The other side of the argument is that if the facade is not there, if they only admit rich people, the university will lose its reputation and become irrelevant overnight.
The thing that gives elite universities their reputation both their academic reputation and the elites that attend them. If they lose the academic reputation, the unis become irrelevant and might as well be a party house for rich people; no one will care except tabloids. If they lose the elites, the universities will still be prestigious universities.
So to spell it out, what I’m saying is that rich people attending elite universities are not important for elite universities. It mainly benefits rich people.
Most of the financial aid given out by these schools isn’t federal aid. They even give full rides to international students who aren’t eligible for federal at all, and middle-class kids whose families have too much income to be eligible. This aid is funded by the endowment which is donations from rich people.
I think when people say Princeton receives a lot of federal money, they are talking about research grants, and possibly the effective subsidy that comes from the tax deductible status of donations from rich people. Each of these adds up to a lot more money than the Pell grants.
If you take away the rich people, the school won’t be able to afford to operate this way.
> The other side of the argument is that if the facade is not there, if they only admit rich people…
I believe the point was that these schools don't need to accept subsidized student loans or other forms of federal funding. That doesn't mean only admitting rich people; they have enough resources to offer student aid to bring in the academic overachievers on their own, thus maintaining their reputation without federal help.
The thing that gives elite universities their reputation both their academic reputation and the elites that attend them. If they lose the academic reputation, the unis become irrelevant and might as well be a party house for rich people; no one will care except tabloids. If they lose the elites, the universities will still be prestigious universities.
So to spell it out, what I’m saying is that rich people attending elite universities are not important for elite universities. It mainly benefits rich people.