Federal Budget and Taxes

Morning Must Reads: The Payroll Tax Cut, Cuts in Block Grants for Local Gov and the State Use Tax

The economic news in the past couple of weeks has been relatively positive so that must mean it is time for another down to the wire battle in Washington to help restore pessimism! At the end of the month, temporary extensions to the payroll tax credit and extended unemployment benefits will expire. With unemployment high, both measures should be extended through the end of the year.

Morning Must Reads: You Get What You Pay For: Human and Physical Capital

In the State of the Union address last week, President Obama called for more investment in programs that link training in higher education to employers. This morning the Harrisburg Patriot-News has an excellent article detailing one such program here in Central Pennsylvania.

Third and State This Week: State of the Union, Loopholes and Price of Service Cuts

This week, we blogged about the President's State of the Union address, new legislation to address corporate tax loopholes and a new series examining the price of cuts to state services in Pennsylvania.

IN CASE YOU MISSED IT

  • On the State of the Union, Mark Price offered a preview before the President's speech and a recap of his favorite parts the next day.
  • On state budget and tax policy, Chris Lilienthal wrote that legislation proposed by Representatives Dave Reed and Eugene DePasquale would take a first step towards closing corporate tax loopholes in Pennsylvania, but more needed to be done. Chris also highlighted the first and second installments of a new series from the Pennsylvania Budget and Policy Center featuring stories of Pennsylvanians impacted by five years of state service cuts.
  • And in other Morning Must Reads this week, Mark Price compared and contrasted executives and teachers, and highlighted a proposal to strengthen both the minimum wage and the earned income tax credit.

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

Morning Must Reads: EITC Awareness, New Economic Geography and Stigmatizing The Hungry

Today is Earned Income Tax Credit (EITC) awareness day! 

EITC, the Earned Income Tax Credit, sometimes called EIC is a tax credit to help you keep more of what you earned. Congress originally approved the tax credit legislation in 1975 in part to offset the burden of social security taxes and to provide an incentive to work. When EITC exceeds the amount of taxes owed, it results in a tax refund to those who claim and qualify for the credit.

Since we are on the topic of the EITC, today is a good day to highlight a proposal to strengthen both the minimum wage and the earned income tax credit so that they are more effective tools for reducing poverty.

Morning Must Reads: SOTU 2012: Community Colleges, Workforce Development, Taxes & Infrastructure

The Pittsburgh Post-Gazette has a pretty good summary of the State of the Union.

Here is the full text of the President's speech, and Wonkblog has a version of the speech with only what they define as specific policy proposals.

What follows are our favorites from the speech.

Morning Must Reads: Jobs, Budgets and Local Taxes

If you haven't heard by now, a temporary two-month extension of the federal payroll tax cut and emergency unemployment benefits passed by the U.S. Senate was scuttled by the U.S. House on Tuesday. With the failure to extend both measures expected to slow the already tepid pace of economic growth, it is hard to imagine the House will not reconsider its position in the 11 days remaining before the current extensions expire.

Third and State This Week: Corporate Tax Avoidance, Insurance Rate Review and Prevailing Wage

This week, we blogged about a new report on state tax avoidance by some of the largest U.S. corporations, how to really save money on public construction projects, and legislation that undermines the state’s ability to review most health insurance rate hikes.

IN CASE YOU MISSED IT

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

Morning Must Reads: Tax Benefits For Corporations, Health Care and Prevailing Wage

Toll Bros., the Pennsylvania-based homebuilder that benefited mightily from the housing bubble, also managed to benefit handsomely from you the taxpayer. This morning, The Philadelphia Inquirer reports that company profits are down from the previous period in part because the company claimed an eye-popping $59.9 million tax benefit in the 4th quarter of last year.

You can't open the opinion pages without coming across an article from the business lobby claiming businesses need more tax breaks. The fact is these companies got huge breaks that helped boost CEO pay but haven't translated into robust job growth.

Third and State This Week: A $56 million Marcellus Oops, Fiscal Austerity and Why It's Good to Be King

We hope you enjoyed your Thanksgiving holiday and are ready to take a break from the shopping mall to see what you missed this week at Third and State.

We blogged about the Pennsylvania Department of Revenue's Britney Spears moment, the challenges of reading all the way to the end, and why it's good to be king (or at least a well-paid CEO).

IN CASE YOU MISSED IT

  • On the Marcellus Shale, Michael Wood blogged about a $56 million "oops" by the Pennsylvania Department of Revenue in estimates it made earlier this year of Marcellus Shale industry tax contributions in 2010.
  • On jobs and the economy, Mark Price explained why it's a good idea to read to the end before criticizing the work of others. He also highlighted in the Morning Must Reads The Philadelphia Inquirer's series "America: What Went Wrong" and the Pittsburgh Post-Gazette's series on what happened to the middle class.
  • In other Morning Must Reads, Mark Price shared news stories on the fallout of fiscal austerity across the Commonwealth and wrote about the big bucks the new CEO of Pittsburgh-based American Eagle Outfitters will be making. As King Louis XVI of France was fond of saying, it's good to be king.
More blog posts next week. Keep us bookmarked and join the conversation!

Morning Must Reads: Fiscal Austerity Means Higher Taxes, Job Losses, Fewer Resources to Help Abused Kids

The Congressional Budget Office (CBO) has released new estimates of the American Recovery and Reinvestment Act's impact on employment and output (the quantity of goods and services in the economy). Commenting on the new ARRA estimates, Paul Krugman argues that the U.S. has been practicing austerity since the middle of 2010.

  • Paul Krugman, The Conscience of a Liberal — The Big Drag:

...the U.S. federal government has been practicing destructive fiscal austerity since the middle of 2010 (and that’s not even talking about what’s happening at the state and local level). Here’s the average of CBO's high and low estimates of the impact of the ARRA on the level (not the rate of growth) of [Gross Domestic Product] by quarter:

Failing to do more to boost employment growth means tax revenues remain depressed for state and local governments. And this means higher local taxes and more layoffs at a time when the unemployment rate remains higher in most cities and counties in Pennsylvania than it was even at the worst of the last two recessions.

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