All those student protests on the US seem to be about stopping their universities from supporting the Israel government. But supporting a foreign government is not a normal thing for a university to do, why do they do it?

Is there some educational or research resource they get?

77 points

Universities have huge endowments and investment portfolios. These are generally broad and in support of keeping the financial backing of the school stable; this is extremely prevalent in the large older universities like Harvard or Columbia (but almost all universities have one in some form or another). They support both students and ongoing academic research.

While many of these portfolios consist of wider funds, many have specific investments in specific companies and industries. That means that the university is invested in, and taking benefit from, areas of industry. The main request is to divest the investment portfolios from companies owned by or supporting entities connected with Israel’s war on Gaza. In some cases this may be possible (move a ton of stock from a defense contractor making weapons sold to Israel to an energy company) and in some cases it may not (they’re invested in a wide market fund that itself invests in specific funds, but you can’t easily cherry-pick which stocks are actually in it). It’s also possible that there are research grants funded through companies who the students want to apply negative pressure to; cancelling a grant sends a message to the company, but also leaves entire teams and time-dependent science without funding, potentially ending it outright unless alternate funding can be found. There also may be contracts involved for specific research and engagements, and breaking a contract is more complicated than just ripping it up (especially if there are early termination policies outlined).

Realistically, the best students can hope for is a commitment to investigate and divest where possible, which is frustrating but also makes sense. I’ve worked in higher education for 20 years and have seen this on a smaller scale around defense contractors during the wars in Afghanistan and Iraq. The endowment is a slow moving leviathan, but I think it’s a good place for the students to apply pressure.

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19 points

To be fair, many universities are making these steps. They have a dialogue with their students and are going to work towards divestment, even though it will take time, and those student bodies are happy to accept that. It’s very important to note that the schools facing protests are either unwilling to attempt divestment at all, or are refusing to even entertain the possibility of divestment by completely ignoring the request.

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12 points

This is a fantastic answer with a lot of great context. Thank you for sharing!

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52 points

I will try to be as neutral as I can, though it seems impossible in this space.

A lot of Jewish people live outside of Israel for reasons going way back in history, we won’t get into the details of that now. Many of them remain closely tied with family / community / culture / religious practices & beliefs in Israel. These folks are sometimes called the Diaspora.

Some of them live in the United States (and are US citizens) and some of them are very successful / influential. Like almost any other demographic group, some of them can be found on the boards of colleges and universities, corporations, etc.

And some of these folks are still very much invested in Israel and care about what is going on over there, like other folks in the Diaspora.

I hope that helps. I am not taking a side with this answer, just trying to provide some general context on the how we got here.

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30 points

I think this covers everything except for one last question the OP might have had. Israel was, and still is, a US ally. Trading is generally pretty open with those allies, so citizens are fairly free to invest with any company headquartered in those countries. Investing in an Israeli company was no different than investing in an Australian or UK company. Offshore investment can be smart too, as they can potentially insulate you from the effects of economic shocks in America (in the short term). I’m sure someone much more versed in economics or finances could give you a better summary of that end though.

Just in case they’re wondering whether/why it’s possible/common to have foreign investments in the first place. Your comment is a great explanation for why Israel specifically.

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7 points

I will try to be as neutral as I can, though it seems impossible in this space.

There’s always someone who will question your neutrality. Regardless, I applaud your efforts.

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-4 points

I think it needs to be said most Jewish people in the diaspora are not Zionists. And that Israel is and always has been a puppet state formed by the the US

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10 points

I think we would need stats before making that first conclusion. I’ve seen a lot of favorability polls of Israel amongst Jewish people, but not sure I’ve ever seen an explicit ask for Zionism or its definition. I’m sure it’s out there, but I wouldn’t expect the OP to take that for granted without a source.

Your second sentence is arguably correct, but lacking a lot of context and really not presented from a neutral standpoint like the other commentor and I were trying to strike. I think when people are looking for raw information, it’s fair to provide that with as little bias as possible, especially on a heated current issue. And fwiw, I likely agree with you on that issue.

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3 points

Yeah I’m Jewish so this isn’t a new issue to me. Zionism is viewed as a fascist ideology by a lot of Jews, there for I think its unneutral to say afluent Jews are why universities are invested in Israel. I’m being as neutral as possible, these are the facts as I know them and I wouldn’t trust an poll on this matter done now, personally. The fact that Israel was formed by America after ww2 and has been used as a political and military base for America since. Wikipedia has multiple articles on it.

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4 points
*

formed by the the US

Nope. You can blame Britain for that.

In fact nearly every fucked up situation in the Middle East was created by the British. They started multiple shit storms with bone headed border decisions and then conveniently dipped out after WWII without cleaning up their messes.

Another example would be the India / Pakistan problem.

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1 point

…formed by the US…among others.

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-4 points

That’s a wild jump to make.

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10 points
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For the most part, they’re not specifically supporting the Israeli government. They have endowment funds, which they invest in mutual funds and other such financial instruments, like everyone else. Those mutual funds, in turn, invest money in a huge array of different stocks, bonds, etc, generally with the goal of producing a decent return with a minimum amount of risk. Buried somewhere in that pile of investments are things like Israeli government bonds, shares in defense contractors, etc, because political priorities are not usually a factor in how mutual funds decide where to put their money.

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10 points

Many universities have money that they are allowed to use to invest, as long as the principal is used for explicit educational purposes. The investments are supposed to be public/reported, though there have always been complaints that they aren’t.

Students are protesting at college campus that have reported investments in Israel related companies (some, notably, directly related to war efforts) to demand the universities divest from those investments. Some universities have conceded and done so. Others have just called the cops.

NYT Article: https://www.nytimes.com/2024/05/03/business/brown-university-divestment-israel-gaza.html

Brown University explanation of their endowments: https://investment.brown.edu/endowment

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8 points

My guess is if you have a few ETFs you might even have “dealings with Israel”

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