Media clips
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Ross Eisenbrey, vice president of the liberal Economic Policy Institute, and Jared Bernstein, a former White House economist, recently proposed the limit be increased to $984 a week, or roughly $50,000 a year.
“That would mean between five- and 10-million people could be affected, but they might choose a lower number,” Mr. Eisenbrey said about the White House plans.
Economists like Mr. Eisenbrey point to stagnant wages as one cause behind the U.S.’s sluggish growth. Average hourly earnings, adjusted for inflation, rose 0.4% from January 2013 to January 2014. A bump in the threshold would “move more money from employers into employee pockets. That will be good for the economy,” Mr. Eisenbrey said.
Wall Street Journal March 14, 2014 -
EPI’s Richard Rothstein presented research at the Atlantic’s Reinventing the War on Poverty conference on March 6th. Watch the video.
The Atlantic March 7, 2014 -
A rising minimum wage is a tide that lifts all ships. This is common sense: If a shift worker gets a raise and is now making what the line manager has earned, the line manager is also going to get a bump in pay. Raise the minimum wage, and the bottom 20 percent of wage earners soon enjoy larger paychecks, says Dube of UMass.
A $10.10 minimum wage would boost the incomes of 27.8 million workers, according to an analysis by the Economic Policy Institute. Far from the image of a teen flipping burgers at Jack in the Box, the median worker who would benefit is a full-time working woman in her thirties, responsible for half of her family’s income.
Because these workers spend all the money they make, the $35 billion in extra wages they would earn as $10.10 is phased in would get pumped right back into the U.S. economy – doing far more to stimulate growth than if the same dollars were bloating some billionaire’s bank account.
Rolling Stone March 7, 2014 -
Recent college graduates are ending up in more low-wage and part-time positions as it’s become harder to find education-level appropriate jobs, according to a January study by the Federal Reserve Bank of New York.
The share of Americans ages 22 to 27 with at least a bachelor’s degree in jobs that don’t require that level of education was 44 percent in 2012, up from 34 percent in 2001, the study found.
Competition can leave less-educated — yet still qualified — individuals with few employment options, said Heidi Shierholz, economist at the Economic Policy Institute in Washington.
“College graduates might not be in a job that requires a college degree, but they’re more likely to have a job,” she said.
Less-educated young adults are then more likely to drop out of the labor market, said Paul Beaudry, an economics professor at the University of British Columbia in Vancouver who studies U.S. employment trends.
Bloomberg March 7, 2014 -
As part of an effort to revamp America’s complex tax code, U.S. Congressman Dave Camp last week proposed to curb CEO pay by tightening a tax giveaway created in the 1990s. Perhaps unexpected for a Republican, Camp’s plan would raise $12.1 billion in taxes over 10 years by prohibiting U.S. companies from taking income-tax deductions for their top executives’ pay exceeding $1 million, even if it’s based on performance.
Currently, laws exempt performance-based pay from the $1 million limit. The problem with that is it has encouraged companies to raise base salaries to that level and reward executives with options.
Camp’s proposal is a welcome move to help tame the ballooning CEO pay we’ve seen over the years. CEO pay began to escalate in the early 1980s, but salaries took off in big ways after the passage of the Omnibus Budget Reconciliation Act (OBRA) in 1993, which allowed unlimited deducibility of executive pay based on performance; at the time, President Bill Clinton signed it into law and it has been one of his greatest follies. In 2000, CEO pay was 383 times that of the average worker, compared with 123 times in 1995, according to a June 2012 study by the Economic Policy Institute.
CNNMoney March 7, 2014 -
The U.S. is among only three nations in the world that does not guarantee paid maternal leave (the other two are Papua New Guinea and Swaziland). This means many poor American mothers must choose between raising their children and keeping their jobs. The U.S. education system is plagued with structural racial biases, like the fact that schools are funded at the local, rather than national level. That means that schools attended by poor black people get far less funding than the schools attended by wealthier students. The Department of Education has confirmed that schools with high concentrations of poor students have lower levels of funding. It’s no wonder America has one of the highest achievement gaps between high income and low income students, as measured by the OECD. Schools today are actually more racially segregated than they were in the 1970s. Our higher education system is unique among developed nations in that is funded almost entirely privately, by debt. Students in the average OECD country can expect about 70 percent of their college tuition to be publicly funded; in the United States, only about 40 percent of the cost of education is publicly-funded. That’s one reason the U.S. has the highest tuition costs of any OECD country.
