modern endowments. 

Kelly Grotke: We’re at a kind of inflection point because there’s been far too much secrecy. Because we don’t know what’s going on behind the scenes, we can’t really gauge what effects there would be from divestment. 

Salima Hamirani: And we’ll also hear from Andrea Pritchett, who was at an encampment at the University of California Berkeley back in the 80s, when students were asking for campuses to divest from South African Apartheid. 

Andrea Pritchett: One of our strengths at that time was our resistance to back room negotiations. You know as soon as someone emerges as a leader and they get called into some kind of backroom negotiation. When they emerge from that negotiation they’re gonna be subject to a lot of suspicion and derision. 

Salima Hamirani: Stay tuned, all that and more coming up.

 (fade out music)

Making Contact Button: Some of the post solutions that’s coming from grass roots. You’re listening to making contact.

Salima Hamirani: Welcome to making contact. To start us off today, We’re taking a deep dive into the world of endowments. What is an endowment? Why are they invested in arms manufacturers in the first place? And to be frank, I am not a financial expert, and a lot of the language around endowments is deeply financial. So I sat down with someone who is an expert: Kelly Grotke

Kelly Grotke: Hi Salima. Thanks for inviting me on, my name is Kelly Grotke and I’m a founding partner with Pattern Recognition,

Salima Hamirani: Pattern recognition is a research collective looking into the effects of our increasingly financialized world, especially in higher education. 

Salima Hamirani (from interview):  Kelly let’s jump in – to start, what is an endowment?

Kelly Grotke: An endowment is basically, sort of like an investment pool,  you might think of it as a retirement fund for universities. Generally funded by donors that the university uses to support all kinds of operations. And usually they’re fairly complex structures sometimes with as many as 1400 different components depending on what the money is earmarked for. And so the funds are intended to be used in perpetuity, to support various operations of an educational institution

Salima Hamirani: The endowment primarily comes from alumni donations. You know, when your former university sends you mail every year asking for money. That money goes into the endowment. Most of the time it goes into a general fund. So it can be used for basically anything the university needs like equipment, or scholarships, or buildings. Sometimes universities have very big donors.

Kelly Grotke: Like Griffin at Harvard, he made the, I think the biggest single donation to Harvard. And I think it was in the realm of around 600 million or so.

Salima Hamirani: and the money from rich donors like can be earmarked for a specific use – to fund a particular program or even construct a lab. Which is why buildings are often named after very rich people. and not someone like me, who maybe donated a dollar in 2012.

Now the size of endowments varies, some are truly massive –

Kelly Grotke: At the top end, you have places like Yale, Harvard, Stanford, whose endowments tend to measure in the tens of billions of dollars. Then you have a whole range of institutions that have somewhat smaller, one to two billion. Some state schools have, because they get a lot of money from the state too, and don’t have as big of endowments as other places.

But you can say that generally the trend has been towards, you know, establishing an endowment as big as an institution can possibly make it. So trying to get as many donors as possible. The more money that you have, the more you can fund with that money potentially.

Salima Hamirani: These days universities also get money from other streams of income. MIT for example receives billions in funding from the Department of Defense. And that’s something to keep in mind, a modern university is a HUGE money making endeavor. Providing education is sometimes a small part of what they do, whether we agree with that or not –

Kelly Grotke: What came out with Columbia was that the actual revenues that Columbia gets from its students is relatively small compared to other sources of income. It’s a huge landowner in New York City. It has a hospital.

Institutions with enormous endowments that have a lot of other operations, do kind of raise the question about what the principal mission of the institution actually is. And it may be time to revise the idea that these kinds of big institutions are principally institutions of higher education. I think there’s an evolution into something that’s a little bit more hybrid, but the derogation of education, of higher education, into a kind of minor operation is, I think, a serious issue.


Salima Hamirani: OK, so now we have some idea of what endowments are, and how big they are. There’s billions of dollars wrapped up in university endowments around the country. Which makes them a great target for organizing divestment campaigns.

But, there’s a small problem. And this is something I didn’t know before talking to Kelly: the nature of college endowments has fundamentally changed in the past 30 years.

