Opinion | Divesting From Israel Is Impractical and Illogical

“Disclose, divest, we will not stop, we will not rest” is a frequent chant ringing through pro-Palestinian college protests. Of all the actions one could advocate in the war between Israel and Hamas, protesters at Columbia listed, as their first demand, that it divest from companies and institutions that, in their view, “profit from Israeli apartheid.”

Israeli companies aren’t the only target. A proposal Columbia students put forward in December calls for divestment from Microsoft, Airbnb, Amazon and Alphabet, among others. Microsoft is tagged for supplying cloud software services to Israel; Airbnb is targeted for posting rentals in Israeli settlements in the West Bank, listings the platform said it would remove in 2018. The company reversed this policy months later to settle lawsuits.

Administrators at some universities, including Brown and Northwestern, have agreed to talks with students about divestment as part of agreements to end campus encampments. Other schools have said point blank that they will not accede. The University of Michigan Regents, for one, in March reaffirmed “its longstanding policy to shield the endowment from political pressures and base investment decisions on financial factors such as risk and return.”

“Longstanding” is a debatable term, as it was only three years ago that the regents decided the endowment should stop investing in funds focused on certain fossil fuels (which affected the firm I work at). Before the war in Gaza, it had been pretty easy for universities to make compromises around divestment demands, but those expedient choices are haunting them now. Every investment in elite schools’ endowments is up for debate.

College endowment managers no doubt feel beleaguered that pressing moral questions regularly end up on their desks. For that desk is already covered with spreadsheets on another question: how to generate returns for universities that are nonprofits, unfathomably expensive, and desperate to not be just finishing schools for the rich. Last fiscal year, endowments over $5 billion provided 17.7 percent of their university’s budgets. This school year, Williams College charged $81,200 in tuition and fees. But spending per student was $135,600. The endowment helps make up the difference.

Yet activists view endowments with a sense of ownership. They are part of a community that owns this money. They also go after endowments because they lack better targets. It says something about the authority of ideas in our age that students lobby institutions dedicated to the advancement and propagation of knowledge mainly over what they do with their excess cash.