Here are a few links that EPI’s research team clicked through today:

• “The biggest challenge to immigration bill may be guest workers” (Kansas City Star)
• “Boehner: Deficit talks must be broadened to include … Obamacare” (Washington Post)
• “The Morning Plum: Dems shouldn’t agree to ‘temporary’ fiscal cliff solution” (Washington Post)
• “U.S. Deficit Shrinking At Fastest Pace Since WWII, Before Fiscal Cliff” (Investor’s Business Daily)
• “Law School Admission Testing Plunges” (New York Times)
• “Family Becomes Focal Point in Fight to Lower Prison Phone Rates” (ColorLines)

This post originally appeared on Dissent Magazine’s website

By now it’s well known that Papa John’s Pizza CEO John Schnatter is claiming—or threatening—that compliance with the Affordable Care Act would force him to reduce employee hours or raise prices. This was one of a number of post-election “job-creator” tantrums based on the curious belief that President Obama’s re-election (and the continuation of his policies) had somehow changed the political and regulatory landscape.

Schnatter was quickly skewered for his inflated estimation of the ACA’s burden—he claimed it would increase prices 10 to 14 cents—which Forbes calculated to be about one-half of 1 percent of the chain’s operating expenses—or between 3.4 and 4.6 cents per pizza. With Papa John’s charging $1.50 for each extra topping, this is about the cost of a single slice of pepperoni on a large pizza (if we assume a generous portion of 30 pieces of pepperoni per pizza).

But, more important, in the big picture the best way to think of the ACA is that it is providing a mandate (with admittedly small and not particularly sharp teeth) that deters  low-road employers like Papa John’s from continuing to shirk responsibilities to their employees. Read more

Here’s a sampling of links that EPI’s research team found insightful today:

• “What Are Conservatives Getting Wrong About The Economy? (Douthat Reply Edition)” (Rortybomb)
• “Understanding President Obama’s Revenue Targets” (TaxVox)
• “Budget crisis calls for focus on entitlements and revenue” (Washington Post)

It’s remarkable how quick people are to blame workers and their unions whenever a company goes bankrupt or goes out of business. On Friday, I heard Rush Limbaugh on the radio blaming the Bakery Workers for the closing of the Hostess bakeries. His insight apparently didn’t require a look at the company’s history of buyouts and downsizing, the CEO and managers’ pay, the competition, the wage cuts the employees had already taken, or even the company’s products, which have contributed more to diabetes and heart disease than nutrition for decades.

The New Yorker‘s James Surowiecki does a better job of considering the many factors that contributed to such a brutal loss of jobs in “Who Killed The Twinkie?” Surowiecki focuses on the inability of Hostess Brands’ s management to adapt to a changing market rather than the supposed greed of the workers who were trying to hang onto pension benefits they had bargained for decades ago.

The Sacramento Bee‘s Bruce Maiman points out that Hostess’ revolving-door management failed Read more

Washington is fixated with the so-called “fiscal cliff” of legislated spending reductions and expiring tax cuts scheduled for 2013, which are projected to induce a recession if they materialize. As my colleague Josh Bivens and I have repeatedly explained in a series of recent papers and blog posts, this “cliff” simply represents the macroeconomic reality that budget deficits closing too quickly—thus public debt accumulating too slowly—will, if left unaddressed deep into 2013, push the U.S. economy into an austerity-induced recession. Last week, we released a paper, Navigating the fiscal obstacle course, offering our policy recommendations for moderating the pace of deficit reduction and sustaining recovery by reshuffling various components of the fiscal obstacle course (cliff is a terrible metaphor as it implies a false dichotomy). Now it’s worth zooming out and placing this debate in its proper context: in a depression.

FULL ANALYSIS FROM EPI: Budget battles in the lame duck and beyond

Paul Krugman’s latest book, End This Depression Now!, wasn’t hyperbolically titled—the United States truly is in a depression. U.S. economic output is currently depressed $973 billion below potential economic output—what the economy could produce with higher (but noninflationary) levels of employment and industrial capacity utilization. The U.S. economy has operated at 5 percent or more below potential output since Read more

Last Friday, the Peter G. Peterson Foundation held an event called “The Fiscal Cliff and Beyond.” The event both highlighted the results of the Solutions Initiative II (in which EPI took part) and convened discussion panels around the topic of the fiscal cliff as well as longer-term fiscal and economic issues.

