New York Times Warns Against “Dynamic Scoring”

December 8, 2014 at 12:06 pm

A New York Times editorial this weekend raised several red flags about so-called “dynamic scoring” — that is, including estimates of the macroeconomic effects of policy changes in official cost estimates for tax and spending legislation.  We strongly agree.  Our recent paper making the case against dynamic scoring, and a short summary we released today, explain that:

  • Current budget estimates aren’t “static.” The Congressional Budget Office (CBO) and the Joint Committee on Taxation (JCT) incorporate in their cost estimates many changes in individuals’ and companies’ behavior in response to proposed changes in tax rates and other policies.
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In Case You Missed It…

December 5, 2014 at 3:30 pm

This week on Off the Charts, we focused on state budgets and taxes, the federal budget and taxes, the safety net, health reform, and jobs.

  • On state budgets and taxes, Michael Mitchell mapped the large growth in state prison populations in recent decades. Nicholas Johnson presented a video highlighting the State Priorities Partnership, a network of 41 independent organizations working to improve state budget policies.
  • On the federal budget and taxes, Chye-Ching Huang pointed out that a reported congressional “tax extender” package included costly expansions of tax cuts.
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Today’s Jobs Report in Pictures

December 5, 2014 at 9:51 am

Today’s solid jobs report shows a continuing labor market recovery, but one in which unemployment — especially long-term unemployment — remains high relative to recent recoveries.  With inflation running below its 2 percent target, the Federal Reserve faces little or no danger of igniting unacceptable inflation by keeping interest rates low to encourage further job market improvements.

Click here for my statement with further analysis.






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Improving State Budget Policies

December 4, 2014 at 2:26 pm

States’ choices about investing in schools, health care, child care, and other services can either help create opportunity and prosperity for people or hold them back.  This short video explains how the State Priorities Partnership, a national network of 41 independent state policy organizations, works to:

  • strengthen policies that affect low- and moderate-income families, such as health care, economic security, education, and child care;
  • make state tax systems fairer and more effective in raising needed resources; and
  • help other nonprofits and the general public participate in debates about budget priorities.
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The Rise in State Prison Populations

December 3, 2014 at 10:01 am

Most states’ prison populations are at historic highs after decades of extraordinary growth. This growth has been costly, limiting economic opportunity for communities with especially high incarceration rates and taking critical resources from other important investments, such as education. Click on the map below to learn more about the rise in prison populations and spending in each state. The downloadable data file also includes state-by-state information on recent criminal justice reforms.

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Six Ways Health Reform Helps the Middle Class

December 2, 2014 at 2:21 pm

Health reform offers substantial benefits to middle-class Americans, contrary to some recent claims.  Here are some of the most important ones:

  1. A safety net for all. Insurers can no longer refuse to sell someone health coverage or charge higher premiums because of a pre-existing health condition.  Health plans must now cover preventive care, such as vaccinations and routine screenings, with no cost sharing.  Plans must also limit the amount they can require enrollees to pay out-of-pocket each year for covered benefits.
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Boosting Disability Share of Payroll Tax Wouldn’t Threaten Retirees

December 2, 2014 at 12:44 pm

Policymakers need to replenish funding for the Disability Insurance (DI) program — a vital part of Social Security — by late 2016 to avert a sudden, one-fifth cut in benefits to a group of severely impaired and vulnerable Americans.  Some critics claim that replenishing DI by reapportioning payroll taxes between the DI and retirement trust funds would jeopardize retirees, but that’s not the case, as our new paper explains.

Reallocating the shares of payroll taxes that go to the separate DI and Old-Age and Survivors Insurance (OASI) trust funds is a traditional and noncontroversial way to even out the programs’ finances. … Read more

“Tax Extenders” Package Even Worse Than First Appeared

December 1, 2014 at 3:34 pm

12-1-14taxWe’ve explained that the package that emerged last week to permanently extend several temporary tax breaks (“tax extenders”) and enlarge some of them would raise deficits — thereby putting more pressure on domestic programs for cost-saving cuts — while favoring large corporations and leaving out millions of working families. Following a presidential veto threat, the package now appears dead; but as lawmakers continue to consider options for what to do about the extenders, they should recognize another serious flaw in that package: nearly a quarter of its roughly $400 billion cost would have come from expanding tax cuts for businesses, not just extending them (see chart).… Read more

Shielding Homeless Children From Hunger

December 1, 2014 at 1:08 pm

More than 1.2 million children attending public school lack a home of their own, my colleague Douglas Rice recently noted.  They also are at greater risk of hunger.  The school meal programs, by providing a healthy breakfast and lunch at no charge, can help meet the nutritional needs of homeless children — as well as millions of other vulnerable low-income children who can’t count on getting enough to eat.

Two program features make it easier for children whose families are going through especially hard times to obtain school meals.… Read more

In Case You Missed It…

November 26, 2014 at 1:03 pm

Off the Charts will take a break over the Thanksgiving weekend, but we’ll be back on our regular schedule on Monday.  To mark the Thanksgiving holiday, we ran a short series this week on some of the hardships that many American families face and the programs that help them make ends meet and improve their lives.

  • Douglas Rice explained that many American children won’t have a safe, stable home this holiday season, in part due to inadequate funding and significant cuts to federal rental assistance programs.
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Reaching More Needy Americans

November 26, 2014 at 12:20 pm

We’ve noted this Thanksgiving week that the safety net helps millions of Americans avert hardship and meet basic needs like food and housing.  Unfortunately, many eligible people miss out on needed help.  At a time of year when many Americans make a special effort to help the less fortunate, states and localities can redouble their efforts to connect these powerful programs to vulnerable friends and neighbors.

One important area needing attention is reaching people eligible for both SNAP (formerly food stamps) and Medicaid.  … Read more

Helping Children Avoid Homelessness

November 25, 2014 at 1:31 pm

Many American children won’t have a safe, stable home this holiday season.   Homelessness among families with children isn’t an intractable problem; federal rental assistance — like the Housing Choice Voucher program — is an effective solution.  But funding is seriously inadequate and has faced significant cuts.

Here are the numbers.  More than 1.2 million children attending public schools lack a home of their own, according to local school districts’ latest reports to the Department of Education.  Most were “doubled-up”— that is, their families lived with relatives or friends — but nearly 1 in 5 were sleeping in homeless shelters or on the street (see graph).  … Read more