Higher Ed Cuts, Tuition Hikes Worsen Low-Income Students’ Struggles

May 7, 2014 at 2:46 pm

State cuts to higher education have led colleges and universities to make deep cuts to educational or other services, hike tuition sharply, or both, as we explain in our recently released paper.  These tuition increases are hitting low-income students particularly hard, lessening their choices of schools, adding to their debt burdens — and likely deterring some from enrolling in school altogether.

Annual published tuition — the “sticker price” — at four-year public colleges has risen by $1,936, or 28 percent, since the 2007-08 school year, after adjusting for inflation. … Read more

The Problems With the House Approach to Tax Extenders

May 7, 2014 at 1:09 pm

As the House plans to vote this week on a permanent, unfinanced extension of a corporate tax break — the first of several such bills that the Ways and Means Committee has approved — our new report outlines the problems with this approach.  Here’s the opening:

The House on May 7 is expected to consider a bill to permanently extend — and expand — the research and experimentation tax credit, the first of six bills that the House Ways and Means Committee recently approved to make permanent various “tax extenders.”  There is widespread bipartisan support for continuing the research and experimentation credit, as well as some of the other extenders (so named because Congress routinely extends them for only a year or two at a time). … Read more

Five Things Wrong With the House Bill to Fund Housing Assistance

May 6, 2014 at 5:15 pm

Update, May 8: We’ve updated this post to correct the figure for the House bill’s funding cut relative to the 2014 level: the cut is $510 million.

The House Appropriations Committee will vote tomorrow on a 2015 spending bill for the Department of Housing and Urban Development (HUD) that cuts funding for rental assistance and anti-homelessness programs by $510 million below this year’s level, despite rising housing affordability problems.  Here are five major problems with the bill:

  1. Likely provides too little money to renew all of the Housing Choice Vouchers that low-income families will use this year.
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House Fiscal Double Standard in Action

May 6, 2014 at 3:35 pm

The House will vote this week to add $156 billion to budget deficits over the period 2014-2024 by expanding and making permanent the lapsed corporate tax credit for research and experimentation (R&E) without offsetting the cost.  Meanwhile, House Speaker John Boehner continues to oppose legislation to restore emergency jobless benefits that lapsed in December unless “it is paid for and includes something to help create jobs.”

I addressed this fiscal double standard in my latest US News & World Report post, contrasting the House Ways and Means Committee’s passing of bills that would make permanent the R&E credit and five other lapsed corporate tax breaks with Speaker Boehner’s refusal to take up the Senate-passed emergency unemployment insurance bill.… Read more

Emerging Trade Agreement Would Make Drugs Less Affordable

May 6, 2014 at 10:19 am

The Trans-Pacific Partnership (TPP) — a trade agreement that the United States and 11 other Pacific-rim countries are negotiating — threatens to make prescription drugs less affordable for consumers and taxpayers.  CBPP recently joined with ten other organizations, including AARP and Consumers Union, to express our concerns to the Office of the U.S. Trade Representative.

Our concerns fall into three main areas.

First, the draft TPP would restrict Medicare’s ability to limit the prices it pays for drugs for Part B beneficiaries. … Read more

What Is NDD Spending?

May 5, 2014 at 2:21 pm

With the fiscal year 2015 appropriations process underway and Congress starting to write spending bills for next year, observers often have questions about technical terms that litter budget debates.  One such term is “NDD spending.”

Non-defense discretionary (NDD) programs comprise domestic and international programs outside of national defense that Congress funds on an annual basis.  (That is, they exclude “entitlement” programs such as Social Security, Medicare, and Medicaid that actually dominate the budget.)  NDD programs include a broad set of public services, including environmental protection, education, job training, border security, veterans’ health care, scientific research, transportation, economic development, some low-income assistance, law enforcement, and international assistance.… Read more

The Ryan Budget in Context

May 5, 2014 at 1:40 pm

Defending his budget’s $5 trillion in proposed cuts over the next decade, House Budget Committee Chairman Paul Ryan has noted that total federal spending would still be nearly $43 trillion over that period, implying that criticism of the cuts is therefore off-base.  But as I explained recently, this number by itself doesn’t tell anything about whether spending under the Ryan plan would be adequate or properly targeted.

Here’s some historical context for that ten-year cumulative $43 trillion figure, using spending as a share of the economy (gross domestic product, or GDP) — the standard measure that economists and analysts use to examine trends in spending over time:

  • Under current policies (i.e., without Ryan’s cuts), total federal spending — which reflects the costs for everything from Social Security and Medicare to defense, all other government functions, and interest — will average 21.3 percent of GDP over the next decade. 
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Our New Long-Term Budget Projections

May 5, 2014 at 12:19 pm

The nation’s fiscal outlook is stable for the rest of this decade and then worsens gradually, according to our new projections of the budget outlook under current policies through 2040.  The projected ratio of debt to gross domestic product (GDP) — which was 72 percent at the end of fiscal year 2013 — will reach 74 percent by 2020 and 101 percent by 2040 (see chart).

The projections are only slightly less favorable than those we published in June 2013 but show a marked improvement over the situation just four years ago, in 2010.… Read more

In Case You Missed It…

May 2, 2014 at 3:59 pm

This week on Off the Charts, we focused on jobs, the federal budget and taxes, the safety net, and higher education.

  • On jobs, Chad Stone illustrated a mixed April jobs report that shows a big jump in payroll employment but a sharp fall in labor force participation.  Chris Mai pointed out that April’s jobs report also shows state and local governments climbing out of a deep hole.  We updated our table showing the number of weeks of unemployment insurance benefits available in each state.
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The Lasting Effects of State Higher Ed Cuts

May 2, 2014 at 3:16 pm

Almost all states continue to fund higher education well below pre-recession levels, as I explained yesterday and we describe in a new paper.  These lower funding levels mean that colleges and universities have generally cut educational or other services, raised tuition to cover the gap, or both — steps that may diminish education quality at a time when a highly educated workforce is more crucial than ever to the nation’s economic future.

Indeed, since the recession, higher education institutions have:

  • Raised tuition.
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State and Local Jobs Climbing out of Deep Hole

May 2, 2014 at 12:03 pm

State and local governments added 18,000 jobs in April, according to today’s jobs report, and have added 43,000 jobs since the start of 2014.  This is great news given the steep loss of public jobs due to the Great Recession.

Yet, while states and localities have slowly begun to rehire in the past two years (see graph), the number of public employees remains far below six years ago.  Meanwhile, the demands on states and localities continue to grow.  For example, public elementary and secondary schools have 492,000 more students than before the recession.… Read more

Today’s Jobs Report in Pictures

May 2, 2014 at 9:48 am

Today’s mixed jobs report shows a big jump in payroll employment but a sharp fall in labor force participation.  The labor market is clearly much stronger than in the depths of the Great Recession but still far from the “maximum employment” goal that Congress has mandated the Federal Reserve to pursue.  Long-term unemployment remains a particular concern, highlighting why Congress must restore federal emergency jobless benefits – which it allowed to lapse at the end of 2013 and has not restored even though long-term unemployment remains substantially higher than when any of the previous seven emergency programs expired.… Read more