Our projects are designed to empower policy makers to create positive change. With a focus on collaboration and outreach, we provide original, standards-based research on key policy issues.
SCEPA joined with the Economic Policy Institute on Capitol Hill to brief congressional staff and policy experts on tax expenditures, or incentives given through the tax code without scrutiny by Congress.
SCEPA economists are working on the prospects for a more progressive economic order to emerge from the shock of the recession. They have published papers and documents that place current events in a longer-term context as well as policy proposals to deal with short-term concerns. They are also documenting the emerging discussion of how the discipline of economics is reacting to the Great Recession and the questioning of conventional economic analysis.
Lance Taylor, a SCEPA Faculty Fellow, presents an overview of his new book, Maynard’s Revenge, in a Google Tech Talk.
The book, published this November by Harvard University Press, is a timely analysis of mainstream macroeconomics, posing the need for a more useful and realistic economic analysis that can provide a better understanding of the ongoing global financial and economic crisis.
The government spends $143 billion through tax breaks in an effort to expand pension coverage and security. Yet, over half of the American workforce does not have a pension. Retirement insecurity hurts business plans, workers’ lives and retiree well-being. Reform is needed.
SCEPA’s Guaranteeing Retirement Income Project, sponsored by the Rockefeller Foundation and in collaboration with Demos and the Economic Policy Institute, has a plan to guarantee safe and secure retirement income for all Americans.
- Published on Thursday, January 23, 2014
by David R. Howell, SCEPA Faculty Fellow
January 23, 2014
Last week two prominent Republicans lashed out against the growing outcry about American’s rising inequality and unshared growth. New York Times columnist David Brooks wrote that “Suddenly the whole world is talking about income inequality” and this debate “is confusing matters more than clarifying them, and it is leading us off in unhelpful directions.” A few days earlier, leading Republican economist Douglas Holtz-Eakin, the former chief of George W. Bush’s Council of Economic Advisors, dismissed the whole debate as “faulty” since “Inequality means little”.
For both Brooks and Holtz-Eakin, the only real distributional issue America faces is poverty, and the only solution is upward mobility, and that requires growth, skills and good behavior. At root, it’s about free markets for growth and individual productivity.
Each pushes a different strand of the conservative free market vision. Holtz-Eakin demands “sustained rapid economic growth” so that “the hardest working will rise upward in the roster of economic affluence with additional income.” Brooks demands that we confront the dysfunctional behaviors associated with a “frayed social fabric”.
The facts fly in the face of these two strands of Republican apology for the rise of extreme inequality.
- Published on Wednesday, January 22, 2014
by Rick McGahey, SCEPA Faculty Fellow
As the new Congressional term gets underway, one of President Obama's priorities is to regain "fast track" authority (FTA) for foreign trade pacts, so he can pursue the Trans-Pacific Partnership (TPP), a 12-nation deal involving Pacific Rim nations. (I discussed this today on MSNBC's "The Cycle."
"Fast track" authority allows the President to submit a final deal to Congress, where they can only vote up or down on the whole package, and can't amend it. Although some think this is the only way a trade deal can be enacted, others criticize the procedure as anti-democratic, and favoring special interests that can negotiate trade benefits in secret.
Democratic and Republican Congressional leaders who are close to some business interests are supporting fast track. But led by Sander Levin (D-MI,) the senior Democrat on the House Ways and Means Committee, many Democrats oppose FTA and the TPP in its current form. Levin has called for a different type of authority, with more Congressional involvement, more transparency over negotiations, preservation of labor and environmental standards, and procedures to address currency manipulation that favors exports into the U.S.
Opponents of TPP fear that labor and environmental standards will be weakened even further, while pharmaceutical companies will get increased patent and copyright protection, making medicines more expensive, especially in the developing world.
Stay tuned. Trade is a volatile issue, especially in an election year, and there is a big divide between President Obama and Congressional Democrats on this one; last November, 151 of the 200 Democrats in the House sent Obama a letter saying they would not renew FTA in its current form.
- Published on Friday, January 10, 2014
by Rick McGahey, SCEPA Faculty Fellow
The employment report for December 2013 came out today, and what a shocker. Analysts were predicting continued job growth around 200,000 with a gradual reduction in the unemployment rate, but instead we got a sharp drop in the rate—from 7 to 6.7 percent—and a very weak jobs number—only 74,000 net new jobs added to the economy.
And the sharp drop in the unemployment rate provides no comfort—indeed, it seems strange when taken with the weak jobs number. But jobs aren't driving the unemployment rate in this report—labor force participation is. The rate is calculated by dividing the number of people with jobs by the total of those with jobs and those actively seeking work. If people stop looking for work, that brings the rate down, even with slow job growth.
And that's what happened in December. The number of people looking for work declined by 347,000, resulting in the lower unemployment rate. And the drop isn't due to older baby boomers retiring. Labor force participation among workers 45 to 54 years old dropped to 79.2 percent, the lowest rate in 25 years.
Some analysts were quick to blame the low jobs number on bad winter weather or an anomaly driven by the statistical procedures used to calculate the jobs numbers. And the Bureau of Labor Statistics (BLS) did increase the job gain number for November 2013 by 38,000; monthly job number often are revised upward as more data come in from smaller employers.
But even if December turns out to be a very weak month, employment in the U.S. is still weak. The average monthly job growth in the last quarter of 2013 was 172,000 and at that rate, it would take over two years for the economy to reach a full employment level of 5.5. percent. Even if job gains averaged 200,000 per month going forward (a monthly level rarely reached during 2013), it would take another year and a half to reach full employment.
February will tell us whether this report is a one-month blip, or whether the economy is once again weakening. Even if the projected jobs number had been reached, that would be a weak result. We should be investing more in job creation, unemployment benefits, and other social spending, not cutting government spending back.