6 ms·

When some of endowments for many universities are in the millions and Harvard has an endowment of 37.5 billion, I find it hard to have sympathy towards this. T

by MollyR 9y ago

When some of endowments for many universities are in the millions and Harvard has an endowment of 37.5 billion, I find it hard to have sympathy towards this. The colleges and universities have become corporations that run on student loans and graduate student slave labor. This has to change, and it will be a painful process no matter what happens. https://www.usnews.com/education/best-colleges/the-short-list-college/articles/2017-09-28/10-universities-with-the-biggest-endowments https://www.usnews.com/education/best-colleges/the-short-lis...

mikeash 9y ago
Is massively raising taxes on graduate students actually going to help matters?
- blfr 9y ago
  Couldn't the universities just appropriately price the graduate school tuition instead of pretending it's worth tens of thousands of dollars a year and then giving it away for free?
  - wsxcde 9y ago
    The article responds to your argument. Might be a good idea to read it first.
    - Overtonwindow 9y ago
      Hi, please don't insinuate someone has not read the article. This is against the rules. Please read the guidelines. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
    - blfr 9y ago
      By appropriately I don't mean as a hack around this law or for grant money but according to the value delivered to the students. Then it would be fair for students to pay the tax just like it's presumably fair to pay undergrad tuition. Although it would probably have to be deferred somehow.
  - SeanLuke 9y ago
    They don't give it away for free. It's typically paid by someone. For example, my graduate students are on NSF grants that I applied for. The grants pay the graduate students a stipend and health insurance costs, they pay my university the full cost of in-state tuition and fees, and they pay overhead on those costs. These are all budgeted for.
    - Nrsolis 9y ago
      Then I think it's fair to ask if it's really OK to subsidize that compensation delivered in terms of valuable education. You can argue that graduate students and universities are just another special interest lobbying the government for a tax exemption that benefits them. There is nothing special about graduate education when you're conferring something that's inherently valuable (namely MS and PhD degrees) to a lucky few. You could further argue that it's unfair to ask blue-collar workers in fly-over states to pay higher taxes because of the impact of such a subsidy. There is a lot to like in the tax bill: interest on second homes isn't going to be subsidized nor are new mortgage interest on homes over $1M. Frankly, I think it should have been applied to ALL homes over $1M since many economists have argued vociferously that such an exemption is a huge subsidy to the high-cost states. I'd also like to see a revisitation of the taxation of carried-interest for hedge funds. There is no reason to consider performance bonuses as a return on capital if they don't have any basis in the investment/capital at risk. But arguing that graduate students (LUCKY graduate students) are worthy of some kind of exemption is just lobbying. You could easily make the same argument for active-duty armed service members. Frankly, I'd support a tax reduction on those people. They've suffered from our national follies to a disproportionate degree.
      - digitaltrees 9y ago
        Funding basic research to support the accumulation of knowledge and innovation is hardly special interest lobbying. A large part of the power of the US economy comes from having the strongest university system in the world and one that produces the greatest level of basic academic research and resulting commercialization in the world. This tax cut is solely focused on corporations and was fixated on hitting a 20% tax rate. The corporate tax rate could have been 22% or 28% with out the need to scrounge money every other place they could and yet still add 1 to 1.5 trillion to the national debt. No corporation is going to make investments because of this, there just going to horde it in the Cayman Islands or issue dividends then will also end up in the Cayman Islands. Funny how the repatriation of capital exemption wasn’t in this bill. So to your point. Both blue collar workers and grad students are now subsidizing corporate profits that will sit idle in foreign accounts.
  - deleted 9y ago
    [deleted]
  - mikeash 9y ago
    Would that help the problems described in the comment I replied to?
- deleted 9y ago
  [deleted]
- tedunangst 9y ago
  What if we rephrase the question to be restoring taxes?
  - mikeash 9y ago
    Changing the wording doesn’t change the outcome. Does it help or not?
piemonkey 9y ago
While I agree that there are a lot of structural problems with universities and the way funding is allocated, I disagree with the premise that beginning with taxing graduate students is the correct way to do it. Granted, as a current PhD. student at a University of California university, I have some skin in this game which colors my view-point, so take what I say with a grain of salt. In particular, state schools have a lot less flexibility in terms of how we allocate funding to graduate students; our pay rates are set by California state law, and the salary of every single employee of the university is subject to public scrutiny [0]. We cannot simply dip into our endowments to correspondingly raise wages, since the amount which can be withdrawn each year is strictly capped as a portion of the total, to ensure the long-term growth of the fund (see [1], "Endowment Spending Policy"). It is true that colleges and universities have grown tremendously in their size and scope. This is a popular anecdote (and often repeated without data), but consider this: a university has become a mini-society in a lot of ways. Universities offer an unbelievable number of services and drive their own mini-economies. They are often among the largest employers in their area, even in thriving metropolitan centers [2]. They provide health insurance, mental health care, their own police forces, job-searching centers, support groups, etc. As our broader American society scales back its social services, universities are increasingly on the hook to provide these services to students. I agree that universities have grown too large, and resent extremely large unnecessary salaries (for example for sports coaches), but I also acknowledge that such waste exists in any sufficiently large and complex system, and it is a constant and active process to limit its effects. Condemning the whole system on account of this seems like cutting off the nose to spite the face. [0]: https://ucannualwage.ucop.edu/wage/ https://ucannualwage.ucop.edu/wage/ [1]: http://www.ucop.edu/investment-office/_files/report/UC_Annual_Endowment_Report_FY2013-2014.pdf http://www.ucop.edu/investment-office/_files/report/UC_Annua... [2]: http://www.ucla.edu/about/facts-and-figures http://www.ucla.edu/about/facts-and-figures
jseliger 9y ago
The colleges and universities have become corporations that run on student loans and graduate student slave labor I'm sympathetic to criticisms of universities but let's not overstate the case: slaves have no choice and grad students do. It's unwise to go to grad school in most disciplines (https://jakeseliger.com/2012/05/22/what-you-should-know-before-you-start-grad-school-in-english-literature-the-economic-financial-and-opportunity-costs/ https://jakeseliger.com/2012/05/22/what-you-should-know-befo...) but people go of their own free will despite the fact that one hour on Google will return dozens of excellent reasons not to go.
deleted 9y ago
[deleted]
flaque 9y ago
"Some colleges can pay for it" is not a rational argument to not care about this issue. The vast majority grad students do not go to a Harvard that can help pay for this.

