Duke University Endowment gains 55.9% in the fiscal year

[budwom]

^ the windfall is great for the university...but I'm sure the fundraising gang is softpedaling that as much as they can. Hopefully Duke can use some relatively small pice of the windfall to do a few really good one time things.

[kako]

A school's endowment is simply a bunch of money. It grows because people either donate to the endowment or it grows as an investment. At some point, an endowment can be self-sufficient, i.e. it makes enough money on investing to sustain its needs. However, if the needs keep growing, the endowment must grow. Or the endowment grows, and the school finds things to spend it on. I suspect Duke is happy their endowment grew 55.9% in a year. Presumably, they use the endowment for the sake of educating students. But I question whether the educational value of Duke (whether it is the actual education the students get or the value of that education) will grow 55.9% any time soon. I think there's no logical way anyone can argue that it will in the short term. Of course, the university will argue that the money will be spent improving education. But I question if the 55.9% increase will ever be fully recovered in education value. Likely, a big chunk will be spent on fundraising to further grow the endowment, which continues the cycle. It will feed the machine. Which kind of disgusts me.

Yes, coming from a good name school like Duke may get someone an initial job. But it will not help them stay at that job unless there's significant nepotism going on. All that really matters in the workplace is that someone is of value due to their work, not where their degree came from. One of the worst employees I ever hired was a personable guy out of Stanford. He turned out to be the cover boy for entitlement. After watching him come in late, go home early, spend more time on his phone than his computer, etc., I was happy to cut him at the next layoff. On the other hand, one of the best I ever hired was a guy out of a for-profit college. He was a bit rough around the edges. But he worked his butt off, got a great rep around my company, and I promoted him early. So the creme rises to the top work-wise. I definitely don't feel that simply graduating from any top school guarantees success. And if you are paying $400-500K for a kid's education (everything all in for 4+ years), I'm not sure that's a gamble I'd be willing to take for a family financially, unless half a mill isn't a big deal for that family (which could lead to entitlement anyway). So if a kid is so great and goes to a solid public state school and knocks it out of the park, they might not get into a pretentious, self-important workplace. But if they're really good, they will get into another one and eventually blow the pompous one away. And they will have more money in their pocket, as they didn't shell out for the name school. And I'd rather hire a hard working person like that than an entitled one like the one I had.

I certainly have an allegiance to Duke. But I can certainly understand why people would question the value of Duke these days, if they paid for anywhere near the full ride. What I would love to see is Duke start to offer full rides for all undergrads unless their families made more than, say $1M per year (just find some number, $1M seems like a nice round number to me). Growing their endowment 55.9%, they could toss some of that money to the purpose of providing a top notch education. They would certainly afford it. If they did, maybe I'd start donating significant money to them. I'd be really proud of Duke.

As for me and my kids, in my area there's a ton of pressure on them via their peers (more likely, their peers' parents) to go to a big name school like Duke. I recognized that early, and I didn't want to pressure them like that. One of mine is now looking at colleges, as she will matriculate next year. I told her she can go wherever she wants to go - it just has to be accredited. But once she gets there, she needs to work hard, no excuses. It's her life, and her responsibility. She's a smart kid and the schools she's looking at are all fine, just no Dukes and Stanfords on her list. So if she ends up not getting into her dream job after graduation because she didn't go to some name school, so be it. I'll just tell her that she will definitely find her dream job, if she produces in her first job.

9F

[Phredd3]

Duke obviously could have done more to make up for last year's decision to curtail Employer Contributions, but as a current employee myself I would note that such contributions are fairly generous (and are not predicated on matching). More to the point, it is my understanding that they did re-instate those contributions back in June AND made the resumption retroactive back to January 1st, 2021. I was able to dig up the announcement email from June 17th, and here is the link about the current status of the Duke employer contribution program.

Yes, they restored half the contribution and none of the raises. As someone who also went through the Great "No Raises" Recession, that's a fair number of years that I've worked at Duke were there's been no COLA. Those things add up. Actually, they multiply up.

