I usually avoid talking politics on this blog. In part, that’s because I usually don’t have something worth saying.
When the US House of Representatives voted on a tax bill that included a tax on grad student tuition waivers, though, I was tempted. Grad school wasn’t so long ago for me, and combining my friends’ experiences with mine I thought I knew enough for a post.
I still had questions, though. So I asked around, and tried to learn more.
In the end, the tax on tuition waivers was dropped from the bill. I’m not going to comment on the rest of the bill, I really don’t have any relevant expertise there.
I do want to say a bit about what I learned, though.
First, the basics:
In the US, PhD students don’t typically pay tuition. Instead, they get paid a stipend, which gets taxed just like any other income. In exchange, they work for their department at the university, as Teaching Assistants and Research Assistants.
PhD tuition isn’t zero, though. Their tuition (often comparable to undergraduate tuition at the same university) is waived, but someone still pays it. Sometimes that “someone” is the department, paying tuition alongside wages as part of the cost of a Teaching Assistant. Sometimes it’s a grant held by a professor, as part of the cost of that professor hiring a Research Assistant. Sometimes it’s another organization: the National Science Foundation or the Fulbright Program, paying for a student who showed their worth in an application process.
My first question, then, was this: what determines PhD student tuition?
I know a fair number of professors, many of whom have worked with university administrations, so I thought this would be simple to answer. Then I started asking people, and everyone I asked said something different.
Some thought it was mostly set by comparing to other universities. Others had the impression it was tied to undergrad tuition, that the university had a standard price it charges per course. Others pointed out that at many places, the cost of funding a grad student is the same as the cost of a postdoc. Since postdoc salaries are at least somewhat competitive, this implies that the total of grad student tuition plus stipend is set by the postdoc market, and then the university takes as much of it for tuition as they can before the stipend becomes unreasonably low.
What no one claimed, even after I asked them directly, was that grad student tuition represented the cost of educating a grad student. Grad education does cost money, in professor salaries and campus resources. But I couldn’t find anyone who would claim that this cost was anywhere near what universities charged in PhD tuition.
Rather, grad tuition seems to be part of the bulk of mysterious “overhead” that universities take out of grants. “Overhead” varies from grant to grant and situation to situation, with universities taking less out of some places and more out of others. Either way, it isn’t really overhead in the conventional sense: rather than being the cost to the university of administering that grant or educating that grad student, it’s treated as a source of money for the university to funnel elsewhere, to fund everything else they do.
If grad tuition waivers had ended up taxed, couldn’t universities just pay their grad students’ tuition some other way?
Yes, but you probably wouldn’t like it.
Waiving tuition is only one way to let grad students go tuition-free. Another way, which would not have been taxed under the proposed bill, is scholarships.
There are already some US universities that cover grad student tuition with scholarships, and I get the impression it’s a common setup in Canada. But from what I’ve seen, it doesn’t work very well.
The problem, as far as I can tell, is that once a university decides that something is a “scholarship”, it wants to pay it like a scholarship. For some reason, this appears to mean randomly, over the course of the year, rather than at the beginning of the year. This isn’t a huge problem when it’s just tuition, since usually universities are sensible enough to wait until you’ve gotten your scholarship to charge you. But often, universities that are already covering tuition with a scholarship will cover a significant chunk of stipend with it too.
The end result, as I’ve seen happen in several places, is that students show up and are told they’ll be paid a particular stipend. They sign rental contracts, they make plans assuming that money will be there. And then several months pass, and it turns out most of the stipend they were promised is a “scholarship”, and that scholarship won’t actually be paid until the university feels like it. So for the first few months, those students have to hope they have forgiving landlords, because it’s not like they can get the university to pay them on time just because they said they were going to.
Of course, I should mention that even without scholarships, there are universities that pay their students late, which leads into my overall point: this system is a huge mess. Grad students are in a weird in-between place, treated like employees part of the time and students part of the time, with the actual rationale in each case frustratingly opaque. In some places, with attentive departments or savvy grad student unions, the mess gets kept to a minimum. Others aren’t so lucky. What’s worse is that this kind of system is often the sort where, if you put it under any pressure, it shuffles the problem around until it ends up with someone who can’t complain. And chances are, that person is a grad student.
I don’t know how to fix this. It seems like the sort of thing where you have to just reform the system all in one go, in a way that takes everything into account. I don’t know of any proposed plans that do that.
One final note: I usually have a ban on politics in the comments. That would be more than a little hypocritical to enforce here. I’d still like to prevent the more vicious arguments, to keep the discussion civil and informative. As such, the following rules are intended as conversational speed bumps, with the hope that in writing around them you take a bit more time to think about what you have to say.
For the comments here, please: do not mention specific politicians, political parties, or ideologies. Please avoid personal insults, especially towards your fellow commenters. Please try to avoid speculation about peoples’ motives, and focus as much as possible on specifics: specific experiences you’ve had, specific rules and regulations, specific administrative practices, specific economic studies. If at all possible, try to inform, not just vent, and maybe we can learn something from each other.