The Republican tax plan puts graduate students, scientific research and the future of America in peril

As we’ve discussed, House Republicans have passed a $1.5 trillion tax cut that, if signed into law, would, among other things, take health care coverage from 13 million Americans and raise taxes on the middle class. You would think those two things alone would be enough to motivate people to call their elected officials and raise holy hell. As that doesn’t seem to be happening, though, at least not like it did the last time the Republican tried to kill the America Cares Act, I thought that I’d try something different. Instead of posting yet again about how this Republican tax bill will fuck working Americans and raise our insurance premiums, I thought that I’d appeal directly to those of you who either benefit in some way from university research, or know of someone in higher education… Given that we live in the shadow of one of the largest and most well-respected research institutions in the world, I suspect that’s quite a few of us, right?

Well, it would appear that killing the America Cares Act, and raising taxes on the American middle class, doesn’t free up enough money to offset Republican plans to eliminate the estate tax and give billions of dollars in permanent tax cuts to America’s most wealthy, which, as everyone knows, is what this so-called “middle class tax cut” has always been about. [Trump, Ryan and McConnell pitched it as a tax cut for the middle class, but it’s not. Middle class tax cuts are small and temporary, while tax cuts for the rich are large and permanent.] So, the Republicans in Congress had to find other sources of revenue… and one of the places they decided to focus, because they are as stupid as they are evil, was higher education.

The tax plan passed by House Republicans, if signed into law in its current form, would eliminate several tax credits for higher education expenses. Among other things, this would make both free tuition and stipends taxable. This, as others have noted, could raise taxes on graduate students by nearly 300%, subsequently shrinking university research programs, and seriously constricting America’s research and development efforts… It is, to put it bluntly, the stupidest fucking thing the Republicans could have ever fucking done, and it very well might become law of the land.

The Republicans, by backing this legislation, are literally sacrificing our future, and our nation’s competitiveness, in order to repeal the estate tax, essentially allowing for the creation of an American aristocracy… And that, by the way, isn’t hyperbole. That’s the actual trade-off here. They’re actually sacrificing a generation of people studying things cancer therapies and green energy technologies so that a small handful of their billionaire donors can avoid paying taxes when moving money into the accounts of their darling little Ivankas, Erics, and Donnie Jr.s. [“I’m sure you really could have used that cancer therapeutic, but, unfortunately, Ivanka really wanted another yacht, America.”]

And, as you can imagine, the smart people of the United States aren’t exactly happy… The following comes from a letter sent to Congress a few days ago by the American Association for the Advancement of Science, which, by the way, was co-signed by every major scientific organization in the United States. [“Make no mistake,” the letter says, “this plan will undermine research and eventually the economy of the USA.”]

…(The) Tax Cuts and Jobs Act (H.R. 1) will increase the financial burden for graduate students by repealing existing provisions in tax law. While the goal of the House tax reform plan is to help grow the U.S. economy, the language to repeal the student loan interest deduction, graduate student tuition waivers, the Hope Scholarship Credit, the Lifetime Learning Credit and educational assistance programs ultimately will have the opposite effect. By making advanced education less affordable, it is likely to drive some students away from seeking higher education. Because a majority of graduate students are in the key areas of science, technology, engineering, and math (STEM), these provisions will have an outsized impact in the sciences. U.S. scientific and technological ingenuity has helped to make our nation one of the most innovative in the world and generated tremendous economic benefit to our country. This inventive spirit starts with people and ideas – and it is our higher-education system that has fostered the development of inventors, entrepreneurs, Nobel Laureates, and business leaders. Repealing the very provisions that allow graduate students to continue to study in critical STEM fields means that we will be shutting the door on new opportunities for discovery, exploration and innovation…

And, here, to give you a sense of how this legislation, if signed into law, could actually impact America’s young scientific researchers, is a clip from an article written for the New York Times by Erin Rousseau, a graduate student at M.I.T. who studies the neurological basis of mental health disorders.

…My peers and I work between 40 and 80 hours a week as classroom teachers and laboratory researchers, and in return, our universities provide us with a tuition waiver for school. For M.I.T. students, this waiver keeps us from having to pay a tuition bill of about $50,000 every year — a staggering amount, but one that is similar to the fees at many other colleges and universities. No money from the tuition waivers actually ends up in our pockets, so under Section 117(d)(5), it isn’t counted as taxable income.