On the other hand, from the glass-half-full point of view, a lot of employers would not have done even that much, and many of the salaries at Duke are grant-funded. Retirement contribution costs are part of the university's fringe benefit rates. The university's fringe rate was lowered because of the contribution change, so that money was not recovered from federal grant funding during that period. Accordingly, Duke has already used hard money to do as much as they have. So, agreed, it isn't completely one-sided.

[sagegrouse]

A school's endowment is simply a bunch of money. It grows because people either donate to the endowment or it grows as an investment. At some point, an endowment can be self-sufficient, i.e. it makes enough money on investing to sustain its needs. However, if the needs keep growing, the endowment must grow. Or the endowment grows, and the school finds things to spend it on. I suspect Duke is happy their endowment grew 55.9% in a year. Presumably, they use the endowment for the sake of educating students. But I question whether the educational value of Duke (whether it is the actual education the students get or the value of that education) will grow 55.9% any time soon. I think there's no logical way anyone can argue that it will in the short term. Of course, the university will argue that the money will be spent improving education. But I question if the 55.9% increase will ever be fully recovered in education value. Likely, a big chunk will be spent on fundraising to further grow the endowment, which continues the cycle. It will feed the machine. Which kind of disgusts me.

Yes, coming from a good name school like Duke may get someone an initial job. But it will not help them stay at that job unless there's significant nepotism going on. All that really matters in the workplace is that someone is of value due to their work, not where their degree came from. One of the worst employees I ever hired was a personable guy out of Stanford. He turned out to be the cover boy for entitlement. After watching him come in late, go home early, spend more time on his phone than his computer, etc., I was happy to cut him at the next layoff. On the other hand, one of the best I ever hired was a guy out of a for-profit college. He was a bit rough around the edges. But he worked his butt off, got a great rep around my company, and I promoted him early. So the creme rises to the top work-wise. I definitely don't feel that simply graduating from any top school guarantees success. And if you are paying $400-500K for a kid's education (everything all in for 4+ years), I'm not sure that's a gamble I'd be willing to take for a family financially, unless half a mill isn't a big deal for that family (which could lead to entitlement anyway). So if a kid is so great and goes to a solid public state school and knocks it out of the park, they might not get into a pretentious, self-important workplace. But if they're really good, they will get into another one and eventually blow the pompous one away. And they will have more money in their pocket, as they didn't shell out for the name school. And I'd rather hire a hard working person like that than an entitled one like the one I had.

I certainly have an allegiance to Duke. But I can certainly understand why people would question the value of Duke these days, if they paid for anywhere near the full ride. What I would love to see is Duke start to offer full rides for all undergrads unless their families made more than, say $1M per year (just find some number, $1M seems like a nice round number to me). Growing their endowment 55.9%, they could toss some of that money to the purpose of providing a top notch education. They would certainly afford it. If they did, maybe I'd start donating significant money to them. I'd be really proud of Duke.

As for me and my kids, in my area there's a ton of pressure on them via their peers (more likely, their peers' parents) to go to a big name school like Duke. I recognized that early, and I didn't want to pressure them like that. One of mine is now looking at colleges, as she will matriculate next year. I told her she can go wherever she wants to go - it just has to be accredited. But once she gets there, she needs to work hard, no excuses. It's her life, and her responsibility. She's a smart kid and the schools she's looking at are all fine, just no Dukes and Stanfords on her list. So if she ends up not getting into her dream job after graduation because she didn't go to some name school, so be it. I'll just tell her that she will definitely find her dream job, if she produces in her first job.

9F

(a) I Have hired 25 or so people directly from Duke. All turned out well (but many went on to grad school or law school).

(b) Duke is known as a rah-rah school where people work well together. (This is also true of Fuqua, I believe). Duke folks seem to do well in company environments.

(c) In terms of your children (or grands) attending Duke, the student body is full of terrific people, and they well have lots of really good, smart, successful friends for the next several decades. My daughter married someone from Dartmouth who is pretty special; however, my nephew, who turned down Duke for Harvard, ended up marrying someone who went to Duke who is really wonderful.

