Elite Colleges Should Pay Their Fair Share In Taxes.

Elite Colleges Should Pay Their Fair Share In Taxes.

(ThyBlackMan.com) Last month, I had the chance to attend my alma mater’s 45th reunion. Besides the reminder of how old I have gotten, or how stiff my knees are, it was an enjoyable and memorable trip down memory lane.

As with most college reunions, the university did not miss the opportunity to solicit donations from its graduates — giving that helps maintain the “margin of excellence,” as its marketing materials put it.

While I can appreciate the school’s interest in soliciting graduates to fatten its coffers, I was struck by the lengths that our country’s hallowed institutions of higher learning go to protect their enormous endowments. These college presidents appear to believe that there is a special right reserved for elite institutions to receive the highest rate of returns on their investments and pay the lowest tax rates on those profits.

In many ways, colleges these days look more like major corporations rather than not-for-profit places of learning. The top 20 richest colleges — all but three of which are private — sit atop over $500 billion of savings. Harvard’s and Yale’s combined endowments alone total nearly $100 billion, more than the annual GDP of some countries.

Unlike private businesses, however, these schools enjoy cush tax breaks that allow them to shield their money from the government. The wealthiest colleges pay a mere 8% tax rate on the profits that the endowments make from their investments. Compare that to the average corporate rate of 21%.

At the same time, universities receive significant handouts from the government in the form of federal grants. The eight Ivy League schools alone collectively received over $6 billion in grants annually. While ostensibly intended to advance important research, these giveaways often pump taxpayers’ money into the left’s radical DEI agenda.

Under former President Joe Biden, the U.S. Department of Education doled out more than $40 million to promote a diversity program. In 2024, the City University of New York received $19 million for its “equity center.”

Why should hardworking families, many of whom cannot afford to attend these uber expensive institutions, be on the hook for funding their liberal ideology? It seems obvious to me that these wealthy schools should contribute to our country’s economy, not the other way around.

When I was in school, my alma mater’s informal motto was, “In the nation’s service,” and other schools similarly shroud themselves in patriotism, especially when it comes to fundraising. One would assume then that they would gladly pay a fair rate on their tremendous profits. Instead, they fight tooth and nail to protect those gains while hoarding every dollar of federal grants that they can get their hands on.

Schools spend lavishly to protect their darling status. Last year major research universities spent $38 million lobbying federal policymakers, more than a 30% increase over the previous year.

President Donald Trump has not shied away from pulling back the curtain on federal funding to hold schools more accountable to students and weed out the liberal wokeism that is pervasive at most colleges today. In addition to the president’s focus on some of the nation’s most prominent universities, the One Big Beautiful Bill Act finally raised taxes on the profits earned by these large endowments from a paltry 1.4% to the 8% noted above.

One can guess why colleges upped their lobbyist spending last year — they did not want their precious nest eggs to be targeted. It’s nimbyism in academia.

Our national debt — which exceeded the size of the U.S. economy this year for the first time since immediately after World War II — is spiraling out of control. Getting on a sustainable path to pay it down will require greater tax revenue alongside real spending cuts. No sector should be excused, especially not the liberal bastions of higher education.

That’s the trouble, though. Like lawmakers in Washington — who are utterly reluctant to cut federal programs, even as they drive our country deeper into the poorhouse — no college or university wants its ox to be gored.

If academia chooses to use patriotic slogans in its marketing materials, then it should help get our national debt onto a sustainable trajectory and pay its share of taxes. Why should liberal schools be rewarded for peddling their woke ideology while the government forces ordinary Americans to pay a higher tax rate on their investment returns?

Democrats rally around their “tax the rich” mantra. If they are serious about it, they should start with higher education. Of course, they won’t, because these schools are purveyors of their liberal orthodoxy. But Republicans should follow Trump’s lead and finally hold academia to my old school’s motto: in the nation’s service.

Written by Ken Buck

Official website; https://x.com/BuckForColorado