Urban Institute: Economy/Taxes

Retirement Account Balances

paffairs@urban.org ( Barbara Butrica, Philip Issa, Mauricio Soto ) — Thu, 05 Nov 2009 00:00:00 EST

The retirement savings of American households took a big hit when the stock market crashed in 2008. Recently, however, a good portion of these losses has been reversed. This fact sheet follows trends in retirement account balances since the beginning of 2005.

Policy Polymath Eugene Steuerle Returns to the Urban Institute

paffairs@urban.org ( The Urban Institute ) — Fri, 30 Oct 2009 00:00:00 EST

Eugene Steuerle, one of the nation's most respected public policy experts, whose portfolio ranges from taxes and federal spending on children to entitlements and the vitality of nonprofits, has rejoined the Urban Institute as an Institute fellow and the Richard B. Fisher

The Opacity of Marginal Tax Rates

paffairs@urban.org ( Rosanne Altshuler, Jacob Goldin ) — Wed, 21 Oct 2009 00:00:00 EST

Suppose that a taxpayer earns an additional dollar of income. How much tax would she owe on that dollar? A natural way to answer this question would be to look up the taxpayers statutory tax rate - the tax rate corresponding to her tax bracket and filing status.

Risk and Recovery: Understanding the Changing Risks to Family Incomes

paffairs@urban.org ( Gregory Acs, Pamela J. Loprest, Austin Nichols ) — Mon, 12 Oct 2009 00:00:00 EST

This paper examines the characteristics and circumstances of families vulnerable to sharp income drops and those most likely to recover financially. More than 13 percent of nonelderly adults in families with children will see their incomes fall by half at some point over the course of a year, and about 40 percent fully recover within a year. Those who lose jobs or have an adult leave the family are more likely to have a substantial drop in income and are less likely to recover.This study uses data from the Survey of Income and Program Participation, which collects data every four months and can provide information on short-term income loss.

The Individual Alternative Minimum Tax: Historical Data and Projections, Updated October 2009

paffairs@urban.org ( Katherine Lim, Jeff Rohaly ) — Mon, 05 Oct 2009 00:00:00 EST

The alternative minimum tax (AMT), which originally targeted high-income taxpayers, requires annual legislation to prevent it from affecting millions of middle-income individuals each year. There are two primary reasons for the AMTs broadening impact; its parameters are not indexed for inflation and the 2001-2006 tax cuts reduced regular tax liability without changing AMT liability. In 2009, four million taxpayers will pay $33.5 billion in AMT, but without congressional action that number will rise to 27 million owing $102 billion in 2010. This paper describes the AMT and provides TPCs latest estimates of AMT coverage, revenue, and distribution.

Are Families Prepared for Financial Emergencies?

paffairs@urban.org ( Caroline Ratcliffe, Katie Vinopal ) — Thu, 17 Sep 2009 00:00:00 EST

Data from the 2007 Survey of Consumer Finances show a disturbing reality. Even prior to the current recession, many families did not have enough assets to see them through a modest spell of unemployment or another financial emergency. In 2007, nearly one in three U.S. families were liquid asset poor. Low-income, young, and nonemployed families are more vulnerable to economic emergencies. For example, two-thirds (68 percent) of bottom income quintile families and 47 percent of second income quintile families are liquid asset poor, while such shortfalls affect only 1 percent of top income quintile families.

The Dynamics of Poverty in the United States: A Review of Data, Methods, and Findings

Thu, 17 Sep 2009 00:00:00 EST

This paper reviews the literature on poverty dynamics in the United States. It surveys the most prevalent data, theories, and methods used to answer three key questions: How likely are people to enter, exit, and reenter poverty? How long do people remain in poverty? And what events are associated with entering and exiting poverty? The paper then analyzes the combined findings of the literature, discussing overarching patterns of poverty dynamics, differences among demographic groups, and how poverty probabilities, duration, and events have changed over time. We conclude with a discussion of the policy implications of these findings and avenues for future research.

