Recession and Recovery

Third and State This Week: Strong Revenue Growth in PA, Rising Student Loan Defaults, and Morning Must Reads

This week, we blogged about rising rates of student loan defaults, Pennsylvania's strong revenue growth early in the fiscal year, and rising poverty in the wake of recessions. We also started each day with the "Morning Must Reads," highlighting the must-read economic news and opinion of the day. 

IN CASE YOU MISSED IT

  • On higher education and unemployment, Sean Brandon blogged about the rising number of student loan defaults as young college grads find jobs harder to come by in this economy. 
  • On poverty and recessions, Chris Lilienthal shared a chart showing how the recessions of the last 30 years have driven up poverty rates in their aftermath.
  • On state budget and taxes, Michael Wood wrote about a new Pennsylvania Budget and Policy Center analysis showing that state revenue collections in the first two months of 2011-12 are running well ahead of the same two-month period last year. Mike also shared a chart showing that July-August tax collections have outperformed the same two-month period in the last five fiscal years. September revenue collections will provide a much better idea of what to expect in future months.
  • Lastly, Mark Price greeted you each daybreak with the "Morning Must Reads," highlighting current economic news and opinion. This week, Mark highlighted articles on paid sick leave, public sector employment losses, the challenges of local economic development, local area unemployment rates and the bupkis Congress is doing to spur economic recovery
More blog posts next week. Keep us bookmarked and join the conversation!

Morning Must Reads: The Tall Tales Policymakers Tell to Justify Keeping Unemployment and Profits High

The economy is sick. Unemployment has been rising and private-sector job growth has been very weak in the past few months. WE ARE NOT HEADED FOR A DOUBLE-DIP RECESSION! But with unemployment back over 8% here in Pennsylvania, the risks of financial disaster for people who lose their jobs for reasons beyond their control remain higher than they have been at any point since the early 1980s.

The costs of job loss for individuals and society are well documented (PDF). What we need is aggressive action by Congress and the Federal Reserve to spur job growth. But what we are getting is bupkis from Congress. Meanwhile, a broad range of fiscal and monetary policymakers are making stuff up about what is wrong with the economy.

The answer, repeated again and again, is that businesses are afraid to expand and create jobs because they fear costly regulations and higher taxes...The first thing you need to know, then, is that there’s no evidence supporting this claim and a lot of evidence showing that it’s false. The starting point for many claims that antibusiness policies are hurting the economy is the assertion that the sluggishness of the economy’s recovery from recession is unprecedented. But, as a new paper by Lawrence Mishel of the Economic Policy Institute documents at length, this is just not true. Extended periods of 'jobless recovery' after recessions have been the rule for the past two decades. Indeed, private-sector job growth since the 2007-2009 recession has been better than it was after the 2001 recession.

Third and State This Week: States Cutting Budgets, the Debt Ceiling Debate, and a Middle Class 'Under Attack'

This week, we blogged about the looming debt ceiling crisis in Washington, how state budget cuts will hurt the economic recovery, Marcellus Shale job claims, a new report on the middle class in Pennsylvania and more.

IN CASE YOU MISSED IT

  • This week was a busy one for Mark Price, who penned four of our five blog posts. On the Marcellus Shale, Mark corrected an inaccurate figure in a recent Wall Street Journal piece about jobs created in Pennsylvania from Marcellus Shale drilling.
  • On the economy, Mark wrote about a recent report from the Keystone Research Center and the national policy center Demos on a middle class that is "under attack" in Pennsylvania. He also blogged about a new policy brief analyzing Pennsylvania's June jobs report.
  • On the federal debt ceiling debate, Mark shared his op-ed on this "manufactured crisis" which ran on FoxNews.com this week.
  • Finally, on the state budget, Chris Lilienthal highlighted a new report from the Center on Budget and Policy Priorities finding that at least 38 of 47 states are cutting K-12 education, higher education, health care, or other key public services in 2012. According to the report, this cuts-only approach that most states have taken will slow the recovery and weaken the nation’s economy over the long term.

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

A Manufactured Crisis

I was asked this week to pen an op-ed for FoxNews.com (seriously) about the looming crisis surrounding the debt ceiling debate in Washington. Check it out.

The Middle Class ‘Under Attack’

At the Keystone Research Center, we have been chronicling for years the forces that are putting a tighter and tighter squeeze on middle-class Pennsylvanians.

Last week, we released a new report in partnership with the national policy center Demos that takes the temperature of the state's middle class in the wake of the Great Recession. I'm sorry to say, once again, the patient is not well.

The state's annual unemployment rate is the highest it has been in nearly three decades and the cost of going to college is on the rise.