by MollyR 9y ago

mikeash 9y ago

Is massively raising taxes on graduate students actually going to help matters?

blfr 9y ago
Couldn't the universities just appropriately price the graduate school tuition instead of pretending it's worth tens of thousands of dollars a year and then giving it away for free?
- wsxcde 9y ago
  The article responds to your argument. Might be a good idea to read it first.
  - Overtonwindow 9y ago
    Hi, please don't insinuate someone has not read the article. This is against the rules. Please read the guidelines. https://news.ycombinator.com/newsguidelines.html https://news.ycombinator.com/newsguidelines.html
  - blfr 9y ago
    By appropriately I don't mean as a hack around this law or for grant money but according to the value delivered to the students. Then it would be fair for students to pay the tax just like it's presumably fair to pay undergrad tuition. Although it would probably have to be deferred somehow.
- SeanLuke 9y ago
  They don't give it away for free. It's typically paid by someone. For example, my graduate students are on NSF grants that I applied for. The grants pay the graduate students a stipend and health insurance costs, they pay my university the full cost of in-state tuition and fees, and they pay overhead on those costs. These are all budgeted for.
  - Nrsolis 9y ago
    Then I think it's fair to ask if it's really OK to subsidize that compensation delivered in terms of valuable education. You can argue that graduate students and universities are just another special interest lobbying the government for a tax exemption that benefits them. There is nothing special about graduate education when you're conferring something that's inherently valuable (namely MS and PhD degrees) to a lucky few. You could further argue that it's unfair to ask blue-collar workers in fly-over states to pay higher taxes because of the impact of such a subsidy. There is a lot to like in the tax bill: interest on second homes isn't going to be subsidized nor are new mortgage interest on homes over $1M. Frankly, I think it should have been applied to ALL homes over $1M since many economists have argued vociferously that such an exemption is a huge subsidy to the high-cost states. I'd also like to see a revisitation of the taxation of carried-interest for hedge funds. There is no reason to consider performance bonuses as a return on capital if they don't have any basis in the investment/capital at risk. But arguing that graduate students (LUCKY graduate students) are worthy of some kind of exemption is just lobbying. You could easily make the same argument for active-duty armed service members. Frankly, I'd support a tax reduction on those people. They've suffered from our national follies to a disproportionate degree.
    - digitaltrees 9y ago
      Funding basic research to support the accumulation of knowledge and innovation is hardly special interest lobbying. A large part of the power of the US economy comes from having the strongest university system in the world and one that produces the greatest level of basic academic research and resulting commercialization in the world. This tax cut is solely focused on corporations and was fixated on hitting a 20% tax rate. The corporate tax rate could have been 22% or 28% with out the need to scrounge money every other place they could and yet still add 1 to 1.5 trillion to the national debt. No corporation is going to make investments because of this, there just going to horde it in the Cayman Islands or issue dividends then will also end up in the Cayman Islands. Funny how the repatriation of capital exemption wasn’t in this bill. So to your point. Both blue collar workers and grad students are now subsidizing corporate profits that will sit idle in foreign accounts.
- deleted 9y ago
  [deleted]
- mikeash 9y ago
  Would that help the problems described in the comment I replied to?
deleted 9y ago
[deleted]
tedunangst 9y ago
What if we rephrase the question to be restoring taxes?
- mikeash 9y ago
  Changing the wording doesn’t change the outcome. Does it help or not?

