Historically, private for-profit organizations have struggled to remain financially stable.
For decades, Harvard University has remained above many prestigious rankings, along with seven other Ivy League schools, Stanford, MIT, and the most elite, expensive, private nonprofit institutions in the country.
If President Donald Trump succeeds in revoking the status of tax-exempt or federal grant eligibility that he threatens to do on multiple occasions in the past month, America’s oldest university, founded in 1636, can be on a list of schools that are much different than his 400th birthday.
You can attend the University of Phoenix, Hillsdale, Austin and Bob Jones University.
These agencies are one of the schools that, according to their respective websites, currently or in the past, operated without tax-free status or were not supported by the federal government decades later.
Unlike Harvard University, most of these schools operate as business or conservative religious institutions, with no major research centres.
Nor are there any billions of donations sponsored by wealthy alumni donors.
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Still, each of these institutions has a unique identity.
It is located in a small office, but with continued help from wealthy donors, it plans to expand to a residential campus.
The agency operates with non-commercial tax-free status, but it does not receive public funds, according to its website.
“If we were imitating the traditional model of higher education, yes, starting a new university would cost billions. But we haven’t done that,” the website says.
“Building a university from scratch gives us the opportunity to revisit university heritage practices, dramatically reduce the costs of university management, and ensure that the funds are directed to academics as much as possible.
“UATX is developing a new financial model that reverses the bureaucratic bloat of Higher Ed, improves student experience and minimizes fees.”
The school played a role in the abolition movement in the 1860s, educating hundreds of Union soldiers.
However, when forced to track student registrations by race in the 1970s, school administrators resisted federal missions and have since refused federal assistance, according to the university’s website.
However, after years of economic struggle, the school changed its status to a nonprofit in 2024, in a partnership with the University of Idaho, according to the university’s website.
Bob Jones University recently appeared in the news as an example of what will happen to Harvard.
In the 1970s, the federal government revoked Bob Jones’ tax-free status due to discriminatory admission practices for interracial marriages and black applicants.
Due to the declining population of America, the growth of vocational training programs, and the decline in confidence in higher education, many public and private institutions struggle financially, even state and federal grants.
Universities and universities that go on their own without tax credits or government assistance will pose even greater disadvantages.
Of the 99 institutions of higher education that were closed in 2023, 54 were for-profit, private institutions, 17 were private four-year schools, 15 were public two-year schools, 7 were private two-year schools, and two were public four-year schools.
The battle between Trump and Harvard comes from a series of executive orders banning DEI (diversity, equity, and inclusion) programs in higher education and an obligation to fight campus anti-Semitism in accordance with the Civil Rights Act of 1964 and the Supreme Court decision of 2023.
The wealthiest schools have been investigated, and some of them, including Harvard, have been accused of allowing anti-Semitic activities on campus in the wake of the terrorist groups’ attack on Israel on October 7, 2023.
The Trump administration initially frozen grants and contracts over $2.2 billion. Most of it relates to Harvard’s medical and scientific research, threatening to cut off billions more if the university ended the DEI and failed to meet the list of conditions to address campus anti-Semitism.
Harvard refused to comply, and Trump posted on social media the first of two threats to cancel the university’s tax-free status.
Trump proposed on April 30 that Harvard University will not receive federal grants.
The agency has not yet responded to Trump’s latest announcement.
Harvard University spokesman Jason Newton previously said losing tax-free status would put the university’s education mission at risk.
“It would mean a decline in student financial aid, abandoning important medical research programs, and losing opportunities for innovation,” he said in an email response to the Epoch era.
“The illegal use of this instrument will become more widely illegal, and will have serious consequences for the future of higher education in America.”
Kim Helman, executive director of the Southeastern Legal Foundation, said in the court battle between Harvard University and the current president, defenders of the country’s current state of higher education should be reminded just two years ago that the Supreme Court ruled that Harvard University could not allow or refuse students to admit or reject students based on race.
The foundation has sued several cases involving DEIs in education.
Hermann said that means there is no reason to doubt the federal government will win again, whether it involves federal grants or revocation of IRS tax-free status.
Despite Harvard’s complaints pointing out that federally funded research programs have nothing to do with campus anti-Semitism events, she said universities that are discriminated against by race and national origin and allow hostile circumstances should not receive money from US taxpayers.
“We cannot create an accounting entry into a place where discrimination is occurring,” Hermann told the Epoch Times. “If Harvard continues to discriminate based on skin color, if the facts pan out, they (the Trump administration) have a great case.”
The Epoch Times contacted Harvard for an updated response.
