The Tax Code
& Education
A $1.5 trillion corporate tax cut written by lobbyists. A $1.84 trillion student debt crisis sustained by servicers. Two systems rigged by the same playbook: spend to write the rules, then profit from them.
The American tax code is 6,871 pages long. It is not written by Congress. It is written by the 6,107 lobbyists who filed on tax issues in 2024 — 47% of every federal lobbyist in Washington. Their clients spent $4.4 billion on lobbying that year, a record, and the return on that investment dwarfs anything on Wall Street: 22,000% on a single tax holiday. The code they produce is a shadow spending program worth $2.2 trillion in annual tax expenditures — more than Social Security, more than Medicare, more than defense. The difference is that no one votes on it, no one reviews it annually, and the benefits flow overwhelmingly upward.
Education operates under the same gravitational pull. The $1.84 trillion student debt crisis is not an accident but a product of sustained industry lobbying — over $50 million since 2008 from loan servicers alone — that has blocked every attempt at comprehensive reform. The for-profit college sector mounted a $12.5 million lobbying surge to kill Obama-era accountability rules, then watched its champion, Betsy DeVos, rescind them entirely. School choice advocates backed by the DeVos, Walton, and Koch fortunes spent tens of millions to take universal voucher programs from zero states to thirteen in four years. The Heritage Foundation wrote the blueprint to dismantle the Department of Education in Project 2025, then its author was hired to execute it.
The Ledger examined two decades of lobbying disclosures, campaign finance records, IRS enforcement data, student loan servicing contracts, and state-level political spending across the tax and education sectors. The data comes from OpenSecrets, the Joint Committee on Taxation, the Congressional Budget Office, the Institute on Taxation and Economic Policy, the Government Accountability Office, ProPublica, and federal court filings. Every dollar figure in this chapter is sourced to a public record.
The Tax Code
The Tax Cuts and Jobs Act: Anatomy of a Lobbying Victory
The Tax Cuts and Jobs Act, signed December 22, 2017, was the largest overhaul of the U.S. tax code in thirty years. Its centerpiece — slashing the corporate rate from 35% to 21% — was the product of the most intense corporate lobbying campaign in modern history. In a typical quarter, approximately 3,000 lobbying filings mention taxation. In Q4 2017, that number surged to 4,673. The Business Roundtable, a coalition of 200 CEOs from the largest American corporations, spent $17.3 million in that single quarter — nearly quadruple its prior spending. The U.S. Chamber of Commerce, the National Association of Realtors, and the Business Roundtable combined to spend more than $56 million in Q4 2017 alone. Even the Beer Institute increased its lobbying budget by $390,000 to $1.3 million in that quarter, fighting for an excise tax cut.
The Joint Committee on Taxation estimated the law would add $1.456 trillion to annual deficits over a decade. The Congressional Budget Office put the figure at $1.5 trillion over the 2018–2027 budget window. The corporate rate cut alone was projected to reduce federal revenues by $919 billion over the same period. And the benefits were distributed precisely as the lobbying investment predicted: 47.6% to 62.6% of total benefits went to the top 1%, depending on the analytical model used. The top 0.1% of households received an average tax cut of $193,380. The middle 20% received $930. The bottom 40% received less than 2% of total benefits — a gap of roughly $60,000 versus $500 between the top 1% and the bottom 60%.
Stock Buybacks: Where the Money Actually Went
The TCJA's proponents promised a tidal wave of business investment, wage growth, and job creation. The data told a different story. In 2018, S&P 500 companies executed $806 billion in stock buybacks — a 55% increase over 2017. Across all public companies, buybacks approached $1 trillion. The fifteen largest corporate cash holders tripled their buyback spending from $86 billion in 2017 to $231 billion in 2018. By February 2018 — barely two months after the law was signed — companies had announced $171 billion in buybacks versus just $6 billion in worker bonuses. For every dollar that went to employees, twenty-eight dollars went to shareholders.
Only about 20% of the incremental cash flowing from the tax cut went to capital expenditure or research and development. The rest went to buybacks, dividends, and executive compensation. The pattern was not accidental. It was predictable. Academic research had demonstrated after the 2004 repatriation holiday that companies overwhelmingly return windfall tax savings to shareholders rather than investing in productive capacity. The TCJA was the same experiment at ten times the scale, and it produced the same result.
The Companies That Pay Nothing
Despite a statutory corporate tax rate of 21%, hundreds of major corporations pay far less — or nothing at all. In 2018, ninety-one profitable Fortune 500 companies paid zero federal income tax on their combined profits. The list included Amazon, Chevron, Halliburton, and IBM. In 2020, fifty-five profitable corporations paid $0 on $40 billion in combined pretax income — income that would have generated $8.5 billion at the statutory rate. Instead, those companies received $3.5 billion in tax rebates, draining a net $12 billion from the Treasury. Twenty-six companies sustained a zero effective rate across the entire three-year period from 2018 to 2020.