Testimony on Income and Poverty in the United States: 2008 : Before the Joint Economic Committee of the United States Congress

paffairs@urban.org ( Harry Holzer ) — Thu, 10 Sep 2009 00:00:00 EST

Between 2007 and 2008, real incomes fell and poverty rose in the United States, Institute Fellow Harry Holzer testified before the Joint Economic Committee of Congress. Even if the recession ends this year, rising unemployment will mean that real income keeps falling while poverty increases for a few more years and almost certainly by much more than occurred between 2007 and 2008. It will likely take several years beyond 2010 before real income and poverty fully recover from the effects of the downturn.

Focus on the Tax 'Avoidance' Gap

paffairs@urban.org ( Eric Toder ) — Thu, 10 Sep 2009 00:00:00 EST

President Obama's tax reform task force has been asked to propose ways to close the $300 billion tax gap, which is the estimated difference between taxes owed and taxes paid either voluntarily or through enforcement. But the amount of money lost to legal tax avoidance - the difference between an income tax without special tax preferences and taxes under current law - at least double that lost to outright evasion. The perpetrators of this second, "avoidance" tax gap are legislators, not taxpayers. The panel's main focus should be on finding appropriate ways to close this second tax gap.

Transitioning In and Out of Poverty

Thu, 10 Sep 2009 00:00:00 EST

Slightly more than half of the U.S. population experiences poverty at some time before age 65. Roughly half of those who get out of poverty will become poor again within five years. Who is more likely to enter poverty? How long are people poor? And what events are associated with falling into and climbing out of poverty? This fact sheet summarizes key findings from the poverty dynamics literature to describe how, why, and when people move in and out of poverty.

Poverty in the United States, 2008

paffairs@urban.org ( Gregory Acs ) — Thu, 10 Sep 2009 00:00:00 EST

Today, the U.S. Census Bureau announced that the U.S. poverty rate reached 13.2 percent in 2008. Even this significant increase from the 12.5 percent rate in 2007 surely understates the share of Americans struggling to make ends meet today in September 2009.

Rising Poverty Threatens Neighborhood Vitality

paffairs@urban.org ( Margery Austin Turner ) — Thu, 10 Sep 2009 00:00:00 EST

High poverty rates, especially among African Americans and Latinos, threaten the well-being of neighborhoods as well as families. We can anticipate that the number of neighborhoods with dangerously high poverty rates is higher today than in 2000, representing a tragic reversal of the downward trend between 1990 and 2000. Historically, public policies played a central role in establishing and enforcing patterns of racial segregation, alongside discriminatory practices by the private sector and individuals. But no single causal process explains the persistence of residential segregation in America today. To ensure the well-being and sustainability of all neighborhoods, public policies must intervene to break the cycle.

Automatic Enrollment in IRAs: Costs and Benefits

paffairs@urban.org ( Benjamin H. Harris, Rachel M. Johnson ) — Mon, 31 Aug 2009 00:00:00 EST

To encourage better retirement saving, President Obama recently proposed policies that would require firms without retirement savings plans to automatically enroll their workers in IRAs. In addition, the president proposed an expansion of the Saver's Credit to be fully refundable and available to middle-income taxpayers. This report estimates the revenue costs and distributional effects of the president's proposals.

Infants and Toddlers in State and Federal Budgets: Summary Report from Urban Institute Roundtable

paffairs@urban.org ( Rosa Maria Castaneda, Olivia Golden ) — Fri, 21 Aug 2009 00:00:00 EST

This report summarizes the roundtable "Infants and Toddlers in State and Federal Budgets: Yesterday's Choices, Today's Decisions, Tomorrow's Options" conducted by the Urban Institute, with support from the A.L. Mailman Family Foundation, on March 30, 2009. The roundtable's focus grew out of the widely perceived mismatch between sharply limited public investments on infants and toddlers and an accumulated body of research demonstrating the significance of the earliest years of life. We describe the group's diverse perspectives and wide-ranging discussion of strategies to address this mismatch.

