Sen. Ted Cruz Fights for More Flexible Education Savings Accounts

Before Congress adjourned for Memorial Day weekend, Sen. Ted Cruz objected to a new retirement saving bill passed by the House because it left out one important reform.

The Texas Republican is standing up for expanded access to personal savings options for family education choice.

In 2017, college savings plans, or “529s,” were modified to allow parents to use money in those accounts for K-12 expenses.

Cruz’s Student Empowerment Act would build on those good reforms by allowing the money saved to go toward home schooling, apprenticeships, student loan expenses, and education support for students with disabilities.

Named after their section of the Internal Revenue Code, 529 college and K-12 savings accounts allow family members to save and invest after-tax income for future expenses.

Unlike most other forms of savings that get taxed once when the income is first earned, and then again when the savings are spent, any earnings on investments in 529s are tax-free.

Expanding the uses of 529 accounts help parents and students pay for education options outside the traditional school system, giving Americans more choice in their education.

For parents who still want to save and accrue tax-free earnings until college, nothing changes. It’s just more choice for those who want it.

Last week, the House passed the Secure Act, a retirement savings bill that has some good and bad changes.

Two of the good reforms are that the bill would increase eligible retirement savings and expand new families’ access to their 401k to support parental leave for the birth or adoption of a new child.

The bill also includes new taxes on middle-class retirement savings and would allow select community newspapers to use otherwise-required contributions to their employees’ pensions to instead prop up their own balance sheets, making newspaper employees’ retirements less secure.

The original bill that passed out of the House Ways and Means Committee after a unanimous, bipartisan vote also included the important 529 expansion Cruz is fighting for in the Senate.

Although the Secure Act is a mixed bag, the 529 provision was one of the good reforms in the original bill.

In a last-minute decision, Democrats removed the education provisions from the bill on a party-line vote in the House Rules Committee before sending the bill to the floor.

The Democrats reportedly caved to special interests representing teachers unions, which object to American families being allowed to spend their own 529 savings on home schooling.

Now, Cruz is fighting to have the previously unanimously agreed-upon expansion of 529 accounts put into the Senate version of the bill before the vote.

A similar amendment was offered and passed the Senate in 2017 as part of the Tax Cuts and Jobs Act. After a procedural objection by Sens. Bernie Sanders, I-Vt., and Ron Wyden, D-Ore., some of the expanded 529 rules, including those for home-schoolers, were stripped out.

The Secure Act also included a last-minute addition to repeal the “kiddie tax” reforms included in the 2017 tax cuts that raised taxes on some Gold Star Families and other dependents who receive unearned income.

The Secure Act makes important reforms to expand some areas of retirement savings, but stops far short of significantly simplifying existing retirement systems and includes many counterproductive provisions that could make retirement less secure for many Americans.

As it stands under the House version, the bad outweighs the good. Including the expansion of eligible education savings could tip the scale back to a neutral package.

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Why inclusion isn’t working

Calls to lower Oxbridge admissions standards ignore the great work that schools can do.

Disadvantaged students will soon be able to enter Oxford University on lower grades than their more affluent peers. This is part of a raft of ambitious measures by Oxford to tackle accusations that it is socially exclusive. The university hopes to ensure that a quarter of its students come from disadvantaged backgrounds by 2023.

Such announcements are nothing new. The top universities’ signal their commitment to inclusion and diversity every year around exam time. The only difference between one year and the next is the shrillness of the headlines.

In the late 1970s, French sociologists Pierre Bourdieu and Jean-Claude Passeron coined the term ‘cultural capital’. It identified the resources that elites use to preserve their power, position and privileges. Cultural capital is everything that educated parents give to their children. It is the accumulation of years of reading, music lessons, private tuition, days out to museums, theatres and the countryside, guided TV viewing, exotic foreign holidays and shared meals around the dinner table, at which discussions might be held about current affairs.

Children who have been given these things go on to combine them with the knowledge they learn at school. According to this view, this puts them at a distinct advantage. Children who lack cultural capital, on the other hand, often find it impossible to make up the deficit.

