- On Capitol Hill
- On Wall Street
- In the Press
- Policy Reform Work
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.
On March 22, 2013, SCEPA Faculty Fellow Rick McGahey testified at the New York City Council's hearing in favor of legislation to provide mandatory paid sick leave to all city workers, including city employees. Dr. McGahey testified that providing paid sick days for workers would benefit workers and businesses and that any negative economic impact would be slight and more than offset by positive gains for workers and businesses. In his testimony, titled, "The Economic Effects of Paid Sick Leave," he stated:
- In cities that have enacted paid sick day requirements, the implementation has been straightforward, with minimal impact on businesses.
- Empirical evidence from increases in the minimum wage strongly suggests that a policy of paid sick days will not have discernible effects on employment.
- There are economic benefits to workers and to businesses, through increased productivity and decreased turnover.
- To encourage good quality jobs and support good employers, the policy should be as uniform as possible, with no significant carve-outs for specific sectors.
On April 3, 2013, Artur Runge-Metzger, the European Union's Director of the European Commission's Climate Action Directorate joined SCEPA's lecture series on the Economics of Climate Change to present, "Towards 2020: A New Chapter in Europe's Climate Change Policy."
On January 1, 2013, the EU stepped forward to lead the movement for needed adaptation policies, including carbon pricing and renewables, by adopting its “20-20-20” package. The new program sets European-wide targets for 2020 that build on the Kyoto Protocol and impacts sectors falling under both the EU emissions trading system and renewable energy.
The event was generously supported by the Fritz Thyssen Foundation and the Macroeconomic Policy Institute (IMK).
by Rick McGahey, SCEPA Faculty Fellow
President Obama's team may think they are winning the public relations battle on the sequester, but in the process, they are losing the war over the best way to cut the debt and deficit.
The employment report for February came out this morning, and it is (finally) a strong report. The unemployment rate declined to 7.7 percent, the lowest rate since December 2008. But more importantly, job growth showed 236,000 new jobs being added to the economy, the first time in two years that monthly job growth has exceeded 200,000. If we hit that mark every month, it is estimated we will reach 6 percent unemployment in 19 months.
However—and it is a big however—federal fiscal policy is working against a strong economic recovery, and Washington policy makers seem hell-bent on slowing or stopping the recovery. And Republicans are actually winning the overall war over spending reductions, while the Obama Administration indulges in short-term public relations battles, missing the bigger picture.
In January, we restored some tax revenues paid by the wealthy as part of avoiding the so-called "fiscal cliff." Bush-era tax cuts were allowed to expire for those making over $400,000 a year, instead of the $250,000 threshold that President Obama fought for during last year's presidential election. These revenues probably don't hurt economic growth, as taxing the wealthy is less harmful than other tax increases. (Social Security payroll taxes reverted to their usual level for workers, which is more economically harmful.)
But the bigger hit on the economy began on March 1--the automatic spending cuts passed by Congress in 2011, the "sequester," originally enacted in the 2011 debt ceiling deal. In 2011, Republicans in Congress would not agree on new revenues, and the sequester—an across-the-board cut to all discretionary spending, including the military—was put into place.
At the time, no inside-the-Beltway expert believed the specific sequester cuts would actually happen. Although Republicans now want to blame it on the president, at the time they enthusiastically embraced the idea. Here's Paul Ryan (R-WI) in 2011, asked by Fox News commentator Sean Hannity why the sequester was a good idea: "Because we're cutting spending...What conservatives like me have been fighting for, for years are statutory caps on spending... We got that in law."
The sequester was supposed to hit on January 1, but as part of the deal on the Bush tax cuts, it was put off until March 1, with many commentators assuming it wouldn't happen, and that Congress would negotiate a more sensible package. But the president insisted on more revenues as part of any deal, and since about the only thing that unites Republicans any more is resisting any revenue increases, they refused, and the sequester cuts have gone into place.
The Obama Administration thinks it is winning a public relations battle blaming the cuts on Republicans, but the truth is that Republicans are winning the overall budget battle. We are making large cuts in the federal debt, heavily tilted towards spending cuts. A combination of spending cuts and new revenues of almost $4 trillion already has been enacted, close to the amount needed to stabilize the debt-to-GDP ratio. But guess what? That $4 trillion is made up of around $4 in spending cuts for every $1 in new revenue. Even the Bowles-Simpson plan, much criticized by progressives and liberals for excessive proposed spending cuts, only called for $2 to $3 in spending cuts for each $1 of new revenue.
So spending cuts are carrying the day. But do we hear any calls from Washington, including the president, to stop these harmful reductions? On the contrary—all we hear are more calls for cutting spending, "grand bargains" to reduce Social Security and Medicare benefits, and little prospect of any real balance between spending cuts and tax increases.