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Saturday, May 10, 2008

Taxing the Uber-Wealthy ... Endowments

Any idea that sends the education establishment into apoplexy is worth further discussion, and the proposal made by members of the Massachusetts legislature that the Uber-Wealthy college endowments should be taxed is worth a further look. The proposal is being floated that endowments in excess of $1 billion would be taxed at the rate of 2.5%. Considering the fact that there are 7 college endowments larger than $1 billion in the Bay State, that would bring in a boat load of money.

The Harvard endowment is worth about $34 Billion. Now, that’s a pile of money. If Harvard were a person it would be the 7th richest person in the world, right behind Anil Ambani who owns the better part of India and ahead of Ingvar Kamprad who owns Ikea (the furniture company).

The educrats are squealing like stuck pigs and claiming that they do a tremendous amount of good with their loot. Of course they are also claiming tax-exempt status which keeps them from paying things like property taxes that private sector institutions pay, depriving the cities in which they reside of needed tax revenue.

Inside Higher Ed has the story:
“Why do we want to tax the poor all the time, but we let off the hook the richest of the rich?” said State Rep. Angelo Scaccia, a Democrat, said during the course of Monday’s debate


But let’s get real; you don’t collect an endowment in excess of $34 billion by spending money freely. You do this by a process known as hoarding. You do this by charging your customers through the nose. You do this by being miserly. You also do this by making smart investments but not having to pay taxes on the income and the gains …because you claim tax exemption!

At one time I may have had some sympathy for the educational establishment in this country. That was at a time that they supported this country. Now they have become – at best – disinterested bystanders to the country’s problems and – at worst – have sided with our foes.

By all means, it’s time to tax the bloated malefactors of great wealth at Big Education!

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