“We Love the Poorly Educated!” Trump, GOP, Take Aim at Higher Education

November 22, 2017

War on Science to a whole new level.
You think I’m kidding when I say the GOP wants a nation of serfs.

New Tax reform bill massively shunts money to top 1 percent.
Knocks out most important rungs for getting up the economic ladder.

Play that out for 30 years. You’re Guatemala with Nukes.

Nature:

Doing a PhD is a classic exercise in delayed gratification. While classmates enter the workforce and start putting money into retirement plans, students who enrol in graduate school face many years of long hours, teaching requirements and weekends running experiments that can’t wait. Someday, perhaps, an advanced degree will land them a more lucrative and rewarding job.

Meanwhile, none of that work is well compensated. In the United States, according to the US Department of Education’s latest data, from 2011 to 2012, more than half of graduate students make less than US$20,000 a year. For reference, the federal poverty line for a single person without children is $12,060. Living in an expensive region such as Boston, Massachusetts, or the San Francisco Bay Area in California is especially tough. For example, graduate stipends at the US National Institutes of Health (NIH) are capped at $23,844 and are not adjusted for cost of living. To help out, universities often waive tuition fees, which can sometimes be more than a student’s income.

The last thing that graduate students need is a tax hike. But that is what many would face under a clause in the federal-tax-reform bill passed by the US House of Representatives last week. It will now need to be reconciled with the Senate’s tax-reform bill (which retains many existing student tax benefits), and signed by the president.

The 429-page tax plan — which President Trump reportedly tried to christen the “Cut, Cut, Cut Act” because it would ostensibly shrink taxes for many — would require students to report tuition-fee waivers as taxable income, moving the students into a higher tax bracket. Graduate students, who receive the lion’s share of tuition waivers, would be most affected. And 60% of the 145,000 students who get tuition reductions each year are working in science, engineering, technology and mathematics fields, the US Department of Education estimates.

The amount of money that the government would reap from these taxes would be minuscule, given the $20.5-trillion national debt. But it could weigh heavily on young scientists. Take a hypothetical PhD student at the Massachusetts Institute of Technology (MIT) in Cambridge, in receipt of a $23,844 NIH stipend. Under the current system, she would pay very little in taxes. The new law would add her $49,000 MIT tuition bill to her taxable income as though she were paid a $73,000 salary — an amount she never actually sees. This would add thousands of dollars to her tax burden.

This example is extreme — most graduate schools’ tuition fees are closer to $16,000 — but it is safe to say that many students could see their tax rate rise. Students who attend public universities outside their home states would be especially hard hit: out of state, tuition can cost double what it does in-state. The bill would also eliminate a tax benefit that allows people with low incomes to deduct student-loan interest from their taxable income.

New York Times:

WASHINGTON — The moment the last of Fred Vautour’s five children walked across the stage as a Boston College graduate was priceless.

Not only did Mr. Vautour have the rare distinction of handing each of his children their diplomas, but he was also able to pay for their nearly 18 years of schooling by collecting trash, scrubbing toilets and mopping floors while the campus slept.

“As much as I struggled, it was incredible to be able to do that for them,” said Mr. Vautour, 64, who has worked the graveyard shift as a custodian at Boston College for 17 years. “I took this job for benefits, but never imagined this would be one of them.”

It may not be one for long — or at least could be severely curtailed. The sprawling House tax bill, set for a vote on Thursday, would tax the value of college tuition benefits conferred on thousands of university employees like Mr. Vautour, one of several provisions that would hit colleges, universities and their students, hard.

Republicans drafted the bill with the premise that it would simplify the nation’s tax code and cut rates for middle-income Americans. To help pay for the $1.5 trillion tax cut, lawmakers eliminated many individual tax breaks, arguing the overall plan would compensate for any lost benefits. The result: while many families and businesses would see tax cuts, a large percentage of undergraduates and graduate students would see their tax bills increase, some dramatically.

And if students take out more loans to pay their new taxes, they would face another surprise: Under the House bill, interest paid on student loans — a deduction that more than 12 million people used in 2015 — would no longer be tax deductible.

“These benefits ensure the brightest and best in the country can continue to afford an education,” said Steven M. Bloom, director of governmental relations for the American Council on Education, which represents 1,800 college and university presidents across the country. “Congress is sending a clear message that they’d rather use that money for corporate tax breaks.”

For Dacen Waters, 26, who is in his fourth year of pursuing a doctorate in physics at Carnegie Mellon University, the House bill would impose about a $7,000 tax increase.

In Mr. Waters’s program, the Mellon College of Science grants students an annual stipend of $29,400 and a $43,000 tuition waiver. Under the current proposal, their taxable income would rise to $61,000 from $19,000. That would effectively cut students’ net stipend by nearly $10,000 a year.

 

bootstraps
Going after students is not only one way that Republicans are attacking education across America.