The Distribution of Federal Taxes, 2009-12

paffairs@urban.org ( Rachel M. Johnson, Jeff Rohaly ) — Fri, 21 Aug 2009 00:00:00 EST

Overall, the federal tax system is progressive. On average, households with higher incomes pay taxes that are a larger share of their income. But barring legislative action, the numerous sunsets and phase-ins that Congress has written into the tax code will result in a tax system that is in a state of flux over the next few years. As a result, current law dictates significant changes in the degree of progressivity in the federal tax system between now and 2012. This paper summarizes the Tax Policy Center's latest estimates of the distribution of federal taxes for 2009 through 2012.

How We Can Pay for Health Reform

Thu, 30 Jul 2009 00:00:00 EST

In this paper and brief, the authors discuss alternative ways that health reform could be financed. They analyze different options including several proposals for delivery system reforms and for reduction in Medicare and Medicaid payments. They estimate the cost savings that could occur due to the introduction of a public plan option. Finally, they explore a range of revenue options. The key message of the paper is that health reform can be paid for, but it is best to obtain funds from a large number of measures to spread the burden broadly.

Reducing Obesity: Policy Strategies from the Tobacco Wars

paffairs@urban.org ( Carolyn L. Engelhard, Arthur Garson, Jr., Stan Dorn ) — Mon, 27 Jul 2009 00:00:00 EST

To combat the epidemic of obesity, lawmakers can adapt policy approaches that have substantially cut tobacco use. A 10 percent tax on fattening food, identified based on a model used by the British government to determine the foods that may not be advertised to children, would reduce consumption while raising more than $500 billion over 10 years. Adding simple, "traffic light" nutrition labels to the front of each food package would change consumers' buying habits, as would listing calories on menus at chain restaurants. Consumption of fattening food would be further reduced by banning its advertisement in the mass media.

Catastrophic Budget Failure

paffairs@urban.org ( Leonard E. Burman ) — Tue, 14 Jul 2009 00:00:00 EST

In a Washington Times op-ed, Len Burman explains why even this gloom-and-doom outlook is "wildly over-optimistic." The latest CBO budget outlook predicts a bleak scenario if we don't change our current policies.

Changes to the Tax Exclusion of Employer-Sponsored Health Insurance Premiums: A Potential Source of Financing for Health Reform

paffairs@urban.org ( Lisa Clemans-Cope, Stephen Zuckerman, Roberton Williams ) — Fri, 26 Jun 2009 00:00:00 EST

Many have suggested that reducing or eliminating the tax exclusion of employer-sponsored health insurance (ESI) could generate significant additional tax revenue to fund expansions in health insurance coverage. In this paper, we focus on two specific policy design elements: (1) a cap, or dollar limit, on the amount of employer-sponsored health insurance premiums excluded from taxable income; and (2) an index that determines how this cap might grow over time. Our analysis shows that limiting the tax exclusion would provide substantial funding for health reform and mitigate the huge inequities built into the current treatment of employer premiums.

How Will the Stock Market Collapse Affect Retirement Incomes? : Older Americans' Economic Security No. 20

paffairs@urban.org ( Barbara Butrica, Karen E. Smith, Eric Toder ) — Wed, 24 Jun 2009 00:00:00 EST

Urban Institute projections suggest the stock market collapse will have small effects on most Americans' retirement incomes. It's estimated that 37 percent of Americans born between 1941 and 1965 owned no stocks when the market crashed in 2008 and that income from assets will account for a small share of retirement income, even for those with stocks. For most retirees, Social Security provides the majority of income. Had Social Security been invested in private accounts with equities, the impact of the crash would have been much largerpositive or negative, depending on one's birth cohort and on future market performance.

