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The GOP tax bill hurts graduate students, and that hurts all of us.

Nov 20, 2017

There’s a lot that can be argued about the Republican tax bill that has passed the House and still faces an uncertain future in the U.S. Senate.


But one lesser-known provision is what it would do to higher education, and specifically graduate studies. For one thing, according to all the analyses I’ve seen, it would tax the stipends and tuition waivers graduate students depend on.

According to a well-researched story by Robbie Gonzalez in a recent issue of Wired magazine, that could destroy the plans of many students struggling to get advanced degrees. Graduate tuition is terrifically expensive today, and schools often waive it for promising students in return for their research work and teaching some lower-level classes.

This enables students who are not rich to earn their degrees. But the Wired story used a typical example of one such student whose work qualified her for a tuition waiver worth $43,000. If the current tax bill becomes law, she’ll be taxed on that, even though she receives nothing in cash. Not only will she no longer be able to afford rent and food—for most people, getting a doctorate in this country may become financially impossible.

I was alerted to this not by the Wired article, but by an old friend of mine who began his career at Hope College in Holland, and went on to distinction as an organic chemist and a distinguished research chemist at Bowling Green State University in Ohio. Doug Neckers is 79 now, and founded a major department there and has been a mentor to chemists all over the country. He is a warm and mild-mannered man who has considered himself a Republican.

He’s also not strictly an academic; he has run a thriving business and has 65 patents to his name. And he is outraged by the tuition-taxing provision, and also one under which colleges and universities will pay a tax on the income from their endowments.

“Just because Harvard has a gazillion in the bank doesn’t mean that the meager endowments of the places I have taught have anything to spare,” Neckers told me. But the tax on tuition stipends is worse.

“It will kill graduate programs in universities if stipends and tuition waivers are taxed,” he said. “Foreign students won’t be able to afford a graduate education here, and Americans won’t want to live on poverty wages either.”

He believes this will have the biggest “direct impact on enrollment in graduate programs in the sciences and engineering.”

I also heard yesterday from another self-made man who was extremely indignant about all this. Bill Haney, who is 81, grew up in what is now the Detroit suburb of Troy, in a house which lacked indoor plumbing.

He’s worked every day since he was 10, got himself through the University of Michigan, and rose to become an executive vice president of a major marketing company and the author and publisher of numerous books. He wrote Senator Orrin Hatch, the Utah Republican, an open letter which said in part “loading further burdens onto the very college students we need to succeed and remain in the country is not good business.”

Whether those in power are paying attention is doubtful. But I think our future as a nation, and perhaps our civilization, may depend on it.

Jack Lessenberry is Michigan Radio’s Senior Political Analyst. Views expressed in his essays are his own and do not necessarily reflect those of Michigan Radio, its management or the station licensee, The University of Michigan.