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The GOP Tax Plan Will Destroy Graduate Education

forbes.com

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Re: The GOP Tax Plan Will Destroy Graduate Education

#61

Post by taylodl »

turc1656 wrote: post #49
taylodl wrote: post #12

Earlier quoted context omitted.

I don't follow your line of thought. How is the government picking up the tab? The government isn't making any payment back to the institution.

I believe what Overtonwindow meant was that the cost of education has gotten out of control primarily because whenever the government guarantees debt ( cough housing cough ) it creates a perverse incentive where the lenders profit by bigger loan values and the schools profit by jacking up the cost of their service for which the loans are issued. Essentially, there is far less of a check and balance on the price of th…

In my state the state legislature has repeatedly and dramatically curtailed state funding for the public colleges, which of course has led to tuition increases. Then the state legislature capped the percentage in-state tuition may increase on an annual basis. Now the public schools take far fewer in-state students and instead focus on out-of-state and foreign students who are able to pay the pretty darn near private school tuition.

Education is a global commodity and the pricing is set by demand. The fact is other governments are assisting their best and brightest to attend American universities, which are considered amongst the best in the world, while our government is making it harder for our best and brightest to attend our own universities. This doesn't seem like a good strategy for America.

Re: The GOP Tax Plan Will Destroy Graduate Education

#62

Post by hcknwscommenter »

tanderson92 wrote: post #48
rayiner wrote: post #47

Earlier quoted context omitted.

Graduate students, as a class, are not the "least privileged." Most are from families that are pretty educated and well-off to begin with.

That is true, and is unrelated to my comment. I was referring to the least privileged members as a subset of that class. I know plenty of PhD students who were the first in their family to attend college, or graduate high school.

Here here. As a first in the family to attend college Ph.D. graduate, this tax bill seems terrible to me. Luckily, I finished my Ph.D. two decades ago. Thus, America continues its long decline by older generations pulling the ladder up against the youngers.

Re: The GOP Tax Plan Will Destroy Graduate Education

#63

Post by maxerickson »

wahern wrote: post #42
test6554 wrote: post #21

Earlier quoted context omitted.

Can you elaborate more on what is going on at universities? Are you saying that grant money comes in for research, but gets funneled back to the university through tuition?

The default tax rule in the U.S. is that any benefit you receive, in any form, is earned income and taxable. Layered atop that default rule are a long list of exceptions, which are generally categorized as (1) exemptions and (2) deductions. If you attend a Ph.D program where the advertised tuition is $30k per year, and you get a tuition waiver (or w'ever it's called), the default tax rule says that you still earned i…

Getting rid of exemptions and deductions is also "simplification" and "reform".

I mean, I agree that the plan is focused on paying for corporate and high end tax cuts, but how do you do tax simplification if special interests are all off limits?

Re: The GOP Tax Plan Will Destroy Graduate Education

#64

Post by tanderson92 »

rayiner wrote: post #57
tanderson92 wrote: post #53

Earlier quoted context omitted.

> Repealing it to increase the earned-income tax credit would almost certainly be fair. False. The IRS states that the EITC only applies to those over age 25 if you do not have a qualifying child (many graduate students fail both). Also, some graduate students fail the most basic tests for EITC-eligibility since they do not have "earned income" despite having taxable income. Another thing is that the tuition being ad…

The fact that graduate students may not be eligible for the EITC is irrelevant. The point is that the people who are eligible for the EITC are statistically much more likely to be underprivileged than graduate students are (as a group). As to the plan to use the tax break to fund corporate tax cuts, it depends on economic conclusions that are beyond my understanding. I tend to be of the mind that we shouldn't tax cor…

Since you acknowledge the increases in the EITC are unhelpful to these underprivileged students you are then saying it is acceptable to raise taxes on the underprivileged portion of a largely privileged group because it's statistically hard to tease out the difference. That's...heartless?

Balancing it out in other members of the lower income class doesn't really help, IMO. You are penalizing people who are underprivileged for trying to improve their lot in life and move into a higher class with one of the best means possible: higher educational attainment.

It's obscene.

P.S. your point about taxation of corporations is interesting too: corporates shouldn't be considered people for purposes of taxation but can participate in political activity and speech (political donations) using rights of individuals. Nice deal, if you can get it.

Re: The GOP Tax Plan Will Destroy Graduate Education

#65

Post by maxerickson »

lewis500 wrote: post #20

I don't understand this. During my PhD my "scholarship" was just basically the university choosing not to charge me money. It's not as though I sat down and set on fire $20k worth of paper every year. So now they have to pay tax on to the amount they would have otherwise charged me? Isn't that kind of a hypothetical concept? Like, can't they say, "Oh the tuition for the civil engineering PhD program is now zero"? Vir…

Yes, during your PhD there were no tax consequences to the university forgiving your tuition, because it was given special consideration.

This would change that.

Ostensibly valuable students will be able to arrange for the university to bear the burden of the taxes, but it will be a change and it is likely that large institutions will use it to their advantage.

