Wednesday, October 27, 2010

Crunching the Numbers

Last night I attended a Young Alumni meeting at Yeshiva University. I learned the following things:

-Yeshiva University is currently running on a 22 million dollar structured deficit; the prediction is that President Joel runs out of cash (not endowment funds, but cash) next year

-Due to this, the plan is to cut 12 million from the budget by next year. That way, President Joel will have cash to play with for four years.

For anyone who is interested in more information about these numbers, why it is this way and what you can do about it, email Barbara Birch at the Office of Alumni Affairs at

There was one point that President Joel made that particularly resonated with me. He asked us to image a world without YU. What would Judaism look like without YU? That's when it started to hit me- you'd have Boro Park and liberal Judaism, perhaps a few Jews drifting somewhere in the middle because they're graduates of Touro or TI-and nothing in between. Imagine a world totally untouched by YU: no college, no university, no RIETS Semikha program, no YU Rabbis, no YU Kollels, no Center for the Jewish Future programming, no Azrieli teachers in Jewish day schools, no doctors from Einstein, no psychologists from Ferkauf, no business majors from Sy Syms. Basically, imagine YU didn't exist at all.

If you're part of the circles in which I move, such a thing is almost impossible. Your everyday interactions revolve around some sort of Yeshiva University connection, whether it's a rabbi you respect, the fact that you were once a student there, the psychologist you see weekly, the doctor who gives you a check-up, the kid who donated bone marrow to you and swabbed at a YU Gift of Life event. Whether you realize it or not, you have been changed for the better because of something to do with YU.

What we have to realize is that the burden of supporting this institution falls upon our shoulders. It may not be everything that we envisioned and it cannot be all things to all people. But it holds a place of supreme importance in the Jewish world. And a Jewish world without YU and everything it entails is a scary prospect.

We give money all the time because we don't want to live in a world without the State of Israel. I'm not saying it's the same thing, because it's not (for one thing, because YU isn't a country) but it's still pretty important. Imagine America without Yeshiva University and you have dealt a death blow to committed, relevant Orthodox Judaism in the States. Whether or not you were a student at YU yourself, in some way, you've benefited from the institution. It's just good practice to say thanks.


Jennifer.Freiman said...

This scares me! I'm hopefully looking into going there after this year..I feel like it's the perfect environment to flourish in! Thank you for writing this, hopefully others are influenced by it!

TPW said...

Hopefully people with means will donate to YU--the university has been my home for the past three years and I love it deeply.

There is one very simple thing YU can do immediately to save money (and probably lots of it): implement a more efficient temperature system in all buildings and dormitories.

When I was in Stern, I used to wear t-shirts in the winter because the buildings were so hot. In fact, my dormitory was so hot that I slept with my window open throughout January and February, and I know several people who simply turned on the AC. In summer, I wore sweaters because of the way-too-high air conditioning. It was an utter waste of money and energy.

EJB said...

I would suggest YU transfers Stern's AC units to YC dorms. We have the opposite problem in the summer months. That way, dormers can actually sleep in their room in the hotter months, as opposed to in a lounge (or even in the library :-O)

Ezzie said...

I'd LOVE to see the breakdown of those numbers, but regardless - there's no way that a place with $882,063,490 in endowment funds is going to disappear so fast.


Obviously a $22M loss is nothing to sniff at, but let's be real: The overstatement of YU having to shut down is downright ridiculous when their endowment is sitting on $800M, far more than some of the schools ranked higher than them.

I also think the impact would be less than you might expect, since it wouldn't disappear retroactively but would slowly cut down various programs that lose money.

While perhaps this money is already factored in somewhere, the earnings on those endowments most likely more than covers those losses - they simply didn't expect the $100M or so hit they took from Madoff (for which they bear some responsibility for not noticing was amiss, as an institutional investor).

If the $882M is earning just 4% on average, that is over $35M in earnings a year. At a more likely 8%, that's $70M - and I'm guessing they get tax benefits (no tax?) on that, too.

YU isn't going anywhere so fast unless someone is really horrible with managing their assets.

Chana said...


The interest on endowments goes to fund student scholarships. Just last year they gave $37 million dollars as financial aid to undergraduate students (both merit and need-based). $12 million of that was endowed scholarships. The rest was interest or simply invented because of the need.

The point is: they are not trying to scam you. They actually need the money. And people should give money.

Ezzie said...

$12M from endowments is not exactly a lot - requiring barely 1.5% interest on the endowment amount listed.

Like I said - I'd love to see their numbers in full. But the statement "imagine a world without YU" is so far from where they are now it's laughable. Perhaps it's "imagine YU with some small cutbacks", but it's not like they're disappearing so fast.

Chana said...