One of the reasons modern endowments have gotten so big has something to do with what’s called the Yale model. And this is where things start to get really interesting for organizers planning divestment campaigns. So back n the 70s and 80s, universities were still invested in public funds. So, things like the stock market. But in the 90s the Yale model changed all of that.

Kelly Grotke: It was basically a portfolio strategy pioneered by David Swensen at Yale. And what he did was start to invest in a lot of kinds of financial instruments that previously hadn’t really been used. We’re talking about the world of alternative investments, also called private funds. So we’re talking hedge funds, venture capital, real estate, investment trusts, private equity. Things like that. Which are higher risk, but also, so the theory goes, have the potential for a higher yield. So when Swenson was doing this, it was quite unique. He published a book basically detailing the strategy and told people, you know, don’t try this at home.

Salima Hamirani: At the time, his investment strategy was pretty new and very successful. Yale’s endowment ballooned under his stewardship

Kelly Grotke: In the years following, His pioneering method of portfolio management, a lot of other institutions, including much smaller ones, have basically adopted his strategies for managing their portfolios. Which means that ever large allocations of resources have gone into the world of private funds,

Salima Hamirani: Private funds are exempt from the Investment Company Act of 1940 which is supposed to regulate the world of finance if investments go south. But let’s say you’re really rich and want to throw your money into high risk investments and lose it all, then that’s your problem because supposedly, it won’t affect the broader economy. 

Kelly Grotke: But fast forward to where we are now, you’re seeing all sorts of entities investing in this world of private funds, which was once restricted to, you know, high net worth individuals. You’re seeing people’s pension funds go into these and ever larger allocations.

Salima Hamirani: And The world of private funds is extremely complicated – I lost a good portion of my life trying to understand them while researching for this show. So, even universities will hire outside managers, like hedge fund managers, to invest their money into an intricate web of holdings.

Kelly Grotke: What that does essentially is basically takes that money private. These investments are governed by contract. And they’re so secretive that I think only a few of them have really been leaked- what the terms of the contract are. But that means you lose a substantial amount of transparency, which was pretty much intact if you’re dealing with the world of stocks and bonds and publicly traded investments.

Salima Hamirani: Private funds are also more vulnerable, because they’re volatile. Universities suffered huge losses to their endowments in the 2008 market crash for example

Kelly Grotke:  And that propelled really a wave, a kind of a second wave of like, uber financialization. So what do you do when you’re in a situation where you need this money to fund various parts of your operations and the money’s not there? Well, you know, you go into something that maybe has potential for greater returns. But it’s not at all clear at this point, according to a lot of experts in the field, that those kinds of investments are necessarily making any more money than say a standard index fund would.

So the whole rationale for this hyper financialized and very secretive form model of investing is that you make more money at it. But it’s not clear even at this point that this is the case

Salima Hamirani: This is why the student’s first demand to disclose the university’s holdings is so important. Only the outside managers really understand what’s going on, and they’re sitting behind a curtain of secrecy, contracts and financial jargon. Even the heads of the endowment might not know what investments they’re holding. But the argument that maybe the university should know where the money is going, and should divest some of it, is often portrayed as naive by the media. Many financial experts argue that they have whats called a fiduciary responsibility to get a good return on their money.  So they must invest in whatever makes profit- even if its weapons producer

Kelly Grotke: Yeah, I think that’s basically the kind of message that is getting received by people who are daring to question or who would like to see their institutions align more with their own principles. 

The responsibility to grow the endowment is a matter of fiscal responsibility. I’m not saying that it’s, you know, unethical. I’m just saying that there is a real, there’s a distinction, an operative distinction between fiduciary responsibility and ethical responsibility. There are all sorts of reasons why it’s very hard to divest. But you have to keep in mind that, you know, I think some of these claims about fiduciary responsibility are untested. Meaning, I think that there are multiple reasons why that argument would be made: that it would be irresponsible, that the university would be damaged. We don’t really know. Okay. I mean, a skilled investment advisor should be able to navigate this terrain and invest money in all sorts of things all over the world. Because we don’t know what’s going on behind the scenes we can’t really gauge what effects there would be from divestment

Salima Hamirani:  What Kelly is saying here is important: It’s possible that universities could divest without hurting their bottom line. What if they made just as much money investing in public funds?  