(d) What is the amortized cost of the $300K or so for a Duke education? $20 K a year or so?. If you can swing it financially, it should not be a significant consideration, IMHO (where the H got lost when my nephew accepted Harvard).

(d)

[ice-9]

Part of why I believe kids should go to the best school possible is because I think good schools are more similar than they are different. There will always be a subset of morally bankrupt money grubbing kids; and another subset of do good salt of the earth give all to society types; they exist at every school. I also believe most good schools are diverse enough that every person can find their niche. Whether that's anime loving weebs to sports obsessed jocks to geeky intellectual math Olympiads; good schools which prioritize diversity will have all types of communities that kids can opt into.

So I don't believe in typecasting schools as being good for one type of kid versus another. Maybe you can make an argument about weather and school size...but it's only three to four years, so I say "suck it up" for the former and for the latter it's more about specific classes than school population number anyway (intro economics will be large class size regardless while obscure liberal arts topics will probably be small). I also don't put too much credence in this school is good for this vs. that discipline; this is undergrad, what you learn isn't advanced enough where specialization matters. Most top schools are good enough for everything. Yes, even engineering at Harvard.

What I have observed through work experience though is that tiers of schools do predict probability of success in the companies and industries I've worked in. Not fully of course, the best always have a habit of distinguishing themselves no matter where they went to school. Whether it's because the most capable kids tend to get into better schools, or going to better schools produce the most capable kids, regardless, I believe people should go to the best school they can get into.

[ikiru36]

Yes, they restored half the contribution and none of the raises. As someone who also went through the Great "No Raises" Recession, that's a fair number of years that I've worked at Duke were there's been no COLA. Those things add up. Actually, they multiply up.

On the other hand, from the glass-half-full point of view, a lot of employers would not have done even that much, and many of the salaries at Duke are grant-funded. Retirement contribution costs are part of the university's fringe benefit rates. The university's fringe rate was lowered because of the contribution change, so that money was not recovered from federal grant funding during that period. Accordingly, Duke has already used hard money to do as much as they have. So, agreed, it isn't completely one-sided.

Phredd3, thank you for the reminder about the lack of COLA in 2020, especially amidst increased concerns about inflation. And COLA is not only important in its year, but the loss of a single year compounds over time as future increases are generally based on a % of current salary. Given this successful year for the endowment, maybe, hopefully, they will find a way to redress those losses, especially for those at the lower end of the salary pole.

[kako]

(a) I Have hired 25 or so people directly from Duke. All turned out well (but many went on to grad school or law school).

(b) Duke is known as a rah-rah school where people work well together. (This is also true of Fuqua, I believe). Duke folks seem to do well in company environments.

(c) In terms of your children (or grands) attending Duke, the student body is full of terrific people, and they well have lots of really good, smart, successful friends for the next several decades. My daughter married someone from Dartmouth who is pretty special; however, my nephew, who turned down Duke for Harvard, ended up marrying someone who went to Duke who is really wonderful.

(d) What is the amortized cost of the $300K or so for a Duke education? $20 K a year or so?. If you can swing it financially, it should not be a significant consideration, IMHO (where the H got lost when my nephew accepted Harvard).

(d)

(a)-(c) are all good things, but the endowment size has nothing to do with them. Duke should use its endowment to provide better financial access for people to attend. Period. Whatever (d) is, Duke should increase sharing its wealth with the students who attend, thus lowering (d).

9F

[Steven43]

(a)-(c) are all good things, but the endowment size has nothing to do with them. Duke should use its endowment to provide better financial access for people to attend. Period. Whatever (d) is, Duke should increase sharing its wealth with the students who attend, thus lowering (d).

9F

I like how you threw in “9F” at the end.

