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Billionaire Pledges to Pay Loan Debt of This Year’s Morehouse College Graduates

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4 years ago

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  • Billionaire investor Robert F. Smith promised to pay off the student loan debt of the 2019 graduates at Morehouse College, an all-male historically black school in Atlanta, Georgia.
  • Though the exact amount of the class’ debt is still being calculated, the gift is expected to be around $40 million.
  • This is just one of Smith’s major donations in recent years.

A Generous Gift

Billionaire tech investor and philanthropist Robert F. Smith said he will pay off the student debt for all graduates in Morehouse College’s class of 2019.

Smith announced the news on Sunday while delivering the commencement address at the all-male historically black college in Atlanta, Georgia.

“On behalf of the eight generations of my family who have been in this country, we’re gonna put a little fuel in your bus,” he said. “This is my class, 2019. And my family is making a grant to eliminate their student loans.”

His announcement shocked the nearly 400 graduates, who reacted with cheers and applause.

One graduating student named Aaron Mitchom told the Associated Press that he had drawn up a spreadsheet to calculate how long it would take him to pay off his $200,000 in student debt. According to his math, it would take him about 25 years.

“I can delete that spreadsheet,” he told the AP after the commencement. “I don’t have to live off of peanut butter and jelly sandwiches. I was shocked. My heart dropped. We all cried. In the moment it was like a burden had been taken off.”

Brandon Manor, another graduate, told the New York Times, “Now all of a sudden, I can look at schools I might not have considered, because I am not applying with about $100,000 in undergraduate loans.”

Who is Robert F. Smith?

Smith, the founder and CEO of the private equity firm Vista Equity Partners, is worth an estimated $5 billion and is the richest black man in America, according to Forbes.

The 56-year-old who originally hails from Colorado but now lives in Austin went to Cornell for his undergraduate degree and earned a B.S. in chemical engineering. Afterward, Smith earned his MBA from Columbia Business School.

He went on to work for several companies like Kraft General Foods and then Goldman Sachs, advising companies like Apple and Microsoft before founding his own investment firm.

What does this gift mean?

Smith’s pledge stunned administrators, who called it the largest single gift in the school’s history. The donation also comes at a time where student loan debt has soared to roughly $1.5 trillion, according to recent Federal Reserve data.

Morehouse President David A. Thomas called the gesture “a liberation gift,” telling CNN, “When you have to service debt, the choices about what you can go do in the world are constrained.”

“(Smith’s gift) gives them the liberty to follow their dreams, their passions.”

According to Thomas, the total amount of student debt for the class is still being calculated but the Associated Press estimated that the gift is worth about $40 million.

In return, Smith says he expects the graduating class to pay it forward to give future classes the same opportunity one day.

“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.”

Other Major Donations

The billionaire tech executive has managed to stay under the radar for much of his career. While this major donation has thrust him into the spotlight, it is far from his first generous gift.

In 2016, he pledged a $20 million gift to the National Museum of African American History and Culture. That same year, he donated $50 million to Cornell University to go towards its chemical and biomolecular engineering school, and to support black and female engineering students.

In 2017, Smith signed The Giving Pledge, a commitment by some of the world’s richest people – including Bill and Melinda Gates and Warren Buffet – who have promises to giving most of their wealth to philanthropy. In 2018, he gave $2.5 million to the Prostate Cancer Foundation to focus on research and care for African-American men and veterans with prostate cancer.

Before Sunday’s graduation speech, Smith had already donated $1.5 million to Morehouse for scholarships and a new park.

See what others are saying (The New York  Times) (Forbes) (Time)


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White Supremacist Propaganda Reached Record High in 2022, ADL Finds

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2 weeks ago

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March 9, 2023

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 “We cannot sit idly by as these extremists pollute our communities with their hateful trash,” ADL CEO Jonathan Greenblatt said.

White supremacist propaganda in the U.S. reached record levels in 2022, according to a report published Wednesday by the Anti-Defamation League’s Center of Extremism.

The ADL found over 6,700 cases of white supremacist propaganda in 2022, which marks a 38% jump from the nearly 4,900 cases the group found in 2021. It also represents the highest number of incidents ever recorded by the ADL. 

The propaganda tallied by the anti-hate organization includes the distribution of racist, antisemitic, and homophobic flyers, banners, graffiti, and more. This propaganda has spread substantially since 2018, when the ADL found just over 1,200 incidents. 

“There’s no question that white supremacists and antisemites are trying to terrorize and harass Americans with their propaganda,” ADL CEO Jonathan Greenblatt said in a statement. “We cannot sit idly by as these extremists pollute our communities with their hateful trash.” 

The report found that there were at least 50 white supremacist groups behind the spread of propaganda in 2022, but 93% of it came from just three groups. One of those groups was also responsible for 43% of the white supremacist events that took place last year. 

