- Pennsylvania Among 'Terrible 10' Most Regressive Tax States
- February 4 Non-Partisan Training: HOW TO RUN FOR ELECTION BOARD IN 2013: HOW TO RUN FOR COMMITTEEPERSON IN 2014
- Republican Governors Opt-In to Medicaid Expansion
- The Reports of Unions' Death Are Greatly Exaggerated
- Ask Allyson Schwartz to run for Governor
- Mind the gap: Opting Out of Medicaid Expansion Leaves Low-income Families Behind
- Jan. 14 Workshop:HOW TO RUN FOR ELECTION BOARD IN 2013; HOW TO RUN FOR COMMITTEEPERSON IN 2014
- Seth Williams on Guns, Jasmine Rivera on School Closures @PFC Meetup Wednesday
- PA Revenue Strong Midway Through Year; Tax Cut Could Have Big Impact
- What to Make of the Fiscal Cliff Deal?
The economic news this morning makes you feel like you are watching Major Kong (from the movie Dr. Strangelove — the picture on the left) ride the bomb like a mechanical bull to our mutual total economic destruction. But our economic situation is more similar to that of Otto (played by Kevin Kline in A Fish Called Wanda — on the right). At first we are amused with the idea of being run down by a steamroller moving 2 miles per hour. But then we realize that we have stepped in wet cement and are thus destined to be run down by the U.S. Senate a one-eyed man with ketchup stains round his nostrils.
In short, our problem is a lack of aggregate demand and the solution is well within our grasp, but our politics are paralyzed and millions are destined to be run down by years of needless misery.
The Mercyhurst College Center for Applied Politics has released to The Philadelphia Inquirer the results of a poll asking Pennsylvanians about the impact of the economy on their lives.
- Amy Worden, The Philadelphia Inquirer — Erie college poll shows impact of hard times on Pa. residents:
The poll found that one in four Pennsylvania residents has had someone living in his or her household lose a job or be laid off in the last 12 months — and two out of three had close friends or family members who were put out of work in that time. More than three out of every four Pennsylvanians said they knew individuals or families who struggle every month to afford basic needs such as rent, utilities, health care, clothes, or food. 'The poverty question was startling,' said Joseph Morris, a professor and director of the college's Center for Applied Politics, which conducted the poll, 'as was the fact that a strong majority of Pennsylvanians have had to make lifestyle changes because of the economy.'
The Mercyhurst College Center findings mirror those of the State of Working Pennsylvania 2011:
On Tuesday, I joined state Representatives Tom Murt and Gene DiGirolamo at a press conference announcing their bill to enact a natural gas drilling tax that would support shared statewide priorities like education and human services, as well as local impacts and environmental protection.
Almost 98% of natural gas produced in the United States is subject to a drilling tax or conservation fee. This legislation would finally put Pennsylvania into the mainstream of energy-producing states. It would address the impacts of drilling but go beyond that to support economic growth and more opportunities for Pennsylvanians.
You can listen to a two-minute podcast of my remarks from the press conference below and click here to read more about the Murt-DiGirolamo plan (including a link to the lawmakers' co-sponsorship memo).
The September revenue collections are in, and as I told the Harrisburg Patriot-News this week, Pennsylvania is on track to meet revenue projections for the year, despite missing official estimates for the first quarter of 2011-12.
How's that? Well, first of all, revenue collections so far this fiscal year are running ahead of the same three-month time period last year, reflecting a stubbornly slow but continued economic recovery. Tax revenue grew by 3.7% during the quarter, which is slightly ahead of estimated growth of 3.3% for the fiscal year.
While actual tax collections are below official estimates, some of that underperformance may be attributed to a change in the way those revenue estimates were made. The 2011-12 estimates predict a larger share of annual revenue coming in during the first half of the fiscal year than revenue estimates of the past several years. If 2011-12 collection patterns follow a similar course as most recent years, this change may make budget “shortfalls” more common in the first half of the fiscal year, followed by surpluses in the second half.
Bruce Bartlett, former advisor to Ronald Reagan and George H.W. Bush, has a column in the Economix blog at The New York Times this morning with compelling fresh evidence (from the Bureau of Labor Statistics) that job creation is not hampered by regulation but, you guessed it, a lack of demand.