But under the House’s tax bill, our waivers will be taxed. This means that M.I.T. graduate students would be responsible for paying taxes on an $80,000 annual salary, when we actually earn $33,000 a year. That’s an increase of our tax burden by at least $10,000 annually.

It would make meeting living expenses nearly impossible, barring all but the wealthiest students from pursuing a Ph.D. The students who will be hit hardest — many of whom will almost certainly have to leave academia entirely — are those from communities that are already underrepresented in higher education.

The law would also decimate American competitiveness.

Some universities might be able to cover tuition for some students, but in so doing, they would be forced to decrease the total number of graduate students they accept. American applicants to graduate school will leave the United States in favor of less expensive international institutions, and United States institutions will be unable to attract international candidates. At M.I.T., 43 percent of graduate students are foreign nationals, many of whom receive international funding. These students conduct transformative research, and bring so much diversity of culture, experience and expertise to our schools. Do we really want to shut out the next generation of innovators from our universities?

…The House bill would also end the student loan interest deduction, which allows individuals who make up to $80,000 and are repaying student loans to decrease their debt. It also eliminates the Lifetime Learning Credit, which is instrumental for many nontraditional students…

So, have you got all that?

To put it simply… At this moment in history, when we’re confronting antibiotic resistant super-bugs, global warming, and any number of other incredibly terrifying things, our Republicans in Congress are passing legislation that would disincentivize talented young people with scientific aptitude from entering graduate programs. Furthermore, at a time when the middle class is contracting, and wealth inequality is growing more and more pronounced, this legislation would make it more difficult for the non-wealthy to obtain advanced degrees… And for what? So that wealthy campaign donors can get even larger tax breaks.

Oh, and not only would free tuition be taxed under this Republican bill, but, individuals with student debt would no longer be able to write-off the interest paid on that debt. So, as I just read in the New York Times, “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.”

But this is what the Republicans in the House, when trying to find a way to pay for their $1.5 trillion in tax cuts came up with. They figured out a way to make this completely shortsighted and irresponsible legislation work by, in the words of the Washington Post, “(raising) the cost of college for millions of Americans.” Is that really what we want? Should we prioritize tax cuts for the wealthy over science and education?

One last thing… I’d like to share this video of Republican Senator Orrin Hatch defending the Republican plan to cut taxes, saying that, as someone who “(came from) the lower middle class,” he’s “sick and tired” of hearing Democrats claiming that this Republican legislation really just helps the rich… I bring it up because Hatch, according to his official biography, received a full scholarship to law school… And I can’t help but wonder how his life might have been different, as a member of the lower middle class, had he been taxed on that tuition… If you’d like to ask him, he can be reached at @OrrinHatch.

So, if you haven’t already, find the phone numbers for your Congressperson and Senators and call them… while it’s true that the Senate version of the legislation may not be as anti-education and anti-science as the House version, there’s a chance that these items could find their way into the reconciled bill that Trump will sign into law, and we cannot afford to take that chance. We need to kill this legislation right now in the Senate, so it never makes it to Trump’s desk in any form. This isn’t just the biggest wealth grab in modern American history. It isn’t just incredibly cruel. It’s bad policy. And it needs to be stopped.

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  1. Iron Lung
    Posted November 19, 2017 at 10:56 pm | Permalink

    But it will make all those unemployed people in Kentucky happy.

  2. YpsiLiz
    Posted November 20, 2017 at 5:37 am | Permalink

    The grad students brought this on themselves. Instead of paying rent and buying food, they should have been sending campaign contributions to Repugnican candidates

  3. Eel
    Posted November 20, 2017 at 9:07 am | Permalink

    Once Trump’s Subterranean Jobs Bill goes though, they can work in the coal mines.

  4. Jcp2
    Posted November 20, 2017 at 9:16 am | Permalink

    I guess it depends on whether the tuition fee is real money or fake money. If it’s real money, then just give it straight to the graduate student as salary, call them an employee, and let them pay taxes on it. If it’s fake money, then reduce tuition to zero, since no student really pays it, and they pay taxes on the stipend only. Or any combination in between. The schools aren’t really totally powerless. The tuition rates and stipend amounts are somewhat arbitrary and not reflective of true value.

