Taxing college endowments will make higher education less affordable
Growing up in a small town in Maine, I never thought we would arrive at a time where the value of a college education — long the hope of everyone who wanted more for their children — would be questioned by some Americans, including by some of our government officials.
Nothing was more important to my parents, who had no education themselves and very little in the way of material resources. My mother was an immigrant. My father was the orphan son of immigrants. They were right about the power of education, and because of them and because of the openness of American society, all five of their children graduated from college; I was able to become majority leader of the US Senate and to engage in activities of which they could not possibly have ever dreamed.
My path in life is linked directly to my education and to the people who assisted me along the way. That’s why, since leaving the Senate, I have worked to ensure that students in Maine with the talent and ambition to go to college have a helping hand that will allow them to get there and to thrive. It’s also why the current doubt by some about the value of higher education is so deeply troubling.
Today, our colleges and universities — the engines of opportunity, economic growth, and scientific discovery in America — are under fire for any number of asserted transgressions. Most of all, they are criticized for being too expensive and for not controlling costs. Tuition and fees have certainly increased, and that is a legitimate concern. But so have the funds set aside by our nation’s strongest colleges and universities for financial aid. In fact, during the past decade, the actual price at many of these institutions — the amount paid by students after financial aid is factored in — has closely tracked inflation as measured by the Consumer Price Index.
These colleges and universities are following through on their commitment to low-income and first-generation college students and to diversity of all kinds. And they are doing it with endowment resources provided by donors who understand the immense value of higher education and who restrict their gifts for this purpose.
Concerns about cost were clearly behind the recent move by Congress to impose an unprecedented and self-defeating new tax on the endowment earnings of our most respected colleges and universities. But this tax makes no sense. It hampers efforts to make college affordable for students who would be unable to attend without financial aid.
I was one of those students when I was admitted to Bowdoin College. I graduated from high school at the age of 16, insecure, uncertain, and as naive as a human being can be. It was only because of the generosity of others that I was able to enroll and graduate four years later. I have no doubt that Bowdoin changed my life. In addition to learning from great professors across the curriculum, I gained resilience, the ability to think critically, empathy for others, how to adapt to change, and how to take advantage of new opportunities — abilities that are considerably more important today. Most important, for the first time in my life I gained a measure of self-confidence.
There is nothing wrong with holding our institutions accountable, and some recent criticism of our colleges and universities is surely warranted. But reasonable accountability is a far cry from the astonishing views, revealed in recent polls, that these institutions are having a negative effect on America or that a college degree isn’t worth the cost. Without our colleges and universities and the opportunity they provide, America would be unrecognizable.
The good news is that these schools are seeing record applications, partially because of the aid and opportunity they provide and also because Americans from every corner of our country and from every circumstance know — as my parents did — that higher education changes lives. Rather than disparaging our colleges and universities and imposing new taxes, we should acknowledge and celebrate the central role they continue to play in the American dream and in the strength of American society. We can do so by making college available to more of the talented young men and women who want to improve themselves and their country.
George J. Mitchell served as the majority leader of the US Senate, as independent chairman of the Northern Ireland Peace Talks, as chairman of the International Fact-Finding Committee on Violence in the Middle East, and as US special envoy for Middle East peace.