Also this morning, as if on cue, news stories appeared about the movement Monday of bills to weaken Pennsylvania's prevailing wage statute. The Pennsylvania House majority leader called the current prevailing wage statute a "job-crushing" law — without actually providing any evidence, naturally.
The view that people who lost a job due to the economy are lazy and shiftless dilettantes has spread from the editorial page of The Patriot-News to the newsroom with a particularly misleading story Monday.
- Ivey Dejesus, The Patriot-News — Harrisburg-area employers find skills gap keeps them from filling jobs:
The jobs are out there. Companies just can’t find the workers to fill them....Economists and business leaders point to a factor contributing to the pervasive disparity between available jobs and workers: attitude. Prospective work candidates simply want their cake — and on a silver platter. Some don’t want to commute, others want to work only the day shift, and others don’t want to take a job they feel is beneath them.
Dejesus gets creative with the presentation of facts, noting "3.2 million jobs remained vacant as of the end of July, even as 14 million Americans were jobless." How does the BLS report this number? "There were 3.2 million job openings on the last business day of July, the U.S. Bureau of Labor Statistics reported today." The reader of the Dejesus story is left with the impression that the problem is unfilled job openings.
Sharon Ward, Director of the Pennsylvania Budget and Policy Center, issued the following statement on Governor Corbett's proposed impact fee on drilling in the Marcellus Shale::
"Governor Corbett has proposed a small, limited fee that fails to capture for Pennsylvanians the true worth of this vast natural resource, and fails to fully offset the short and long-term damage that will be done by the industry. The proposal sells Pennsylvanians short.
"Pennsylvania has been called the Saudi Arabia of natural gas. The Commonwealth should do what resource-rich countries like Saudi Arabia have done and use gas revenues to invest in our communities and build a stronger statewide economy. A more robust fee would support infrastructure, public investments and jobs across the state and would provide additional revenue to local governments to pay for the impacts of drilling.
"Other proposals now before the Legislature would generate far more than the Governor's plan would for local and state impacts, and offer a better deal for Pennsylvanians.
"The Commonwealth should also move swiftly to put in place stronger regulations and improved enforcement to protect local communities and the environment. The best way to address the negative impacts of natural gas drilling is to avoid them.
“There is bipartisan support in the Legislature for a drilling tax or fee that supports shared priorities like education and health services, as well as local impacts and environmental protection. We hope the final drilling fee will adopt this approach and count all Pennsylvanians in.”
Here is another look at General Fund tax collections in the first two months of Pennsylvania's 2011-12 Fiscal Year. As you can see, collections so far this year have exceeded pre-recessionary levels — a positive sign.
Revenue collections for September will be released as early as late Friday. September collections are important to monitor because they include quarterly corporate and personal income tax payments. They should give us a much better idea of what to expect in future months.
So far, so good.
The U.S. Department of Education recently released 2009 fiscal year data on the number of students defaulting on college loans. In a press release, the Department noted that the national default rate rose from 7% in 2008 to 8.8% in 2009, affecting loans for all types of colleges and universities. The default rate rose from 6% to 7.2% on loans for students at public institutions, 4% to 4.6% at private institutions, and 11.6% to 15% at for-profit institutions.
Among the states, Pennsylvania has the third highest number of higher learning institutions (behind California and New York) and a student default rate of only 6.6%, which is considerably better than the national rate. However, Pennsylvania is no exception when you compare the relationship between the unemployment rate and the borrower default rate.
Earlier this month, Rortybomb blogger Mike Konczal compared the default numbers of subprime mortgages with for-profit college loans. In his analysis, he drew attention to the relationship between unemployment and default rates.
The Keystone Research Center recreated one of Mike's graphs below. It is quite clear that as unemployment rises, the number of students defaulting on their loan payments also goes up. Pennsylvania is the label highlighted in red.
Some state policymakers are concerned that Pennsylvania tax collections are trailing official revenue targets for the first two months of the 2011-12 Fiscal Year. However, Pennsylvania’s revenue collections for July and August are running well ahead of the same two-month period in 2010-11.