White supremacist events saw a startling uptick of their own, with the ADL documenting at least 167, a 55% jump from 2021. 

Propaganda was found in every U.S. state except for Hawaii, and events were documented in 33 states, most heavily in Massachusetts, California, Ohio, and Florida.

“The sheer volume of white supremacist propaganda distributions we are documenting around the country is alarming and dangerous,” Oren Segal, Vice President of the ADL’s Center on Extremism said in a statement. “Hardly a day goes by without communities being targeted by these coordinated, hateful actions, which are designed to sow anxiety and create fear.”

“We need a whole-of-society approach to combat this activity, including elected officials, community leaders, and people of good faith coming together and condemning this activity forcefully,” Segal continued. 

See what others are saying: (Axios) (The Hill) (The New York Times)

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Adidas Financial Woes Continue, Company on Track for First Annual Loss in Decades

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2 weeks ago

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March 8, 2023

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Adidas has labeled 2023 a “transition year” for the company. 

Yeezy Surplus 

Adidas’ split with musician Kanye West has left the company with financial problems due to surplus Yeezy products, putting the sportswear giant in the position to potentially suffer its first annual loss in over 30 years. 

Adidas dropped West last year after he made a series of antisemitic remarks on social media and other broadcasts. His Yeezy line was a staple for Adidas, and the surplus product is due, in part, to the brand’s own decision to continue production during the split.

According to CEO Bjorn Gulden, Adidas continued production of only the items already in the pipeline to prevent thousands of people from losing their jobs. However, that has led to the unfortunate overabundance of Yeezy sneakers and clothes. 

On Wednesday, Gulden said that selling the shoes and donating the proceeds makes more sense than giving them away due to the Yeezy resale market — which has reportedly shot up 30% since October.

“If we sell it, I promise that the people who have been hurt by this will also get something good out of this,” Gulden said in a statement to the press. 

However, Gulden also said that West is entitled to a portion of the proceeds of the sale of Yeezys per his royalty agreement.

The Numbers 

Adidas announced in February that, following its divergence from West, it is facing potential sales losses totaling around $1.2 billion and profit losses of around $500 million. 

If it decides to not sell any more Yeezy products, Adidas is facing a projected annual loss of over $700 million.

Outside of West, Adidas has taken several heavy profit blows recently. Its operating profit reportedly fell by 66% last year, a total of more than $700 million. It also pulled out of Russia after the country’s invasion of Ukraine last year, which cost Adidas nearly $60 million dollars. Additionally, China’s “Zero Covid” lockdowns last year caused in part a 36% drop in revenue for Adidas compared to years prior.

As a step towards a solution, Gulden announced that the company is slashing its dividends from 3.30 euros to 0.70 euro cents per share pending shareholder approval. 

Adidas has labeled 2023 a “transition year” for the company. 

“Adidas has all the ingredients to be successful. But we need to put our focus back on our core: product, consumers, retail partners, and athletes,” Gulden said. “I am convinced that over time we will make Adidas shine again. But we need some time.”

See what others are saying: (The Washington Post) (The New York Times) (CNN)

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Immigration Could Be A Solution to Nursing Home Labor Shortages

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2 weeks ago

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March 7, 2023

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98% of nursing homes in the United States are experiencing difficulty hiring staff. 

The Labor Crisis 

A recent National Bureau of Economic Research paper has offered up a solution to the nursing home labor shortage: immigration. 

According to a 2022 American Health Care Association survey, six in ten nursing homes are limiting new patients due to staffing issues. The survey also says that 87% of nursing homes have staffing shortages and 98% are experiencing difficulty hiring. 

The National Bureau of Economic Research (NBER) outlined in their paper that increased immigration could help solve the labor shortage in nursing homes. Immigrants make up 19% of nursing home workers.

With every 10% increase in female immigration, nursing assistant hours go up by 0.7% and registered nursing hours go up by 1.1% And with that same immigration increase, short-term hospitalizations of nursing home residents go down by 0.6%.

The Solution 

Additionally, the State Department issued 145% more EB-3 documents, which are employment-based visas, for healthcare workers in the 2022 fiscal year than in 2019, suggesting that more people are coming to the U.S. to work in health care. 

However, according to Skilled Nursing News, in August of 2022, the approval process from beginning to end for an RN can take between seven to nine months. 

Displeasure about immigration has exploded since Pres. Joe Biden took office in 2021. According to a Gallup study published in February, around 40% of American adults want to see immigration decrease. That is a steep jump from 19% in 2021, and it is the highest the figure has been since 2016.

However, more than half of Democrats still are satisfied with immigration and want to see it increased. But with a divided Congress, the likelihood of any substantial immigration change happening is pretty slim. 

See what others are saying: (Axios) (KHN) (Skilled Nursing News)

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