New York Times 6/7/17:

Gov. Sam Brownback’s leadership of Kansas came to be synonymous with a single, unyielding philosophy: Cut taxes, cut the size of government, and the state will thrive.

But this week, Mr. Brownback’s deeply conservative state turned on him and his austere approach. Fed up with gaping budget shortfalls, inadequate education funding and insufficient revenue, the Republican-controlled Legislature capped months of turmoil by overriding the governor’s veto of a bill that would undo some of his tax cuts and raise $1.2 billion over two years.

The results were a warning of the risks for other Republican-controlled states that have tested similar approaches, and a dizzying descent for Mr. Brownback’s legacy and any future political aspirations.

And in March, the Kansas Supreme Court found that the state’s spending on public education was unconstitutionally low, dealing the governor another blow and putting added pressure on Republican lawmakers to at least loosen his tax-cutting policy.

Wisconsin, under GOP Gov Scott Walker, has been particularly hard on education.

Wisconsin State Journal:

Gov. Scott Walker’s proposed budget cut of $300 million to the University of Wisconsin System comes as other states, nationally and in the Midwest, have inched up funding for higher education, restoring support lost during the economic recession. More increases are expected in coming years.

“The numbers do seem to be improving,” said Lara Couturier, director of postsecondary state policy at Jobs for the Future, a Boston research nonprofit focused on education and employment for low-income Americans. “Since the dog days of the recession, the national picture is looking a little better but it doesn’t change the fact that there has been overall a declining investment in higher education by our states.”

Wisconsin is one of a handful of states that hasn’t restored funding in this fiscal year to where it was in 2009-2010, when higher education systems nationwide — in addition to most other public agencies — saw dramatic funding cuts due to the economic recession that started in late 2007.

Forbes:

Just two months ago I wrote about Wisconsin Governor Scott Walker’s dual attacks on his state’s flagship university. Walker, who is currently running for the Republican nomination for President, is moving to eliminate tenure for professors at the University of Wisconsin, while at the same time implementing an enormous $250 million budget cut.

This week we learned a new reason why Gov. Walker cut that $250 million: He wants to give it to wealthy hedge fund managers to build a new basketball arena for the Milwaukee Bucks.

No kidding. I can only imagine what my colleagues at the University of Wisconsin are thinking.

Inside Higher Education:

Colleges and higher ed lobbyists are refining their attacks against House Republicans’ proposed tax overhaul, taking aim at provisions that would significantly affect institutional operations as the tax plan goes under the microscope.

Several proposals to raise taxes on wealthy colleges and universities came under fire, including a 1.4 percent excise tax on private university endowments valued at $100,000 or more per full-time student and a 20 percent excise tax on employee compensation above $1 million at all nonprofit entities. So did another proposal that would raise the cost of construction for private colleges, rich and poor, by eliminating tax-exempt private-activity bonds.

The changes would harm colleges’ financial health, drive increased costs for students and harm colleges’ ability to attract top talent to key positions, opponents say. Those arguments join criticisms of other pieces of the tax plan that could directly affect students, such as ending student loan interest deductions, eliminating part-time students’ ability to receive education tax credits and imposing new taxes on tuition assistance.

As a whole, the tax plan is notable for the numerous ways it targets higher education in order to pay for Republicans’ political priorities, like cutting corporate taxes and simplifying the individual tax code. That likely signals a difficult political path ahead, according to some observers who see wealthy institutions as actors that have long abused a friendly tax code and have now missed their chance to reform their behavior and negotiate in good faith over policy changes. To many in higher education, the proposals represent a punitive slap at institutions serving the country in many ways.

 

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4 Responses to ““We Love the Poorly Educated!” Trump, GOP, Take Aim at Higher Education”

  1. webej Says:

    What a disaster.
    But the “costs” are also ridiculous.


  2. Meanwhile, the carried interest loophole appears to be safe.

  3. metzomagic Says:

    Pretty soon, the only people who will be able to afford a PHD will be rich kids – a self-reinforcing elite 😦 What Trump and the Rethuglicans are doing is patently disastrous for the future of education in our country. Not to mention the all too obvious trashing of the environment.

    But the voters who are turning a blind eye to what Trump and co. are doing to the country will vote these self-serving idiots in again. All because Trump promised: “Less taxes! And I’ll get your jobs back!”. Less taxes for the super-rich and more jobs for his cronies is more like it. Could have told you that 2 years ago. He’s drained the swamp, alright… and filled with with a more vicious species of alligator.

  4. Andy Lee Robinson Says:

    Education is a threat to Republicanism so it has to keep the population ignorant, like convincing chickens that KFC has their best interests at heart.

    Greedy conscienceless sociopaths milk the system, and the conned ignorant keep supplying the milk, so more ignorance=more milk.

    This is how revolutions begin and civilizations end.


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