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Bridging The Gap
Graduate Students Escaped Tax Increases, but They Still Feel a Target on Their Backs.
  Thursday 21 December, 2017
Graduate Students Escaped Tax Increases, but They Still Feel a Target on Their Backs.

Samantha Hernandez was finishing up an argument for her dissertation about Latinos and affirmative action on Thursday when the emails started pouring in with the subject line “Congratulations.”

President Trump had finished a celebratory news conference to announce the completion of a sweeping overhaul of the nation’s tax code, and graduate students were breathing a deep sigh of relief. House Republicans had targeted them for a hefty tax increase, one that many of them could not hope to pay, but they had escaped unscathed.

The question now is this: Once lawmakers put a target on your back, are you ever really in the clear?

“I’m relieved,” said Ms. Hernandez, the legislative director for the 600,000-member National Association of Graduate-Professional Students and is to graduate from Arizona State University with a doctorate in political science in the spring. “But we’re not done. This is not over.”

For the last month, Ms. Hernandez and fellow graduate students had led a nationwide effort to defeat a proposal from House Republicans that would have saddled hundreds of thousands of them with unexpected tax bills by declaring the value of their waived tuition fees as taxable income. A month of phone-banking, Twitter posts and personal lobbying — she worked on her dissertation from the cafeteria of the Longworth House Office Building between meetings on Capitol Hill — had paid off.
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But the tuition tax proposal is just one in a growing list of graduate school benefits that House Republicans have in their legislative sights. Next up is an extensive rewrite of the law governing the nation’s higher education system, and again, Republicans hope to drastically curtail or end revenue streams that graduate students rely on to pursue advanced degrees.

“I think there’s a general assault on higher education right now,” said Justin Draeger, the president of the National Association of Student Financial Aid Administrators. “I think it’s tied into a dangerous narrative in our country about elitism. It undervalues our most important resource, which is our inventiveness, our ingenuity, our ability to solve big problems. A lot of that work happens at graduate-level education.”

Others say that such scrutiny is warranted and long overdue. Conservatives contend that the measures are good for taxpayers and could result in colleges and universities lowering their prices.

“Big subsidies for people with advanced degrees should come under scrutiny when you have a populist streak,” said Jason D. Delisle, a resident fellow at the American Enterprise Institute. “By definition, everybody going to graduate school already has a college degree. The reality is, we’re worried about whether we’re helping undergraduates enough, and meanwhile, graduate students have amassed these big subsidies.”

Robert Kelchen, an assistant professor of higher education at Seton Hall University, was blunt: “Graduate students are not a group that Republicans tend to like. They get big subsidies, and that’s not seen as good for taxpayers.”

To doctoral students working long hours not just at their studies but with the undergraduates they are required to teach, those subsidies may not look so big. Doctoral students usually receive a small stipend for their studies — on average $15,000 but perhaps double that for students in the sciences — and are almost always expected to teach classes as they complete their degrees. In return, universities waive their tuition.

But House Republicans want to declare the value of that waived tuition — worth as much as $50,000 a year — as taxable income, a huge hit for a student with perhaps a $30,000 annual stipend.

In addition to tuition waivers, House Republicans targeted two other popular graduate student benefits: a tax deduction for up to $2,500 in student loan interest, which graduate students have more of because they do not receive subsidized loans and those loans have higher interest rates, and a “lifetime learning credit” that offsets 20 percent of the first $10,000 of qualified education expenses and can be used for years on end.

All were saved in the final tax deal that Congress will vote on Tuesday. All are still endangered.

“We go into every Republican administration understanding that we’ll have to fight for at least one ticket item,” Ms. Hernandez said. “This year has been different.”

In a proposed rewrite of the Higher Education Act, House Republicans have proposed an overhaul of the federal student aid system that includes capping the amount that graduate students can borrow from the federal government and ending loan forgiveness programs. That would include abolishing the popular Public Service Loan Forgiveness program, which forgives some loans for some graduates who take jobs with the government, join the Peace Corps or work at nonprofit organizations.