One could write the most unintelligent, nonsensical, bordering-on-insanity post, but if you close it with 9F it’s all good. 😛

[sagegrouse]

(a)-(c) are all good things, but the endowment size has nothing to do with them. Duke should use its endowment to provide better financial access for people to attend. Period. Whatever (d) is, Duke should increase sharing its wealth with the students who attend, thus lowering (d).

9F

I don't happen to agree that providing tuition-free education should be sole purpose of Duke's endowment, (see below) it isn't the main purpose of Duke's. But, we will all follow the leader -- Harvard. While it hasn't reported its endowment size for the year (The Harvard endowment was $41+ B in 2020), I expect it to reach $50 B this year. As such, Harvard could pay all tuition for its 22,900 students for about 2.3 percent of its endowment value each year, and the endowment would still grow through investments and gifts. Harvard has been the bellwether on financial aid policy. It led the way in raising the family income levels at which students had to pay tuition and in emphasizing grants over loans in financial aid. We'll see if it goes the extra step. If it does, other elite schools will say "Gulp" -- and follow.

Duke has been trying to raise endowment to fund scholarships, implying that existing endowment is used for faculty, facilities and research. At Duke, much of the value of scholarships are paid out of tuition receipts. (and this is far more the case at most private colleges and universities).

Anyway, it's a long and detailed discussion, and I still don't know what "(d)" was supposed to be.

[johnb]

The Board apparently limits the amount spent from the endowment to 5.5%/year (using a 3 year rolling average; ie, this year’s windfall won’t lead to quickly increased soending).

As of June 30, 2021, of that 5.5%, about 22% was designated for support of financial aid, and 20% was designated for support of specific faculty positions (I’m guessing endowed chairs). Nearly one-third of the endowment was designated for unrestricted support of the university or one of its schools or budget centers. The rest seems to go to instruction/research/other.

I guess we’ll eventually find out whether Duke becomes more generous with financial aid.

I bet Duke has debated whether to simply cut tuition by half—which might make Duke even more incredibly difficult to get into, or maybe people would feel it was like attending the Dollar store. Since people are lining up to come, I’m guessing Duke doesn’t think that’s the place to invest extra cash….

[sagegrouse]

The Board apparently limits the amount spent from the endowment to 5.5%/year (using a 3 year rolling average; ie, this year’s windfall won’t lead to quickly increased soending).

As of June 30, 2021, of that 5.5%, about 22% was designated for support of financial aid, and 20% was designated for support of specific faculty positions (I’m guessing endowed chairs). Nearly one-third of the endowment was designated for unrestricted support of the university or one of its schools or budget centers. The rest seems to go to instruction/research/other.

I guess we’ll eventually find out whether Duke becomes more generous with financial aid.

I bet Duke has debated whether to simply cut tuition by half—which might make Duke even more incredibly difficult to get into, or maybe people would feel it was like attending the Dollar store. Since people are lining up to come, I’m guessing Duke doesn’t think that’s the place to invest extra cash….

Thanks, JohnB. (Nice sloop you got there!) I wonder if most of the endowment-oriented financial aid goes to grad students, specifically PhD candidates -- almost all of whom receive fellowships. Brodhead specifically told a group of us that undergraduate financial aid was funded by the operating budget (which means, I think, an "offset to tuition"). And, of course, hew as trying to raise money to fully finance scholarships. The Duke Forward campaign may have changed things ad interim, but maybe not totally.

[JasonEvans]

I bet Duke has debated whether to simply cut tuition by half—which might make Duke even more incredibly difficult to get into, or maybe people would feel it was like attending the Dollar store. Since people are lining up to come, I’m guessing Duke doesn’t think that’s the place to invest extra cash….

This may be a controversial take but I hate the idea of cutting tuition. Full tuition at a place like Duke is paid by the wealthy. By having them pay a ton, it allows the school to afford to take middle class kids and give those folks financial aid. Heck, I would be in favor of making tuition $100k per year. Anyone who can afford that would pay it and the rest would fill out their FAFSA forms and get aid to make up the difference between what they can afford and the $100k bill. So, someone who could afford to pay $20k would get $80k of aid and someone who could afford $75k would get $25k of aid.