Do We Need a Value-Added Tax to Solve Our Long-Run Budget Problems?

paffairs@urban.org ( Rudolph G. Penner ) — Tue, 23 Jun 2009 00:00:00 EST

The U.S. budget is on an unsustainable path. That is because Social Security, Medicare, and Medicaid, which together constituted almost one half of noninterest spending before the recent stimulus plan, are all growing faster than tax revenues. If these programs are not reformed, tax burdens raised, or other spending decimated, deficits and the national debt will explode. It is difficult to imagine solving the entire budget problem by slowing spending growth, because benefits would then be far below those previously promised. It is equally unlikely that tax increases could solve the whole problem because the tax burden would then be so far above any ever experienced by Americans. To the extent that tax burdens are to be increased, there are three options. Tax rates could be raised in the existing system, but that would be extremely inefficient. Tax reform might raise revenues more efficiently, but that is excruciatingly difficult politically. That leaves the possibility of a brand new tax and a VAT is a very likely candidate.

Promoting Economic Mobility By Increasing Postsecondary Education

paffairs@urban.org ( Ron Haskins, Harry Holzer, Robert I. Lerman ) — Fri, 12 Jun 2009 00:00:00 EST

A college education strongly affects whether or not children from poor or low-income families move up the economic ladder when they become adults. But they are less likely to enroll in either two- or four-year colleges, and less likely to complete a degree when they do, relative to those from middle- and upper-income families even after accounting for differences in academic preparation. We review current federal efforts to help low-income students attend college, and recommend new policies that would improve their academic preparation, provide more effective guidance on selecting and paying for college, and improve retention and graduation rates.

Extending the EITC to Noncustodial Parents: Potential Impacts and Design Considerations

paffairs@urban.org ( Laura Wheaton, Elaine Sorensen ) — Fri, 12 Jun 2009 00:00:00 EST

This paper examines the noncustodial parent earned income tax credit (NCP EITC), a new type of credit recently enacted in New York and Washington, D.C. and proposed by Senator Bayh and then-Senator Obama in 2007. The NCP EITC offers an earned income tax credit to low-income noncustodial parents who work and pay their full child support. This paper describes the rationale for this policy and provides national estimates of the benefits and costs of an NCP EITC under three alternative policy scenarios. It also discusses several key design and implementation issues.

Low-Income Working Families: Updated Facts and Figures

paffairs@urban.org ( Alexandra Stanczyk ) — Thu, 11 Jun 2009 00:00:00 EST

A large percentage of American families have low incomes, which lead to a host of challenges and disadvantages for both parents and children. In 2006, one out of every three families with children had incomes below twice the federal poverty level (FPL): $40,888 for a family with two adults and two children. While these families face many of the same challenges as other families, they are particularly financially vulnerable. This fact sheet provides statistics on the work effort, earnings, health care access and other characteristics of these families.

Data Appendix to Federal Expenditures on Infants and Toddlers in 2007

Wed, 03 Jun 2009 00:00:00 EST

Federal Expenditures on Infants and Toddlers in 2007 looks comprehensively at federal spending and tax expenditures targeted toward infants and toddlers. This appendix details our data sources, the programs we include, and the methodology used to estimate the percentage of federal expenditures that went to infants and toddlers in 2007.

Capping the Tax Exclusion of Employer-Sponsored Health Insurance: Is Equity Feasible?

paffairs@urban.org ( Stan Dorn ) — Tue, 02 Jun 2009 00:00:00 EST

Some policymakers propose capping the amount of employer-sponsored insurance that is exempt from federal income and payroll taxes. If such a cap is based on employer premiums, inequities will result. Workers could pay higher taxes if their employer is located in a high-cost area, if many co-workers are in their 50s and 60s, or if a few employees have a major illness or accident. To avoid such inequities, the cap could be based on benefit generosity, measured by actuarial value, which is the cost of expected claims if a nationally representative population received the covered benefits.

The Impact of Foreclosures on Home Ownership and Affordable Housing in the District of Columbia

paffairs@urban.org ( Peter A. Tatian ) — Fri, 29 May 2009 00:00:00 EST

In this testimony before members of the D.C. City Council, Peter Tatian, senior researcher in the Urban Institute's Metropolitan Housing and Communities Policy Center and director of NeighborhoodInfo DC, presents recent data showing that the national foreclosure crisis has not spared households in the District of Columbia. Although the intensity of the foreclosure problem is not as severe as in other parts of the region, the nation's capital has seen a marked and steady increase in foreclosures since the beginning of the housing market downturn.

