![Harvard University [CGTN-VCG]](https://i0.wp.com/usachinatrading.com/wp-content/uploads/2020/08/Harvard-University-CGTN-VCG.png?resize=525%2C295&ssl=1)
Editor’s note: Hannan Hussain is an assistant researcher at the Islamabad Policy Research Institute (IPRI) and an author. The article reflects the author’s opinions, and not necessarily the views of CGTN.
The U.S. government has no right to pressure American universities into divesting from China – that was the message from the country’s higher education institutions after the Trump administration issued a call to remove China-based companies from institutional endowments. “The boards of your institution’s endowment funds have a moral obligation, and perhaps even a fiduciary duty, to ensure that your institution has clean investments and clean endowment funds,” said Keith Krach, the U.S. Under Secretary of State for Economic Growth, Energy, and the Environment, in a recent letter. “I urge you to divest from [Chinese] companies that are on the Entity List or that contribute to human rights violations.”
The weakest link in Krach’s appeal is his use of morality and politics to authorize government interference in academic endowments – particularly those concerning China. Harvard Professor William Kirby called the bluff on that argument, condemning the government’s intimidation-heavy approach towards Beijing and its surface-level knowledge of Harvard’s endowment process. “Few or no portions of [the endowment] could be tied to ‘individual’ Chinese stocks,” Kirby said. In his attempt to pit American universities against Chinese stocks, Krach also falsely accused Chinese companies of sidestepping U.S. audit transparency requirements. The allegation is part of a broader Trump administration campaign to forcefully delist Chinese firms from U.S. stock exchanges – a campaign criticized for its political manipulation and lack of clarity.
U.S. academia helps put that criticism into perspective. Dr. Terry Hartle of the American Council on Education – the leading U.S. higher education lobby group – touched on the legitimacy of Chinese stocks on U.S. financial markets by underlining their availability to American investors, including universities. There is also evidence to establish the reliability of cooperation between American universities and Chinese companies. According to a 2019 Bloomberg investigation, U.S. academic institutions have consistently experienced a sizable return on investments from Chinese companies. This provides a compelling justification for U.S. universities and colleges to sustain their multibillion-dollar investment stakes in competitive Chinese ventures.
Another report, by the Wall Street Journal in August, suggests that it is standard practice for endowment funds to be kept only partly public, raising questions about the U.S. government’s political oversight of autonomous institutional dealings. Krach also incorrectly implies that American universities must treat federal compliance as a matter of “moral obligation,” when it is the State Department that lacks the authorization to demand institutions divest from Chinese stocks. Interestingly, U.S. universities are long-time observers of the Trump administration’s deliberate escalations with Beijing. Academics have protested the U.S. government’s controversial ban on selective Chinese students earlier this year, defending student contributions to cutting-edge research and scientific innovation in America. Numerous universities across the U.S., including Princeton, redoubled their efforts to confront selective visa restrictions on Chinese students by the Trump administration.
Moreover, proposals to discriminate against Chinese nationals in STEM fields (science, technology, engineering and mathematics) triggered nationwide student activism from Stanford to Texas State University.
Above all, top American research centers – such as the Harvard Ash Center – continued to release findings that improved global understanding of the Chinese public, regardless of the Trump administration’s push for more anti-China actions. Hence, it is this same thread that runs through Professor Kirby and Dr. Hartle’s rejection of Trump’s divestment demands – an unwillingness to present American universities as a battleground for U.S.-China relations and calling out the administration for its implausible reasoning.
It is fair to point out that Beijing made these points categorically clear back in June – that only reason and respect can bring the American and Chinese people together.
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