Kelly Grotke: And so people should be willing to consider that their investments align with their stated values.

Salima Hamirani:  You’re listening to Kelly Grotke talking about university endowments and divestment. And we have a lot more to dig into, right after the break.


Salima Hamirani: We’re just jumping in to remind you that you’re listening to Making Contact. If you’d’ like more information please visit us online at

And now, back to the show.

Salima Hamirani:  Welcome back to making contact. In the first half of the show we sat down with Kelly Grotke who researches higher education and financialization,  to learn about endowments: What they are, how they function and how they’re invested. We’re continuing that conversation in the second half. Specifically I wanted to how these new investment models, such as the yale model affect how students run divestment campaigns.

Salima Hamirani (from interview):  Andrea – I guess a big question is, if today, a lot of an endowment’s investments are secret, is it possible to know whether a university has truly divested or not?

Kelly Grotke: You’re absolutely right. There’s no real way to check. I mean, you would have to rely on trust, basically, and it would probably be a kind of second hand trust because the university outsources a lot of its investment activities, most do at any rate to outside managers. So you’ve got trust two levels removed.

The more serious question is that the landscape is very different than what it was back in the seventies, eighties, nineties, when divestment from South Africa was going on. And that was a long term campaign and it took a long time and there was a lot of resistance to it too. But at the time, I think most colleges and universities wouldn’t have as heavily been invested in the Yale model type thing with the substantial allocations to private funds.

It’s not even clear that in some cases they can even publicly declare what investments related to the war in Gaza they might have. they might not even be able to disclose this because of the nature of the contracts. If they did that, that potentially they could be sued because these things are considered the intellectual property of the fund managers.

Salima Hamirani:  That’s a huge problem we just heard. Not only are some universities in the dark about how their endowments are being invested – just trying to find out where their money is going might trigger an intellectual property lawsuit. 

So transparency wouldn’t just benefit the students involved in the current divestment campaign for Palestine. It could benefit everyone involved in higher education. The entire university community should have some awareness of where money is going and how it’s being spent.

Kelly Grotke: What’s happened in Gaza has, has really the potential to blow up a lot of this secrecy and to raise a lot of really important questions about the relationship between, you know, ethics and finance and what kind of world we want to live in.

Salima Hamirani:  So what does this all mean for organizing? Well for one, Kelly thinks that transparency is a good start.

Kelly Grotke: Demanding transparency is an excellent issue to organize around. I’ve done a little bit of that myself with an alumni organization and we’ve insisted on it for quite a long time. It’s very hard, but as non profit institutions of higher education, I think transparency should be part of what they do as a matter of routine.

Salima Hamirani: But she also says that it’s important not to get too bogged down in the financial jargon and the opaque rules. Because at the end of the day, the students have an ethical argument that isn’t addressed by the rules of finance. It’s a different unshakeable core the students can hold onto

Kelly Grotke:, there’s a political virtue, I think, to a certain intransigence. You know, that no matter what you’re told about the reality, the complexity, the ethical demands remain. That doesn’t mean that you shouldn’t learn about and educate yourself about the world of finance and the complexities involved with actually divesting. But there’s also just the insistence on the ethical center of the message. Because I don’t think that finance has anything really, that is equivalent to that.

fade out music

Salima Hamirani: That was Kelly Grotke founding partner of Pattern Recognition – focusing on financialized higher education. And we’re not done quite yet! To end the show we really wanted to hear from Andrea Pritchett, a former student organizer, from the campaign against South African Apartheid. Because one thing I’ve learned over the years covering social movements is that nothing we do is completely new, and that we always have so much to learn from the past. Andrea wanted to share what she learned from her time at an encampment back in the 80s, and what advice she would give to students today –

Here’s Andrea –

Andrea Pritchett: My name is Andrea Pritchett, and I am a co-founder of Berkeley Copwatch. I’m an eighth grade history teacher. And I’m a long time resident of UC Berkeley and a graduate of UC Berkeley.

