The Giving Review: A conversation with Defense of Freedom Institute’s Jay P. Greene: Part 1

The education scholar and reform advocate talks to Michael E. Hartmann about the K-12 school-choice and higher-education reform efforts, including philanthropic support of them—as well as the structural challenges for, and tax-advantaged status of, nonprofits involved in reform.

Jay P. Greene is a senior fellow at the Defense of Freedom Institute, where he focuses on combating antisemitism in K–12 education, higher education, and teacher unions. A leading education-policy scholar, Greene has spent more than three decades shaping debates over K-12 school choice, education reform more generally, and the civic effects of schooling through influential academic research, policy analysis, and public commentary.

His work evaluating school-voucher and parental-choice programs—including the publicly funded Milwaukee and Cleveland programs in the 1990s and early 2000s—helped establish the empirical foundation for modern reform and was cited by the U.S. Supreme Court in its landmark 2002 Zelman v. Simmons-Harris decision upholding the constitutionality of vouchers.

Greene founded and chaired the Department of Education Reform at the University of Arkansas, served as a senior research fellow at The Heritage Foundation and a senior fellow at the Manhattan Institute, and currently also serves as director of research for Do No Harm, where he leads research on the effects of ideological movements in medical education, research, and clinical practice.

Greene contributed two chapters to Higher Education in America: It’s Worse Than You Think, a newly released anthology from Encounter Books edited by Heritage president Kevin D. Roberts. Greene’s contributions are “The Donor Problem: Your Help Is Hurting” and “Trump’s New Plan.” The book also features a chapter by the Manhattan Institute’s John D. Sailer, in large part about the philanthropically supported “scholar-activist pipeline” in higher ed.

In Greene’s chapter on donors, he argues that those who want to improve higher ed should largely stop giving to existing colleges and universities, because entrenched institutional incentives and ideological cultures make even well-intentioned gifts unlikely to produce meaningful reform. Instead, he contends, philanthropy should support new universities and independent institutions that can compete with or bypass the existing higher-ed establishment, rather than perpetuate and strengthen it. “People who have a substantial amount of money and are considering donating to a university need to hear this simple advice: Don’t do it,” Greene begins.

The preternaturally good-natured Greene was nice enough to join me for a recorded conversation earlier this month. The just more than 25-minute video below is the first part of our discussion; the second is here. During the first part, we talk about the K-12 school-choice and higher-education reform efforts, including philanthropic support of them—as well as the structural challenges for, and tax-advantaged status of, nonprofits involved in reform.

After some limited initial successes, school-choice reformers “championed basically the red-state strategy,” Greene tells me that the school-choice movement …

“[…] abandon[ed its] obsession with trying to pass bipartisan legislation with minority Democratic representatives in support and said, Look, you could just pass legislation with Republicans. In legislatures, you have a majority in 30-some states, why don’t you look at those states and try to win and make arguments that appeal to those Republican legislators as opposed to the Democrat ones, which were largely arguments about the values benefits of choice as opposed to the justice benefits? I think they’re both true, but that shift in strategy helped us basically go from zero states with universal school choice to almost a fifth of the country with universal school choice now in a period of five years.

Greene cautions against centralized planning within any reform movements. Reformers and their funders rarely know in advance what political or educational strategies will work, according to Greene, so they should encourage experimentation rather than impose “best practices” or model legislation from the top down. There’s an unfortunate irony in a school-choice movement devoted to decentralization itself becoming overly centralized in its own strategy. The best outcome, he maintains, is when parents themselves—not financially flush national advocacy organizations—are the primary defenders of school choice.

“The good news is we now have reached” a point, Greene says, where “the parents are fighting on their own” for them. “We’d like choice to look like Social Security, where it protects itself, because all sorts of high-influence seniors get it, who are wealthy and sophisticated.” In that context, the big national AARP group “does not protect Social Security. It is grifting off of it by selling insurance discounts. That is pretty close to where we’re getting with the national school-choice movement, where” certain groups are “not protecting school-choice programs anymore. They’re now grifting off them—beginning to do so, anyway.”

Success and subsidy

More broadly, according to Greene, nonprofits suffer from a structural governance problem. Unlike businesses, they lack a clear performance metric like profit. As a result, nonprofits and their donors have difficulty judging success, communication between groups and their supporters becomes unreliable, and organizational incentives become distorted.

“There may be donors pushing things onto these organizations, but there may be organizations feeding incorrect information to their donors. And so there’s a fundamental problem there,” he says. “Look, I’ve spent my entire life working in nonprofits and every one of them has been dysfunctional in its own way”—though he acknowledges that all organizations, including for-profit ones, are subject to imperfections arising from human nature.

