Economic History

Third and State This Week: Challenging Conventional Wisdom on Payday Lending & Time to Raise the Minimum Wage

This week at Third and State, we blogged about a new report challenging the conventional wisdom on payday lending, the third anniversary of the last increase in the minimum wage, public policy that shrinks the economy, bizarre claims about income inequality and much more.

  • Jamar Thrasher wrote about a Pew Center on the States report showing that payday lending is less frequent in states with restrictive laws and that borrowers tend to use payday loans for recurring expenses — not just emergencies.
  • Intern Alan Bowie blogged about the third anniversary of the last increase in the minimum wage and how it has not kept pace with the rising cost of living.
  • On income inequality, Mark Price shared a Paul Krugman column catching the Tax Foundation making a bizarre claim about income inequality.
  • On jobs and the economy, Mark Price highlighted an insightful Q&A with Professor Peter Cappelli of the Wharton School of Business on his new book Why Good People Can't Get Jobs, and wrote about the danger of public policies that shrink the economy.
  • Finally, on the Marcellus Shale, Mark Price highlighted a Patriot-News column eviscerating the U.S. Chamber of Commerce for using suspect job numbers in a Marcellus gas public relations campaign.

More blog posts next week. Keep us bookmarked and join the conversation!

Third and State Recap: PA Budget, Human Cost of Ending General Assistance & Wall Street Execs on Honesty

Happy Friday the 13th! Over the past two weeks, we been busy blogging about the enacted state budget, the revenue outlook at the start of the new fiscal year, the human cost of eliminating General Assistance, recent news on the Marcellus Shale front and much more.

IN CASE YOU MISSED IT

  • On the state budget, intern Alan Bowie had this post and intern Jamar Thrasher had this post summing up the post-budget headlines. Michael Wood had an analysis of better-than-expected revenue collections in June, allowing the state to start the new fiscal year with a $400 million fund balance. And Mark Price blogged about the problems with budget austerity.
  • On jobs, Mark Price blogged about a New York Times editorial and research by the Economic Policy Institute on just how much state and local budget cuts have hurt job growth nationally.
  • On poverty and public welfare, Kate Atkins wrote about the human cost of eliminating General Assistance, which will come to an end on August 1 under the new budget.
  • On the financial sector, Mark Price blogged about a recent poll finding one in four Wall Street executives view wrongdoing as a key to success.
  • On the economy, Alan Bowie wrote about an effort to increase the federal minimum wage and the long-term impact of the housing crisis on African Americans.
  • And, on the Marcellus Shale, Jamar Thrasher blogged about legislation that enacted a moratorium on gas drilling in Bucks County and a new report showing how major oil companies use tax loopholes to avoid paying federal taxes. 

More blog posts next week. Keep us bookmarked and join the conversation!

The Human Cost of Eliminating General Assistance

Since the Great Depression, Pennsylvania has had a General Assistance (GA) program — a small cash benefit that serves as a bridge to self-sufficiency for the temporarily disabled and for victims of domestic violence and addicts seeking help to turn their lives around.

Since the Great Depression. Until this past weekend.

This year’s budget ended Pennsylvania’s modest benefit for 68,000 people, effective August 1. At $205 per month, nobody was getting rich from the program. Here is a sample of who is using General Assistance and why:

Morning Must Reads: The Impact of Economic Austerity, Student Loans and the Geography of Manufacturing

The U.S. economy is growing, albeit too slowly to make a substantial and badly needed dent in the unemployment rate. Growth in the U.S. economy will almost certainly mean continued growth in the Pennsylvania economy.

The most important risk to Pennsylvania's job growth in 2012 remains job losses among teachers, nurses and other public servants caused by federal and state budget cuts. 

Third and State This Week: A Brighter Revenue Picture, Impact of Corporate Tax Cuts and Payday Lending

This week at Third and State, we blogged about a new revenue report from the Independent Fiscal Office offering a more upbeat view of the economy moving forward, and the likely impact of a state House-approved bill to reduce corporate taxes by nearly $1 billion by the end of the decade. We also posted Morning Must Reads on payday lending legislation and the economic cost of an asset test for Pennsylvanians in need of food assistance.

IN CASE YOU MISSED IT

  • On the state budget, Sharon Ward blogged about the Independent Fiscal Office's new report predicting a smaller revenue shortfall for the current year and more robust revenue collections for 2012-13. Mark Price also had analysis on the new revenue report, noting that state budget cuts have hurt job growth.
  • On tax policy, Chris Lilienthal wrote about the House's approval of a plan to reduce corporate taxes by nearly $1 billion by the end of the decade without any commitment from businesses to put Pennsylvanians back to work. Sharon Ward shared her Philadelphia Inquirer op-ed on this bill and a memo she sent to editors and reporters outlining her concerns with the bill.
  • Finally, Mark Price had Morning Must Reads on legislation in the state House to legalize payday loans charging upwards of 300% in annual percentage rates, and the lost economic activity from implementing an asset test for people receiving food stamps.

More blog posts next week. Keep us bookmarked and join the conversation!

Morning Must Reads: Happy May Day, SNAP Asset Test to Cost PA $45 Million & Deaths from Falls

Happy International Workers Day! What's that, you ask? Historian Jacob Remes breaks it down for you.

A Harrisburg Rooster Takes Credit For The Sunrise

A recent tweet (see above) from our good friends over at the Commonwealth Foundation highlights that private-sector job growth in 2011 was the strongest in Pennsylvania since 1999 and links that outcome to state tax and spending policy.

The figure below plots the 12-month moving average of private-sector payrolls in Pennsylvania since 1990. What you will notice about the figure is that in the period following a recession (the areas shaded gray*) private-sector payrolls expand. That's what is known in macroeconomics as an expansion; it's been a characteristic of every business cycle on record since 1854. Given where we are in the business cycle, to link private-sector job growth to 2011 state tax and spending policy is like the rooster taking credit for the sunrise.

Morning Must Reads: Local Jobs Data, Holding the Jobless Hostage and the History of Banker Pay

The Pennsylvania Department of Labor and Industry (L&I) has released local data on jobs in December. Later today L&I will release the full data here. What follows is a run down of how newspapers across the commonwealth covered the new release.

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