government spending – Page 2

Biden and Harris’ Record on Spending and Debt Is a Tragedy of Epic Proportion

Posted on December 2, 2024 by Lone Candle

“According to brand-new Congressional Budget Office (CBO) numbers, the 2024 budget deficit is around $1.8 trillion. It’s heading to $2.8 trillion in 10 years, assuming a very rosy scenario. Worrisome too is that interest payments on government debt will eat up over 20 percent of revenue in 2025. As the Hoover Institution’s Joshua Rauh noted, if you remove the revenue earmarked for the Social Security Old Age and Disability Insurance program, that number jumps to 27.9 percent and rising.”

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“Three months into the term and four months after the last $900 billion COVID-19 relief bill, the Biden-Harris administration pushed through another $1.9 trillion bill. This spending was so out of proportion with the state of the economy, which faced an output gap of only $420 billion, that we suffered the worst inflation in 40 years. This wasn’t just a serious hit to the deficit—it also cost the typical family more than $10,000.
The administration then decided to push several large, unpaid-for bills. Riedl lists some: “$1.4 trillion in new spending in omnibus appropriations bills, $620 billion in student loan bailouts, $520 billion for new veterans’ benefits, a $440 billion infrastructure law, a semiconductor bill, and $360 billion in new [Supplemental Nutrition Assistance Program] and health spending forced through by executive order.”

Some economists wrongly insisted that adding debt is no big deal as long as interest rates are low. This condition certainly doesn’t apply to the Biden-Harris spending spree. Add it all up, including interest payments on the debt, and you get $5 trillion on top of what was already there.”

https://reason.com/2024/10/10/biden-and-harris-record-on-spending-and-debt-is-a-tragedy-of-epic-proportion/

DOGE Can Succeed by Scaling Back Its Ambitions

Posted on December 2, 2024 by Lone Candle

“is DOGE doomed to fail? Not if its architects take a more realistic approach to cutting government. Fundamental reform of Social Security, Medicare, and Medicaid will require delicate, bipartisan negotiations that are already taking place within parts of Congress. Senate Democrats will not back down from filibustering a partisan GOP Social Security plan just because Musk and Ramaswamy recommended it in a report. Nor will Congress suddenly drop its longstanding opposition to eliminating entire federal departments.

Republicans need to stop overpromising and underdelivering on federal budget policy. Congressional Republicans unrealistically promise to balance the budget within a decade while not even attempting to pass any actual legislation slowing the growth of spending. Musk promises to zero out one-third of federal spending, and Ramaswamy pledges to fire three-quarters of federal employees. It’s all bluster to compensate for ultimately doing nothing.”

https://reason.com/2024/11/21/doge-can-succeed-by-scaling-back-its-ambitions/

To Succeed at Cutting Government, Musk and Ramaswamy Must Take on Entitlements

Posted on November 20, 2024November 20, 2024 by Lone Candle

“First, it’s not as if there is some secret knowledge to be uncovered by the DOGE when it comes to fixing the rampant inefficiencies of the federal government. Those Medicare and Medicaid overpayments are documented annually, for example. The Government Accountability Office and various inspectors general file regular reports. The Congressional Budget Office maintains a list of things that could be cut to reduce the deficit. Various members of Congress—most prominently, Sen. Rand Paul (R–Ky.)—periodically publish lists of silly, wasteful, or dubious government spending.
What’s lacking, in short, is not ideas but the political will to act on them.

The amount of political will is going to matter, because that is very relevant to the second point: Unless Trump is willing to set aside his promise not to touch America’s entitlement programs, the DOGE will be unable to follow through on its mandate.

Again, look at those improper payments made by Medicare and Medicaid. The $101.4 billion of improper payments the two entitlements made in 2023 accounted for 40 percent of all improper payments across the entire government that year, according to the GAO. That same GAO report suggested a simple change in how Medicaid bills some of its services that, if implemented, could save $141 billion over 10 years.”

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“The same problem pops up when you start looking at other big swings that the DOGE could take. Seven of the top nine suggestions made by the Congressional Budget Office’s annual report on “options for reducing the deficit” involve changing elements of America’s three federal entitlement programs. Capping Medicaid spending, increasing premiums for Medicare Part B, or reconfiguring how Social Security benefits are paid to wealthier Americans each could save hundreds of billions of dollars over the next decade. None will be possible as long as entitlement reform is off the table.

All of this is a function of the federal government’s fiscal reality: Entitlements are the biggest and fastest-growing segment of the budget. This year, so-called “mandatory spending”—primarily Social Security, Medicare, and Medicaid, along with a few other government-funded health care programs—will cost nearly $4 trillion, while all discretionary spending will total less than $1.8 trillion.

Musk has promised $2 trillion in spending cuts, but he could propose eliminating all discretionary spending—good luck zeroing out the Pentagon—and would still fall short of that goal. It is impossible to be serious about fiscal reform while promising not to touch the entitlement programs.”

https://reason.com/2024/11/13/to-succeed-at-cutting-government-musk-and-ramaswamy-must-take-on-entitlements/

Do the benefits of the expanded child tax credit actually fade with time?

Posted on October 27, 2024 by Lone Candle

“By sending unconditional monthly checks of up to $300 per child to the nation’s poorest families — including those with little to no income who had typically been excluded from such programs — the “child allowance” lifted 2.1 million children out of poverty who would’ve otherwise been left behind.

