I am not sure where the line lies. If you fund a program that is not run by the government, say 100 billion dollars, should the government not "manipulate" how the program runs? I believe there should be some sort of accountability. To my knowledge the government spends over 7 billion dollars on Pell grants, and if the government has little to no say in whom it should be awarded to, it makes no sense to me. If the University decides to accept less qualified students through legacy admission and give the money to them, it should be challenged I believe.
add: come to think of it, I guess private university can just not accept financial aids from the government and keep their own admission policy if they have enough money to subsidize students who need financial aids. Whether you like it or not, federal money comes with (or should come with) strings attached (or manipulation in your words)
add: come to think of it, I guess private university can just not accept financial aids from the government and keep their own admission policy if they have enough money to subsidize students who need financial aids. Whether you like it or not, federal money comes with (or should come with) strings attached (or manipulation in your words)