I found a few comments from two different panels interesting. In one panel, Erskine Bowles, who co-chaired the 2010 fiscal commission and now is a big supporter of the Fix the Debt campaign,  said that if we go over the fiscal cliff, U.S. credit will be downgraded by rating agencies—for example Moody’s or Fitch. On a different panel, Douglas Holtz-Eakin, former John McCain adviser, CBO head, and now director of the American Action Forum, said that if we go over the fiscal cliff (a terrible metaphor), financial market reactions will be severe.

FULL ANALYSIS FROM EPI: Budget battles in the lame duck and beyond

Since “financial market reaction” to fiscal developments is going to be a big theme in coming months, it’s worth thinking a little more carefully about statements like these. Read more

Piggybacking on my earlier post, this post outlines the five job creation proposals in our new paper, Navigating the fiscal obstacle course, which offers policymakers a realistic blueprint for moderating the pace of deficit reduction to boost growth and employment. These job creation policies are also adopted in a comprehensive federal budget proposal that EPI will release on Friday as part of the Peter G. Peterson Foundation 2012 Solutions Initiative.

FULL ANALYSIS FROM EPI: Budget battles in the lame duck and beyond

Relative to current policy, our paper recommends investing roughly $600 billion over the next decade, mostly over the next three years, in emergency unemployment benefits, aid to state governments, infrastructure investment, investing in teachers and school modernizations, and a one-year targeted tax rebate.1 These are all cost-effective ways to boost demand, and EPI endorsed variations of each of these proposals in our Sept. 2011 paper Putting America back to work: Policies for job creation and stronger economic growth. Note that any purported “resolution” of the fiscal obstacle course (e.g., a “grand bargain”) that omits these or similar proposals for increasing near-term budget deficits relative to current policy unequivocally fails the challenge actually facing policymakers, which is to sustain and accelerate the recovery.

Emergency Unemployment Compensation

We propose restoring the Emergency Unemployment Compensation program to again support up to 99 weeks of benefits in high unemployment states Read more

Yesterday, my colleague Josh Bivens and I released a paper, Navigating the fiscal obstacle course, intended to offer a realistic blueprint—one that accounts for the constraints regrettably imposed by the current political climate—for how policymakers should navigate the so-called “fiscal cliff” of legislated spending reductions and expiring tax cuts scheduled for 2013. At its core, the fiscal cliff reveals the macroeconomic reality that budget deficits closing too quickly—thus public debt accumulating too slowly—will, if left unaddressed deep into 2013, push the U.S. economy into an austerity-induced recession. Contrary to the misplaced but pervasive inside-the-Beltway hand-wringing of recent years about rising public debt, this outlook implies that big budget deficits and rising public debt have been sustaining growth and economic recovery in recent years. The only way for policymakers to successfully navigate the scheduled fiscal restraint is to substantially moderate the pace of deficit reduction while the economy remains depressed—meaning for several years at minimum.

FULL ANALYSIS FROM EPI: Budget battles in the lame duck and beyond

Our recommendations build on our analysis from a recent paper, A fiscal obstacle course, not a cliff, which argued that “cliff” is a terrible metaphor because it implies Read more

Today, the Census Bureau released new data from the Research Supplemental Poverty Measure (SPM) that showed that more Americans are likely in poverty than is reflected by the official federal poverty line. The SPM estimates for 2011 show a poverty rate of 16.1 percent, or roughly 49.7 million people, which is higher than the official poverty rate of 15.1 percent, or 46.6 million people.

First introduced last year, the SPM attempts to make a more holistic appraisal of household well-being by incorporating greater detail on real household expenses and additional resources available to households through government programs. The SPM also takes into account individuals’ residence type (renters, homeowners, homeowners with a mortgage), and regional differences in consumer prices.

With this inclusion of more detailed data on government assistance, the SPM allows for some interesting back-of-the-envelope calculations on the poverty-fighting effects of these programs. Read more

Here’s some reading material for you from items EPI’s research team skimmed through today:

• “Help Wanted: Regulatory Czar with Commitment to Protecting Public Health, Worker and Consumer Safety, and the Environment” (Center for Progressive Reform)
• “Offsetting a Carbon Tax’s Cost on Low-Income Households” (Congressional Budget Office)
• “How to Bridge the Hiring Gap” (New York Times)