A Balanced Approach to Restoring Fiscal Responsibility

Source: Henry Aaron, Nancy Altman, Kenneth Apfel, James Blum, J. Bradford DeLong, Peter Diamond, Robert Greenstein, James Horney, Richard Kogan, Jack Lew, Marilyn Moon, Van Doorn Ooms, Uwe Reinhardt, Charles Schultze, Robert Solow, Paul Van de Water, Center on Budget and Policy Priorities, July 2008

Sixteen leading economists and budget experts issued a major critique of a recent proposal to address future federal budget deficits through radical changes in budget procedures for Social Security, Medicare, and Medicaid. They believe there are better ways to begin tackling projected deficits, which they describe in their critique.
See also:
Executive summary
Press release

The World Bank and the ILO: Two Visions of Employment Regulation

Source: Yaraslau Kryvoi, Bulletin of Comparative Labour Relations, Vol. 66, 2008

From the abstract:
The World Bank’s Doing Business report has become one of the most influential, yet the most controversial instruments which affect labour law reforms around the world. This study discusses the controversy between the World Bank’s and the International Labour Organization’s approaches towards flexibility of employment regulation with special emphasis on fixed-term contracts.

The ILO employment regulation targets are balanced to harmonize the interests of all three stakeholders – employers, employees and governments, while the Doing Business targets clearly favour the interests of employers. What is more important, the Doing Business targets on fixed-term contracts and dismissals seem to contradict the international labour standards as reflected in the ILO conventions and recommendations.

Although both organizations ultimately have the same goal – to help economies and people prosper, their visions of the proper mixture of flexibility and security are clearly different. It is hardly possible to expect that Doing Business reports would lobby for the interests of employees because this will not necessarily stimulate more favourable businesses environments. However, as this study suggests, there are ways to reduce tensions between these two visions.

Gerrymandering the Vote How a “Dirty Dozen” States Suppress as Many as 9 Million Voters

Source: Marc Dunkelman, Democratic Leadership Council, Policy Report, June 2008

From the summary:
Voters are frustrated by the gridlock in Washington. Surf by C-SPAN on the dial and it is not hard to find members talking past one another from the political extremes.

In large measure, today’s stalemate is the result of partisan gerrymandering. The boundaries that separate districts hew to the partisan advantage of one party or the other, encouraging members of Congress to play to their party’s base, rather than the broad center of the electorate.

When members can’t lose, voters do — because it takes pressure off Congress to get the job done. But gerrymandering has another nefarious effect: pre-determined election results suppress the vote. This study explores just how dramatically partisan redistricting hampers the ability of voters to affect policy in Washington, D.C.

Key Findings:
• Low Voter Turnout. The United States ranks 139th in the world in terms of voter participation, according to the Institute for Democracy and Electoral Assistance.
• 30,000 Additional Voters Cast Ballots in Competitive Elections. On average, 30,000 additional voters cast ballots when elections are competitive. That’s the equivalent of expanding the voting pool by one-sixth.
• 11 Million Votes Suppressed. As many as 11 million voters fail to cast ballots because of gerrymandering.
• 86 percent of Members Coast into Office. During 2002, 91 percent of House members won their seat by 10 percent or more. And in 2006, all but 60 of the 435 voting members of the House won by as large a spread.
• 28 Percent More Voters in Most Vs. Least Competitive Districts. On average, 214,000 voters cast ballots in each of the 60 most competitive House races run in 2006. In 60 of the least competitive elections (where members won by between 50 and 90 percentage points), only 153,000 voters came out to have their choices counted — 28 percent fewer.
• “Dirty Dozen” States. Of the almost 11 million suppressed votes, as many as 9 million might be cast in 12 particular states: Alabama, California, Georgia, Hawaii, Louisiana, Mississippi, New Jersey, New Mexico, New York, North Carolina, Virginia, and West Virginia.

The State of the Nation’s Housing 2008

Source: Joint Center for Housing Studies of Harvard University, 2008

The nation is in the throes of a housing downturn that is shaping up to be the worst in a generation, finds The State of the Nation’s Housing report issued today by the Joint Center for Housing Studies of Harvard University. While the falloff in housing starts, new home sales, and existing home sales already rivals the worst downturns in the post World War II era, home price declines and mortgage defaults are the worst on records that date back to the 1960s and 1970s.