The moment you take a penny of financial aid, you don't really care how high tuition is at a school like Duke that meets 100% of aid. If FAFSA says I can afford to pay $55k, it does not matter to me whether tuition is $60k or $100k. In either case I am paying $55k. But, if tuition is $100k, then the really rich kids who can afford a bill that large are carrying more of the burden of supporting the school.

I'm sure you all get it, but to put a fine point on it -- right now, the child of a super rich person pays something like $70k per year to Duke. If tuition were $150k per year, which would sound outrageous, Duke would get a higher percentage of tuition from the super rich. Sounds like a good plan to me!

[acdevil]

This may be a controversial take but I hate the idea of cutting tuition. Full tuition at a place like Duke is paid by the wealthy. By having them pay a ton, it allows the school to afford to take middle class kids and give those folks financial aid. Heck, I would be in favor of making tuition $100k per year. Anyone who can afford that would pay it and the rest would fill out their FAFSA forms and get aid to make up the difference between what they can afford and the $100k bill. So, someone who could afford to pay $20k would get $80k of aid and someone who could afford $75k would get $25k of aid.

The moment you take a penny of financial aid, you don't really care how high tuition is at a school like Duke that meets 100% of aid. If FAFSA says I can afford to pay $55k, it does not matter to me whether tuition is $60k or $100k. In either case I am paying $55k. But, if tuition is $100k, then the really rich kids who can afford a bill that large are carrying more of the burden of supporting the school.

I'm sure you all get it, but to put a fine point on it -- right now, the child of a super rich person pays something like $70k per year to Duke. If tuition were $150k per year, which would sound outrageous, Duke would get a higher percentage of tuition from the super rich. Sounds like a good plan to me!

A good plan under the assumption that the FAFSA levels are calibrated correctly and the aid is in grants, not loans. Based on my (perhaps dated) personal experience, I’m skeptical.

[uh_no]

A good plan under the assumption that the FAFSA levels are calibrated correctly and the aid is in grants, not loans. Based on my (perhaps dated) personal experience, I’m skeptical.

i was in the process of writing the same thing. there is always someone picking up some part of the tab who can't afford it. Parents refusing to contribute more than X amount to their children's tuition, despite being able, for instance, is not an uncommon occurrence...and the student is left on the hook for the loans. I'm not saying I have an easy fix, just that "rasing only affects people who can afford it anyway" is not true in practice.

[Bluedog]

A good plan under the assumption that the FAFSA levels are calibrated correctly and the aid is in grants, not loans. Based on my (perhaps dated) personal experience, I’m skeptical.

You may be skeptical, but that's how it works at a school like Duke. They calculate how much you can pay and take the difference. Loans are capped at the federally allowed amounts per year (something like $5.5k) although they are eliminated completely for those below certain income levels.

[Acymetric]

You may be skeptical, but that's how it works at a school like Duke. They calculate how much you can pay and take the difference. Loans are capped at the federally allowed amounts per year (something like $5.5k) although they are eliminated completely for those below certain income levels.

(Emphasis mine)

I believe they are saying they believe that calculation is incorrect, not that one isn't being made.

[uh_no]

i was in the process of writing the same thing. there is always someone picking up some part of the tab who can't afford it. Parents refusing to contribute more than X amount to their children's tuition, despite being able, for instance, is not an uncommon occurrence...and the student is left on the hook for the loans. I'm not saying I have an easy fix, just that "rasing only affects people who can afford it anyway" is not true in practice.

You may be skeptical, but that's how it works at a school like Duke. They calculate how much you can pay and take the difference. Loans are capped at the federally allowed amounts per year (something like $5.5k) although they are eliminated completely for those below certain income levels.

The skepticism isn't that duke meets demonstrated need, but that demonstrated need, as determined by FAFSA, in many cases does not align with actual need in reality. If it WERE the case, you wouldn't see US undergrads coming out of duke with private loans...and yet this is anecdotally common.