  5. Posted November 20, 2017 at 9:36 am | Permalink

    Jcp2, I have the same questions. But as I understand it, there are a couple of reasons why universities can’t reduce graduate stipends to zero. First (and I am not a lawyer nor an accountant), I guess if you price something far below its value, the IRS can still try to tax you on what the IRS thinks it’s worth. So in this case, if universities say they’re going to charge their graduate assistants $1 for tuition but their regular graduate assistants $20,000, the IRS might call foul on that $1 tuition and make them pay the taxes. Second, as I understand it, there are a lot of grants in the sciences where a lot of the money being asked for is for paying graduate assistants to do things, and that includes paying tuition. So it’s not as simple as just changing the price of tuition in one place.

    The bottom line is the GOP tax plan (and really, the Trump administration’s view of education generally) is aggressively against state-sponsored education at all levels. In a sense, it is exactly what their base wants, too. I can’t recall the percentages right now, but some huge percentage– like 75%– of Republican voters have no trust in higher education, probably because they think that all we do is turn our students into good Democrats or something. Dark times.

  6. M
    Posted November 20, 2017 at 9:44 am | Permalink

    If you’d like to see examples of ways in which university research has help improved the lot of humanity, check out The Better World Report.

  7. Jcp2
    Posted November 20, 2017 at 10:15 am | Permalink

    I’m not advocating for stipends to be reduced, just tuition. Or just give the entire tuition amount to the “graduate student” and call them an employee for their work on behalf of the school, since that’s what the school thinks it’s worth. The other graduate students who pay full tuition and do not receive a stipend would still be students and in a separate category. If it’s the case that no graduate student in a section ever pays tuition, then maybe they were never really students at all, but poorly paid employees . Isn’t that the whole core of the debate about graduate student unions, or for that matter, NCAA athletes in income sports?

  8. ypsidoodledandy
    Posted November 20, 2017 at 11:00 am | Permalink

    The only surprise is it took this long for them to get to the intellectuals.

    From Pastor Niemoller:

    “First they came for the Socialists, and I did not speak out—
    Because I was not a Socialist.

    Then they came for the Trade Unionists, and I did not speak out—
    Because I was not a Trade Unionist.

    Then they came for the Disabled, and I did not speak out—
    Because I was not Disabled.

    Then they came for the Jews, and I did not speak out—
    Because I was not a Jew.

    Then they came for me—and there was no one left to speak for me.”

    We lost vast amounts of future economic productivity and innovation (and human capital development) when we exported the manufacturing supply chain overseas. And yet, the intellectual class was silent, cause…….oh yah, it wasn’t them or those they knew.

  9. Lynne
    Posted November 20, 2017 at 11:04 am | Permalink

    I will admit that there is a part of me that is happy about this albeit a mean part of me. I know some people who work for a large university out west whose jobs will be on the line if this goes through. They voted for Jill Stein. I begged them not to. I tried to tell them that it was selfish of them to risk other people’s lives and well-being as surely that is what would happen under a Trump presidency. But you know, it is easy to risk other people’s lives and well being. But now THEY are going to feel that fear and THEY are going to be counting on others having THEIR backs for a change.

    Of course, that feeling of schadenfreude isnt going to stop me from doing the right thing and I will make my phone calls and fight for their jobs and those of others. This tax plan is just so bad that it is necessary to put one’s own feeling aside. But it is also important that we all plan on voting in the midterms and beyond.

  10. site admin
    Posted November 20, 2017 at 11:05 am | Permalink

    Here’s a script for grad students calling their elected officials.

  11. facebook stalker
    Posted November 20, 2017 at 11:20 am | Permalink

    MM on Facebook:

    Whether you work in the service industry, or in academia, there’s a pretty good chance that, if you live in SE Michigan, your livelihood depends on university research. I know that, here in Ypsi/Arbor, we have legislators who understand that. If you could talk with your friends and family members out of state, though, it would be very much appreciated. Without young scientists, humanity is sunk.