For some graduate students, whose loans can reach six figures, choosing federal loans over private ones and qualifying for loan forgiveness programs may be the only ways to ensure they will not be paying off loans for the rest of their lives.

The higher education bill, introduced by Representative Virginia Foxx, Republican of North Carolina, cleared the House Committee on Education and the Workforce this month.

Committee aides argued that graduate students would still have access to private loans should they want to pursue degrees at colleges outside their price range. And they framed their approach in terms of tough love: “People weighing their graduate school options have to consider debt obligations and the prospects for a good-paying job after graduation,” said one Republican aide, who spoke on the condition of anonymity because she was not cleared to speak to the news media. “Too often, students do not make informed decisions in this regard.”

Policy experts and student advocates see the recent bills as a way to settle some longstanding conservative gripes with graduate school — considered expensive and excessive — that have new momentum as confidence in academia among the majority party declines.

According to a recent Gallup poll, 33 percent of Republicans said they had confidence in colleges. A Pew Research Center poll released over the summer found that 58 percent of Republicans and conservative-leaning independents said colleges and universities had a negative effect on the country, compared with just 37 percent two years ago.

Mr. Delisle said graduate school subsidies began going too far in 2006, when a Republican Congress and president instituted the Grad PLUS loan, which allows graduate students to borrow the full cost of tuition and living expenses to pay for school.

In the years after, Democrats added income-based repayment plans that forgave debt after 25 years and the Public Service Loan Forgiveness program.

“Why are we subsidizing them when they make big salaries and can support themselves, when there is a long list of people who can’t?” Mr. Delisle asked.

But a high income is in the eye of the beholder. The average salary of a tenure-tracked assistant professor is $74,543.

To earn a salary, Mike Vincent, 32, works as a graduate student assistant at the University of Florida, a position that guarantees nine months of work, as he completes his doctoral degree in musicology. His wife, Rebecca Pethes, was unable to secure a similar job this year to supplement her own graduate degree, so the couple has struggled to raise their 1-year-old child, Isobel, on Mr. Vincent’s annual salary — $16,000 for nine months, $18,000 if he can finagle an extra semester of work.

“I don’t know what it means to pay taxes on a normal income,” he said. “I can’t even imagine making that much money right now.”

All of Isobel’s clothes, toys and books are passed on from their church and their relatives, and a $300 check from their church will fund their holiday celebrations.

Graduate school was once considered a matter of national defense after Sputnik, when the nation panicked over the Soviet Union’s advancement. A year after, President Dwight D. Eisenhower signed the National Defense Education Act to provide money and incentives for Americans to pursue advanced degrees.

Internationally, the United States is still the best place to conduct research, said Surya D. Aggarwal, 27, who studied in India and Britain before coming to Carnegie Mellon University to obtain a doctorate in biology.

“I knew if I actually wanted to ask the hard questions and get anywhere, it had to be the U.S.,” Mr. Aggarwal said. “It’s definitely still the premiere place. But international students are looking at these reports, and taking a hard look at what they want to go through.”

Beth B. Buehlmann, the vice president for public policy at the Council of Graduate Schools, said Mr. Trump has said he wants to tackle pressing issues but is saddled with a shortage of workers in science, technology, engineering and mathematics.

“We need graduate students at a time when our society is becoming more complex,” she said. “Instead we’re creating barriers for people to even see that as a possibility.”

In pursuing a political science degree, Ms. Hernandez, 29, a Mexican-American whose grandmother has a third-grade degree, is defying what statistics say is possible. She recalled one congressional aide who forthrightly told her that “people elect to go to graduate school.”

“It’s an elective degree for some people — like white men, those who come from wealthy backgrounds,” Ms. Hernandez said. “But for people like me, it’s not an elective degree; it’s a struggle, not just for me but for my community. We have to get these degrees because we need to make it more normal for us to be in these fields and be at the table.”

Source: https://www.nytimes.com/2017/12/19/us/politics/graduate-students-education-tax-bill.html?rref=collection%2Fsectioncollection%2Feducation&action=click&contentCollection=education®ion=stream&module=stream_unit&version=latest&contentPlacement=2&pgtype=sectionfront

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