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The holidays may be over, but the higher ed community is still waiting to see what Uncle Sam is going to put into its stimulus stocking. Our bet is it will be much needed tens of billions of dollars, hopefully for both student aid and campus infrastructure.

At some point though, and it may not be in his first budget, President Obama is going to follow through on his while also taking a scalpel to government programs where there is poor targeting, inefficiency, or ineffectiveness. Federal higher education programs won’t be free from that examination, nor should they be. The key for advocates and incoming Secretary of Education Arne Duncan, however, is to make sure that savings generated by identified cuts are plowed back into quality education programs.

Since its inception, Higher Ed Watch has focused on identifying and in the federal student loan programs, because that’s where big taxpayer savings were to be had for . But other programs deserve examination as well.

For example, will someone please give us a convincing reason why in a world of finite resources the federal government should give $146 million a year in – to 48 private college and universities with billion dollar plus endowments while simultaneously for low-income secondary students? Why don’t we target campus-based aid on community colleges and other cash-strapped institutions of higher education? Wealthy institutions should pay for campus-based aid out of their own resources, which are generously subsidized by the federal tax code.

The Ivy League alone had endowment wealth totaling approximately $100 billion at the end of fiscal year 2007. These eight institutions accounted for . They have enough wealth to finance tuition costs for every needy student on their campuses with a fraction of their endowments’ five-year average rate of interest.

Super-size endowments have been built with and continue to enjoy substantial taxpayer support. We allow colleges to accept tax-deductible contributions. We free them from local property tax liability. We exempt their investment earnings from taxation.

Now to their great credit, a number of wealthy institutions of higher education have used taxpayer-supported endowment resources to guarantee generous financial aid packages to students from low and middle-income families. Princeton, for example, expenses for students from families earning $75,000 or less and students from substantially higher incomes also receive steep tuition discounts. that students from families earning less than $60,000 a year pay nothing and those earning up to $180,000 pay no more than 10 percent of family income toward postsecondary education expenses.

It’s true Ivy endowments have taken a hit during the current economic downturn. Harvard, for example, reported a in endowment wealth from June 30 to Oct. 31 last year. Again to their credit, Princeton, Harvard, and other wealthy institutions have all made clear they will not scale back their financial aid in response. Good for them.

Of course Harvard saw gains of , , and on its endowment during the previous three years. In fact, Harvard has only had –and none of those was a decline of more than 3 percent. Harvard’s five-year annual on its endowment is more than enough to cover the extra two-tenths of one percent of endowment wealth necessary to fund its new financial aid policies.

And Harvard’s recent endowment loss is still over the same period of time. In fact, it would be shocking if Harvard lost more during the current financial downturn than cash-strapped institutions of higher education, like those invested in Wachovia’s Common Fund for Short Term Investments who in October.

Which is precisely the point. In a world of finite resources, the federal government should look at relative need and cost-efficiency in awarding campus-based aid. That means helping community colleges and other cash-strapped institutions of higher education first.

Harvard is a phenomenal academic institution, and we should encourage it and other wealthy institutions of higher education to recruit, admit, enroll, and retain low-income students. In a world of infinite resources or even just ample taxpayer resources, giving federal campus-based aid dollars to Harvard is a worthwhile investment. But in a world of finite resources, federal dollars should be targeted on the neediest students attending the neediest schools.

Christmas doesn’t last forever.

Ben Miller contributed to this post.