Reform movements of which nonprofits are a part often become less effective as they succeed, because success attracts further funding, which in turn attracts institutional and individual interest in influence and status rather than mission, helping to make the institutions become professional and bureaucratic—and less focused on their original intent and purpose.

He contrasts the early school-choice efforts. “The school-choice movement way back when was a couple dozen of us who were crazy. We basically were small enough in number that we could gather at John Walton’s house in Jackson Hole each summer, because there weren’t that many of us,” he recalls with me. “And you know, in those days, everyone was really focused, and the nonprofits were efficient for the most part, I think. But when you get big and successful, the problems associated with a large infrastructure arise.

“If I had my druthers,” he submits, “we’d get rid of the tax breaks for large nonprofits. No one should hit that scale. I want to preserve charities. I think charity is really good. That should be tax-subsidized. Start-up nonprofit” status for “really mission-focused organizations that make sense. But when you get big, I don’t see why it should be nonprofit anymore. Now, … you’re either subsidizing a grift, or you’re subsidizing the political advocacy of wealthy people, and I don’t understand why taxpayers should be doing that.

“I want” donors “to be free to donate,” he underscores.

I just don’t want taxpayers to have to provide tax subsidy for those donations. I mean, one of the great things about AIPAC, which is much maligned by some these days, but should be revered—is that donations to it, contributions to it, are not tax-deductible. It is a political-advocacy group. It knows it. And people willingly give to it without tax subsidy because they believe in it, and that’s good.

The problems of too much, and more, money

Turning to higher education, Greene expands upon his “The Donor Problem” chapter in Higher Education in America. Donors, perhaps particularly conservative ones, “always have the fantasy that they can use their dollars in the smart, good way to steer universities in a positive direction—they could fix them,” he laments.

“[A]t the heart of the problem with universities, frankly, is excess money,” Greene describes. Universities

are roughly equivalent to trust-fund babies. Trust-fund babies are notorious for bad behavior. Why? Because they just have too much money. And when you have too much money, and didn’t otherwise have some restraints, … it leads to some really bad behavior and that’s what universities are. Universities are awash in cash, huge amounts of money.

Universities’ problems “can’t be fixed by giving them even more money,” according to Greene.

Because what they will inevitably do is steal your money and divert it for some bad purpose or they will use it to substitute for other money they were going to devote to that activity anyway. … You’re then effectively cross-subsidizing some other bad activity that you actually oppose, and so that’s why you don’t really want to give them more money.

As in his chapter, Greene offers advice about how to better deal with higher-ed’s problems to donors with different levels of wealth. Beginning with billionaires, he says, “you should be building new universities, and don’t think it’s impossible or out of reach or that there’s no, you know, opportunity for this,” he says, citing previous work by the American Enterprise Institute’s Frederick M. Hess and Grant Addison published as “An Ivory Tower of Our Own” in National Affairs in 2019.

Greene also references the University of Austin in Texas (UATX), which was founded in 2021 and enrolled its first undergraduate cohort in 2024. UATX explicitly champions open inquiry and intellectual pluralism. It reportedly had more than $200 million in philanthropic support to open. “We should be having a dozen UATXs and they should be funded at much-higher levels,” Greene urges.

Compete with elites, patiently and humbly

Asked whether only a handful of new conservative universities would meaningfully change higher ed, he responds that real competition does require numerous credible alternatives, but this is achievable. He points to Vanderbilt as an example of an institution attracting outstanding students by avoiding the ideological excesses of elite coastal universities.

Greene also rejects the idea that society can simply ignore elite universities and alternatively seek to expand other mechanisms to credential employment-seekers. Elite higher-ed institutions still continue to educate future political leaders, corporate executives, and culturally influential professionals.

As well, he emphasizes that this is a long-term project. Analogizing to the school-choice movement—which took several decades to mature—he argues that philanthropists should expect a 20- to 30-year (or longer) horizon.

“Look, I’m describing to you a solution, but I am humble enough to know that it might not be the right solution,” Greene says. “Exactly how you build these universities or what they’re designed like, I have no idea. And we’re going to go through trial and error.” We “have to learn and adapt our plans as we go.”

Reminded of the role that the Covid lockdown’s negative educational ramifications have probably played in school choice’s recent successful expansions, he says, “Part of being a capable reform movement is being well-positioned to capitalize upon events and use them for meaningful change. I think, again, the world will endlessly give us those types of opportunities.”

In the conversation’s second part, Greene talks more about philanthropic support of higher-ed reform, including for non-billionaires, the risks and drawbacks of funding conservative “beachhead” centers within existing universities in particular, and what ordinary citizens can do about the problems of and being caused by higher ed—as well as more about nonprofitdom’s privileged tax status.