Re: The GOP Tax Plan Will Destroy Graduate Education

#66

Post by lewis500 »

maxerickson wrote: post #65
lewis500 wrote: post #20

I don't understand this. During my PhD my "scholarship" was just basically the university choosing not to charge me money. It's not as though I sat down and set on fire $20k worth of paper every year. So now they have to pay tax on to the amount they would have otherwise charged me? Isn't that kind of a hypothetical concept? Like, can't they say, "Oh the tuition for the civil engineering PhD program is now zero"? Vir…

Yes, during your PhD there were no tax consequences to the university forgiving your tuition, because it was given special consideration. This would change that. Ostensibly valuable students will be able to arrange for the university to bear the burden of the taxes, but it will be a change and it is likely that large institutions will use it to their advantage.

No but from an accounting perspective I don’t get how this works. Phd students often do no use any of the univeristy’s real resources. The marginal cost of a phd student is often zero or negative, due to the work they do. There are no platonic costs to charge them, especially if they are passed quals and aren’t taking classes any more. Sure they use their advisor’s time, but that’s unaccountable and variable. So the university could just adjust tuition downward for programs for which everyone gets a scholarship anyway. Is the GOP going to regulate tuition too?

Re: The GOP Tax Plan Will Destroy Graduate Education

#67

Post by rayiner »

tanderson92 wrote: post #64
rayiner wrote: post #57

Earlier quoted context omitted.

The fact that graduate students may not be eligible for the EITC is irrelevant. The point is that the people who are eligible for the EITC are statistically much more likely to be underprivileged than graduate students are (as a group). As to the plan to use the tax break to fund corporate tax cuts, it depends on economic conclusions that are beyond my understanding. I tend to be of the mind that we shouldn't tax cor…

Since you acknowledge the increases in the EITC are unhelpful to these underprivileged students you are then saying it is acceptable to raise taxes on the underprivileged portion of a largely privileged group because it's statistically hard to tease out the difference. That's...heartless? Balancing it out in other members of the lower income class doesn't really help, IMO. You are penalizing people who are underprivi…

> Since you acknowledge the increases in the EITC are unhelpful to these underprivileged students you are then saying it is acceptable to raise taxes on the underprivileged portion of a largely privileged group because it's statistically hard to tease out the difference. That's...heartless?

No, it's utilitarianism. A tax break that disproportionately benefits the educated and well-off shouldn't be preserved just because a small minority of the people it benefits are not well off. Better to eliminate it in favor of a tax break that primarily goes to disadvantaged people.

> You are penalizing people who are underprivileged for trying to improve their lot in life and move into a higher class with one of the best means possible: higher educational attainment.

Someone who has gotten into graduate school necessarily has an undergraduate degree, and probably can make a decent living. At that point, it's better to focus government money on people who aren't so lucky.

> corporates shouldn't be considered people for purposes of taxation but can participate in political activity and speech (political donations) using rights of individuals.

The "people" thing is a red herring. "People" shouldn't lose their free speech rights just because they act in concert through a corporation. That has no bearing on whether "people" are more appropriately taxed at the corporate level or the individual one. The latter is a purely utilitarian concern. I don't think there is anything morally wrong with taxing corporations, I just think it's not worth the hassle given how easy it is for corporations to move to low-tax countries.

Re: The GOP Tax Plan Will Destroy Graduate Education

#68

Post by nindalf »

maxerickson wrote: post #63
wahern wrote: post #42

Earlier quoted context omitted.

The default tax rule in the U.S. is that any benefit you receive, in any form, is earned income and taxable. Layered atop that default rule are a long list of exceptions, which are generally categorized as (1) exemptions and (2) deductions. If you attend a Ph.D program where the advertised tuition is $30k per year, and you get a tuition waiver (or w'ever it's called), the default tax rule says that you still earned i…

Getting rid of exemptions and deductions is also "simplification" and "reform". I mean, I agree that the plan is focused on paying for corporate and high end tax cuts, but how do you do tax simplification if special interests are all off limits?

You don't. The complexity of the tax code isn't a bug, its a feature because people don't want a simple code, they want a simple code _with_ all the exemptions they're likely to use.

Re: The GOP Tax Plan Will Destroy Graduate Education

#69

Post by UncleMeat »

JonFish85 wrote: post #5

No, it won't. The sensationalism all around is just infuriating; I know it's basically politics in a nutshell, but this sort of crap is getting really old. It's not going to destroy higher education; it might raise the bar a bit of who goes to graduate school, and force schools to do more to entice top tier talent to come to their school, but it's not going to destroy it.

A bit? I know people whose taxable income would increase by 200% without these waivers. This translates to a tax increase of ~500% and ensures that people making 25k in stipends are paying 15k in federal taxes.

Re: The GOP Tax Plan Will Destroy Graduate Education

#70

Post by nindalf »

lewis500 wrote: post #20

I don't understand this. During my PhD my "scholarship" was just basically the university choosing not to charge me money. It's not as though I sat down and set on fire $20k worth of paper every year. So now they have to pay tax on to the amount they would have otherwise charged me? Isn't that kind of a hypothetical concept? Like, can't they say, "Oh the tuition for the civil engineering PhD program is now zero"? Vir…

Can't speak to PhDs but for MS programs, the university couldn't charge $0, because they need to charge foreign students exorbitant amounts of money to balance the books.
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