"Higher education has always been given a favored status because it serves a very important purpose in our society, our culture, and our economy," Shattuck says.

In recognition of this fact, Congress has usually supported legislation beneficial to colleges and universities, such as boosting funds for student financial aid and basic scientific research.

But last year, Congressional action on tax reform and mandatory retirement dealt higher education its first significant legislative defeats in recent years.

The Tax Reform Act of 1986 hurt schools in a number of ways, costing Harvard several million dollars in lost revenues. The overhaul removed deductions for charitable donations to colleges and universities, changed the tax-free status of such institutions when they borrow money, and taxed graduate student scholarships and grants.

Representatives from higher education organizations fought hard to insert provisions which would protect their members. The two largest organizations, the American Council on Education (ACE), an umbrella group of almost all colleges and universities in the nation, and the AAU, lobbied especially hard, but to no avail--The bill passed.

Some Hill watchers believe the tax bill was the turning point in changing Congressional and public perceptions that are now beginning to look upon higher education as a special interest group.

"Their attempts to get exemptions when all the other special interests had to make sacrifices pissed off a lot of Congressmen," said a Senate aide close to the bill's formulators.

"The education lobby put a lot of pressure on us," the aide says. "If Senators didn't look at higher education as a special interest group before [the bill], they sure as hell did afterwards."

But higher education officials think that the Tax Reform Act was neither a defeat for institutions of higher learning nor a signal of a new Congressional sentiment that colleges and universities ought to be treated as another special interest.

"The Tax bill was a unique event," Shattuck says. "I don't think it indicates a change of any kind."

Carol Schieman, AAU director of governmental relations, agrees. "It was just a recognition that higher education had been treated more than favorably in the past while other interests had not," she says.

Some Hill watchers say that the anti-higher education provisions of the bill were the work of one man: Rep. Dan Rostenkowski (D.-Ill.), chairman of the House Ways and Means Committee that drafted the legislation.

"To his eyes, higher education lobbyists were pleading for the same things everyone else was: their own special interest," says a House aide close to the committee. "So why should he give them any preference in a bill that hurt everyone equally?"

Defeat on Retirement

Following on the footsteps of the tax bill setback came another defeat. Higher education representatives strove to include a 15-year exemption for colleges and universities in a 1986 bill that prohibited mandatory retirement, but only got a seven-year exemption.