The individual cases are instructive. FedEx earned $1.2 billion in pretax income in 2020 and paid nothing; it received a $230 million rebate. Nike earned $2.9 billion and paid nothing; it received $109 million. Duke Energy reported $7.9 billion in pretax income across three years and paid nothing on balance. Salesforce earned $2.7 billion in 2021 and paid zero. AT&T and Charter Communications each earned more than $1 billion in 2021 and paid zero. The average effective rate for 379 profitable Fortune 500 companies in 2018 was 11.3% — slightly more than half the 21% statutory rate. For the period 2018–2021, 95 companies averaged an effective rate below 10%, up from 56 companies in the pre-TCJA period of 2013–2016. The GAO found that 34% of large, profitable corporations pay zero federal income tax in any given year.
These zero-tax companies are not passive beneficiaries. Public Citizen's “The Price of Zero” report found that the 55 companies paying $0 in 2020 spent $450 million on lobbying and campaign contributions between 2015 and 2020. They deployed an average of 526 lobbyists per year. FedEx alone spent $71 million on lobbying and campaign contributions across the 2016–2020 cycles. Twenty-two of the fifty-five companies lobbied specifically on the Tax Cuts and Jobs Act.
The Carried Interest Loophole: A Masterclass in Survival
The carried interest loophole allows private equity and hedge fund managers to pay the 20% capital gains rate instead of the 37% ordinary income rate on their management fees. Despite bipartisan criticism from Obama, Trump, Clinton, Sanders, and Biden, the loophole has survived every reform attempt — a testament to the financial industry's raw lobbying power. The loophole costs the federal government between $2 billion and $18 billion per year, depending on methodology. The CBO estimated in 2017 that closing it would raise $14 billion over a decade.
The pattern of near-reform followed by survival is remarkably consistent. Obama called for carried interest reform in multiple budget proposals; Congress blocked every one. Trump pledged on the campaign trail to close it; the TCJA merely extended the holding period from one year to three. The Build Back Better Act included a reform provision; it stalled. The Inflation Reduction Act of 2022 contained a provision projected to raise $17 billion. Then Senator Kyrsten Sinema demanded its removal as a condition of her vote. Sinema had received more than $2 million from the securities and investment industry since 2018, including $44,000 from Blackstone employees and executives alone and $95,000 combined from KKR, Carlyle Group, and Apollo Global Management. Senate Majority Leader Chuck Schumer said Democrats had “no choice” but to drop the provision. The One Big Beautiful Bill Act of July 2025 left the loophole intact yet again.
The private equity industry's investment in political influence is staggering. In the 2020 election cycle, the securities and investment sector spent $625 million on combined political activity — $547 million in campaign contributions and the rest in lobbying. Citadel led individual firms at $67 million, followed by Blackstone at $43 million and Susquehanna International at $30 million. During the TCJA debate, Blackstone, Carlyle, and KKR combined to give $1.31 million to Republican lawmakers versus $438,000 to Democrats. Blackstone employees alone gave $212,000 to Mitch McConnell. The American Investment Council, the industry's primary lobbying arm, paid $100,000 to The Duberstein Group for carried interest lobbying during the TCJA fight. When Obama had proposed closing the loophole in 2010, Blackstone increased its lobbying budget from $6.7 million to $9 million in a single year.
Offshore Havens: $2.6 Trillion in the Shadows
Before the TCJA, Fortune 500 companies held $2.6 trillion in profits offshore, sheltered from the then-35% corporate rate. They maintained 9,755 subsidiaries in tax haven jurisdictions. The taxes avoided on those holdings totaled an estimated $752 billion. The Netherlands, Ireland, and Bermuda alone accounted for 35% of all overseas profits reported by U.S. multinationals — despite containing less than 0.3% of the world's population. The annual revenue lost to offshore profit shifting is approximately $150 billion per year in federal and state revenue combined.
Apple's arrangement with Ireland became the defining case study. Between 2004 and 2014, Apple routed €110.8 billion in non-U.S. profits through Irish subsidiaries, paying an effective tax rate as low as 0.005% — despite Ireland's statutory rate of 12.5%. In 2016, the European Commission ordered Apple to pay €13 billion plus interest in unpaid Irish taxes — the largest corporate tax fine in history. Apple's response, revealed in the Paradise Papers, was to move its intellectual property holdings to Jersey in the Channel Islands. Google deployed a parallel scheme known as the “Double Irish with Dutch Sandwich,” routing $23 billion through Ireland and the Netherlands to Bermuda in 2017 alone, saving approximately $3.6 billion per year.