Andrea Pritchett: in the fall of 1984, there was a lot of unrest in South Africa and folks were making protests across the country. The Democratic Party was actually leading the charge in  sponsoring arrests at South African consulates in protest of the apartheid regime. Through the winter in December of 1984 at UC Berkeley 38 people got arrested, And then by the spring of 85, there was a higher level of student activism and we began a sit-in that lasted for six weeks on the steps of the main administration building called Sproul Hall.

Salima Hamirani: I asked Andrea what she thought worked during that time, especially what tactics were especially useful.

Andrea Pritchett: Well, what, what worked was, reaching out across constituencies and really building up some, some serious unity with labor unions.

Salima Hamirani:  She said that an ILWU strike really made an impression on the students -that’s the International Longshoremen’s and Warehousemen’s Union. They refused to unload ships from south africa for weeks and faced serious consequences –

Andrea Pritchett: their example of sacrifice, I think, really infused us with a level of seriousness that created momentum that lasted for the next couple of years, honestly.

Salima Hamirani: The strike also reminded the students to leave campus and make connections – so that they could share the wider call for divestment

Andrea Pritchett: Taking the time to reach out and go make presentations to organizations that are not on the steps. What we learned is that, yes, the sit-in is important, but at the end of the day, it’s symbolic. It wasn’t stopping the functioning of the administration building. It wasn’t stopping anything. It was just an organizing hub.

I’ll tell you another thing that actually kind of worked was when the faculty senate got activated, they created something called the California Plan. A professor of economics named Claire Brown, and some other professors, wanted to counter some of the propaganda from the university, where the university was saying things like, “Well, if we divest, we’re going to hurt the black South Africans, and, We’re going to suppress the economy of those poor people. We can’t do that to them.” And they had all these justifications. They also said that we have a fiduciary responsibility to get as much money as we can. 

Salima Hamirani: Sound familiar? We talked about this argument in the first half of the show. In Andrea’s time, because there wasn’t so much secrecy around the endowment, they were able to dismiss the claims of fiduciary responsibility. 

Andrea Pritchett: So what the academic Senate did is they did an end run around around those arguments and by creating a step by step divestment plan, an analysis of the impacts of divestment, showing that the university portfolio would do as well or better by divesting from those companies. It really gave us power.

Salima Hamirani: But there were also a few things Andrea says current students should be wary of at this moment – and first, is actually a surprising one – Don’t get too involved in negotiations. Especially if they’re behind closed doors.

Andrea Pritchett: And so trying to avoid, you know, having leaders, honestly, because leaders,..I think it’s the nature of the beast at this point that we don’t trust leaders. You know, as soon as somebody starts to emerge as a leader and they get called into a backroom to some kind of negotiation, when they emerge from that negotiation, they’re going to be subject to a lot of suspicion and derision. One of our strengths at that time was our resistance to backroom negotiations. We said, look, these are our demands. If you have any updates on what progress you want to make towards those demands, write it up. We’ll copy it and distribute the information. We don’t need to haggle. 

Because actually we don’t have any power. The only power we have is this little encampment, you know, that could be swept away at a moment’s notice. It’s not real power, I think folks just have to be really wary about what you give up when you’re in a negotiation with the university. But there’s a lot of pressure. People go into these traditions…they yield before the university’s power and they think like, oh my god, if we don’t do it the way they do it, they’re going to call off negotiations.

Well, let them call it off

Salima Hamirani: Andrea told me that she’s speaking from experience. And that at one point they slipped and they did end up in a negotiation with the university. And it did not go well. 

Andrea Pritchett: But what happened to us was that we got kind of maneuvered into a back room and they’re like, oh, you guys, you can have whatever you want. You’re going to have a big protest at the Regents meeting? How many porta potties do you need? How many shuttle buses do you need? It wasn’t about porta potties. It was about police.  And they were getting us to give them information about our organizing so that they could better estimate how to stop our protests.

Salima Hamirani: Andrea also cautioned against trying to keep an encampment going indefinitely- its important to keep the end goal in mind, not just the tactic.

