Re: MIT’s financial records contradict its claims of austerity
Clarity and additional context on MIT’s financials
To the Editor:
I am providing a response to an op-ed that appeared in the Aug. 18 issue of The Tech, “MIT’s financial records contradict its claims of austerity,” to provide some clarity and additional context.
First, as President Sally Kornbluth explained in a community letter in May 2026, and as senior leaders communicated in a November 2025 letter, MIT’s central budget — a significant source of funding for graduate student stipends and benefits — faces major new financial burdens from an increase in the endowment tax rate from 1.4% to 8.0% that just took effect and reduced tuition revenue and reimbursement for research infrastructure related to 16% decrease in campus direct research activity charged to federal grants. [1] Lost research revenues also directly reduce available funds to pay stipends to graduate student research assistants. While a common suggestion is to draw down the endowment to replace these lost resources, state law requires MIT to maintain the endowment as a “permanent fund,” preserve its purchasing power and spend it as directed by its source.
Second, while the living wage calculator is a useful tool, many of its assumptions (including the cost of health insurance, housing, transportation, and payroll taxes) must be modified for an MIT graduate student. Accounting for these modifications, the living wage for an MIT graduate student is approximately $46,500, which is about 10% below the minimum MIT PhD RA stipend of $51,200. MIT addresses living wage compensation and stipend rates in more detail on our Graduate Student Unionization site.
MIT will continue to pursue a fair contract for our graduate student workers that ensures they have the resources they need to thrive while reflecting the reality of the Institute’s financial situation.
Sincerely,
David L. Darmofal
Vice Chancellor for Graduate and Undergraduate Education
Jerome B. Wiesner Professor of Aeronautics and Astronautics
[1] The figure of 16% is sourced directly from the Office of the Vice President for Finance at MIT.