Rolling Stone March 7, 2014 -
New York Times March 5, 2014 -
Expanding the EITC would help reduce poverty in two ways, according to Thomas Hungerford, a senior economist at the Economic Policy Institute, another left-leaning think tank. First, it would give childless low-income Americans who are already working an income boost. And expanding the credit would encourage more people to work.
“It was designed to get people into the workforce because you can only get it if you have earned income,” Hungerford said.
Many argue that this is one of the most direct ways to help low-income workers. In 2011, the credit lifted 6.6 million people above the poverty line, according to an IRS estimate cited by the Associated Press. An EITC expansion only benefits the poor, unlike a minimum-wage hike, which could help some people who are not poor, like those working minimum-wage jobs for extra cash.
Expanding the EITC is also more politically palatable than a minimum-wage hike, which many conservatives oppose, arguing it will discourage businesses from hiring minimum-wage workers.
The Huffington Post March 5, 2014 -
March 3 (BNA) — Following Connecticut’s lead, Vermont and Massachusetts could be the next states to enact employer-paid sick leave laws, which tend to help workers with low wages who disproportionately lack access to this benefit, proponents of such policies told Bloomberg BNA.
The Economic Policy Institute said in a report released last October that almost 40 million U.S. employees, or about 40 percent of the nation’s private-sector workforce, currently have no right to any paid sick leave. As a result, EPI said, these employees commonly go to work sick or leave their ill children home alone because they fear they will be fired for missing work.
“Even if they are not terminated, the loss of pay they suffer takes a dramatic toll—particularly since jobs without sick pay are concentrated among low-wage workers,” EPI said in “The Legislative Attack on American Wages and Labor Standards, 2011-2012.”
Bloomberg BNA March 5, 2014 -
A new report from the Economic Policy Institute showsthat all 50 states have experienced lopsided income growth in recent decades. In fact, between 1979 and 2007, the top 1 percent of U.S. taxpayers took home nearly 54 percent of the total increase in income.
To put it another way, while the bottom 99 percent of earners experienced an 18.9 percent average growth in income, the income of the top 1 percent grew more than 10 times that much — a whopping 200.5 percent increase.
MSN Money March 5, 2014 -
A coalition of school districts and parents has sued the state, arguing that the funding from the state was not enough to suitably educate children. A three-judge panel agreed, writing that it was “completely illogical” for the state to cut taxes while blaming an economic downturn for spending cuts.
Brownback appealed that decision, and is awaiting a ruling from the state Supreme Court.
Not surprisingly, whether states revert to pre-recession spending levels depends primarily on the party in power. Gordon Lafer, an associate professor at the University of Oregon’s Labor Education and Research Center, points to several states that elected Republican governors in 2010 — Pennsylvania, Ohio, Michigan and Wisconsin — as examples of the philosophy of lower spending.
“For a lot of these actors, the budget cuts and the fiscal crisis is greeted more as an opportunity than a tragedy,” said Lafer, who studied the issue for the left-leaning Economic Policy Institute.
Los Angeles Times March 5, 2014 -
National Journal February 28, 2014
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Elise Gould, a Ph.D. economist who directs health policy research at the Economic Policy Institute in Washington, told me in an e-mail that “Fairness in health care is about what kind of society we would like to create for ourselves. Efficiency is about making sure that health care is provided in a timely and cost-effective manner. The ACA promotes both fairness . . . by making health care more accessible and affordable . . . and efficiency in various ways, such as increasing the availability of preventive medicine, reducing the use of last resort health care (ER visits) relative to health maintenance and treatment at earlier stages of illness.”
Those are good points, but I still wanted to know whether the U.S. has a moral obligation to provide health insurance.
“Do we have a moral obligation to provide health care to people who would otherwise die in the streets?” Gould asked. “Unabashedly, I say yes and would venture to guess that most people would as well.”
The Washington Post February 28, 2014 -
There is a lot to celebrate about the pre-kindergarten program in the D.C. public schools. In fact, some aspects of the program are so strong that school officials would be smart to borrow them for application in later grades. This is all explained in the following post by Elaine Weiss, the national coordinator for the Broader Bolder Approach to Education, a project of the nonprofit Economic Policy Institute that recognizes the impact of social and economic disadvantage on many schools and students, and works to better the conditions that limit many children’s readiness to learn.
Weiss looks at an exemplary pre-K program called Jubilee JumpStart Center in the culturally diverse Adams Morgan section of Northwest Washington, where there will be the screening of a film called “Ready for Kindergarten: The Impact of Early Childhood Education,” tonight, Feb . 27. (You can find details here.)