Corporate inversions — reincorporating in a low-tax jurisdiction while maintaining U.S. operations — arrived in two waves. The first, from 1996 to 2004, involved “naked inversions” to Caribbean havens and was partially closed by legislation. The second wave, from 2012 to 2016, targeted Ireland and the United Kingdom through mergers with real foreign companies. The largest completed inversion was Medtronic's $48 billion acquisition of Covidien in Ireland in 2015, driven by $20 billion in untaxed offshore reserves despite the vast majority of Medtronic's revenue coming from the United States. The largest aborted inversion was Pfizer's $160 billion attempt to merge with Allergan in 2016, which would have avoided $40.7 billion in taxes on offshore earnings. The Obama Treasury Department blocked the deal with new anti-inversion rules.
The global response has been tepid. In 2021, more than 140 countries signed an OECD agreement establishing a 15% minimum corporate tax rate for companies earning above €750 million. The Income Inclusion Rule took effect in January 2024, with roughly 90% of in-scope multinationals subject to it by 2025. But in January 2026, a “Side-by-Side” agreement effectively excluded U.S. multinationals from the 15% floor. The Trump administration had already pulled the United States out of the implementation framework. Critics note that the 15% rate is itself too low and riddled with exceptions that undermine its effectiveness.
Defunding the IRS: Cutting the Cops on the Beat
The most efficient way to reduce taxes for the wealthy is not to change the tax code but to ensure it is not enforced. Since 2010, the IRS enforcement budget has declined 23% in inflation-adjusted terms. The result is a collapse in auditing capacity precisely where the money is. The overall individual audit rate dropped from 0.89% in 2010 to 0.29% in 2019. Millionaires became 80% less likely to be audited between 2011 and 2018. Audit rates for returns reporting more than $5 million in income fell 66% over the same period. Meanwhile, Earned Income Tax Credit claimants — among the lowest-income filers — were audited at a rate of 0.78%, nearly three times the overall rate. The working poor became about as likely to face an IRS audit as someone in the top 1%.
The disparity is structural. Auditing complex corporate and billionaire returns requires specialized expertise that the IRS can no longer retain. Experienced agents leave for private-sector tax practices that pay multiples of government salaries. What remains is the capacity for simple “correspondence audits” — automated checks on straightforward returns filed by low-income workers claiming the EITC. The total revenue shortfall from reduced enforcement since 2011 exceeds $95 billion in cumulative collections. The Treasury estimates the annual tax gap — the difference between what is owed and what is collected — at $600 billion. Stanford University researchers estimate that noncompliance by the richest 1% alone costs $175 billion per year.
The Inflation Reduction Act of August 2022 attempted to reverse the damage with $80 billion in mandatory IRS funding over ten years. The CBO projected the investment would generate $204 billion in additional revenue — a return of $2.55 for every $1 spent. The Republican response was swift and systematic. The first bill of the 118th Congress, H.R. 23, proposed rescinding the entire $80 billion. The Fiscal Responsibility Act of 2023 immediately rescinded $1.4 billion and agreed to claw back $20 billion more. Subsequent appropriations rescissions in FY2024 and FY2025 stripped an additional $40.4 billion. In total, approximately $41.8 billion — 52% of the original investment — was clawed back within three years. The enforcement boost that was designed to last a decade was effectively killed before it could demonstrate results. The primary beneficiaries of the defunding are the corporations and wealthy individuals whose complex returns the IRS can no longer audit.
The Tax Prep Industry: Lobbying to Keep Filing Painful
In most developed nations, the government files taxes for its citizens using data it already possesses. In the United States, a $14 billion industry exists to perform this service — and that industry has spent over two decades ensuring the government never competes with it. Since the launch of the IRS Free File Program in 2003, Intuit (maker of TurboTax) and H&R Block have spent a combined $93 million lobbying against free government-provided tax filing. Intuit alone has spent $47.2 million. H&R Block has spent $42 million over two decades of federal lobbying.
ProPublica's 2019 investigation documented Intuit's twenty-year campaign in granular detail: deliberately steering eligible taxpayers away from free filing options, deploying deceptive advertising, and lobbying Congress to prohibit the IRS from developing its own free system. The FTC subsequently found that Intuit had engaged in deceptive practices with its “free” TurboTax advertising. Intuit's lobbying spending has only accelerated: nearly $3.8 million in 2023 and nearly $4 million in 2024 — both company records. When the IRS launched its Direct File pilot in thirteen states on January 29, 2024 — the first time taxpayers could file online directly with the IRS for free, funded by the Inflation Reduction Act — the tax prep industry mounted an intense opposition campaign. The Trump administration ended the Direct File program in 2025.
The “Death Tax”: How 18 Families Rewrote the Estate Tax
In 1995, Republican pollster Frank Luntz conducted polling on the estate tax and advised the new GOP majority to never use the words “estate tax” or “inheritance tax” again. Instead, they should call it the “death tax.” It was one of the most effective framing operations in modern political history. The rebranding shifted public perception from a tax on wealthy estates — affecting roughly two in every 1,000 decedents — to a universal tax on death itself. Support for repeal surged despite the fact that the overwhelming majority of Americans would never owe a penny.