(FWIW: international admissions are NOT need blind, and given it is already hard to get into duke as an international, it is even more so if you have any financial need)

[CrazyNotCrazie]

This may be a controversial take but I hate the idea of cutting tuition. Full tuition at a place like Duke is paid by the wealthy. By having them pay a ton, it allows the school to afford to take middle class kids and give those folks financial aid. Heck, I would be in favor of making tuition $100k per year. Anyone who can afford that would pay it and the rest would fill out their FAFSA forms and get aid to make up the difference between what they can afford and the $100k bill. So, someone who could afford to pay $20k would get $80k of aid and someone who could afford $75k would get $25k of aid.

The moment you take a penny of financial aid, you don't really care how high tuition is at a school like Duke that meets 100% of aid. If FAFSA says I can afford to pay $55k, it does not matter to me whether tuition is $60k or $100k. In either case I am paying $55k. But, if tuition is $100k, then the really rich kids who can afford a bill that large are carrying more of the burden of supporting the school.

I'm sure you all get it, but to put a fine point on it -- right now, the child of a super rich person pays something like $70k per year to Duke. If tuition were $150k per year, which would sound outrageous, Duke would get a higher percentage of tuition from the super rich. Sounds like a good plan to me!

I'm sure that to some this is going to sound tone deaf and entitled, but I'll say it anyway. A lot of people think that all Duke alums are as wealthy as David Rubenstein, but in reality, a large portion of Duke's students and alumni are middle to upper middle class families from high cost of living areas. Yes, they have made the choice to live in these areas, but they also should not be penalized for it. Many of these families also choose to be prudent and save money for college, making sacrifices to do so. No, they are not choosing between eating and not eating, but they are forgoing things they could otherwise enjoy. Also, people used to have kids younger so they would have more time after the kids went to college to save up for retirement. As families have kids later, they have more savings by the college years that is considered free game for colleges (not all of it can be stashed in accounts that are not considered in aid formulas) and less time after the kids are in college to save unless they work until they are very old.

The current system penalizes these families as they make too much to qualify for significant aid but not enough to be able to easily write the check and not think about it, particularly as the cost of attendance is growing at a rate faster than wages. The cost of a year at Duke as a percentage of the salary and savings of the typical student has gone up significantly. Yet Duke (and other schools) has no qualms about calling these alums and asking for increased gifts, primarily appealing to loyalty to Alma Mater Dear but also with the implied message that the extra $50 a year might put Junior over the top to get in as a legacy.

The current system is set up to benefit the super rich and those who get a full ride - it is a barbell effect. I have many classmates with kids approaching college age who do well financially by most metrics (and most are in the same financial category that their parents were when they attended) but are not even considering Duke for their kids.

All that being said, the economics major in me says that Duke is a luxury good where demand far exceeds supply, so they should charge what they can. But just don't forget the people who got you there in the meantime.

[sagegrouse]

This may be a controversial take but I hate the idea of cutting tuition. Full tuition at a place like Duke is paid by the wealthy. By having them pay a ton, it allows the school to afford to take middle class kids and give those folks financial aid. Heck, I would be in favor of making tuition $100k per year. Anyone who can afford that would pay it and the rest would fill out their FAFSA forms and get aid to make up the difference between what they can afford and the $100k bill. So, someone who could afford to pay $20k would get $80k of aid and someone who could afford $75k would get $25k of aid.

The moment you take a penny of financial aid, you don't really care how high tuition is at a school like Duke that meets 100% of aid. If FAFSA says I can afford to pay $55k, it does not matter to me whether tuition is $60k or $100k. In either case I am paying $55k. But, if tuition is $100k, then the really rich kids who can afford a bill that large are carrying more of the burden of supporting the school.

I'm sure you all get it, but to put a fine point on it -- right now, the child of a super rich person pays something like $70k per year to Duke. If tuition were $150k per year, which would sound outrageous, Duke would get a higher percentage of tuition from the super rich. Sounds like a good plan to me!