Political Claims Get a Reality Check in "Policy and Evidence in a Partisan Age"

paffairs@urban.org ( The Urban Institute ) — Thu, 28 May 2009 00:00:00 EST

In Policy and Evidence in a Partisan Age: The Great Disconnect, Paul Gary Wyckoff presents an accessible, compact, and iconoclastic exploration of the paradox between the exaggerated claims made for public policies and the reality of their limited effectiveness.

A Detailed Picture of Intergenerational Transmission of Human Capital

paffairs@urban.org ( Austin Nichols, Melissa Favreault ) — Fri, 22 May 2009 00:00:00 EST

Using data from the Health and Retirement Study, we consider how parental education relates to four outcomes in the children's generation: education, lifetime earnings, health, and wealth. By focusing on parents' and children's ranks, we characterize relative mobility in terms of distributions of outcomes and can see patterns that even a relatively disaggregated analysis, like a quintile-based transition matrix, can obscure. Our results show relatively high intergenerational mobility except at extremes, where very low-ranked parents are much more likely to have very low-ranked children and very high-ranked parents are much more likely to have very high-ranked children.

Risk and Recovery: Documenting the Changing Risks to Family Incomes

paffairs@urban.org ( Gregory Acs, Pamela J. Loprest, Austin Nichols ) — Fri, 22 May 2009 00:00:00 EST

Using the 1996, 2001, and 2004 panels of the Survey of Income and Program Participation, this brief examines the likelihood that nonelderly individuals in families with children experience substantial drops in family income and recoveries from such drops. Over 13 percent of families see their incomes fall by half at some point over the course of a year with the lowest- and highest-income families the most likely to experience a substantial income loss. Further, only two in five individuals recover to at least 100 percent of their pre-drop income in the year after the drop.

Five Questions for Rosanne Altshuler

paffairs@urban.org ( Rosanne Altshuler ) — Mon, 18 May 2009 00:00:00 EST

Rosanne Altshuler, codirector of the Urban-Brookings Tax Policy Center, answers five questions about tax reform and her experience as chief economist on President Bush's 2005 tax reform panel. The panel's report, Altshuler said, should serve as a blueprint for President Obama's tax reform commission—though the recession makes many of the proposed actions harder to take.

Federal Expenditures on Infants and Toddlers in 2007

Tue, 05 May 2009 00:00:00 EST

This report examines more than 100 programs through which the federal government spends money on children and calculates the amount spent on children under three. These first time expenditure estimates provide a place to start in gauging the priority the nation places on investing in very young children and in comparing expenditure patterns to researchers findings about investments that work. For example, despite extensive child development research underscoring the importance of quality early care and education programs for infants and toddlers, especially those in poverty, just 7 percent of federal funding for children between birth and age 2 went toward these efforts in 2007.

Federal Expenditures on Infants and Toddlers in 2007 Key Facts

Tue, 05 May 2009 00:00:00 EST

Extensive research shows investing in very young children can help build a strong future workforce, improve children's educational success and health, and potentially reduce some of the social ills that drain the nations resources and will. What investments does the United States currently make in infants and toddlers?

Youngest Children Are Underrepresented in Federal Budget

paffairs@urban.org ( The Urban Institute ) — Tue, 05 May 2009 00:00:00 EST

Despite extensive research documenting the benefits of investing in young children, infants and toddlers are underrepresented in the federal budget. The nation's 12.5 million children under age 3 are 4.2 percent of the population, but they received just 2.1 percent-$44.1 billion-of federal domestic spending in 2007.

Economic Minefields

paffairs@urban.org ( Rudolph G. Penner ) — Thu, 02 Apr 2009 00:00:00 EST

Institute Fellow Rudy Penner questions the costs and after-effects of heavy economic stimulus. There is a path out of our misery, he says, but it is surrounded by big and little mines, some of which have been planted by public policy.

