Falwell's Liberty University Raking in Money from Taxpayers

In the past, Liberty University was saved from debt by being a beneficiary of the late Jerry Falwell's life insurance policy. It has also been bailed out by the financial maneuverings of Rev. Sun Myung Moon. These days, however, the university is experiencing phenomenal growth, due in part to the largesse of the American taxpayer.

"I hope I live to see the day when, as in the early days of our country, we won't have any public schools. The churches will have taken them over again and Christians will be running them. What a happy day that will be!" - The Rev. Jerry Falwell, America Can Be Saved

One might think that a private, decidedly conservative, and totally evangelical Christian University, that was founded by the late Rev. Jerry Falwell, who was openly critical of government programs, would spurn federal dollars. Au contraire mon ami.

In fact, this year, the fortieth anniversary of Liberty University, Rev. Falwell's dream -- now being looked after by his son Jerry Jr. -- has become a reality thanks in large part to America's taxpayers.

Founded by Falwell in 1971, Liberty University, which according to its website is "the largest and fastest growing Christian Evangelical university in the world" and "the largest private university in Virginia," is "celebrating 40 Years of Training Champions for Christ."

During the last fiscal year alone, Liberty received about $445 million in federal financial aid money, according to the U.S. Department of Education. Over the past few years, Liberty University has raked in so much taxpayer money from the federal government that is now ranked among the top ten universities in the United States receiving federal dollars. It is also Virginia's top recipient of federal money.

In a 2009 piece for RH Reality Check titled "Why is the Federal Government Supporting Evangelism?", Eleanor J. Bader pointed out that LU's [Jesse] Helms School of Government "crows that it turns out 'Christ-centered leaders, able to apply God's word in every area of life.' What's more, LU's webpage showcases its mission, promising students an 'action-oriented curriculum dedicated to world evangelism and repudiation of political correctness.'

"Not sure what that means? The site explains: 'A strong commitment to political conservatism, total rejection of socialism, and firm support for America's economic system of free enterprise.'"

Since it doesn't get much more religiously oriented than Liberty University, a fair question to ask is: Should a private sectarian institution be receiving federal funds?

"The short answer is that it would be difficult -- if not impossible -- to challenge the government grants going to Liberty students," Rob Boston, Senior Policy Analyst with Americans United, told me in an e-mail exchange. "This can be difficult area of the law. The Supreme Court has always been more lax on aid to religious colleges than it has been on aid to secondary schools. In years past, the court has held that tax aid cannot go to institutions deemed 'pervasively sectarian' but that such aid was permissible for those schools that were judged to be 'religiously affiliated.' This test has begun to erode at the high court, however, under the conservative majority. Complicating the matter is that the fact that many conservative legal scholars argue that Pell Grants are actually aid to the student, not the school -- an argument that has been embraced by the Supreme Court's conservative bloc."

"The rapid growth of Liberty's online program has fueled the increased reliance on federal aid dollars, said Robert Ritz, LU's executive director of financial aid," Lynchburg, Virginia's The News & Advance recently reported. In addition to 12,000 students on campus, the University enrolled nearly 52,000 students online last year.

"It has ballooned," said Ritz of Liberty's financial aid volume. "In some categories, I've seen us rank no. 3 nationally, or in the top ten. It's because of our size and the growth." According to The News & Advance, "In the span of a year, Liberty's experienced about a 56 percent spike in federal student aid, from $284 million in 2008-2009 to $445 million in 2009-2010, according to Department of Education data compiled by The News & Advance. (LU calculates the total aid at $432 million and $277 million, still a 56 percent increase.)"

In a recent piece at WiredPen, Kathy Gill pointed out that while Liberty has received more than $445 million, in 2010, National Public Radio received $2.7 million in federal money (http://wiredpen.com/2011/05/25/student-loans-private-universities-and-npr/). The Corporation for Public Broadcasting received $420 million from the federal government.

According to Gill, who teaches digital communication at the University of Washington, "Liberty ... sucks in federal dollars because it has set up an online university (think University of Phoenix et al) which it has used to claim 58,000 students."

Gill stated that, "The federal windfall, if it follows the law of averages, is coming at the expense of the American taxpayer. That's because students at for-profit colleges/universities default at an astronomical rate relative to public colleges. Private school students account for about half of all federal student loan defaults yet these institutions account for about a quarter of federal financial aid while enrolling only about 10 percent of college students."