Andrea Pritchett: My hat is off to the UC Berkeley students who ended their encampment because. At the end of the day, we remember that encampments are a tactic, they’re not the end in itself. The point isn’t to keep the encampment going as long as it allows, as long as you can, you know, because what inevitably happens in these encampment situations is that they can get bogged down in logistics. That the whole point… you find yourself more worried about, will there be bagels in the morning for the campers than going out and talking to the AFSCME or SEIU locals. it’s like wait, we’re supposed to be doing political work over here You know and staying light and staying mobile and being able to respond to changing, you know to a dynamic situation. We, the mistake that we made was that people fell in love with the tactic. They just wanted to stay there indefinitely. And so, people end up voting with their feet. You know, they go home. And as summer was approaching here, and the reality that a lot of students were going to go back to their homes, I’m really proud of those organizers who said, we’re going to have closure, and we’re going to end this. And we’re not going to let the police end it. I hope folks around the country take note of that too, that it’s okay to stop, it doesn’t mean defeat. It means a change in tactic because you gotta keep your goal in mind.

Salima Hamirani:  When Andrea and I were talking about the current student encampments she also told me she was really impressed. For one, the example of the student divestment protests have already spread beyond the university into other areas.

Andrea Pritchett: I can personally thank the students for creating the momentum. That allowed my union yesterday to vote, you know, the executive board, 25 to 4 in favor of divestment.

Salima Hamirani:  As a middle school teacher, Andrea is part of the Berkeley Federation of Teachers. And the vote to divest meant that they’re pulling their pension funds out of Israel. Berkeley is a small town, but Andrea says that if they scale up, this could be a game changer.

Andrea Pritchett: If we get the other unions in California to make that same call, which is what we’ve approved and that’s our action plan. If we can get the California Federation of Teachers to call for Calstrs to divest, that they’ve got like $330 billion that they control. And so if California teachers just that one constituency can prevail upon our union and influence Calstrs, that’s huge. You know, and if that becomes, if these dominoes start to fall, we, we will change the trajectory of this. I really do believe it

So that, you know, don’t underestimate the ways that these actions ripple out. I’m a middle school teacher. We’re having walkouts. We’ve had three walkouts of middle school students desperate to get up to the encampment and be with the college kids to speak their hearts, So there’s, there’s a lot of ways that we impact people that we don’t get to see it affects people.

Salima Hamirani: This part of the conversation really stood out to me – The encampments made such an impact on Berkeley teachers that they voted to divest their pensions. That’s Huge. They’ve also inspired younger students to walk out and join the encampments at the university nearby. College campuses are sometimes very isolated from the communities that they sit in. The example of the students for Palestine broke that barrier. That’s not a small feat.

However, despite all the similarities between Andrea’s time in the encampments in the 80s and the student protests today. There are some stark differences. While there was plenty of backlash to the divestment campaigns, the students weren’t being physically attacked by counter protesters. The encampment at UCLA was brutally attacked one night- students were beaten, pepper sprayed and viscously attacked. 

Ambi: sounds of clashing at encampment

Andrea Pritchett: When you’re under siege like that, when you feel vulnerable, not only to the police, but to these random attacks, the temptation is to barricade yourself in, but we have to be careful because when we barricade ourselves in, our connection to the wider public gets broken and that’s what they want to do.

That’s what they’re trying to do. They want to isolate our movements. We have to, instead of falling for that, we’re not an armed resistance. We’re not a resistance movement. We’re a political movement. And I think remembering that, that.. how do we bring in new folks? That’s always the question. How to keep the door open despite whatever kind of obstacles or challenges or attacks we might have to endure.

Salima Hamirani:  That was Andrea Pritchett, middle school teacher and cofounder of Berkeley Cop Watch. And we’d love to hear from our audience: are you on a board of directors for an organization that’s thinking of divesting? are you a student that has questions? Are you a worker currently wondering where your own retirement funds are going? There’s so many ways the promise of the encampments can continue to affect how we think about money and investments. Leave us a comment and as always you can find links on divestment and our guests on our website www.radioproject. And that does it for today’s show. I’m Salima hamirani. Thanks for listening to Making Contact. 

Author: Radio Project

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