Of the two proposals for tax reform, the Senate’s plan, while controversial among the country’s wealthiest private institutions, is by far the lesser of two evils when considering the future of education in America.
With 77 Fortune 500 companies headquartered in Westchester County and adjacent Fairfield County, a relatively good transportation infrastructure and hundreds of knowledge-based service and technology firms all within 30 to 45 minutes of New York City, the tristate region is ideally positioned to become the next Silicon Valley or the next Research Triangle — but only if our local colleges and universities can produce the highly trained workforce these firms so desperately need. The House bill would make it virtually impossible for that to happen because it puts the acquisition of critical skills out of reach, even where employers are willing to invest in the continuing education of their employees.
There are four specific items hidden away in the dark recesses of the House bill that should concern every citizen of this country because they directly affect our global competitiveness.
1. The Lifetime Learning Credit will be eliminated. This will impact part-time students, graduate students, and learners who are seeking retraining. In an age where the difference between having a job and not having one, or having to settle for one that doesn’t pay the bills, will depend increasingly on people’s continual willingness to update their skills, this disincentivizes entire populations from lifting themselves out of a dead-end or disappearing job by making it impossible for them to do so. This is a direct assault on one of the most fundamental American values: self-sufficiency and the ability to reinvent oneself.
2. The Student Loan Interest Deduction will be eliminated. This will saddle students with even higher debt at the end of a typical four-year education, forcing more of them to forego a career as a teacher or social worker because the need to pay off a huge debt load will dictate that they look for a job in law or on Wall Street, not because they want to be a lawyer or financial analyst but because they have to pay back their loans.
3. Employer-provided tuition benefits will be taxed. This is perhaps the cruelest part of the House proposal. It will make it impossible for many low-level staff employees who wish to enhance their skill level to do so even where employers are willing to assist them. This will disproportionately affect staff members — many of them members of minorities or first-generation students who entered the work force with relatively low job skills but eventually understand the need to acquire additional skills. It will also make it harder for employers around the country, but particularly in a growing economy like Westchester County, with dozens of Fortune 500 firms and hundreds of specialized businesses that depend on access to a highly skilled workforce, to find well-trained employees locally or regionally because staff could no longer afford to take advantage of lifelong learning offerings.
4. Tuition benefits for graduate student teaching and research assistants will be taxed. This will tip the balance of graduate student choices away from careers in research and development, where the initial investment in college may eventually deliver greater rewards but will take longer to repay and onto career choices that promise more immediate financial results, such as the legal and financial professions. In addition, this will, if enacted, willingly surrender to Europe and China America’s current lead in one of the few remaining areas in which we are still world leaders — the knowledge industry — by reversing the decades-long influx of the best and the brightest minds from all over the world to the United States. It will also render moot any ongoing conversations about creating a research and development hub in Westchester County because there will not be a qualified cadre of employees to work in such facilities.
So, if, as a society, we are interested in actively barring our children from pursuing a career that best matches their talents and skills, we should vote for the House bill.
If we want to tell those adults in Westchester County who are already in the workforce and are ready to give up their nighttime and weekend hours to increase their qualifications, that we don’t care about their efforts because we don’t need a better-trained workforce in Westchester County, then we should vote for the House bill.
If we wish to say to our employees that the American Dream is dead and that the great American tradition of bootstrapping to get out of a dead-end job is something we no longer value, then we should vote for the House bill.
If we want to ensure that tomorrow’s leading innovations no longer come from Apple, IBM or Regeneron, but from startups in China, Russia or Singapore, then we should support a vote for the House bill.
For those of us who believe in the great American tradition of bootstrapping and hard work to move ahead and who want to maintain America’s global competitiveness, there is only one choice here: the Senate bill. It is not ideal but, unlike the House bill, it will not do irreparable harm to the nation’s future and the future of our children.
Michael Geisler is president of Manhattanville College in Purchase and a director of The Business Council of Westchester. He can be reached at Michael.Geisler@mville.edu or 914-323-5230.