According to The Chronicle of Higher Education, "Officials at for-profit colleges say that their students default at higher rates because a majority of them are poorer to start with and face many more financial challenges. Critics of the colleges say their high default rates show that many of those institutions are loading up their students with unaffordable debt that the students cannot repay once they graduate or drop out."

Kathy Gill also noted that in 2007, the year that Falwell died, "Liberty was $20-$25 million in debt," which was paid off through the use of "a $34 million insurance policy," that Falwell had taken out.

Some twelve years earlier, the existence of Liberty University was being threatened, by a debt of $73 million. In 1995, veteran journalist Robert Parry told the spellbinding story of secret meetings, strange bedfellows, and how the Rev. Sun Myung Moon secretly helped to bail out the university by funneling funds to a non-profit Forest, Va.-based organization called Christian Heritage Foundation, which was run by two Virginia businessmen, Dan Reber and Jimmy Thomas (http://www.consortiumnews.com/archive/moon3.html).

According to Parry, "Reber and Thomas earned Falwell's public gratitude by excusing the Lynchburg, Va., school of about one-half of its $73 million debt. In the late 1980s, that flood of red ink had forced Falwell to abandon his Moral Majority political organization and nearly drowned Liberty University in bankruptcy.

"... Their non-profit Christian Heritage Foundation of Forest, Va., snapped up a big chunk of Liberty's debt for $2.5 million, a fraction of its face value. Thousands of small religious investors who had bought church construction bonds through a Texas company were the big losers. But Falwell shed no tears. He told local reporters that the moment was 'the greatest single day of financial advantage' in the school's history.

"Left unmentioned ... was the identity of the bigger guardian angel who had been protecting Falwell's financial interests -- from a distance and without publicity. That secret benefactor was the Rev. Sun Myung Moon, the self-proclaimed South Korean messiah who is controversial with many fundamentalist Christians because of his bizarre Biblical interpretations and his brainwashing tactics that have torn thousands of young people from their families. Moon also has grown harshly anti-American in recent years.

"Covertly, Moon helped bail out Liberty University through one of his front groups which funneled $3.5 million to the Reber-Thomas Christian Heritage Foundation, the non-profit that had purchased the school's debt."

Another interesting Liberty U./Moon connection is Dr. Ronald Godwin, who currently serves as Senior Vice President for Academic Affairs and Provost of Liberty University. According to the website Cult News from Rick Ross, Godwin was "formerly a Senior Vice President at the Moon-controlled newspaper the Washington Times" (http://www.cultnews.com/?p=2036).

Ross reported that Godwin was "A professor at Liberty University during the 1980s [before he] ... took a job at the Washington Times in 1986. He also once served as Executive Director and Executive Vice President of Falwell's 'Moral Majority' and was contributing editor of its newspaper according to his bio."

The tax-exempt university has a 5000-acre campus, complete with more than 120 buildings, and 60 accredited undergraduate majors, and schools of aeronautics, arts and sciences, business, communications, education, government, religion, and law.

Liberty's Commencement 2011 featured speaker was film director and screenwriter Randall Wallace. According to the Randall Wallace Films website, Wallace is "the Oscar®-nominated creative force behind the epic storytelling of such critical and box-office hits as Braveheart , We Were Soldiers and Pearl Harbor ... [and] last Fall ['s] Secretariat, the impossible true story of the racehorse who won the Triple Crown in 1973."

In introducing Wallace, Falwell told the crowd of nearly 30,000 at Williams Stadium that the director/screenwriter who also teaches film classes at Pepperdine University, was an "especially fitting" guest speaker because the university would be opening "its own Center for the Cinematic Arts next year with a mission to impact the entertainment world with Christian values just as Wallace has."

Wallace told the graduate that they "may be feeling weak and lost and confused, but I tell you I believe with all of my heart, that feeling that way you are a more fitting tool for God than the man that believes that his money, that his fame, that the honors of other men have made him wise. Jesus gave us one clear order -- to love one another. And if you look at your parents today and you see tears in their eyes, I promise they're not tears of sorrow or fear, these are tears of love. God loves you and if you love back in every way you can, then ... you will look back on this day as the day of your greatest strength, as a day of victory."

With the Religious Right so adamantly against government programs, American United's Rob Boston pointed out that "The more interesting question appears to be a non-legal one," since "it has become an article of faith among the Religious Right that government programs are always bad and that reliance on public forms of assistance breeds dependency. In light of this, it seems just a bit hypocritical for so many Liberty University students to be bellying up to the federal trough and for the school to behave as a ward of the state."

ENDS

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