Late last year, Harvard University announced plans to replace all undergraduate loans with grants and to spend an additional $22 million annually to help low- and middle-income students. Starting in the 2008-2009 academic year, undergraduates from families earning between $120,000 and $180,000 annually will pay only 10 percent of their incomes in tuition.

The devil, as Ross Perot used to say, is in the details—and, in the words of an earlier Harvard grad, Henry Adams, the devil also may be in the unintended consequences. “I think it’s a great step in the right direction,” says Charlie Slack, an author in Connecticut who graduated from Harvard in 1983, “but people in income brackets just above that are facing a very steep tuition hill themselves, especially if they live in a high cost region,” such as the Northeast.

Education policy experts have been eyeing Harvard’s move cautiously, particularly since Yale and a handful of other schools have emulated it. Most agree this isn’t merely a wave of academic altruism; rather, it’s the latest development in a long-running battle between congressional watchdogs and the nonprofit sector. Harvard happens to be a tempting target for federal scrutiny since, as Slack notes, its overall endowment (nearly $35 billion) “is more than the GNP of a lot of countries."

Read the full text of this article in The American.