GOP tax bill endangers America’s STEM education, innovation

The “Tax Cuts and Jobs Act” (H.R. 1) is touted as a bill that will stimulate the U.S. economy and accelerate the creation of thousands of jobs over the next decade. Parts of it may, but one specific section could do real harm to the American economy and our technological leadership for decades.

Many graduate students count on teaching or research assistantships, and the tuition waivers that come with them, to be able to afford their graduate degrees. This is a standard part of many students’ educational plans, and a crucial professional step for students planning to pursue academic or research careers — especially in the STEM fields.

The House version of H.R. 1 makes tuition reductions taxable income and repeals the tax deduction for student loan interest. The Senate version keeps those provisions intact but may abandon them in the final version of the bill after reconciliation.

{mosads}This provision could dramatically increase graduate students’ tax liability, making the cost of attending graduate school exceedingly prohibitive to many students.

Graduate students can’t earn a considerable amount of money because they can’t work full time. They are, after all, students. And tuition is extremely expensive. It is entirely possible that the reduction in tuition graduate students receive in exchange for an assistantship, rivals or even exceeds their annual income.

Taxing tuition reductions as though they were income could, therefore, create an impossible tax liability for students. Congress would effectively be requiring graduate students to either hold a regular full-time job while pursuing their studies — for the sole purpose of earning money to pay their tax bill — or limiting graduate school to only wealthy students.

This is especially true for students pursuing STEM degrees. Many STEM fields require an advanced degree for employment. STEM degrees demand considerable time for studying, conducting lab work and research, making employment even more unattainable. Moreover, many universities charge more for STEM degrees because the fields are more expensive to teach.

Therefore, STEM graduate students both receive more potentially taxable benefits when their tuition is reduced than other students and are less able to earn money to pay their increased tax burden.

This is dangerous to the U.S. scientific research enterprise and our innovation-based economy, which depends on a scientifically educated and competitive workforce.

The American economy needs more STEM graduates, not less. We need more American students to major in engineering, physics and biology to meet future workforce needs in technology, computer science and medicine.

Consider this: in 2010 China had more PhDs graduating than in the U.S. The number of doctorates in China since 2002 markedly grew from 14,368 PhDs (compared to 40,030 in the U.S. in the same year), to 27,677 only 2 years later, and rose to 48,987 by 2010. Whereas the PhDs awarded in the U.S have grown at a more sluggish rate (3.3 percent), from 40,030 PhDs in 2002 to 48,069 in 2010 and even experienced a 3.1 percent decline in 2010 compared to the two prior years.

Congress should ensure that America has the technical and scientific skills necessary to compete in the 21st century, not dissuade students from pursuing science.

Our Founding Fathers understood the importance of education.  They explicitly mandated Congress with promoting through intellectual property rights the “Progress of Science and useful arts” in the Constitution. George Washington in his first address to Congress on January 8, 1790 said, “I am persuaded that you will agree with me that there is nothing which can better deserve your patronage than the promotion of science and literature. Knowledge is in every country the surest basis of public happiness.”

Americans built a great nation, an growing economy, and an unprecedented industrial and technological might. But today America is faced with tremendous technological challenges while also presented with incredible opportunities. So, I urge Congress to remember the immortal words of George Washington, abide by the principles of the Constitution, and defend the ability of Americans to seek education to build a better future for America.

Congress has recognized the value of business investments in our tax code. Education is an investment that is vastly more important to our country’s long-term economic health than factories and buildings.

The tax code should be encouraging our students to pursue advanced STEM degrees, not making it financially unfeasible to do so – which is exactly what H.R. 1 does. Reductions in tuition in exchange for teaching and research assistantships are not income. Treating them as such, will severely disrupt America’s higher education system and place that education out of reach of many of our most promising students.

Mina Hanna is a senior software consultant at Synopsys, Inc. and previously worked at Intel Corporation. He received a Master of Science in Electrical Engineering from Stanford University.