Consequently, Bourdieu took a dim view of schools. Pupils with cultural capital tend to end up in the kind of schools where they teach Latin, whereas pupils at schools for the disadvantaged get given comic books. Schools, he argues, do little more than entrench the inequalities caused by imbalances in cultural capital, while universities are primarily fortresses for preserving elite power.

Bourdieu’s view is now mainstream. Despite the countless attempts by universities to open up admissions, shadow education secretary Angela Rayner knows many will agree with her when she describes leading universities as a ‘privileged, closed club’.

But this argument comes with a host of assumptions that deserve to be challenged. Why should universities be held responsible for the academic ability of those who apply to them? Can social inequalities like a lack of cultural capital be simply engineered away with access schemes and quotas? Oxford has promised ‘support’ for disadvantaged students with additional seminars. But are universities the appropriate place to make up for years of missing knowledge?

Bordieu was right about cultural capital to a certain extent. Beyond raw intelligence, cultural capital is often what determines whether someone has what it takes to get into Oxford or Cambridge. While it cannot be obtained overnight, there is no need for it to be the preserve of a wealthy elite. It is perfectly possible to provide children with cultural capital in schools.

All cultural capital really is is a love of knowledge and learning. Good schools can provide pupils with experiences and ways of thinking that are truly liberatory, enabling them to explore new places and things, both physical and intellectual, that are beyond their immediate experience.

The constant attempts to get universities to ‘open up’ to disadvantaged applicants shows that we have wrongly given up on the potential for our schools to provide an inspiring, well-rounded and knowledge-rich education.

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Australia: Wealthy white parents are turning away from selective schools because they fear their children will be an ethnic minority

This is mainly a NSW concern as only NSW has much in the way of government funded selective schools.  It is also about Chinese students -- who star in selective schools -- which can be demoralizing for all but the very smartest white kids. In some years ALL the top students are Chinese, many from selective schools.  Their combination of hard work and high IQ is unbeatable.  Their talent makes it easier for them to get into selective schools in the first place.  So they get a high quality education for free.  Why would they go elsewhere?  White parents are more aware of the important social advantages of private schools


Wealthy white parents are avoiding sending their kids to selective schools because they fear they will be an ethnic minority, according to an expert. 

Christina Ho, a social scientist from the University of Technology, says Anglo families were choosing to send their kids to private schools while migrant families are choosing selective schools. 'We do have this self-segregation going on,' Dr Ho said.

And part of the reason appears to be based on the fear of being a minority.  'A lot of Anglo families are saying, 'I would be a minority if I went to a selective school,' Dr Ho said.

The same concern impacts the schooling choices of rich migrant families, who previously preferred private schools. As with Anglo families, they were now choosing selective schools because they were worried about being a conspicuous minority in private schools.

'We do have a lot of wealthy migrants in this country who are living in the eastern suburbs and north shore, who could potentially afford to send their kids to private schools but they are not.' said Dr Ho.

In NSW, more than 80 per cent of students in fully selective schools came from language backgrounds other than English (LBOTE).

Of the 99 schools with fewer than 10 percent LBOTE students, over half were private and in affluent areas.

Dr Ho's research indicates that the process of self-segregation is leading to a wider problem across Sydney where many schools are more ethnically divided than the suburbs in which they are located.

'The increasing diversity of our communities is not reflected in our education system,' Dr Ho told msn.com.  

The process of self-segregation worries Dr Ho who argues that when schools no longer reflect their local communities, students have less opportunity to develop cultural understanding.

She adds that the reason for the ethnic divide lies in policies that encourage parents to shop for schools, over selecting their local school.

Pranay Jha, the son of Indian migrants, had the choice of attending a selective school or attending the King's School in North Parramatta on a scholarship.

His parents decided on the private school option, and Mr Jha, admits he felt isolated, and suffered from some cultural shame. 'I was surrounded by white people, and so to socially succeed in the school you needed to play down your ethnicity a lot,' he said.

Mr Jha also remembers being racially abused while playing sport and believes that if there had been more diversity at the school it would provide students from migrant backgrounds with a greater sense of solidarity.

However, the ethnic make-up of The King's School has changed since Mr Jha's graduation in 2015. At that time 31 per cent of students were LBOTE. By 2018 the number had risen to over 40 per cent

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