On taxes

This is a good springboard in the comments section for a discussion about when taxes are meaningful and when they're not. If you choose to participate, let's try to do it without the usual political boilerplate both sides usually use, and try to define if there is or is not a public good to be derived from taxes on behalf of those who are paying their own way through school?

Comments (17)

I guess it seems to me that a person whose parents are paying for college would benefit more from tax cuts than someone who is working their way through.

It is doubtful that someone that is working his/her way through college is making enough to be taxed very much (if at all) so a tax cut wouldn't help him/her directly. Assuming a college students parents are likely making more than the student does, they would benefit from a tax cut and thus be better able to help the student with his or her tuition bill.

Posted by brian | June 11, 2008 4:18 PM

I doubt Ms. Rondeau is working 40 hours a week and taking on a full-time workload of 12-18 credits. There are a few things to consider regarding this statement.

1. If Ms. Rondeau is only working part-time and/or is still claimed as a dependent, tax cuts will do little to change her burden to the federal government.

2. Plenty of college kids work to put themselves through college. They still need to take out loans to pay for some of their schooling.

Really, I'm a little offended that they related "hard-working" with the Republican stance. Give me a break.

Posted by Dan | June 11, 2008 4:29 PM

"She's paying her way through college, something that makes her appreciate the Republican stance on issues such as tax cuts."

The story would be far more interesting if it explained why she appreciates the GOP stance on tax cuts. As brian notes, it would be interesting to know what her income level is - and if she actually pays any federal taxes. I recall getting a lot back when I started out in the workforce.

And of course, the question goes unasked & unanswered about what programs to cut. Our gov't is already spending may more than it receives in tax revenue & the ongoing borrowing is a not-insignificant facto in the stagnant economy we now face. So... If we cut taxes, what services are going to be cut?

Posted by bsimon | June 11, 2008 4:37 PM

Whoa there folks, b

Before we launch into a rant about the cost of "higher ed", let's talk about where higher ed money goes. First of all most funding does not go to teachers, it goes to researchers, i.e. most "professors" do not teach.

If you look at schools that do nothing but teach, for instance community colleges, the price is much lower.

I am seeing about $4,500 a year here

Even private Catholic Colleges like St. Thomas and St. Kates, really have a cost structure comparible to the U of M ($12K) once all their "scholarships" are accounted for.

If your kid is training to be a doctor, or an engineer the tax subsidy might be considerable, but if your Biff and Buffy are studying Philosophy in preparation of a career at Caribou - you and they are subsidizing the tax-payer, not the other way around.

Posted by GregS | June 11, 2008 8:29 PM

//are studying Philosophy in preparation of a career at Caribou

Huh?

Posted by Bob Collins | June 11, 2008 10:26 PM

It should have read "studying Philosophy in preparation for a career at Caribou".

Where else does one work with a major in Philosophy?

Posted by GregS | June 12, 2008 5:26 AM

Caribou is where one can buy coffee.

Posted by GregS | June 12, 2008 5:33 AM

Apparently, on This Old House. I guess I have to be impressed with someone who can both (a) pass shop class and (b) major in philosophy, seeing as how I've never done either. (g)

Posted by Bob Collins | June 12, 2008 8:05 AM

That is impressive.

On the other hand, I would venture to guess there are more Philosophers who earn their daily bread from carpentry than philosophy.

My daughter majored in philosophy (even though she was a wiz in Calculus, go figure). After a stint at Caribou Coffee, she stumbled into a career of working with runaway teens. She's good at it and I am proud of her, but I am glad that I didn't shell out $160K for her education.

Perhaps the U of M should split off its College Of Liberal Arts, so Philosophy majors would only owe the bank $20K at graduation rather than eight times that amount.

Posted by GregS | June 12, 2008 8:19 AM

It brings up an interesting question, though. How much of education is about a job, and how much is about just being the "development" (however you define it) of the person as a person?

Posted by Bob Collins | June 12, 2008 8:23 AM

"i.e. most "professors" do not teach."

I would agree that many professors don't spend most of their time teaching, but most have to teach at least one or two classes every semester. I would need proof to convince me that most professors don't teach at all. I would argue that the research that they do is also in the public interest ... but that isn't what this post is about.

"Where else does one work with a major in Philosophy?"

I'm sure most students that major in Philosophy understand that they are unlikely to get a job with only that degree. Many go on to law school or the seminary. Others go to grad school to teach philosophy. Some probably work at Caribou.

(full disclosure: I wasn't a Philosophy major)

"What are the limits on taxation? Basic services? Is higher education a basic service?"

I'm not sure that higher education would count as a basic service, but I also think it should be subsidized by the tax payer. I think an educated public is worth the tax dollars in takes to get it. Basic services obviously need to be provided with tax money, but we should also be able to elect to pay more in taxes to get other services as well, such as subsidized higher education. We have done this.

Posted by brian | June 12, 2008 8:28 AM

brian,

I agree that "research" professors are assigned some "teaching" duties such as mentoring grad students, but in budget terms, the greater cost is still research.

There is a huge gap in price between a four year college that offers neither research or grad school and one that does.

