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Wabash Always Fights!

January 15, 2009

Wabash Always Fights!

This beloved and oft-repeated cry arises out of an acceptance of challenge, a fundamental work ethic, and a determination never to give up that permeate life at Wabash. We hear “Wabash Always Fights” in athletic contests, in difficult discussions of the Gentleman’s Rule, and in Chapel Talks as a reminder of our fundamental shared commitment to one another and to demanding the best of ourselves and our college. It is a cry that is easy to say, but not always easy to live, because we often say it when we are back on our heels, when we are behind in the contest, when we might be baffled even disheartened by the challenges before us.

Wabash enters the New Year with a number of challenges before us. From one angle of vision, we wouldn’t have it any other way. Complacency is not a Wabash trait, and not one on which the College has built its greatness. But the economic challenges that face Wabash — that face all of us — are unusual, to say the least. The descriptive word that comes up in conversation is “unprecedented.” No liberally educated student should be surprised by a downturn in the economy; but one of the suddenness, character, and severity we now are experiencing is a shock and threatens some of our deepest assumptions about Wabash’s strengths.

When you meet people who know just a little about Wabash, they might say, “A great college with a great endowment.” In the rapid decline in the financial markets over the last year, Wabash remains a great college, of course, and our endowment remains among the highest per-student endowments in the country. Still, we must recognize the challenge we face as we look at an endowment that has lost about 30% of its value in the last year, over $130 million.

Now that sounds catastrophic, and believe me, it is scary, but we need to remind ourselves that the College withdraws usually between 4-6% of the endowment’s value calculated on an average of the values over the trailing 12 quarters. So, as dire and sudden as this drop in endowment has been, its impact will be felt most severely as the 12-quarter trailing average begins to reflect the past year’s experience more fully. The investment committee of the Board of Trustees monitors and adjusts our investments with great care, and we all hope the economy improves and then the value of our holdings should increase. Yet, we must plan carefully to minimize the effect of the last year and to anticipate slower growth ahead.

As important as the endowment is for Wabash, our greatness does not reside in the size of our endowment, but in the kind of education it has helped to make possible, in the choices that we have been able to make to enrich our students’ experience. Over the last few years there has been a lot of national attention drawn to endowments like Harvard’s, but whether in Cambridge or in Crawfordsville, the endowment of any college is a means to an end. We must keep our eyes on the strengths of a Wabash education. We will need wisdom, inventiveness, and courage to navigate the current waters and make careful and realistic financial plans for the College.

As I have talked with other college presidents, we all share the worry that the economic impact of higher unemployment and increased insecurity will affect enrollments in fall of 2009 and beyond.

Grand economic questions often come down to the fundamental decisions that we make as individuals, as families, and as institutions. Right now families all over the country are considering college choices and wondering how they will be able to pay for college. This is the quiet conversation that takes place around kitchen tables and in living rooms, shaped by hopes and expectations, parental income, and family needs. Our applications for the Class of 2013 are up 19%. This is good news, and the hard face-to-face work of our admissions and financial aid staff will support families in these difficult times. Since its founding, Wabash has invested in bright, motivated young men, regardless of their financial circumstances; and we remain committed to working with students to help make a great Wabash education possible for worthy young men.

As we all think about Wabash and look to both the immediate months and the farther future, around the virtual living room of our Wabash community, we need everyone’s help, ideas, and energies. We are working hard on fund raising. Increased revenue and a larger percentage of alumni donors will add stability to our finances. Gifts to Wabash will help lessen our losses from endowment revenue and help keep financial aid strong. Now is certainly a critical time to invest in Wabash.

At the same time, we at the College will work together to adjust our current operating and capital expenditure budgets. Some of the additional points we will consider include: extending the timetable for the upgrades of our athletics fields; determining the optimum timeline for implementing the priorities of our Strategic Plan; evaluating all current and future vacancies in faculty and staff positions; and looking at whether or not we can offer salary increases to current College employees. We have had campus-wide conversations with the faculty and staff, and we will meet with the Board of Trustees soon. These discussions enable us to bring the best wisdom together to address the challenges that confront us.

We must move ahead with courage and care, with caution and with speed. These seemingly contradictory attitudes are necessary. I have asked all to keep a sharp eye on our mission and core values and to consider in all of our choices how we might leverage positive movement ahead for Wabash at the same time we examine how we make the hard choices to assure our financial stability.

One hundred seventy-six years ago, Wabash was founded to meet the “wants of the country.” Today, Wabash stands poised to again serve the needs of the country by producing liberally educated men who can think critically, act responsibly, lead effectively, and live humanely. In times like these, those are precisely the most necessary qualities.

Together I know we face the future with hope, confidence, and steady resolve. The many strengths of the College continue to ensure Wabash’s future, invigorate our present, and guarantee our continued positive importance in the larger world.

Wabash Always Fights!


These thoughtful comments remind us that in a time of financial turmoil our most cherished dreams and institutions are at risk. When I was an undergraduate I remember Warren Shearer talking about life at the college in the Great Depression. At times like these we must all give special thought, support, and encouragement to our alma mater. Thanks for two excellent postings. The Wabash crisis is one being repeated across the nation, and warrants our persisten attention. I appreciate this effort to keep us informed and involved in the conversation about Wabash.

To me, the obvious place to start trimming the budget would be with the athletic facility upgrades. Some of these changes are absolutely needed, particularly the improvements to the practice fields. However, no one NEEDS field turf. I understand the argument that field turf is less expensive in the long run. However, in the short term, grass is MUCH less expensive, and what we are dealing with is (hopefully) a relatively short-term financial problem. I also understand the 'keeping up the the Jones (DePauw, Hannover, etc)' argument for turf, but if field turf really is less expensive long-term, then eventually the real prestige will come with having grass anyway.

Pat -- Why don't you consider extending the trailing period from 12 to at least 20 quarters. Some endowments have always used a longer period such as that. It would cushion the income consequence of the market decline. And a longer averaging period would, I suggest, be a better measure of the long term income value of the endowment. As your blog suggests, the cliff-like nature of this market drop is materially distortive; we need not let that one-off event have a one-off impact on income-based education at Wabash.

I am just curious as to what investments the college made that resulted in a 30% drop in portfolio value and whether or not this is net of distributions (President White implies that it is, but I'm not 100% clear). Either way, this reeks of a portfolio that was invested in hedge funds, commodities, real estate, and what ever else was hot money at the top of the cycle, rather than what I have come to think of as a conservative endowment allocation.

I understand that it is easy to nitpick with hindsight being 20/20, but these sorts of returns, especially when so many people depend on them, should result in drastic changes. Whether those changes occur with regard to consultants, investment managers or even overly bullish investment committee members, that I suppose is up to the college. However the college had better take a long, hard look at its investment process.

John Bott '97

Faculty & staff have made Wabash the great institution it is today. They are the first priority. Despite our rich athletic tradition, our tradition of producing scientists, artists, lawyers and leaders is greater.

President White, I also appreciate the effort to communicate important issues regarding the College.