Billionaire pledges to pay Morehouse College graduates’ student loans - Activate World

Billionaire pledges to pay Morehouse College graduates’ student loans

Robert F. Smith gave the 2019 commencement address at Morehouse College in Atlanta. His speech to 396 graduates touched on Mr. Smith’s education and experiences launching a highly successful career. Then he departed from his prepared remarks and said, “My family is going to create a grant to eliminate your student loans!”

Lunchtime Conversations:

  • Alexandria Ocasio-Cortez tweeted “This could be the start of what’s known in Econ as a ‘natural experiment. Follow these students & compare their life choices with their peers over the next 10-15 years.” In your opinion, how will these graduates’ lives change in the future due to their student debt cancellation?
  • Mr. Smith co-founded a private equity firm, which receives a significant tax break in the income he earns. Instead of a large giveaway, would addressing the tax code be a better initiative?
  • What role should universities or the government have in helping lower income people access and afford college?

Noteworthy:

  • Robert Smith’s gift is estimated to be worth about $40 million, making it the single largest individual donation to a historically black college or university.
  • Mr. Smith founded Vista Equity Partners, a private equity firm that buys and sells software firms. Vista has unconventional hiring practices seeking skilled engineers and managers from different professions rather than focusing on Ivy League degrees or Silicon Valley backgrounds.
  • Having applied for an internship at Bell Labs in high school, he was told he was too young. Mr. Smith called every Monday for five months and finally got the position. 

Storyline:

Mr. Smith told the commencement audience that his gift was meant to set an example of paying forward.

“Let’s make sure every class has the same opportunity going forward, because we are enough to take care of our own community,” he said. “We are enough to ensure we have all of the opportunities of the American dream, and we will show it to each other through our actions and through our words and through our deeds.”

According to a friend, Mr. Smith had become increasingly concerned in recent years about the degree to which students leave college saddled with heavy debts, including many at Morehouse. This was something that gnawed at Mr. Smith as he prepared to accept an honorary degree from the college.

Mr. Smith said that before he got in to private equity and made his fortune, he was a chemical engineer who “spent pretty much every waking hour in windowless labs doing the work that helped me become an expert in my field.”

That was the foundation of his success, he said. “Only after I put in the time to develop this expertise and the discipline of the scientific process that I was able to apply my knowledge beyond the lab,” he said. “Greatness is born out of the grind. Embrace the grind.”

Mr. Smith emphasized the responsibility of the graduates’ new diplomas, “The degree you earn today is one of the most elite credentials that America has to offer,” he said. “But I don’t want you to think of it as a document that hangs on a wall and reflects what you’ve accomplished up till now. No. That degree is a contract — a social contract — that calls on you to devote your talents and energies to honoring those legends on whose shoulders you and I stand.”

Sources: CBS News, The New York Times, The Wall Street JournalThe Washington PostThe New York Times

Photo by Caleb Woods on Unsplash