The College Endowment Tax is More Dangerous Than You Think

The College Endowment Tax is More Dangerous Than You Think
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There’s no shortage of items to criticize in the newly passed tax bill. Of these, the college endowment tax merits special attention. The bill imposes an excise tax of 1.4% on colleges with endowments worth over $500,000 per student. If you think that sounds like a nonpartisan formulation, think again: this tax imposed by Republicans will fall on some 27 wealthy private institutions, most of which (no coincidence) are known for their overwhelmingly liberal student bodies.

The excise tax isn’t a practical measure or a necessary revenue generator. It’s punitive. Of course, there’s much in contemporary politics that is strictly vindictive, or spiteful. An excise tax on colleges should be a particularly worrying development nonetheless because it indicates a new willingness to impose these vindictive and pointless measures on something that was once a bipartisan American value: higher education.

Conservative resentment against institutions of higher education has been brewing for many years. Colleges, especially elite institutions, tend to lean left – and there’s been no shortage of conservative pundits spewing absolute claptrap about how such institutions are brainwashing students into liberal hippies, pushing a “special snowflake” mentality on students, suppressing conservative viewpoints, etc. Colleges also underrepresent rural students, an increasingly salient point as the urban-rural divide comes to the fore of American politics.

But the attack on college has escalated to something more than standard talking points on conservative morning news.

That’s dangerous. A 1.4% tax on a few institutions may seem a paltry drop in an ocean of political complaints – but it’s one menacing drop.

Politicizing college is an absolute travesty; college isn’t supposed to be a liberal extravagance. The American college system is the best in the world, and a quintessential part of the American Dream – a stepping stone to higher things and extraordinary opportunities. It is bound up in a basic value which transcends partisanship, a value which ought to grant it immunity from these ridiculous, petty legislative measures.

Instead it has been transformed into a symbol of inaccessible liberal elitism, and therefore fair game for conservative attacks, like the excise tax. The politicization of higher education poses two serious dangers for American universities. The first is practical, the other principled.

Punitive measures against America’s most elite institutions may signal more to come. That should have us all worried. Today’s lawmakers may not be able to accomplish much, but inflicting unnecessary damage is clearly well within their capabilities. Further legislative attacks, whether they materialize within the next four years or the next thirty, could materially damage the quality of America’s best universities, and drain their wallets. An uncertain political environment is dangerous for colleges in of itself. That’s a substantial risk to the preeminence of the American university system, and an obvious concern for us all.

The second risk is that education itself becomes a predominantly liberal value. Higher education’s social value is part and parcel of the American Dream; university is a necessary step to achieving success in a wide range of sought-after professions. The idea of the American Dream is ludicrous without a highly competitive and highly regarded university system, with the financial means to provide robust need-based aid. If higher education is unceremoniously shoved off of its bipartisan pedestal, it’ll be American values that are damaged.

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