A 2006 United for a Fair Economy report identified eighteen families with a combined net worth exceeding $185 billion who were financing a coordinated campaign to repeal the estate tax. The families included the Gallos, the Kochs, the Mars family, and the Waltons. Patricia Soldano, an estate planner, launched the repeal effort with approximately fifty wealthy clients; her Policy and Taxation Group spent $250,000 or more per year on lobbying. The results have been dramatic. The estate tax exemption was $675,000 with a top rate of 55% in 2001. The TCJA doubled it to approximately $11.18 million per individual. By 2025 it had grown to $13.99 million. The One Big Beautiful Bill Act made the higher exemption permanent at $15 million or more, indexed to inflation. The estate tax, which generated significant revenue for a century, now applies to a negligible fraction of estates. An ironic footnote: the life insurance industry, which benefits from estate tax planning, spent roughly $1.5 million through the Coalition for America's Priorities fighting to preserve the tax.
The Race to the Bottom: State Tax Subsidies
State and local governments spend an estimated $45 to $90 billion annually on corporate tax incentives and economic development subsidies. Megadeals worth $100 million or more have become commonplace, despite academic research consistently demonstrating that targeted incentives do not generate broad-based economic growth. The Amazon HQ2 bidding war of 2017 epitomized the dynamic: 238 North American cities submitted bids, with the twenty semifinalists averaging offers of $2.15 billion from cities and $6.75 billion from states over fifteen years. New York offered $1.525 billion in tax breaks plus $325 million in cash grants before grassroots opposition killed the deal in February 2019. Virginia offered up to $750 million. Over its lifetime, Amazon has received more than $1 billion in state and local tax breaks.
The SALT deduction cap — set at $10,000 by the TCJA — added another dimension to state tax competition. The One Big Beautiful Bill Act raised the cap to $40,000, phasing down to $10,000 for incomes over $500,000. Full repeal would cut taxes by more than $140,000 for the top 0.1%, with 75% of the benefit flowing to households earning above $430,000. The SALT caucus — a bipartisan coalition of representatives from high-tax states including New York, New Jersey, and California — has made SALT relief a precondition for supporting any tax legislation, creating a dynamic in which the wealthiest households in the wealthiest states hold the entire tax code hostage.
The Hidden Budget: $2.2 Trillion in Tax Expenditures
Tax expenditures — the credits, deductions, exemptions, and exclusions embedded in the code — totaled $1.9 trillion in 2024 and are projected to reach $2.2 trillion in 2025. That figure exceeds the federal spending on Social Security, Medicare, or national defense — any single line item in the discretionary or mandatory budget. Yet unlike direct spending, tax expenditures face no annual appropriations review. They reduce revenue rather than appropriate funds, making them less visible to the public and less subject to democratic oversight. Individual tax breaks account for $1.7 trillion of the total; corporate tax breaks add $188 billion. The growth rate is accelerating: an 8% increase, or $155 billion, is projected from 2025 to 2026 alone.
The overall tax gap — the difference between taxes owed and taxes paid — stands at $600 billion annually by Treasury estimates. The IRS projects $540 billion per year for tax years 2017 through 2019. The corporate tax gap alone is at least $32 billion per year by IRS estimates, though this figure is widely considered a significant undercount. Corporate tax revenue as a share of GDP has declined for decades, with the burden shifting to individual income taxes and payroll taxes. The Economic Policy Institute concluded that the TCJA “overwhelmingly benefited the rich and corporations while overlooking working families.” The 2025 extension battle confirmed the trajectory: the One Big Beautiful Bill Act made TCJA's individual provisions permanent, restored 100% bonus depreciation, and raised the SALT cap — at a projected cost of $4 trillion over the 2025–2034 budget window.
The Tax & Education Pipeline
Seven steps trace how corporate lobbying rewrites the tax code, guts enforcement, and reshapes American education from kindergarten through graduate school.
The $1.5 Trillion Rewrite
In Q4 2017, lobbying filings on tax issues surged to 4,673 — a 56% spike above the quarterly norm. The Business Roundtable quadrupled its spending to $17.3 million in a single quarter. When the Tax Cuts and Jobs Act was signed on December 22, 2017, it slashed the corporate rate from 35% to 21% and added $1.456 trillion to the national debt over a decade. The top 1% received 47.6% of the benefits. The bottom 40% received less than 2%.
Buybacks Over Bonuses
Corporate America promised the TCJA would unleash investment and worker pay. Instead, S&P 500 companies spent $806 billion on stock buybacks in 2018 — a 55% jump. By February 2018, companies had spent $171 billion on buybacks versus just $6 billion on worker bonuses. Only 20% of incremental cash went to capital expenditure or R&D. The rest went back to shareholders. Ninety-one Fortune 500 companies paid zero federal income tax that year.
The 22,000% Return
In 2004, ninety-three firms spent $282.7 million lobbying for a repatriation tax holiday and saved $62.5 billion collectively — a 22,000% return on investment. Every dollar spent on lobbying returned $220 in tax savings. The Sunlight Foundation found that companies lobbying more on taxes consistently pay lower effective rates. The TCJA proved the formula scales: 47% of all federal lobbyists now work on tax issues.
