Georgia’s Great Money Laundering Scheme

by Nick Star

Today, for the third time in a month, I was forced to sit through the sales pitch for the money laundering racket known as Georgia Annotated Section 48-7-29.16. State law permits Georgia residents to receive, in the form of a tax rebate, 100% of a donation up to $2,500 (for a married couple, or $1,000 for single residents) to qualified scholarship funds to send students to private schools rather than public ones. In addition, the donor receives a federal tax deduction for the donation. Why is this immoral, unethical, and perhaps even unconstitutional? As the principal of the private school where I teach iterated, and reiterated, "this is not a donation, it is a redirection of tax monies to our school instead of Uncle Sonny," presumably referring to Governor Sonny Purdue (as if the governor is even the one taking the money). For a "donation" of $2,500, a family in the 20% federal tax bracket would receive a $3,000 refund, $2,500 of which is paid by hard working Georgia citizens, and the other $500 paid by the tax payers of the United States. Anyone who has watched many mafia shows or movies like "The Sopranos" or "The Godfather," understands that money laundering works by channeling funds through businesses under the guise of "services" or "products." This is no different than paying citizens with public money to "donate" money to private interests.

The argument that is always made is that this is "to help kids transition from public to private schools." Not the least of the offenses with this argument is that it implies that public schools are inherently less beneficial to students (and arguably, society) than private ones, but that is a whole other discussion. The real problem is who is paying for the tax refunds. When I was a child, my family struggled financially. My father worked a full time job, usually with overtime, as well as a "part-time" job that typically totaled around 40 hours per week. My mother, while a graduate of MIT, stayed home to take care of the kids due to health problems as well as the fact that child care was more expensive than her salary when she worked as an architect in the early- to mid-80's. We lived in a small house without the luxury of cable TV or air conditioning. We ate out only when my grandparents took us. The birthday money from my grandparents paid for the dues so I could play soccer in the town league, as it would have otherwise been too expensive, even at the meager price of a shirt and shoes. Occasionally I would show up to cub scout meetings with an "IOU" for the den leader because we weren't able to find a dollar to send with me. We received WIC benefits for most of my childhood, and occasionally even from a local food bank. While we likely qualified for welfare, we only applied and received it twice in my life. I never considered myself poor because I always knew people financially worse off than I was. I never went to bed hungry one time, but I knew kids who did. I tell you about this, not because I want any shred of sympathy for my family - these struggles are what made me who I am today, but instead, empathy for those like my family. Those families, like mine, pay their taxes dutifully, but could never, even with a 100% tuition scholarship, begin to afford to pay for just the books and uniforms. Yet these families' tax dollars are going to subsidize the private school tuition of the upper middle class who can't afford the entire cost of a private school education, only part of it.

I have nothing against private schools, I obviously teach in one. The students are very respectful, and if the families have the means to pay for it, they have every right to pay to send their children to private schools where their academic education is augmented with religion. I want to make a difference in children's lives, and this is the best way I know how at the moment. I do however take offense with forcing those with nothing to pay to subsidize the tuition of students who drive cars more expensive than their teachers' salaries. This program has been marketed as "a great way to help needy students," but nobody here has any idea what needy is.