The Atlasian Universal Education Bill (Debating)

[Lumine]

Sorry, Senator TNF is now the sponsor of this bill.

[Dr. Cynic]

Second.

[TNF]

I'm working on an amendment for this, so I'd like to hold off on the final vote at least until I can get it finished for presentation.

[Fmr President & Senator Polnut]

I'm working on an amendment for this, so I'd like to hold off on the final vote at least until I can get it finished for presentation.

If it's realistic, I'm happy to wait for Senator TNF's amendment.

[Southern Senator North Carolina Yankee]

Lets petrify Nix and make him a perment fixture in our chamber.

[TNF]

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[Lumine]

Right, the amendment has been adopted. Final vote?

[Fmr President & Senator Polnut]

I'm very uncomfortable about the virtues of this amendment. We have no idea how much the new tax would actually raise. I'm very wary of the knee-jerk reaction to any funding need is a new tax that people will move heaven and earth to avoid.

Until we get an idea about the funding needs, I'm not comfortable passing this.

[TNF]

According to an article in the Atlantic, it would cost $62.6 billion to pay for universal higher ed. I think the tax that I proposed would definitely raise that amount.

[Southern Senator North Carolina Yankee]

Disconnecting the cost from the service will ensure that the cost of providing a high quality education will balloon when the same quality education would be preserved at a lowerp rice under a different approach.

We do need to help those who cannot afford it, but we should not be paying to send Bill Gate's kids to Harvard, he can do that himself. Also we need to be more discerning in what degrees we do fund as not all will lead to jobs, which helps neither the economy, nor the students themselves. Once you do that, you can then invest in expanding available slots to ensure the increased demand is met without increasing tuition costs.

[Cranberry]

Since the main point now seems whether we can afford to pay for this, allow me to make these calculations.

Here is the Atlantic article TNF was talking about. According to Departement of Education data, public colleges in 2012 collected $62.6 billions in tuition fees in 2012. At the same time, the government had total expenditures of $69 billions for financial aid programs for students, of which around 20 millions was spent on grants for students to pay their tuition fees for public colleges or universities, which of course would not be needed anymore.

Taking in account our own budget, we have the following expenditure points in our budget that are signed to pay for such programmes:
- 40 billions "Higher Education"
- 45 billions "Tax Credits", of which I would say approx. 5-10 billions affect families that sutain students paying for tuition fees or students themselves

Taking in account, we have a budget point of approx. 45 billions, of which we can say around 15-20 billions would be void if this bill is passed. 60 billions minus 20 millions brings us to $40 billion dollars we would need to pay.
(Considering this, the US expends 100 billions for student loans, I didn't find an equivalent of such in Nix's budget - is everything such included in "Higher Education"?)

Now let's go on taking TNF's tax proposal:

According to this source, there were around 240'000 people in 2009 and around 400'000 people in 2007 that earned more than one million dollars. This Wall Street Journal Article says in 2009 there were 72 Americans making more than 50 Millions, in total 6 Billions compared to 151 in 2007 making 14 Billions. There were no real sources for people making 10 Millions or more, so we will have to speculate a bit here.
Taking again into account Nix's budget, we had revenues of 67 Billions from the 5 Million+ bracket, with a tax rate of 60%. That brings us to a total income of that bracket of around 110 Billions. Starting to speculate now, we can probably say that around half of this, 55 Billions was made by people earning more than 10 millions. They paid around 33 Billions in Nix' budget, and raising the tax rate for them to 65% would give us an additional 3 Billions in revenue.

So, to sum up, according to my calculations, this bill would cost us 62.2 Billions, of which we would save around 20 Billions in expenditures for student loans and grants and such that would become void. The proposed tax by Senator TNF would raise around 3 Billions in revenue, resulting in us needing to still find 39.2 Billion Dollars.

[Cranberry]

Now, let's come to my personal opinion here. I fully support free, or at least nearly free if it is not possible otherwise, access to higher education. Senator Yankee made a very good point here in my opinion, why should we pay for Bill Gate's son to go to college, Bill Gates can do that for himself. As such, I would propose a kind of "middle-in-the-road approach", a very similar to the one that was present in Austria for a long time. We install general tuition fees paid not to the educational instiution, but to our education fund; these fees of course need to be a lot cheaper than the ones paid now. We maybe can even double them for foreign students, if we want to. Now, we say that students from families earning less than $50'000 or any other sum a year, don't need to pay this, and just students from families earing more do. I will try to find some numbers with which we can work, and then propose numbers with which we could raise those remaining $39 billions.

[Cranberry]

According to Census data (See Table 5), 15'514'000 students were enrolled in a public college or university in 2013. If we know assumed that all these students together should pay for the $39.2 billions, we come to the sum of $2'526 that would be needed to be paid by each individual student per year. The current average tuition fee for students is $5'899 in public institution, according to the "Back to School" data of the National Center for Education Statistics.
If we now reduced this sum to install general tuition fees of $450 per student and semester, equaling $900 a year, we can generate revenues of around $14 billion.