Defunding the Referee
Congress cut the IRS enforcement budget 23% in real terms after 2010. The audit rate for millionaires collapsed 80%. EITC claimants — the working poor — became nearly as likely to be audited as the top 1%. When the Inflation Reduction Act invested $80 billion to rebuild enforcement, the CBO projected it would recover $204 billion. Republicans clawed back $41.8 billion within three years, killing the program before it could work.
The $1.84 Trillion Anchor
Student loan debt now stands at $1.84 trillion, owed by 45.8 million Americans. Loan servicers like Navient and MOHELA spent over $50 million lobbying Congress since 2008 to protect their revenue streams. When Biden attempted broad forgiveness, the Supreme Court blocked it in a 6-3 ruling — with standing based on MOHELA's potential revenue loss. The servicer industry collected $1.1 billion in DOE payments while borrowers drowned.
The Privatization Wave
In 2021, zero states had universal school voucher programs. By 2025, thirteen did. The American Federation for Children — founded by Betsy DeVos — spent $9 million on state elections in 2022, winning 277 of 368 races and defeating 40 incumbents. Jeff Yass contributed $7 million to the AFC Victory Fund alone. In Colorado, pro-voucher forces outspent opponents 158-to-1. The Heritage Foundation authored the blueprint in Project 2025, then its author was hired into the DOE to execute it.
Dismantling From Within
The Department of Education lost approximately 1,700 employees — nearly half its workforce — under the Trump administration. At least 240 Office for Civil Rights attorneys were laid off. DOGE cut dozens of IES research contracts worth $900 million. Lindsey Burke spent 17 years at the Heritage Foundation writing the chapter calling for the DOE's elimination, then was hired as Deputy Chief of Staff for Policy and Programs to implement it. The revolving door does not just spin — it swings open and stays.
“Ninety-three firms spent $282.7 million lobbying for a tax holiday and saved $62.5 billion — a 22,000% return. Every dollar spent returned $220 in tax savings.”
University of Kansas / Sunlight Foundation Study, 2009
Education
The $1.84 Trillion Student Debt Machine
Federal student loan debt stood at $1.69 trillion as of September 2025. Including private loans, the total reached $1.84 trillion — owed by 45.8 million borrowers carrying an average balance of $39,547. The debt grew $54 billion in 2025 alone, with quarterly year-over-year growth averaging 2.94%. Federal loans account for more than 90% of all student debt. This is not a market failure. It is a system maintained by an industry that profits from the debt's persistence.
The student loan servicing industry has spent over $50 million lobbying Congress since 2008. Navient, the largest servicer, led the field with $1.71 million in 2020 alone. Sallie Mae (SLM Corp) spent $1.4 million that year. MOHELA, a state-chartered servicer, spent $320,000 in 2019 while collecting $279.2 million in servicing fees in 2023 and over $1.1 billion in Department of Education payments since 2011. The industry's lobbying has been remarkably effective at blocking reform: every major attempt to restructure student debt has either been killed in Congress, blocked by courts, or gutted through administrative inaction.
The Biden administration's attempt at broad student loan forgiveness illustrates the industry's defensive power. The initial plan — up to $20,000 in forgiveness per borrower under the HEROES Act — was struck down by the Supreme Court in Biden v. Nebraska on June 30, 2023, in a 6-3 ruling that invoked the “major questions doctrine.” The basis for Missouri's standing was MOHELA's potential revenue loss if forgiven loans exited its servicing portfolio. A state-chartered loan servicer's profits became the legal lever to block relief for 45 million borrowers. A second attempt in September 2024 was pre-emptively blocked by seven Republican-led states within two days. In total, the Biden administration forgave approximately $175 billion for 4.76 million borrowers through targeted programs — roughly 9.5% of total federal student debt — through mechanisms the servicer lobby could not easily challenge: Public Service Loan Forgiveness corrections, income-driven repayment adjustments, and borrower defense discharges. Over fifty members of Congress called on the Department of Education to consider terminating MOHELA's contract in 2024.
For-Profit Colleges: The $12.5 Million Lobbying Surge
The for-profit college industry mounted one of the most aggressive lobbying campaigns in education history during 2010–2012, when the Obama administration proposed “gainful employment” rules that would have tied federal student aid eligibility to debt-to-income outcomes for graduates. Before the rules were proposed, the industry spent $2.8 million on lobbying in 2009. By 2010, spending nearly tripled to $7.57 million. In 2011, it peaked at $12.5 million — deployed through 37 lobbying firms that fielded 158 lobbyists, 71% of whom had prior government experience and twelve of whom were former members of Congress. The Association of Private Sector Colleges and Universities (now Career Education Colleges and Universities) hired former Senate Majority Leader Trent Lott and former Senator John Breaux through Squire Patton Boggs, paying $1.44 million over four years.