  12. Iron Lung
    Posted November 20, 2017 at 12:17 pm | Permalink

    “They voted for Jill Stein. ”

    Most people working at Universities or contracted with Universities or have businesses which depend on Universities did not vote for Jill Stein.

    I fail to understand why the many should be punished on the voting record of the few. But go ahead. Feel good about yourself.

  13. Anonymous
    Posted November 20, 2017 at 12:24 pm | Permalink

    They have different priorities.

    Check out this headline: Private jet management could be shielded from taxes under Senate tax bill

  14. Lynne
    Posted November 20, 2017 at 1:18 pm | Permalink

    Iron Lung. I agree. In no way should the many be punished for the voting record of the few. Unfortunately that is the reality of the situation. People who voted for Stein or didnt vote are partially responsible for Trump getting elected. That so many of them were shitty assholes who were willing to risk a Trump presidency when they thought OTHER people were going to pay the price and are now realizing that they too will be hurt is just a little bright spot in an otherwise horrible situation.

    I plan to work as hard as I am able to keep even those people but especially the many more people who got out and voted for HRC from being hurt by this tax plan. Why? Because it isnt good for anyone and yes because a failure on my part related to my feelings of schadenfreude would hurt those who find themselves in this situation through no fault of their own.

  15. wobblie
    Posted November 20, 2017 at 3:40 pm | Permalink

    Lynne, you said your Jill Stein voting friends were out west. If they live in California, Oregon or Washington their vote for Stein had no effect on the election, Clinton carried those states by large majorities. If they live in Idaho, Wyoming, Montana, Utah their vote for Stein had no effect, Trump won by big majorities. (the other states I’ve not bothered to look at but I suspect the same). You can blame people like me here in Michigan if you want. Stein challenged the election results in Michigan because there were 70,000 uncounted votes, mainly from Detroit. More than enough to change the 17,000 vote lead Trump had. Stein was found to lack standing because the recount would not effect her position in the polls. The Stein folks asked the Clinton folks to pick up the ball–Clinton would have had standing. Clinton refused to contest the election results–That is why we have Trump as President.

  16. Iron Lung
    Posted November 21, 2017 at 7:32 am | Permalink

    Move on. 2016 is over.

  17. Kim
    Posted November 21, 2017 at 8:54 am | Permalink

    Orrin Hatch got his ass handed to him by Claire McCaskill.

  18. Jean Henry
    Posted November 21, 2017 at 9:16 am | Permalink

    I’m interested in the long term ramifications of these cuts. If we cut research funds and funding to train researchers for 3 to 7 years, and then it’s all restored later, at what point and for how long do we feel the impact?

    Many of our worst fears under Trump have not come to be… yet. And we are reasonably focused on the legislative and executive actions around which we can rally resistance and possibly prevent. But Amy Siskind is keeping that weekly list of changes/behavior/actions that are unprecedented for a president.
    The tweets are the least of my concern, and may be held against him legally at some point. They are a diversion from all the other actions that debilitate our government’s capacity to serve our interests. How can we possibly undo those? And how long will it take. I’d like to see an long range projection on all of this crap.

  19. Lynne
    Posted November 21, 2017 at 5:24 pm | Permalink

    It will take decades to undo the damage caused by judicial appointments alone.

    Yes, we have been protected somewhat by Trump’s incompetence. My brother tells me that there are literally whole agencies where the employees are showing up and then doing nothing all day. Their orders have been to do nothing without being told to do it but then they are never told to do anything. I guess the Type A’s at the State Dept are going a little bit crazy with having nothing to do.

    However, there are at least three more years to go and a lot of potential damage to be done in that time other than the damage done by inaction which causes its own problems.

3 Trackbacks

  1. […] the national debt, raise taxes on the middle class, take health care from 13 million Americans, and decimate higher education… but what I’m really drawn to is this story about the fight over the future of the […]

  2. […] to the national debt, raise taxes on the middle class, take health care from 13 million Americans, decimate higher education, and eliminate the estate tax, paving the way for a true American […]

  3. […] to the national debt, raise taxes on the middle class, take health care from 13 million Americans, decimate higher education, and, through the elimination of the estate tax, pave the way for development of a true American […]

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