Organization Trends

A Reckoning May Be Coming for Universities on Foreign Funding

The sword of Damocles hanging over much of what the new GOP-led House is planning to investigate in any number of coming hearings – everything from COVID origins to tech/government collusion – is the influence of the Communist Party of China.

And why wouldn’t it be? Now that President Biden’s entanglements with China via his troubled son Hunter have been all-but confirmed, and Chinese President Xi Jinping and Russian Premier Vladimir Putin are toasting to a stronger alliance between the two countries, the GOP House is behaving like it knows it has a lot of clean up to do before the 2024 election. If the U.S. hopes to maintain some sense of sovereignty, that is.

One theater of battle in the newly-revealed economic and propaganda war between the West and the Communist East (we may not have accepted we’re at war, but we were) has been in education, with the influence of socialist and outright communist philosophy floating through schools – not as debatable philosophies but as pedagogy and curriculum — from the university on down.

Which made recent news that the University of Pennsylvania’s Penn Biden Center may have benefited from a massive increase in foreign funding to the university – with most of the $61 million it received following the Penn Biden Center’s opening in 2017 coming from China – that much more eyebrow-raising.

But credit to the new House because they are attempting to address the alleged corruption in a way that gets at the heart of it: by using the power of the purse granted to them by the Constitution.

To that end, the House Ways and Means Committee, led by Chairman Jason Smith (R-MO), has recently written a letter to the University of Pennsylvania reminding them that their committee – the oldest in the federal government and deriving “a large share of its jurisdiction from Article I, Section VII of the U.S. Constitution” – has “jurisdiction over the taxation of endowments and [to] raise concerns about revelations that the Penn endowment, which also appears to fund the Penn Biden Center, has known investments in adversarial entities.”

Oh my.

Our understanding is that the Penn Biden Center is an entity operating under the umbrella of the University of Pennsylvania and receives all its funding through the University. In fact, the Penn Biden Center’s mission statement includes the following: “The Penn Biden Center does not accept any contributions or gifts.”

President Biden was paid approximately $900,000 over approximately two years according to public reporting and his public tax returns while the Center also paid other employees. Presumably, if these funds were not coming from contributions or gifts, these funds had to come from the University.

Public reports have also raised questions about foreign direct investment in the University of Pennsylvania and the relationship between those investments and the creation of the Penn Biden Center. The timing of the Center’s creation along with the reported increase in foreign investment appears to coincide with members of President Biden’s family seeking business opportunities in China.

Specifically, the letter requests that UPenn provide documentation about the legal relationship between itself and the Biden-named think tank, and opens up the possibility of examining whether the university had been investing in Chinese companies that were on any of the federal government’s (USG) adversarial entities lists stemming from a 2022 letter they received asking for information.

The University of Pennsylvania’s June 23, 2022, response to Representative Murphy’s letter noted that the University’s endowment does in fact hold investments in three entities on the USG Lists. Based on the most recently available public data, which indicates that UPenn’s endowment holdings are valued at approximately $20.7 billion, 9 the percentage invested in listed entities equals a value of approximately $3.3 million. In addition, the University’s June 23, 2022, response did not indicate any plans to divest, nor did it identify the entities that held such investments.

It’s been slowly coming to light over the last several years that U.S. universities – supposed protectors of the values undergirding a liberal society and free speech – have been “massively” underreporting foreign funding. The House GOP is apparently poised to look at that trend – and to determine if that underreporting is tied to a concurrent trend toward enrichment of university endowments that are then used to invest in companies that work toward the demise of those same liberal values. Good luck and Godspeed to them in their work.


Sarah Lee

Sarah Lee was born and raised in Atlanta, Ga., but found herself drawn to Washington, DC, the birthplace of her mother, after completing a master’s degree in public administration from…
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