piemonkey 9y ago

While I agree that there are a lot of structural problems with universities and the way funding is allocated, I disagree with the premise that beginning with taxing graduate students is the correct way to do it. Granted, as a current PhD. student at a University of California university, I have some skin in this game which colors my view-point, so take what I say with a grain of salt. In particular, state schools have a lot less flexibility in terms of how we allocate funding to graduate students; our pay rates are set by California state law, and the salary of every single employee of the university is subject to public scrutiny [0]. We cannot simply dip into our endowments to correspondingly raise wages, since the amount which can be withdrawn each year is strictly capped as a portion of the total, to ensure the long-term growth of the fund (see [1], "Endowment Spending Policy"). It is true that colleges and universities have grown tremendously in their size and scope. This is a popular anecdote (and often repeated without data), but consider this: a university has become a mini-society in a lot of ways. Universities offer an unbelievable number of services and drive their own mini-economies. They are often among the largest employers in their area, even in thriving metropolitan centers [2]. They provide health insurance, mental health care, their own police forces, job-searching centers, support groups, etc. As our broader American society scales back its social services, universities are increasingly on the hook to provide these services to students. I agree that universities have grown too large, and resent extremely large unnecessary salaries (for example for sports coaches), but I also acknowledge that such waste exists in any sufficiently large and complex system, and it is a constant and active process to limit its effects. Condemning the whole system on account of this seems like cutting off the nose to spite the face. [0]: https://ucannualwage.ucop.edu/wage/ https://ucannualwage.ucop.edu/wage/ [1]: http://www.ucop.edu/investment-office/_files/report/UC_Annual_Endowment_Report_FY2013-2014.pdf http://www.ucop.edu/investment-office/_files/report/UC_Annua... [2]: http://www.ucla.edu/about/facts-and-figures http://www.ucla.edu/about/facts-and-figures

jseliger 9y ago

The colleges and universities have become corporations that run on student loans and graduate student slave labor I'm sympathetic to criticisms of universities but let's not overstate the case: slaves have no choice and grad students do. It's unwise to go to grad school in most disciplines (https://jakeseliger.com/2012/05/22/what-you-should-know-before-you-start-grad-school-in-english-literature-the-economic-financial-and-opportunity-costs/ https://jakeseliger.com/2012/05/22/what-you-should-know-befo...) but people go of their own free will despite the fact that one hour on Google will return dozens of excellent reasons not to go.

deleted 9y ago

[deleted]

flaque 9y ago

"Some colleges can pay for it" is not a rational argument to not care about this issue. The vast majority grad students do not go to a Harvard that can help pay for this.