Soak the Rich — Colleges!17 Sep 2005 / Paul Epps
A core value of American liberals is the importance of redistributing wealth from the prosperous to others, through highly progressive taxes and transfer payments. Which leads to a question: If redistributing wealth is a good idea for workers, companies, individuals, and families, then intellectual consistency suggests it should be equally valid for institutions like colleges and universities. Right?
Why should students at Princeton, where economist Paul Krugman teaches when he is not thundering against the ‘well off ‘ on the New York Times editorial page, enjoy income from huge endowments, while students at poorer institutions have far fewer educational resources? How unfair!
Worse, the extreme inequality of colleges is subsidized by the government. Gifts to rich schools are tax deductible for the donors. Universities and colleges pay no taxes on their capital gains, dividend, and interest income. This is an outrage against liberal principles! Remedial legislation is clearly needed!