What’s in This Week’s Issue…

Good morning. Brown University charges nearly $93,000 per year and still runs a $46 million deficit. It’s the figure that pushed one Brown undergraduate, Alex Shiek, to start asking an uncomfortable question: where exactly does all this money go?

Harvard’s endowment crossed $53 billion while student loan defaults quietly touched record highs. Somewhere between those two facts, the math stopped working.

For decades, the promise was simple: take the debt, earn the degree, unlock a better life. That belief held the entire system together until now.

So this week…

• 🏆 The Big Play: How universities turned student debt into a profit engine

• 💪 The Power Move: What actually changes when you stop playing along

• 💵 Follow the Money: Can California replace the US in the World Health Organization?

-GEN

🏆 The Big Play

The biggest money power story of the week.

How Universities Became Hedge Funds Disguised as Schools

For most of the 20th century, college was a gamble that paid off. And a degree signaled access. Employers trusted it, banks priced loans around it, and families built entire life plans on it.

Then the payoff stopped.

Since 2000, median wages for college graduates have barely moved and have struggled to outpace inflation over two decades. Over the same period, tuition tripled. Student loan debt crossed $1.7 trillion. And today, roughly one in five borrowers is seriously behind on payments.

This isn’t just another bubble. What makes it different is who’s insulated from the damage:

1. The Administrative Money Machine

Alex Shiek wasn’t a whistleblower or activist. He was an undergraduate at Brown and had a simple question: Where does $93,000 per year actually go? 

So he looked. He scraped public data, catalogued administrative roles, and emailed staff asking what they did day to day.

Here’s what he found:

• Brown employs 4,000 administrators. Not professors, administrators.

• Since the 1990s, administrative hiring has grown far faster than faculty or enrollment.

• Spending on student services and administration has far outpaced spending on actual instruction.

• Many administrators have their own administrative assistants, who have their own assistants.

When Alex asked for clarity, the response wasn’t transparency. Brown warned staff not to reply. Then they initiated disciplinary charges against him for "emotional harm" and violating the technology policy. An anonymous email even sent him his own Social Security number.

The message was clear: don't ask where the money goes.

2. The Debt That Never Dies

But the administrative bloat is just the visible waste.

In 2005, Congress made student loans effectively impossible to discharge through bankruptcy. Overnight, education debt became permanent.

That single change rewired incentives across the system. Universities could raise prices without fear, and students could always borrow more. And unlike every other form of lending, there was zero risk for the lender or the school:

• Federal student loans expanded, removing any incentive for universities to control costs.

• Graduate programs exploded because grad students can borrow virtually unlimited federal loans.

• Master's programs now charge $50,000-plus per year, while the number of Americans with graduate degrees has nearly doubled since 2000

The job market didn’t absorb this surge. So students responded rationally. They borrowed more, stacked credentials, and hoped the next degree would finally work.

It rarely did. Debt fed desperation → esperation fed enrollment → Enrollment fed debt.

And universities got paid every single time.

3. The Tax-Free Hedge Fund Problem

Here's where it gets interesting.

While students borrow to pay tuition, universities invest that revenue in massive endowment funds that operate exactly like hedge funds, but with one critical advantage.

Taxation:

• Harvard's endowment sits at $53 billion. It's managed by Harvard Management Company, a professional investment firm that invests in private equity, hedge funds, public equities, and even a vineyard in California.

• Most hedge funds pay 25% to 45% in taxes, while these elite universities’ endowments pay between 1.4% to 8% at most.

• This tax advantage compounds over decades, allowing endowments to grow exponentially faster than any private fund could.

In theory, these funds exist to support education. In practice, most are structured to preserve capital and legacy. Roughly 80% of Harvard’s endowment is donor-restricted, legally locked into purposes that often have nothing to do with lowering tuition.

Even when costs explode, flexibility doesn’t follow.

In 2022, a lawsuit accused Ivy League schools of coordinating financial aid offers to keep them uniformly tight. The institutions settled for tens of millions rather than defend the practice.

So, students took the loans, universities took the capital, and endowments took the upside.

All while belief filled the gap. Until it didn’t.

💪 The Power Moves

Playbook for understanding the game of power.

How You Can Still Win in a Rigged System

Systems like this don’t collapse because people get angry. They collapse when people stop believing compliance is worth it.

That’s already happening.

Some graduates double down, chasing one more credential in hopes of outrunning debt. Others embrace something closer to resignation, defaulting strategically and treating credit scores as collateral damage.

Both reactions point to the same truth: the spell is breaking.

So here’s what you can do:

• Stop treating credentials as default assets. Before taking on more debt, force the numbers to justify themselves.

• Then look outside the monopoly. Many companies no longer require degrees if competence can be demonstrated.

• Finally, see universities clearly. They are not moral authorities. They are revenue-optimized institutions protected by policy and belief.

The Takeaway:

The higher education system isn't broken. It's working exactly as designed, extracting maximum value from students while insulating itself from risk.

But systems designed to profit from failure only survive if people keep believing they have no choice.

The moment you realize the degree isn't worth the debt, the game changes. And when millions realize it at once, the whole structure collapses.

💵 Following the Money

Three of the wildest financial and corruption stories from around the world.

#1 - Can California replace the US in the World Health Organization?  

#2 - US trade allies are looking elsewhere. Here’s what that could mean for you

#3 - US accused of war crimes after disguising an attack plane as a civilian craft in a boat strike

✨ Poll time!

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