I would now propose to install a more progressive system of general tuition fees. According to table 8 of the census link, (it is with family data) we can say that there were 429'000 students with families earning less than $20'000 a year, 2'337'000 students with families earning $20'000-$75'000 a year, and 2'709'000 students with families earning more than $75'000 a year. Keeping this distribution of income, and eypanding it to receive the total number of students in public institutions we had before, we can see the following number of students with the following family incomes:

- $20'000: 1'388'000
$20k-$75k: 6'542'000
$75'000+: 7'583'000

I would propose now a following distribuition of tuition fees:

- $20'000 (family income): 0$  (REVENUES: 0$)
$20k-$75k: 450$/semester (900$/year) (REVENUES: $5.8 Billions)
$75k-$150k: 750$/semester (1'500$/year) (REVENUES: $7.6 Billions)
+ $150'000: $1500/semester (3'000$/year) (REVENUES: $6.0 Billions)

That would generate us revenues of approx. 20 Billions, still just half of the sum we need to get togetehr somehow.
What ways are there to get us 20 Billions?

[Southern Senator North Carolina Yankee]

I hate doing it, but the first thing that would come to my mind would be a fourth grouping above maybe $500,000, but I doubt it would raise enough revenue to cover $20 billion.

[windjammer]

Senator Cranberry's proposition seems to be  a good idea, I will support that. We just need to find funds in order to fund that. Although I wouldn't mind having a small deficit budget if it allows students to reduce tuition fees.

[TNF]

I am also totally comfortable with running a deficit if it means educating the next generation and ending the discrimination that currently exists against working class students without the means to attend college.

[Cranberry]

I hate doing it, but the first thing that would come to my mind would be a fourth grouping above maybe $500,000, but I doubt it would raise enough revenue to cover $20 billion.

I seriously doubt we would make probably half a million with it, as I simply doubt many people making $500'000 plus send their children to public universities.

But yes, as others said, I too would have no problem at all with running a small deficit. We have I guess a surplus of 18 billions or something like that as of this year, so that would be just 2-3 billions deficit, for this year. And Lumine also expressed he wanted to draft a 2015 budget, so we can surely add our stuff from this bill there, too.

[Fmr President & Senator Polnut]

If we're comfortable with running deficit based on this Bill because we have a very small surplus this year, is pretty short-sighted.

[Cranberry]

If we're comfortable with running deficit based on this Bill because we have a very small surplus this year, is pretty short-sighted.

I said it would be a small deficit just for this year, we would have to search for a more permanent solution when discussing next year's budget. But yes, you are right, it would be pretty short-sighted just thinking for this year.

[TNF]

So then we just raise taxes on the rich. What's the problem?

[windjammer]

If we're comfortable with running deficit based on this Bill because we have a very small surplus this year, is pretty short-sighted.

I said it would be a small deficit just for this year, we would have to search for a more permanent solution when discussing next year's budget. But yes, you are right, it would be pretty short-sighted just thinking for this year.

I just would like to point out that having a small deficit like under 1% isn't catastrophic at all, this is when the deficit is out of control that this is problematic.
Reducting education cost should be a top priority!

[Fmr President & Senator Polnut]

So then we just raise taxes on the rich. What's the problem?

There are severely diminishing returns in that strategy.

The fact is, I won't support a proposal unless a long term funding strategy is in place, because not only is that security necessary but the reality is the real-term costs will increase over time.

This thinking is how you end up with structural deficits, which I know might not be an issue for some, but if it's something that can be avoided with a clear strategy, then we should.

[Southern Senator North Carolina Yankee]

I tend to aggree with Polnut. Both with regards to the taxes and with regards to the spending. Raising taxes much more at this stage will not yield much in terms of revenues.

[Cranberry]

So then we just raise taxes on the rich. What's the problem?

You proposed that already, and we can't even get 10% of the sum needed from that.

Anyway, I guess I'll revoke my earlier position, and join the Senators Polnut and Yankee in their sensible opinion of finding a way to get the remaining money in somehow, and not run a deficit of it. As much as I believe free or near free universal education is imperative, we should try to keep our budget as balanced as possible, too.
So, we are probably at the point to find some other methods of funding this. I don't like it, but maybe we should raise the fees we would levy in my latest proposal by a bit? Maybe we also have a budget point from which we could transfer something to this point? I will try to come up wing a few more solutions tomorrow.

As a matter of fact, since Senator Dr Cynic is sponsor of the bill, I dare ask if I may assume co-sponsorship for this bill, for the case the Senator is sworn in as GM before we pass this act?

[TNF]

So we raise them higher. Not a problem.