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Columbia Business Monthly

Offshore Drilling and Big Higher Education Numbers

Apr 06, 2018 03:10PM ● By Makayla Gay

By: John Temple Ligon

  Offshore drilling anywhere in the world comes with risk. The coasts of California and Louisiana probably have the worst American records for blowouts. And the oil left behind on the ocean floor looks like black mayonnaise for decades to come.

With all that risk and failure and the gooey garbage left behind comes money–tons of money–and jobs.

In South Carolina there is hue and cry over the possibility of the ecological damage that can come with offshore drilling. But what is the hue and cry over the endowments in the major universities, the direct beneficiaries of successful oil exploration, both inland and offshore?

The crowd blasting the offshore drilling possibilities, citing the hospitality industry’s jobs' benefits in the status quo along the tourist-rich Carolina coast, seem to think we locals should be happy changing sheets, tending bar, waiting tables, and maintaining golf course grass. The vocal objections coming out against offshore drilling is mostly from the chiefs of the hospitality industry, the guys who build and own hotels and bars and restaurants, not necessarily the rank and file changing sheets, tending bar, waiting tables, and maintaining golf course grass.

Oil search and economic exploitation can be seen in high numbers in Oklahoma, Louisiana, Texas, and California, among other states. Where you have oil exploration you have rich university endowments, far richer than around here.

Take little Rice University in downtown Houston and its roughly 4,000 undergraduate students. The endowment at Rice is running around $5.5 billion, which is about $1.4 million per undergraduate student.

On a much larger scale of population, the University of Texas system and its 167,000 undergraduates has an endowment worth $24 billion, or $144,000 per student.

Here at the University of South Carolina main campus in Columbia, we have 25,500 undergraduates with an endowment of about $660 million, which comes to almost $26,000 per student.

Which university – Rice, Texas, South Carolina – has failed so far to see much oil money? None of the three, on the other hand, can afford to turn down oil money. Rice and Texas are long addicted to the energy industry, and South Carolina needs to see what’s available offshore or come up with another comparable resource to get into the high endowment game. Right now, South Carolina at only $26,000 per undergraduate in endowment is hardly in the game. The legislature is down to something like 10 percent of the school budget carried with state money, and the rest has to come from high tuition.

Come on. Can South Carolina afford to turn up its nose at the endowment enhancement possibilities offshore?

Go ahead. Keep sending our kids to the hospitality industry and offer them careers changing sheets, tending bar, waiting tables, and maintaining golf course grass. And then monitor the quality of people who stay in the hospitality industry here while comparing that crowd with the energy business found in Oklahoma, Louisiana, Texas, and California, where the oil-rich endowments afford scholarships and low tuition.

Oh, and by the way, oil-rich residents of oil-rich states come with gifts, largess from the supposedly risky offshore activity. BP recently gave the University of California system a cool $500 million. Ever see anything like that around here?

Now, just to get ridiculous, look at King Abdullah University, begun in 2009. The school has an endowment of $20 billion. And how much of that $20 billion came for oil? Probably all of it.

Then check out the world’s richest school, Harvard, and its endowment of $35 billion, just to go completely nuts. They started in 1636. Look into what part of the $35 billion comes from the energy industry. With that kind of money, they can run a need-blind admissions policy. They don’t sweat too much whether an applicant has the money or not. They’ll find the money.

What if the University of South Carolina and Clemson University, generations from now after a successful search for oil offshore, could let its students come to class tuition-free? Can you imagine?