While actual tax collections are below official estimates, some of that underperformance may be attributed to a change in the way those revenue estimates were made, as the Pennsylvania Budget and Policy Center explains in our recent Revenue Tracker.
This will come as a little or no surprise to most people, but poverty rates rise following recessions. The economists at the Keystone Research Center recently put together this chart to make that point, using poverty data from the U.S. Census Bureau's Current Population Survey (CPS), going back to 1980.
(Click on the chart to make it larger.)
The Census also released data from its American Community Survey (ACS), which we highlighted last week and fellow blogger Stephen Herzenberg discussed recently on Radio Smart Talk (skip ahead to the 40-minute mark for Steve's segment).
Poverty has risen sharply in most areas of Pennsylvania, according to new data released today by the U.S. Census Bureau. The report highlights the widespread impact of the recession and the need for policymakers to protect struggling families and invest in building a stronger economy.
Overall poverty in Pennsylvania rose by a statistically significant margin, going from 11.6% in 2007 to 13.4% in 2010. Most Pennsylvania metro areas also saw statistically significant increases in poverty from 2007 to 2010.
The number of Pennsylvanians living in deep poverty — the share of the population with incomes below half the poverty line — rose to 5.9% (726,102 people) in 2010. As the Center on Budget and Policy Priorities explains, Pennsylvania was one of 40 states to see a statistically significant rise in deep poverty.
In urban areas of Pennsylvania, poverty rose to 14.7% in 2010 with 1,360,202 urban residents currently living in poverty, according to the Census Bureau’s annual American Community Survey. That is up from 12.7% in 2007, before the recession started. The picture is similarly bleak in rural Pennsylvania where 9.5% of residents (287,982 people) lived in poverty in 2010, up from 8.1% in 2007.
Pennsylvania’s unemployment rate rose to 8.2% in August but remains below the 9.1% national rate. Pennsylvania has been below the U.S. unemployment rate for 40 consecutive months, and at or below the U.S. rate for 58 consecutive months. This trend is in jeopardy, however, as Pennsylvania’s unemployment rate has risen eight-tenths of one percentage point since May.
Government and Information industries performed very poorly in August, while the Manufacturing and Professional and Business Services sectors showed employment growth. In the last two years, Pennsylvania saw the third highest rate of job growth out of the 50 states by volume and the 11th highest in percentage terms.
However, Pennsylvania’s jobs deficit, or the difference between the number of jobs the state has and the number it needs to regain its pre-recession employment rate, is 240,700. That number includes the 126,000 jobs Pennsylvania lost plus the 114,700 jobs it needs to keep up with the 2% growth in population that has occurred in the 44 months since the recession began. Pennsylvania, like the rest of the nation, needs a jobs plan to meet the vast challenges our economy currently faces.
The weak national economy is being felt in Pennsylvania as the unemployment rate climbed from 7.8% to 8.2% in August, according to the state Department of Labor and Industry's August jobs report.
As I noted in a media statement, declining public-sector employment is continuing to be a drag on the economy, as private-sector job growth limps along. This chart illustrates just how much public-sector employment has dropped off over the past year.
The August report clearly demonstrates the need for a jobs plan to meet the vast challenges our economy faces. On that point, my colleague, Stephen Herzenberg, appeared on WITF-TV's Smart Talk Thursday evening discussing that very issue. You can watch it online (episode should be posted shortly).
National poverty rate hit 15.1% last year, the highest level since 1993
As the recession took its toll last year, more Americans fell into poverty, saw their incomes decline and joined the ranks of the uninsured, according to new data from the U.S. Census Bureau.
The Census Bureau released the results of its annual Current Population Survey today in a new report — the first to include a full year of data from the Great Recession.
During 2010, the poverty rate increased to 15.1%, the highest level since 1993, with a record-breaking 46.2 million American adults and children living in poverty. Median household income also declined, and the number of individuals without health insurance increased again, now approaching 50 million.
Public programs continued to play an important role in blunting the full force of the economic downturn. An estimated 3.2 million Americans were kept out of poverty through unemployment insurance coverage, while public health programs such as Medicaid and the State Children's Health Insurance Program (SCHIP) helped to fill the gap as employment-based coverage declined once again.