The institutions at the center of this lobbying effort were, in many cases, running fraudulent operations. Corinthian Colleges closed in 2015 after being denied access to federal funds following investigations into systematic fraud. The result was $5.8 billion in loan discharges for 560,000 borrowers — the single largest student loan discharge in history at the time. ITT Tech closed in September 2016 under similar circumstances, generating $3.9 billion in discharges for 208,000 borrowers. DeVry University, which had spent $720,000 on lobbying in 2011 (through lobbyist Heather Podesta), ultimately had $37 million in student loans canceled. In total, nearly $9.7 billion in student loans have been discharged from the two largest for-profit closures.
The regulatory arc tells the story of capture in miniature. The Obama administration finalized gainful employment rules in 2014 and implemented them in 2015. Betsy DeVos rescinded them entirely in July 2019. DeVos staffed the Department of Education with former for-profit college executives who then rolled back regulations on their former industry and delayed enforcement of fraud findings. The Biden administration released new gainful employment regulations in October 2023. Under the second Trump administration, reporting deadlines were delayed and implementation remains uncertain. The rule has been proposed, implemented, rescinded, re-proposed, and re-implemented across three administrations — a sixteen-year regulatory saga driven entirely by the oscillation of industry lobbying power.
The Voucher Wave: From Zero to Thirteen States
The school choice movement experienced the fastest policy diffusion in modern education history between 2021 and 2025. In 2021, zero states had universal school voucher or Education Savings Account programs. By the end of 2025, thirteen did. Five states — Arkansas, Florida, Iowa, Ohio, and Utah — enacted universal programs in 2023 alone. Florida's HB 1 made 3.2 million K-12 students immediately eligible. Iowa set the per-student amount at $7,598. Four more states followed in 2024: Alabama, Georgia, Louisiana, and Wyoming. In 2025, Texas created a $1 billion ESA program at $10,000 per student, Tennessee enacted a $7,000 ESA, and Wyoming removed its remaining income restrictions. Participation grew from approximately 584,000 students in 2023–2024 to 805,000 in 2024–2025 — a 40% increase in a single year.
This did not happen organically. The American Federation for Children, founded by Betsy DeVos, is the nation's largest school choice advocacy organization and has been credited with passing more than 200 school choice laws across 31 states. In 2022, AFC spent $9 million on state-level elections and won 277 of 368 races, defeating 40 incumbents opposed to vouchers. The organization announced $10 million for 2024 state elections. Its Victory Fund has raised $10.6 million since launch, with Jeff Yass contributing $7 million and the DeVos family contributing $1 million. In Texas alone, AFC spent nearly $4 million in 2024. In Tennessee, AFC and Americans for Prosperity combined to spend $1.125 million on lobbying for a statewide voucher plan.
The Koch network's Americans for Prosperity set a record with $1.9 million in federal lobbying in 2023, deployed seventeen lobbyists, and received nearly $80 million in funding primarily from Koch Industries. AFP conducts door-knocking, literature distribution, and phone banking for pro-voucher candidates. The Heritage Foundation's Project 2025 education chapter — authored by Lindsey Burke, who subsequently became DOE Deputy Chief of Staff for Policy and Programs — identifies school vouchers as a key conservative litmus test and proposes establishing a federal voucher program. Heritage President Kevin Roberts has called vouchers a “non-negotiable” priority.
The Walton Family Foundation has invested more than $1 billion in education, including over $400 million specifically in charter school grants. The foundation has funded one in four charter school startups in the United States; 840,000 students attend Walton-funded schools. In 2023, the foundation dispensed nearly $580 million in total grants. In Colorado alone, the Waltons directed more than $20 million to education advocacy groups including Colorado Succeeds, the Colorado League of Charter Schools, and Transform Education Now. Democrats for Education Reform, a PAC encouraging Democratic Party support for charter schools, has been sustained by Walton family funding for over a decade — though the organization's footprint has contracted from nineteen state chapters to four by 2025, and its staff from thirteen to four.
The DeVos family's political spending extends far beyond the AFC. During her Senate confirmation hearing, Betsy DeVos acknowledged under questioning that it was “possible” her family had contributed $200 million to Republican candidates over the years. Documented contributions include $58 million to Michigan state candidates, $17.7 million to federal candidates, and $6.4 million across twelve other states. The family's annual philanthropy totals approximately $90 to $94 million, with nearly half directed to education groups.
Teachers Unions: The Other Side of the Ledger
The teachers unions are the largest organized counterweight to the school choice movement, and their political spending is substantial. The National Education Association, with approximately three million members, spent $22.7 million in campaign contributions during the 2024 cycle. Its advocacy fund PAC raised $27.9 million and disbursed $29.4 million, including $2.5 million to Future Forward USA Action, $1.5 million to the House Majority PAC, and $1.5 million to the Senate Majority PAC. The NEA's total political footprint in 2024 was approximately $169 million — encompassing contributions, political activities, lobbying ($2.78 million), and $128 million in grants to other organizations. In 2025, the NEA spent $51.7 million on political activities and lobbying alone.