Well, the point of the statement wasn't to suggest that they are disappearing tomorrow, just that we should be cognizant and responsible of the fact that we need to do our part to make sure they stay awesome.

Ezzie said...

Which is fine, and expressing the importance of the various programs and what those costs are would do so without saying "imagine a world without YU".

Chana said...


It would have bored most of us to death. If you want the numbers and what everything is used for, they have that data- email Barbara- that's why I put her email in the post. In short, there's no need to complain- the solution is right there.

YU Alum said...

I would give, if only they had done a less crappy job of preparing me for the job market...

Anonymous said...

YU deserves our support, at the same time imho they need to review their vision and mission and value proposition and how to implement them in tough financial times.

Joel Rich

Anonymous said...

This is a very important post. Thank you for writing it. My husband and I have two students @ YU and the financial help they receive is very much appreciated. All I can say is that YU needs to be supported and all parents who send their children there should make an effort to give back...even if it's as little as $25 and strive to give more.

Unknown said...

YU is a very important institution.
However their tuition,dorm and other costs are astronomical.
To charge around 45,000 dollars per year isoff the charts.

Ezzie said...

I understand it would bore most people to death; I also am not complaining. I simply feel that making somewhat outrageous statements that imply YU is going to close without money asap seems pretty odd, in light of their nearly $1B endowment.

You likely have never heard this, but an oft-cited criticism of YU's funds management is that they keep extra in the endowment to keep themselves in the US News top 50, since endowment money is a surprisingly large factor in their calculations. I personally don't believe this to be the case, since as I noted there are some schools near them in the rankings with substantially less money in their endowments, but that those schools are able to be so highly ranked despite larger student bodies and smaller endowments makes me think that perhaps it's not in quite the dire situation as implied in the post.

I've requested the numbers, we'll see what they actually give out information-wise.

Also, it's somewhat contrasted with what Pres. Joel wrote last year: "While certainly this represents a painful decline, we are in the same or better position as many universities. Although this decreased endowment must factor into our long term fiscal plans, it will have minimal impact on day-to-day operations. Total income from endowment last year represented 13% of the University's operating income."

The only way this all makes sense is if they're saying we don't want to touch the endowments and want to keep the operating income almost solely from itself - which is a very defensible position. At the same time, you can't say that but also say "imagine a world without YU" - that they want to avoid touching the endowment money does not mean that the endowment money is untouchable.

Shades of Grey said...

This post really scared me.

Did Barbara talk about any current fund-raising endeavors involving young alumni?

An idea that just popped into me head. Perhaps we (meaning you and I, as well as whoever else) could start a fund-raising campaign for newlyweds to donate a portion of their wedding gift cash or their ma'aser money (and/or whatever amount they could legitimately afford) to YU. Everyone could and should be encouraged to donate, and it would be very nice to see some of the more affluent young couples sincerely look within themselves and give within their more-than-meager means.

Certainly if a young couple legitimately needs their money to live off of, they wouldn't have to donate as much, but I am willing to bet most couples could donate a few hundred, perhaps even $1,000 to YU safely without harming their ability to support themselves.

What do you think?

Anonymous said...

While I have tremendous respect for YU as a leading institution in Modern Orthodoxy, I think you overstate YU's importance as a centrist Orthodox force. I, for one, am a full member of the centrist Modern Orthodox community--eschewing both what you refer to as "liberal" and "Boro Park" Judaism, respectively. However, I attended a non-YU college and graduate school that had flourishing Jewish communities that were vibrant and steadfastly dedicated to halakha. If we look beyond the narrow group of doctors, therapists, businessmen, and other professionals who have emerged from YU's (often less than stellar) graduate schools, we find a brilliant and accomplished community of Orthodox professionals, academics, and scholars who graduated with honors from the halls of America's greatest universities--ranging from Harvard and Penn to Yale and NYU--and still constitute potent forces within centrist Orthodoxy. Need I remind you that our spiritual founder, Rav Yosef Dov Soloveitchik, zt"l, was a graduate of the University of Berlin and his father's private sefarim room--not the peculiar, dual-curriculum melding of secular and Jewish studies that is YU.

To sum up then, while I acknowledge that YU provides great programming for the Modern Orthodox community (from which I too benefit), it itself is not the be-all-and-end-all of that community. Your characterization of centrist Orthodox Jews who are not actively associated with YU as "Jews drifting somewhere in the middle because they're graduates of Touro or TI" is a bit too inward looking and detached from reality. Looking beyond YU's walls, we can see Modern Orthodoxy supported by numerous other institutions and producing a multitude of non-YU-educated Torah scholars, academics, and professionals.

Noam said...

There will always be the left leaning "boropark" Jew or the liberal Jew with right wing tendencies. MO is not down and out.
On the other hand there is a basic human trend to always strive, in Judaism its usually a slow right creep.