This morning, the New York Post published a story arguing that New York University was "booting" blind Chinese activist Chen Guangcheng from the university after pressure from the Chinese government. The paper speculates that NYU's plans for a Shanghai campus were behind the decision.

Chen, a political dissident who spent years under house arrest in China, became a fellow at the university after escaping from his homeland with the help of Hillary Clinton in May 2012.

Now a source close to Chen has hit back at the article, describing it as a "hatchet job" on embattled NYU President John Sexton, whom the source also described as a "hero" and a "stand up guy" for the role he played in accepting Chen in the first place.

However, the source, who asked to remain anonymous, told Business Insider that Chen's plight does reveal one thing — the incredible influence of the Chinese government in U.S. education.

Our source told us that a number of well-known U.S. higher education institutions — including public and religious colleges — declined to offer a Chen a position after his escape, even if that position was privately funded. The issue wasn't so much a fear of direct threats from China, the source said, but rather a fear of losing revenue from future Chinese projects.

China has concrete ways of exerting itself in the global higher education market, such as the state-funded Confucius Institutes that have been popping up around the world. There are 70 such non-profits in the U.S., promoting Chinese language and culture, according to a New York Times article from last year. The Confucius Institutes are extremely attractive to cash-strapped colleges, though some question their influence.

Indirectly, Chinese students – who offer higher revenues for colleges than domestic students — are also a big factor. In the 2011-2012 academic year there were 194,029 Chinese students studying in the U.S. — accounting for an incredible 25.4% of all foreign students in the country. Nine out of every 10 Chinese with assets of more than 100 million yuan ($16 million) hope to send their children abroad to study, according to one recent report, and the U.S. is a popular destination.

Those close to NYU dispute the Post's assertion that Chen had been left "scrambling to find a new home." Jerome Cohen, an NYU law professor who played a pivotal role in Chen's case, has defended NYU, telling former New York Times reporter Howard French that Chen was always due to stay at the school for just one year. Cohen also said that NYU displayed "extraordinary generosity" in its offer, according to a statement published by the Washington Post's Max Fisher.

Our source told us this was correct, confirming that Chen has been aware of the limitations on his time with NYU since the fall.

Chen himself wasn't planning on staying on at the university when we spoke to him earlier this year.

"I'll probably leave NYU by the end of this year," Chen told Business Insider in an interview in May. "NYU is actually receiving a lot of pressure from the CPC [Communist Party of China], and I think that they do fear this kind of pressure."

Losing his NYU status will not effect his immigration status, our source tells us. However, Chen — a self-taught lawyer who speaks little English — is hoping that connecting himself to an academic institution will provide him both the opportunity to learn, and also a chance to help bring attention to human rights abuses in China, where his family still lives and faces harassment.

Chen's supporters are also concerned that he could be forced to accept an offer at a political institution. The Witherspoon Institute, a conservative pro-life think-tank, has offered Chen — who first riled Chinese authorities by defending women forced into abortions — a three-year work offer.

Chen has also been in talks with Fordham University for at least a month. While there was initially some trepidation on the university's part, the university is now expected to offer Chen a position of visiting scholar at the university's Leitner Center for International Law and Justice. Chen is also understood to have another option.

Fordham university spokesperson Bob Howe said that the parties were still in "negotiations." It remains unclear how long the position would last.