The Washington Post February 28, 2014 -
(At the 3:30 mark) According to the Economic Policy Institute, Walmart’s trade deficit with china, between 2001 and 2006, well, it helped destroy 200,000 jobs in this country. An estimated 133,000 of those were manufacturing jobs. Manufacturing is a long-term investment, with the potential for long-term benefits for any economy.
The Ed Show February 28, 2014 -
A study published Wednesday by the liberal-leaning Economic Policy Institute showed that abolishing overseas currency manipulation, a task few economists think would be easy, could bring millions of jobs to the U.S., especially in the manufacturing-intensive states of Sen. Brown and Rep. Levin.
Wall Street Journal February 28, 2014 -
Education Inaccessible
Further, some teens need to work to help earn their way through college. When jobs become scarce, education can become inaccessible, said Heidi Shierholz, an economist at the Economic Policy Institute, a Washington research group funded in part by labor unions.
“Teen jobs matter a lot less if you go to college, but having a work history may be the difference between putting yourself through school or not,” she said.
Bloomberg February 26, 2014 -
Elise Gould, a Ph.D. economist who directs health policy research at the Economic Policy Institute in Washington, told me in an e-mail that “Fairness in health care is about what kind of society we would like to create for ourselves. Efficiency is about making sure that health care is provided in a timely and cost-effective manner. The ACA promotes both fairness . . . by making health care more accessible and affordable . . . and efficiency in various ways, such as increasing the availability of preventive medicine, reducing the use of last resort health care (ER visits) relative to health maintenance and treatment at earlier stages of illness.”
Those are good points, but I was still wanted to know whether the U.S. has a moral obligation to provide health insurance.
The Washington Post February 26, 2014 -
At the 3:30 mark
According to the Economic Policy Institute, Walmart’s trade deficit with china, between 2001 and 2006, well, it helped destroy 200,000 jobs in this country. An estimated 133,000 of those were manufacturing jobs. Manufacturing is a long-term investment, with the potential for long-term benefits for any economy.The Ed Show February 26, 2014 -
Since the Great Recession, reports of rising income inequality in the U.S. have pretty much followed the same basic storyline: The rich are getting richer. The poor are getting poorer. So on, so forth.
It’s easy to associate the economic downturn with the 1 percent’s seemingly meteoric rise in wealth leading up to the recession, but it was hardly an overnight occurrence. The rich have been on an unprecedented tear for decades, as illustrated in a new analysis of IRS income data by the new report by the Economic Policy Institute, a left-leaning think tank. Indeed, the widening income disparity has become so acute that President Obama called it the “defining challenge of our time’ in his recent state of the union address.
Since 1979, the average income of the bottom 99 percent of U.S. taxpayers grew by 19%, while the average income of the top 1 percent grew more than 10 times as much—by 200.5%.Yahoo Finance February 21, 2014 -
But some liberal economists argue that the bursting of the dotcom bubble and later the great recession laid bare the legacy of NAFTA. According to a 2006report from the left-leaning Economic Policy Institute, the treaty led to the loss of an estimated one million American jobs in its first decade. A 2012 poll found that 53 percent of Americans wanted the government to “do whatever is necessary” to amend or leave NAFTA, while only 15 percent wanted to remain in NAFTA as-is.
The Atlantic February 21, 2014 -
The minimum wage has potent implications for our national discussion of inequality and upward mobility. Republicans have been paying lip service to the idea of reducing inequality and increasing upward mobility, but so far policy proposals have been sparse. The minimum wage is a perfect solution. It requires little government spending and is unlikely to have any significant effect on the deficit. It certainly doesn’t violate the “no new taxes” pledge. So a minimum wage hike would be the perfect conservative solution to inequality: targeted at working people (rather than the unemployed), minimal bureaucracy and no new revenue for the government. And studies show it would work. Larry Mishel of the Economic Policy Institute finds that the declining value of the minimum wage has been a major driver of increased inequality. Citing the work of David Autor, he finds that more than half of the growing divide between workers at the median and workers at the lowest 10% of the income distribution can be explained by a declining minimum wage.