Comparisons of MINT 2003 and 2004 Projections with Survey Data

paffairs@urban.org ( Karen E. Smith, Katherine Michelmore, Eric Toder ) — Thu, 19 Mar 2009 00:00:00 EST

This report compares projections of income and assets from the Model of Income in the Near Term (MINT) with data from the Survey of Income and Program Participation (SIPP), the Health and Retirement Study (HRS), the Survey of Consumer Finances (SCF), and the Current Population Survey (CPS). The comparison reveals a fair amount of variability in population characteristics and reported income and assets among these data files. There is no "right" answer, but rather a range of possible answers. For most statistics we compare, MINT's projected values fall between the highest and lowest values among the survey data.

Nine in Ten: Using the Tax System to Enroll Eligible, Uninsured Children into Medicaid and SCHIP

Fri, 27 Feb 2009 00:00:00 EST

In 2004, 89.4 percent of uninsured children who qualified for Medicaid or the State Children's Health Insurance Program lived in families who filed federal income tax forms. This substantially exceeds the proportion of uninsured but eligible children who can be reached through many other outreach strategies. Federal lawmakers could cover uninsured children in these families by: (a) changing federal income tax forms so parents can identify their uninsured children and request coverage; (b) investing in information technology allowing data exchange between states and the Internal Revenue Service; and (c) letting states cover uninsured children if tax information shows they qualify.

A Safety Net For the Least Fortunate

paffairs@urban.org ( Peter Edelman, Mark Greenberg, Harry Holzer ) — Tue, 17 Feb 2009 00:00:00 EST

In this Washington Post commentary, Institute Fellow Harry Holzer suggests ways to help those most adversely affected by the economic downturnlow-income single mothers, disadvantaged adults, youths, and their families.

Tax-Law Expert Demystifies the 100-Year-Old Corporate Tax

paffairs@urban.org ( The Urban Institute ) — Fri, 13 Feb 2009 00:00:00 EST

The U.S. corporate tax has been in effect longer than the current individual income tax but it has only rarely changed significantly since its 1909 inception. Daniel N. Shaviro, in the new book Decoding the U.S. Corporate Tax, outlines longstanding imperfections in the tax code and describes difficulties in applying corporate tax laws now that financial instruments are so complex and capital flows are worldwide. Shaviro also explains how political and economic realities are likely to frustrate much-needed changes to the tax code.

Do Education and Training Belong in the Recovery Package?

paffairs@urban.org ( Harry Holzer ) — Fri, 06 Feb 2009 00:00:00 EST

Ramped-up education spending should be part of an economic stimulus package, Institute Fellow Harry Holzer argues, because it will increase the gross domestic product, lead to more hiring, add income to local economies, and contribute to future productivity.

Health Savings Accounts and High-Deductible Health Insurance Plans : Implications for Those with High Medical Costs, Low Incomes, and the Uninsured

paffairs@urban.org ( Linda J. Blumberg, Lisa Clemans-Cope ) — Tue, 03 Feb 2009 00:00:00 EST

Health Savings Accounts (HSAs) and high-deductible health plans are prominently featured in many discussions of health reform.The hope of supporters is that they will make individuals more prudent purchasers of medical care. However, the tax structure and incentives built into HSAs make them most attractive to the high-income and the healthy, populations already advantaged by the current system. HSA/high deductible plans shift more of the health financing burden onto those using significant amounts of care, with negative ramifications for the low-income and high-need. Nor is it clear that cost-containment, higher value shopping, or reductions in the uninsured will follow.

Federal Taxes and the Elderly

paffairs@urban.org ( Rudolph G. Penner ) — Tue, 03 Feb 2009 00:00:00 EST

The article considers special federal tax provisions affecting the elderly. It examines the taxation of Social Security, private retirement accounts, estate taxation and other provisions of the law that mention age. It also analyzes how the elderly might be affected by tax increases necessitated by the dismal long-run budget outlook. In particular, it looks at the possibility that we shall become more reliant on consumption taxes.