The American Federation of Teachers, with approximately 1.7 million members, contributed over $16 million to federal candidates in the 2024 cycle — 99.9% to Democrats. Its PAC raised $12 million for Democratic candidates. The AFT spent $38 million or more on political activities and lobbying in 2024 and $46.9 million in the 2022–2023 cycle. Combined, the two unions spent over $96.9 million on political activities in 2023. Between 1990 and 2020, their combined direct contributions to federal candidates exceeded $150 million, with 97% or more going to Democrats. Between 1989 and 2009, the unions ranked as the number-one hard-money contributor to federal campaigns at $59.4 million.
The unions' dominance in school board elections is measurable. Union-endorsed candidates have historically won 60% to 71% of contested school board races. In 2025, 84% of incumbents seeking re-election won — the highest rate since 2022. Both the NEA and AFT actively campaign against charter expansion and voucher programs at every level of government. The asymmetry in the education spending fight is stark: the voucher movement is funded by a handful of billionaire families spending tens of millions per cycle; the union movement is funded by millions of individual dues-paying members contributing smaller amounts across a much broader base. Both sides spend heavily. But in state-level charter and voucher battles, the billionaire-funded organizations routinely outspend their opponents by margins of 100-to-1 or more — as Colorado's 158-to-1 ratio in 2024 demonstrated.
Dismantling the Department of Education
The Trump administration has pursued the most aggressive effort in history to dismantle the Department of Education. An executive order signed in March 2025 initiated the process. Approximately 1,700 employees have been cut — nearly 50% of the workforce relative to Inauguration Day. At least 240 Office for Civil Rights employees were laid off, most of them attorneys investigating discrimination complaints. DOGE cut dozens of IES research contracts worth roughly $900 million. Six interagency agreements transferred programs — including Title I, the largest federal K-12 funding stream — to other agencies, with the Department of Labor absorbing several major programs.
The FY2026 budget proposal cuts $12 billion from the Department of Education — a 15.3% reduction. Eighteen ESSA programs would be consolidated into a single block grant with $4.5 billion fewer dollars, a 70% cut. All federal funding for language instruction for English learners would be eliminated. IDEA funding for students with disabilities would be consolidated into a single program. Education Secretary Linda McMahon has described the strategy as working within legal constraints to dismantle the department from inside, following the Project 2025 blueprint: eliminate programs deemed ineffective, shift functions to other agencies, and transfer funding control to states.
The revolving door is the mechanism. Lindsey Burke spent seventeen years at the Heritage Foundation, where she directed the Center for Education Policy and co-authored the Project 2025 chapter proposing the DOE's dismantlement. She was then hired as the DOE's Deputy Chief of Staff for Policy and Programs — the official responsible for implementing the very plan she had authored. During the first Trump term, Education Secretary Betsy DeVos staffed the DOE with former for-profit college executives who then rolled back regulations on their former industry. In 2024, 403 clients lobbied the Department of Education, and total education sector lobbying reached $105.6 million.
The College Board: A Billion-Dollar “Nonprofit”
The College Board is classified as a nonprofit organization. It generated approximately $1.02 billion in revenue in 2023. It holds $2.06 billion in cash and investments. Its CEO, David Coleman, was paid $2.5 million in 2020; its president, Jeremy Singer, received $1.4 million. The organization consistently surpasses $50 million in annual profits. It spent nearly $18 million on employee travel in 2023. It is the only organization in the United States that distributes the PSAT, SAT, and AP exams — a de facto monopoly over the standardized testing pipeline that shapes college admissions for millions of students annually.
The College Board has deployed lobbyists to block competitors from entering the college entrance exam market. The Columbia Undergraduate Law Review has published a case for Sherman Act Section 2 enforcement against the College Board's monopoly position. The organization's federal lobbying is modest in absolute terms — $124,832 in 2024 — but its market power renders aggressive lobbying unnecessary. The monopoly is self-sustaining: colleges require SAT or ACT scores, high schools administer AP exams to boost their rankings, and the College Board collects fees at every stage while maintaining its tax-exempt status.
Universities Fight Back: The 2025 Lobbying Surge
Major research universities dramatically ramped up federal lobbying in 2025 in response to the Trump administration's escalating attacks on higher education. Total lobbying by Association of American Universities member institutions rose from $28.1 million in 2024 to more than $37 million in 2025 — a 31% increase. The University of California system led all institutions at $2.775 million. The University of Washington spent $1.341 million; the University of Florida, $1.334 million; the University of Pennsylvania, $1.32 million; Indiana University, $1.314 million. Yale and Columbia each exceeded $1 million. Cornell spent $914,000 or more.