This speaks to Bob's original question of taxpayer subsidy for higher ed. In

The point I made is undergraduate Liberal Arts appears to be more of a cash-cow than a cost.

In other words, if Ms. Rondeau is attending a state Liberal Art College as an undergraduate, us taxpayers should be grateful for her support.

Posted by GregS | June 12, 2008 8:48 AM

"My daughter majored in philosophy (even though she was a wiz in Calculus, go figure)."

Philosophy & mathematics interesect. Both rely on logic, for one thing.

Posted by bsimon | June 12, 2008 9:19 AM

Full Disclosure, I teach at a public college in Minnesota. I work 50-60 hours per week during the 9 month school year. I make roughly half to 2/3 of what my grad school counterparts at IBM, Seagate, Medtronic etc earn. I like my job.

I don't understand the above complaint with the state paying for "research". It should be fairly common knowledge that about half of our society's economic growth comes from the creation and discovery of new knowledge (see also, transistors, penicillin, the Internet, BT corn, solar cells, engineered lumber...). Minnesota has a thriving technical economy (3M, Medtronic, General Mills...) because of the presence of the University of Minnesota (where I used to attend and do not presently teach).

The thing about investment in expanding the body of knowledge is that you never really know where it will pay off. See also, http://books.nap.edu/openbook.php?record_id=11463&page=1

With regard to tuition, its really a shame that Ventura was ever elected. Before Ventura, students paid roughly 25% of the cost of their schooling at paces like St. Cloud, and now students pay closer to 75% of the burden. I'm not an economist, and I'm uncomfortable putting a price on living in a educated society (perhaps because I like it so much - I similarly won't put a price on my wife, who I also like very much), but there's that saying etched on the front of Northrup Audtorium,

"Founded in the faith that men are ennobled by understanding . Dedicated to the advancement of learning and the search for truth. Devoted to the instruction of youth and the welfare of the state. "

Posted by nt | June 12, 2008 3:00 PM

nt,

No one I know of was ranting about research here. The question revolved around Bob's comment.

This is a good springboard in the comments section for a discussion about when taxes are meaningful and when they're not. If you choose to participate, let's try to do it without the usual political boilerplate both sides usually use, and try to define if there is or is not a public good to be derived from taxes on behalf of those who are paying their own way through school?

In other words undergraduate Liberal Arts education pays for itself and is not subsidized by the tax payer.

Research, Medical School, Engineering and Technology Schools are all GREAT but let's not confuse what the tuition dollar is paying for.

Posted by GregS | June 12, 2008 3:10 PM

GregS, I must have read some of the comments wrong, I agree that reasoned discussion is certainly more pleasant than excited discussion.

I can't provide you with substantive details, but most of the research programs I worked with/knew of at UMN were NSF, DOE, NIH, or corporately funded.

Suppose you are a research professor at UMN and get a grant of $15k from NSF to work on a project with some students. Generally, most of the money on a grant like this goes to salaries. The University requires/suggests that about 45% of salary money be dedicated to "fringe". What this means is that your 15k grant is really 10k to pay salaries and 5k (0.45*10k is about 5k) to pay for the faculty member's office, computer, copy machine, air conditioning, etc.

I doubt the real numbers easily available (and frankly, your average joe isn't a regulating body, so they shouldn't be public), but I would guess that in most cases, Science & Math departments at the U get just as much money from tuition as they do from external funding agencies through fringe costs.

Here's some mathematical guesses. Last spring the UMN physics department taught about 10 general level physics courses. Each course probably enrolled 100-150 students. The course is 4-5 credits (I don't remember) and students pay $300/credit. This means that for the spring semester, the Physics department had an income of about $1.2-2.25M. If we pick a number in the middle of that range and double it, you get a rough estimate of the income of that department, lets say $3.5M. Now, you can read on the UMN tuition page that the state pays 1/3 of the tuition of an average student. This means that the state's (taxpayer's) contribution to this educational endeavor is about $1.2M.

How much grant money does an average faculty member receive per year? I have no idea, but we can make an estimate. The NFS posts list of recent grant awards, see for example,
http://www.nsf.gov/awardsearch/progSearch.do?SearchType=progSearch&page=2&QueryText=&ProgOrganization=PHY&ProgOfficer=&ProgEleCode=&BooleanElement=true&ProgRefCode=9229%2C9141&BooleanRef=true&ProgProgram=&ProgFoaCode=&RestrictActive=on&Search=Search#results

Perusing this list, a typical award would seem to be about 100k. An active professor at UMN might get 1 of these awards each year, which means that (active faculty population)*(100k) might be a reasonable estimate for total grant income. The UMN Physics department has about 85 faculty on its roster. If we assume 40 of those faculty are actively working, submitting proposals, and getting once a year awards, then you have a departmental grant income of $4M.

Now, these are round numbers, and estimates at best (did I say +/- a million dollars? I should have:). I think though that the estimates above debunk the claim that "research is funded by tuition".

Posted by nt | June 12, 2008 5:54 PM

Thanks nt,

That is an interesting insight.

Posted by GregS | June 13, 2008 5:31 AM