When Colleges Defraud Donors

Richard Vedder:

Colleges rarely sue one another, so when little Hillsdale College in Michigan sued the much larger University of Missouri a couple of years ago, it raised some eyebrows. Hillsdale alleges that Mizzou blatantly violated the terms of Wall Street financier Sherlock Hibbs’ will, who left $5 million to his alma mater upon his death to create multiple chairs to be held by “disciples” of the Austrian school of economics. Hibbs, who died in 2002, was a strong adherent of that approach to economics, led in the 20th century by Ludwig von Mises and Friedrich Hayek, asserting, among many other things, that market-based solutions to problems are generally superior to those imposed by governments. Austrian economists are generally libertarians or at least market-oriented conservatives.

Last week’s Wall Street Journal’s account of the current brouhaha by Hillsdale alum Nicole Ault revealed the published vitae of about two dozen members of the Department of Economics (the logical home of Austrian economists) at Mizzou. None had a remotely Austrian orientation. I then learned the names of the alleged Austrian disciples holding Hibbs financed positions, all teaching management or marketing courses unrelated, as far as I could tell from published vitae and course offerings, in any important way to Austrian economics. To be fair, Mizzou once did have a genuine (and good) Austrian economist, Peter Klein —but he left in 2015 to go to Baylor, and I do not believe he was funded with Hibbs money.