Harvard's lobbying surge was the most dramatic — and the most instructive about the dynamics of political spending under threat. Harvard spent nearly $1 million on federal lobbying in 2025, its highest total in more than two decades. In Q1 2025, the university spent $230,000, including $90,000 to Ballard Partners, a firm with close ties to the Trump administration. Q2 set a record at $270,000. The trigger was existential: Trump had stripped Harvard of nearly $3 billion in federal funding and frozen $2.2 billion within hours of the university defying administration demands regarding its governance, hiring, and admissions practices. Trump publicly threatened to revoke Harvard's tax-exempt status. Universities targeted by the administration more than doubled their lobbying spending.
The endowment tax amplified the confrontation. The TCJA had imposed a modest 1.4% excise tax on net investment income for the wealthiest private colleges. The One Big Beautiful Bill Act raised that rate to as high as 8% for institutions with the largest endowments. For Harvard, the increase could cost more than $200 million per year. The institutions at the highest rate include Harvard, Yale, Princeton, Stanford, and MIT. The tax is explicitly punitive — a financial weapon deployed against universities the administration viewed as ideologically hostile.
Early Childhood: The $52.5 Billion Cliff
The expiration of $52.5 billion in pandemic-era child care funding created a crisis threatening millions of children's access to care. The American Rescue Plan had provided $24 billion in stabilization grants and $13.5 billion in Child Care and Development Block Grant expansions, both of which expired in September 2023. An additional $15 billion in block grants expired in September 2024. The projected impact: 3.2 million children losing access to care and more than 70,000 program closures. States faced a $48 billion funding gap in 2024. By that year, 53% of child care providers reported staffing shortages, 56% were under-enrolled relative to capacity, and the root causes were inseparable from the funding crisis: staffing shortages driven by low pay (cited by 89% and 77% of providers respectively) and lack of affordability for families (66%).
Head Start, the federal early childhood program serving low-income families, received $12.3 billion in FY2024 funding and $12.36 billion in FY2026 — modest increases that did not keep pace with inflation. Project 2025 had proposed eliminating Head Start entirely. The National Head Start Association mounted a grassroots defense: 300,000 letters to Congress, 50,000 petition signatures, rallies nationwide, and direct visits to Republican members. The NHSA spent $316,947 on federal lobbying in 2024. Head Start received a reprieve from budget cuts, but its future remains contested. State pre-K spending reached $13.6 billion in 2023–2024, an inflation-adjusted increase of nearly $2 billion, or 17%, over the prior year. Per-child spending rose to $7,888. But these state investments cannot substitute for the scale of expired federal pandemic funding.
The Influence Network
The corporations, foundations, and trade groups that write the tax code and reshape American education through sustained political investment.
U.S. Chamber of Commerce
The single largest lobbying spender in America. Has spent $746 million since 2015. Deployed 99 tax-issue lobbyists in 2024 alone to protect corporate rate cuts and block reform.
Business Roundtable
A CEO coalition of 200+ major corporations that quadrupled its normal lobbying spend to push the TCJA across the finish line. Deployed 68 tax lobbyists in 2024.
Intuit / TurboTax
Spent over two decades and $93 million fighting to prevent free government tax filing. The IRS Direct File program was launched in 2024 and killed in 2025.
American Federation for Children
Founded by Betsy DeVos. The nation's largest school choice advocacy organization. Passed 200+ school choice laws across 31 states. Jeff Yass is its largest donor at $7 million.
Navient
The largest student loan company and top industry lobbying spender since 2015. Part of the $50 million industry lobbying effort that has blocked comprehensive reform for over a decade.
Walton Family Foundation
Over $1 billion invested in education. Funded one in four charter school startups in the United States. Over $400 million in charter school grants. 840,000 students attend WFF-funded schools.
Methodology & Data Sources
All figures in this chapter are derived from publicly available data. Federal lobbying expenditure data comes from Senate Lobbying Disclosure Act filings and OpenSecrets.org. Tax revenue and deficit projections reference the Joint Committee on Taxation (JCT) and the Congressional Budget Office (CBO). Corporate effective tax rate analyses are sourced from the Institute on Taxation and Economic Policy (ITEP) and the Government Accountability Office (GAO-23-105384). The 22,000% lobbying ROI calculation is from a University of Kansas study published via the Sunlight Foundation (2009). Student loan debt figures are drawn from the U.S. Department of Education and the Education Data Initiative. For-profit college lobbying data references OpenSecrets and Sunlight Foundation analyses. School choice spending data references OpenSecrets, NBC News, and state campaign finance disclosures. Teachers union spending data is sourced from OpenSecrets, IRS Form 990 filings (via Americans for Fair Treatment and Capital Research Center), and union financial disclosures. University lobbying data references Inside Higher Ed and OpenSecrets. College Board financials are drawn from IRS Form 990 filings. All dollar figures are nominal unless otherwise stated. Inflation-adjusted figures reference CPI-U where noted.
Follow the Money
Explore the interactive money flow diagram to trace tax lobbying dollars and education spending from corporate treasuries through Congress to the classroom.