A Budget We Can Believe In : Memo to President Barack Obama

Tue, 27 Jan 2009 00:00:00 EST

Two former directors of the Congressional Budget Office now at the Urban Institute join scholars from other organizations in a memo advising President Obama on how to balance the nations short- and long-term economic needs. To reduce escalating future deficits without endangering near-term recovery, the authors recommendations include action to stem the growth of Social Security and Medicare.

Experiment to Get Best Stimulus Results

paffairs@urban.org ( Leonard E. Burman ) — Thu, 22 Jan 2009 00:00:00 EST

What will work best to stimulate the nation out of recession? Look to the states, saysLen Burmanin a commentary for public radio's Marketplace program.

Addressing Short- and Long-Term Fiscal Challenges : Testimony before the Senate Budget Committee

paffairs@urban.org ( Rudolph G. Penner ) — Wed, 21 Jan 2009 00:00:00 EST

The prevalent theme in recent discussions of stimulus is that the risk of doing too little exceeds the risk that we shall do too much. But we must ask how much of too much we can tolerate. The risks of overdoing it are severe and are not emphasized enough in the current discussion. The main worries are that the speed with which the national debt is being increased could eventually cause a very rapid rise in interest rates on Treasuries and that federal, state and local bureaucracies may not be able to manage the proposed huge increase in spending. Turning to the long run, the testimony discusses the need to address short- and long-term budget problems simultaneously and the prospects for using the Conrad-Gregg commission to do so.

Addressing the Nation's Contradictory Fiscal Challenges : Statement before Committee on the Budget, United States Senate

paffairs@urban.org ( Robert D. Reischauer ) — Wed, 21 Jan 2009 00:00:00 EST

In testimony before the Senate Budget Committee, UI's president and former director of the Congressional Budget Office, discusses remedies for the nation's two serious --and diametrically opposed --fiscal challenges: the immediate, short-run problems of economic recession, and the issue of long-term fiscal sustainability.

Massachusetts Health Reform: Solving the Long-Run Cost Problem

paffairs@urban.org ( John Holahan, Linda J. Blumberg ) — Thu, 15 Jan 2009 00:00:00 EST

Many of Massachusetts's health reforms have brought about positive change: the number of uninsured has fallen by half, access to needed care has increased, and private insurance has not been "crowded out" by public insurance programs. But the Massachusetts initiative has also seen higher than anticipated costs. In a new analysis, John Holahan and Linda Blumberg summarize the state's accomplishments, examine the challenges, and suggest four options for addressing long-term costs. According to the authors, much of Massachusetts's high spending growth is due to the concentration in the state's hospital and insurance markets.

How Much State Fiscal Relief is Enough?

paffairs@urban.org ( Stan Dorn ) — Thu, 15 Jan 2009 00:00:00 EST

Between increased Medicaid caseloads, rising indigent care costs, and Medicaid's share of state revenue losses, an economic downturn in the next two and a half years could impose between $74 billion and $118 billion in extra financial burdens on the 50 states, if unemployment averages between 8 and 10 percent. The amount Congress must spend to prevent state service cutbacks and tax increases depends on how fiscal relief is allocated. Basing each state's funding on objective, economic indicators makes federal dollars go farther towards solving state fiscal woes, since more of the money benefits the states that most need help.

Unemployment and Income in a Recession : Recession and Recovery, No. 1

paffairs@urban.org ( Gregory Acs ) — Mon, 22 Dec 2008 00:00:00 EST

This brief, part of the Urban Institute's "Recession and Recover" series, assesses how unemployment and household income changes as the economy moves through a recession and into recovery.

Unemployment Insurance during a Recession : Recession and Recovery, No. 2

paffairs@urban.org ( Margaret Simms, Daniel Kuehn ) — Mon, 22 Dec 2008 00:00:00 EST

This brief, part of the Urban Institute's "Recession and Recover" series, examines how the Unemployment Insurance program responds during a recession and how that response may differ in the current recession from its response in the past.