From the New York Times :

November 8, 2006

Billionaire’s $250 Million Donation Saves Private University in Germany

By MARK LANDLER

BREMEN, Germany, Nov. 2 — Klaus J. Jacobs, a German-born billionaire who lives in England and studied at Stanford, came back to his hometown here the other day to announce that he was donating more than $250 million to the International University Bremen.

The gift is the biggest private donation ever made to a German university — so big, in fact, that its only real parallel is the kind of mega-philanthropy that periodically swells the coffers of American universities.

That is precisely the point for Mr. Jacobs and for the newly appointed president of the university, Joachim Treusch.

“I hope that this sets a precedent,” Mr. Jacobs, 69, said. “There is a lot of wealth in private and corporate hands in Germany. It certainly would be desirable to see more of it going to institutions.”

Mr. Treusch aspires to vault the International University Bremen into the front rank of German universities. To do that, he has decided to rename this five-year-old institution Jacobs University Bremen to honor its benefactor and to serve notice of its American-style ambitions.

“Stanford is not a place but a name; Harvard is not a place but a name,” Mr. Treusch said in an interview after the announcement. “International University Bremen was a rather flat name.”

It was also on the verge of bankruptcy. Now restored with the money from Mr. Jacobs, this fledgling institution is determined to chart a new course in a country that helped pioneer the modern research university in the 19th century but has lost its edge in recent decades.

Mr. Jacobs, a Swiss citizen who was born in this bustling northern German city, said he hoped his gesture would encourage more large-scale philanthropy in a land where it is largely unknown.

Private giving to German universities is limited by several factors, ranging from the lack of a philanthropic tradition to rules that limit the amount of tax-free donations. The biggest hurdle, however, is the state, which has historically been the main financier of higher education.

One result is that German universities lack the resources of their American rivals. The United States spends 2.6 percent of its gross domestic product on higher education; the Germans, only 1.1 percent.

Germany’s most famous universities — Heidelberg, Humboldt and Munich — are public institutions, largely financed by federal and regional governments. Until recently, tuition was nominal. Starting next year, they will be allowed to charge 500 euros ($635) a semester.

“In Germany, the call for the state is the easy one to make,” said Mr. Jacobs, who inherited his family’s coffee company and expanded it into chocolate, amassing one of Europe’s great private fortunes. “It’s always there, and if you shout loud enough, you get the money.”

The Bremen university, which teaches engineering, science, humanities and social sciences, is private — one of a few dozen in Germany. Though it received some start-up capital from the Bremen government, it has had to survive on tuition and fund-raising. Tuition for undergraduates is $19,050 a year, and $550 a month for room and board.

Fund-raising has been erratic, apart from a gift of 10 million Swiss francs ($8 million) from the Jacobs foundation in 2001, which established the Jacobs Center for Lifelong Learning. Without this new gift, the university would have run out of cash by next April.

“It’s about the minimum we needed to stay open,” said Mr. Treusch, a theoretical physicist who negotiated the donation with Mr. Jacobs over three months. “We still have to struggle, but that’s O.K.”

The decision to rename the university for a businessman was not universally welcomed. A few students complained that it was not dignified. In Germany, extreme wealth is still viewed with suspicion rather than reverence. Others countered that the Jacobs name and money would help the university establish a distinct brand image, not to mention keep it afloat.

It is to receive 15 million euros ($19 million) a year from the Jacobs foundation for the next five years to defray its operating expenses. In 2011, Mr. Jacobs will turn over the balance of the gift — 125 million euros ($158 million) — to support teaching and research “at a competitive level.”

The notion of competition is also evolving in Germany. Since the early 1970’s, when admissions were thrown open by government decree, there has been a sort of artificial equality among German schools, which masked disparities in the quality of teachers and students.

Now Germany is acknowledging those differences by channeling hundreds of millions of euros into so-called elite universities, chosen last month by a panel of public officials and scholars.

The International University Bremen did not make it into that charmed circle, but the gift from Mr. Jacobs is double the amount that the three elite schools — the University of Munich, the Technical University of Munich and the University of Karlsruhe — will each receive over the same period.

Germany has other private universities, but they tend to specialize in disciplines like law or management. Otto Beisheim, a wealthy merchant, endowed a management school at Witten/Herdecke University, Germany’s oldest private university, in the industrial Ruhr Valley.

Jacobs University is housed on a converted German military base. Three-quarters of its 1,000 students come from outside Germany, with half from Eastern Europe and Russia. Classes are taught in English.

That cosmopolitan mix appealed to Mr. Jacobs. “There is no other university like this in Europe,” he said.

Putting his name on the door in Bremen, Mr. Jacobs said, was as big a risk for him as it was for the university, since their fortunes are now publicly linked. Still, he said, he would play only an advisory role.

Why didn’t Mr. Jacobs give his millions to his own alma mater, the University of Hamburg? “They didn’t ask,” he said.

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