Scholarships by tuition rebates is the standard approach for private schools with small endowments. Some pay full freight, which is still considerable, even at less competitive schools. That enables the school to "compete" for needy and -- truthfully -- better students by granting scholarships with other people's tuition money.

Where Duke is trying to go is to get the scholarship money for undergraduates covered by special endowment funds. That way, all the tuition money goes into the educational programs. That was a main priority of President Brodhead, and I haven't heard any updates since Vince Price became president. Here is what Duke had to say about scholarships at the conclusion of the campaign:

• Raising $473 million for financial aid and fellowships, and establishing the Karsh Office of Undergraduate Financial Support.
• Creating 594 new scholarship and fellowship endowments across all 10 schools, including the David M. Rubenstein Scholars Program for first-generation, low-income students.

That's significant -- full tuition -- for 400+ and there are other existing funds, but doesn't cover the whole job.

As it is, Duke charges what other well-known private schools charge. And that's been going on for decades, rising a few percentage points a year, in good times and in bad. It is the slow boat to $100K tuition.

[WillJ]

This may be a controversial take but I hate the idea of cutting tuition. Full tuition at a place like Duke is paid by the wealthy. By having them pay a ton, it allows the school to afford to take middle class kids and give those folks financial aid. Heck, I would be in favor of making tuition $100k per year. Anyone who can afford that would pay it and the rest would fill out their FAFSA forms and get aid to make up the difference between what they can afford and the $100k bill. So, someone who could afford to pay $20k would get $80k of aid and someone who could afford $75k would get $25k of aid.

The moment you take a penny of financial aid, you don't really care how high tuition is at a school like Duke that meets 100% of aid. If FAFSA says I can afford to pay $55k, it does not matter to me whether tuition is $60k or $100k. In either case I am paying $55k. But, if tuition is $100k, then the really rich kids who can afford a bill that large are carrying more of the burden of supporting the school.

I'm sure you all get it, but to put a fine point on it -- right now, the child of a super rich person pays something like $70k per year to Duke. If tuition were $150k per year, which would sound outrageous, Duke would get a higher percentage of tuition from the super rich. Sounds like a good plan to me!

Elite universities have been moving in this direction for years and, if the trend continues, they'll get to your proposal in the not-too-distant future. Here are some thoughts:

1. This is a form of taxation on wealth and income...i.e. the more you have and make, the higher the price you pay. If you want higher taxes on wealth and income, then this is one way to do it.
2. As with all taxation, it's important to ask who really pays the tax ("incidence" in economics-speak) and who benefits from the benefits funded by the tax. A lot of kids from rich families go to elite colleges, so they will pay higher tuition fees. Most poor kids do not go to elite colleges, so they will not benefit from cross-subsidies from rich-ivy-kids to not-so-rich-ivy-kids. It will be the small subset of poor kids who go to elite colleges who will benefit.
3. "Poor kids" who go to elite colleges are, in the long-run, not the poorest of the poor. Elite colleges tend to cherry-pick (quite reasonably, I suppose) kids from poor families that a) would have done pretty well anyways and b) almost all graduates from elite colleges are not poor from a life-cycle perspective. Put differently, the beneficiaries of this policy are not poor!
4. There is some legitimate concern that college financial policies negatively affect family savings and income. Elizabeth Warren got asked on the hustings by an irate father who had saved in advance to pay for his kids' college expenses about why his profligate neighbor, whose income had been similar to his but who had not saved, should be rewarded by having his loans forgiven. It's not a crazy question. Relatedly, Marin Feldstein did a study a number of years ago that found (always subject to critique, mind you) that college rules significantly reduced parents' savings. I don't think that problem has gotten any better in the past 30 years.
5. College tuition is pretty much the only service you can purchase in the US where the price you pay is explicitly linked to your income and wealth (outside of things like loans where the cost-of-service is linked to those things).

Just to be clear, I am neither endorsing nor critiquing your proposal.