The study presents a dispiriting picture of how severe and structurally ingrained housing affordability challenges have become. By 2006, 17.7 million households–about 15.8 percent of all households–were spending more than half their income on housing, an increase of 3.8 million just since 2001. Even 34 percent of households with incomes equivalent to 1-2 times the federal minimum wage, and 15 percent with incomes equivalent to 2-3 times this wage, spend more than half their incomes on housing. With the economy spinning out a growing proportion of full and part-time jobs with wages in these ranges, prospects for a meaningful reduction in affordability problems remain dim.
See also:
SON 2008 Press Release
SON 2008 Fact Sheet
SON 2008 Media Advisory
SON 2008 Appendix Tables (Microsoft Excel)
SON 2008 Sources (Microsoft Excel)
SON Archive
Subprime mortgages are nearly double for Hispanics and African Americans – EPI Snapshot, June 11, 2008

Strange, but True: Unusual Strategies for Claiming Social Security Benefits

Source: Center for Retirement Research at Boston College, Fact Sheet

Three claiming strategies have recently received a lot of press attention:
• “Borrow and Invest” – an individual can claim benefits and then reclaim at a later date, paying back the money received (without interest) during the interim.
• “Claim Now, Claim More Later” – a married individual can claim a spousal benefit, and then switch to her own retired worker benefit later.
• “Claim and Suspend” – an individual may claim his benefit and then suspend payment, allowing his spouse to claim a spousal benefit.

These strategies were generally designed to encourage work, but are likely to benefit mainly those with substantial resources.

State Transportation Woes Have Common Thread

Source: Tax Justice Digest, Citizens for Tax Justice, June 20, 2008

North Carolina is suffering from an increase in the cost of asphalt. Asphalt is made of petroleum derivatives, and its cost has increased 25% since the end of 2006. This is causing the state to cut back on road repaving projects which are likely to cost more money to accomplish the longer they go unrepaired.

In Missouri, the state has a projected $1 billion transportation fund deficit. It is only expected to be able to meet 40% of obligations starting July 2009. In spite of this, all three major candidates for Missouri Governor pledge not to raise the state motor fuels tax. The two Republican gubernatorial contenders, Sarah Steelman and Kenny Hulshof suggest dedicating general funds revenue to transportation and privatizing some state roadways respectively.

Virginia is currently confronting a “growing bridge and road maintenance shortfall” which is depriving money from road construction. Governor Tim Kaine has recently released a proposal to raise vehicle registration fees and sales taxes on vehicles, while keeping the state fuel tax unchanged.

These states have in common a tendency to tinker around the edges of transportation funding policy while failing to address the taboo topic of gas taxes. The root cause of these transportation troubles is that the gas tax has been kept too low to finance the transportation needs in all these states.

Pandemic Mutations In Bird Flu Revealed

Source: Society for General Microbiology, ScienceDaily, July 9, 2008

Scientists have discovered how bird flu adapts in patients, offering a new way to monitor the disease and prevent a pandemic, according to research published in the August issue of the Journal of General Virology. Highly pathogenic H5N1 avian influenza virus has spread through at least 45 countries in 3 continents. Despite its ability to spread, it cannot be transmitted efficiently from human to human. This indicates it is not fully adapted to its new host species, the human. However, this new research reveals mutations in the virus that may result in a pandemic.

15 of the Most Astonishing Retirements, Bonuses and Cash-Outs in Corporate America

Source: HR World Editors, June 17, 2008

While athletes’ contracts grab all the headlines, they can’t hold a candle to the most legendary corporate cash-outs, retirements, and bonuses. Here are 15 of the most astonishing retirement packages, severance payouts and bonuses that corporate America has ever seen.

Family Resource Simulator

Source: National Center for Children in Poverty, 2008

The Family Resource Simulator illustrates the impact of “work supports”–such as earned income tax credits and child care assistance–on the budget of a hypothetical family. Based on the answers provided on steps 1 through 7, the Simulator generates graphs that show how family resources and expenses change as earnings increase.