According to the report, times are particularly tough for Pennsylvania's young people, with state budget cuts to 18% of public university funding and a 7.5% tuition hike in Pennsylvania's State System of Higher Education. Pennsylvania's young people already bear the seventh highest rate of student debt in the nation — at approximately $28,000 on average.

Third and State This Week: Marcellus Shale, Budget Cuts and the Economy, and a Pa. Jobs Update

This week, we blogged about new reports on the Marcellus Shale, the economic impact of state budget cuts, the latest Pennsylvania jobs report and a groundbreaking new study on the health and financial impacts of Medicaid.

IN CASE YOU MISSED IT

  • On the Marcellus Shale, Sharon Ward shared her response to the final report and recommendations of the Governor's Marcellus Shale Advisory Commission, which reads like an industry wish list. Earlier in the week, Sharon shared her response to an industry-funded study that overstates the economic benefits and underestimates the costs of increased shale drilling. Chris Lilienthal, meanwhile, summed up the news coverage on the industry study.
  • On the state budget, Mark Price blogged about the impact of budget cuts on economic growth. Those states that made steep public spending cuts in the wake of the Great Recession have seen weaker economic growth in the years since, he wrote, citing research from the Center for American Progress.
  • On jobs and unemployment, Mark wrote that Pennsylvania's June jobs report provides cause for concern.
  • And, on health care, intern Emma Lowenberg highlighted a groundbreaking study out of Oregon showing that Medicaid has positive health and financial impacts.

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

Third and State This Week: Pa.'s 2011-12 Budget, Job Numbers, Medicaid Cuts, and Lost Drilling Tax Revenue

This week, we blogged about a new analysis of the 2011-12 state budget, $200 million in lost revenue from legislative inaction on a drilling tax, what's at stake with proposals to cut Medicaid, a look at the recent national jobs report and more.

IN CASE YOU MISSED IT

  • On the state budget, Sharon Ward highlighted a new analysis from the Pennsylvania Budget and Policy Center on the recently-enacted 2011-12 state budget. Sharon also shared an op-ed she wrote grading the budget (it got a D).
  • On the Marcellus Shale, Chris Lilienthal wrote that the state has lost $200 million since October 2009 from legislative inaction on a Marcellus Shale drilling tax.
  • Intern Chaquenya Johnson made her Third and State debut, with two blog posts on jobs and the economy. One offers some analysis from experts on June's national jobs report ("a litany of bad news," in the words of one), and the other details the findings of a paper on the experiences of Denmark and Germany in the Great Recession and what we can learn from them.
  • Finally, on health care, guest blogger Athena Ford of the Pennsylvania Health Access Network explained what is at stake for seniors, families, jobs and more with proposals to cut Medicaid.

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

Your Job or Your Hours

Chaquenya JohnsonBy Chaquenya Johnson, Intern

When the economy is hit by a sudden drop in demand, employers typically react by cutting employment or hours of work — sometimes both.

Like We Said, Policymakers Are Focusing on the Wrong Deficit

New York Times economist David Leonhardt makes two simple points in today’s paper that we made in our release last week underscoring the need for more action to create jobs.

First, output in the United States has rebounded thanks to the Recovery Act, surpassing its level before the recession. The Act, according to our estimates, saved 400,000 jobs in Pennsylvania alone.

In Case You Missed It: Third and State Blog This Week

This week. we blogged about the upcoming two-year anniversary of the Recovery Act, President Obama's budget plan, a few hundred Valentine's Day messages for Governor Corbett, sales tax loopholes that only Amazon.com could love, and much more!

In case you missed it:

  • On the state budget, Michael Wood detailed Amazon's foot-stomping response to efforts by states to close a sales tax loophole that gives the online retailer an unfair competitive edge over other retailers. (Spoiler alert: The brick-and-mortar stores are none too happy about it!) Mike also shined some light on Pennsylvania's "conservative" debt levels and explained that Pennsylvania's debt service payments have long been low — between 3% and 4% of the state budget.
  • On health care, Chris Lilienthal shared some of the Valentines that Governor Corbett received this week from Pennsylvanians asking him to have a heart and save adultBasic.
  • On the federal budget, Chris highlighted some analysis from the Center on Budget and Policy Priorities on President Obama's budget proposal for the 2012 Fiscal Year. Mark Price, meanwhile, shared a video clip of Columbia University Professor Jeffrey Sachs discussing the federal budget and noting that both parties have the wrong priorities by cutting services vital to working- and middle-class families.
  • Finally, on the economy, Mark Price takes note of the upcoming two-year anniversary of the passage of the American Recovery and Reinvestment Act. Mark also blogged that policymakers are focused on the wrong deficit — Main Street America is a lot more concerned about a deficit in jobs and wages than they are about the federal fiscal deficit.

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

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