Salon February 21, 2014 -
Sure, Davidoff is right that sky-high CEO pay deserves a broader look across the board. After all, it’s a big driver of income inequality. As the Economic Policy Institute has found, “Executives, and workers in finance, accounted for 58 percent of the expansion of income for the top 1 percent and 67 percent of the increase in income for the top 0.1 percent from 1979 to 2005.” Not only that, but taxpayers are subsidizing these big pay packages thanks to a loophole allowing corporations to write off CEO pay that is “performance based.” (Rep. Lloyd Doggett, D-Texas, has introduced legislation to fix that particular problem, but given what the Republican-held House is interested in these days, I wouldn’t expect it to come up for a vote anytime soon.)
US News and World Report February 21, 2014 -
Since then, according to Doug Hall, director of the Economic Analysis and Research Network at the Economic Policy Institute, other economists have done similar studies at the state and county level when a minimum wage change makes labor more expensive in one jurisdiction than in a neighboring one.
The chart above shows the results of more than 1,400 different studies. The x-axis shows the size of the employment effect, and the y-axis shows that statistical power of the analysis.
The Fiscal Times February 21, 2014 -
Economist at the Economic Policy Institute Heidi Shierholz says that despite projecting job loss, the CBO’s latest report on the minimum wage hike also shows how lower wage workers will
The Hill February 21, 2014 -
On Thursday afternoon, the faculty senate will review this proposal to tie the president’s salary to that of the school’s lowest-paid employees. Such workers at the public liberal arts college currently make$24,500 a year, which would translate into a $245,000 salary cap for the president — roughly $80,000 less than Ian Newbould, the college’s interim president, presently makes.
The move comes at a time of budget difficulties for the college, which lost roughly $3.5 million in expected tuition this academic year when it failed to fill enrollment numbers for its freshman class. It also comes at a time when higher-ed costs are ballooning across the United States and when executive pay is under increased scrutiny. This fall, the Securities and Exchange Commission voted to propose a rule requiring companies to disclose the ratio of CEO pay compared to their median worker’s. In 2012, according to the Economic Policy Institute, that ratio was 273-1.
The Washington Post February 21, 2014 -
The United Auto Workers’ failure to organize the employees at Volkswagen’s plant in Chattanooga, Tenn., has been greeted with predictable hosannas from the sworn enemies of American unions. Survey their celebratory columns, though, and you won’t find the slightest consideration of most Americans’ primary economic problem: How do workers get a raise in today’s economy? With the rate of unionization so low that even unionized employees have trouble winning good contracts, how can workers profit from the gains in their productivity? What will it take for workers to regain the power to reap what they sow?
In recent decades, they’ve reaped precious little. Between 1947 and 1973 — roughly the one period of union strength in U.S. history — productivity increased by 97 percent and workers’ compensation (that’s wages plus benefits) by 95 percent. Since 1973, however, as unions have weakened, productivity has increased by 80 percent and compensation by just 11 percent, according to the Economic Policy Institute.
The Washington Post February 21, 2014 -
But that’s all water under the bridge. The important point is that U.S. fiscal policy went completely in the wrong direction after 2010. With the stimulus perceived as a failure, job creation almost disappeared from inside-the-Beltway discourse, replaced with obsessive concern over budget deficits. Government spending, which had been temporarily boosted both by the Recovery Act and by safety-net programs like food stamps and unemployment benefits, began falling, with public investment hit worst. And this anti-stimulus has destroyed millions of jobs.
The New York Times February 21, 2014 -
A new non-partisan report has set off a storm of dueling arguments over the perennially testy question of raising the minimum hourly wage.
The proposal, by Democrats, to raise the minimum wage to $10.10 per hour would bring some 900,000 families above the poverty line and boost the income of an additional 16.5 million workers, but any such pay increase could also cost the jobs of as many as 500,000 workers, an analysis by the Congressional Budget Office found.
Almost as soon as the report was released Tuesday, opponents began to cite the report in an effort to torpedo any Congressional vote to hike the federal minimum from $7.25 per hour to $10.10 by 2016.
CNNMoney February 21, 2014 -
Further, some teens need to work to help earn their way through college. When jobs become scarce, education can become inaccessible, said Heidi Shierholz, an economist at the Economic Policy Institute, a Washington research group funded in part by labor unions.
“Teen jobs matter a lot less if you go to college, but having a work history may be the difference between putting yourself through school or not,” she said.
Carnevale, former chairman of the National Commission on Employment Policy, said as entry-level jobs have become higher-skilled and harder for teens to get, it has most disadvantaged those in lower-income households.
“It’s a Catch-22: You can’t get the job because you don’t have the skills, and if you can’t get the job, you can’t get the skills,” he said. “The work experience issue gets more and more severe as you move down the income distribution.”
Bloomberg Politics February 20, 2014