When Columbia University agreed to federal government demands as conditions for restoring $400 million of federal funding, critics called it a watershed moment, marking the end academic freedom at the 271-year-old institution.

I could be wrong, but my first guess is that those critics may be slightly overreacting. Regardless of whatever horrible policies the Trump administration demanded, there was a simple way the school could avoid the situation entirely: forgo federal funding.

But Columbia University administrators learned what long-time Tennessee economics professor Tony Spiva taught me in 1981: there ain’t no such thing as a free lunch. If you accept someone’s money, you accept whatever conditions the giver decides to attach to it.

This isn’t some novel, Trump-era fascist maneuver. Under the Biden administration, grants for Covid relief, education, environmental projects healthcare and highway construction were preconditioned on the recipients agreeing to conditions unrelated to the core mission of the projects being funded – usually DEI-related. If recipients wanted the money, they had to agree to the conditions.

For Columbia, with its elite status and ample resources, refusing federal money could be a strategic move. Publications like the Chronicle of Philanthropy and Stanford Social Innovation Review have long observed that it is dangerous for any organization to depend on the generosity of a small number of donors for a significant portion of its operating funds.

There are plenty of institutions that have fully or partially rejected such dependencies.

When Center for Disease Control and Prevention funds for programs targeting “gender ideology” were temporarily blocked in January, Advocates for Youth, an organization that advocates for young LGTBQ people, told the CDC to keep the $1.4 million it was slated to receive over the next four years.

It’s the same decision Hillsdale College made in 1984, when it decided to forgo all government support (including federal grants or loans for its students) rather than comply with the reporting requirements of Title IX. (Nonetheless, the school’s website notes that Hillsdale was the first American college whose charter prohibited admission discrimination based on race, sex, or religion.)

The University of Tennessee has decreased its reliance on state funding for education and general expenses, reducing its dependence on the whims of the sometimes seeming nutjobs in Nashville. Thirty years ago, state appropriations comprised 62 percent of UT system education and general revenues. This year the figure will be less than 40 percent. You can argue that state taxpayers should more fully fund the education expenditures for the state’s university system, but the more the university can depend on a fee-for-service, earned revenue model of funding, the less threatened it is by shifts in the political winds.

It’s a lesson the smart Ivy League folks at Columbia might consider.

David Moon is president of Moon Capital Management. A version of this piece originally appeared in the USA TODAY NETWORK.