Arguments against such programs that give unconditional cash usually assert that it’ll drive low-income people to quit their jobs, ultimately harming the economy. But research found little to no drop in employment rates as a result of the expanded CTC. Yet despite a flurry of support from prominent economists and recipients alike, politicians failed to reach an agreement to make the temporary expansion permanent, and Congress let it expire at the end of 2021.”

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“a new working paper from Elizabeth Ananat and Irwin Garfinkel, two economists at Columbia University. Expanding on work they first published in 2022, their research surveys long-run cash and quasi-cash transfer programs (like food stamps) in the US in an effort to predict the overall effects of a child allowance over the very long run. Instead of the grim and jobless future forecast by expanded CTC critics, they find that a future shaped by a permanent child allowance is well worth the investment.
Ananat and Garfinkel found that the total long-run benefits to society of making a child allowance permanent outweigh the costs by nearly 10 to 1.”

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“Their promise of a 10 to 1 return is, frankly, massive. For every $100 or so billion the child allowance would cost the government each year, society would reap additional long-term benefits of about $929 billion. Those dollars represent benefits like improved child and parent health and longevity, higher future earnings for children, and reduced crime and health care costs. There would be an effect from the small dip in employment that their calculations predict, and a resulting decrease in tax revenue — but it would amount to just $2.4 billion. That’s a drop in a bucket overflowing with almost a trillion dollars in benefits.

But the nuances of such long-term returns can be difficult to convey. “A little bit shows up in the first few years in the form of reduced [child abuse and neglect], reduced hospitalizations, and those sorts of things,” said Ananat. “But most of it doesn’t show up until the kids grow up. So that requires a very patient type of investor.””

https://www.vox.com/future-perfect/371858/child-tax-credit-poverty-economics-future-benefits

Data shows migrants aren’t taking jobs from Black or Hispanic people, despite what Trump says

Posted on October 13, 2024October 13, 2024 by Lone Candle

“government data show immigrant labor contributes to economic growth and provides promotional opportunities for native-born workers. And a mass deportation event would cost U.S. taxpayers up to a trillion dollars and could cause the cost of living, including food and housing, to skyrocket, economists say.”

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“The latest U.S. Bureau of Labor Statistics Current Population Survey data shows that as of 2023, native-born Black workers are most predominantly employed in management and financial operations, sales and office support roles, while native-born Latino workers are most often employed in management, office support, sales and service occupations.
Foreign-born, noncitizen Black workers are most often represented in transportation and health care support roles, and foreign-born, noncitizen Hispanic workers are most often represented in construction, building and grounds cleaning.

How has immigration contributed to U.S. growth?

In 2023, international migrants — primarily from Latin America — accounted for more than two-thirds of the population growth in the United States, and so far this decade they have made up almost three-quarters of U.S. growth.

After hitting a record high in December 2023, the number of migrants crossing the border has plummeted.

The claim that immigrants are taking employment opportunities from native-born Americans is repeated by Trump’s advisers. They often cite a report produced by Steven Camarota, research director for the Center for Immigration Studies, a right-leaning think tank that seeks a reduced immigration flow into the U.S. The report combines job numbers for immigrants in the U.S. legally and illegally to reinforce the claim that foreigners are disproportionately driving U.S. labor growth and reaping most of the benefits.

Camarota’s report states that 971,000 more U.S.-born Americans were employed in May 2024 compared to May 2019, prior to the pandemic, while the number of employed immigrants has increased by 3.2 million.

It is true that international migrants have become a primary driver of population growth this decade, increasing their share of the overall population as fewer children are being born in the U.S. compared with years past. That’s according to the U.S. Census Bureau’s annual American Community Survey.

Are immigrants taking native-born workers’ jobs?

Economists who study immigrant labor’s impact on the economy say that people who are in the U.S. illegally are not taking native citizens’ jobs, because the roles that these immigrant workers take on are most often positions that native workers are unwilling to fill, such as agriculture and food processing jobs.

Giovanni Peri, a labor economist at the University of California, Davis, conducted research that explores the impact of the 1980 influx of Cuban immigrants in Miami (the so-called Mariel Boatlift) on Black workers’ employment. The study determined that the wages of Miami’s Black and Hispanic workers moved above those in other cities that did not have a surge of immigrant workers.

Peri told the AP that the presence of new immigrant labor often improves employment outcomes for native-born workers, who often have different language and skill sets compared to new immigrants.

In addition, there are not a fixed number of jobs in the U.S., immigrants tend to contribute to the survival of existing firms (opening up new opportunities for native workers) and there are currently more jobs available than there are workers available to take them. U.S. natives have low interest in working in labor-intensive agriculture and food production roles.

“We have many more vacancies than workers in this type of manual labor, in fact we need many more of them to fill these roles,” Peri said.

Stan Marek, who employs roughly 1,000 workers at his Houston construction firm, Marek Brothers Holdings LLC, said he has seen this firsthand.

Asked if immigrants in the U.S. illegally are taking jobs from native-born workers, he said, “Absolutely not, unequivocally.”

“Many of my workers are retiring, and their kids are not going to come into construction and the trades,” Marek said. He added that the U.S. needs an identification system that addresses national security concerns so those who are in the country illegally can work.

“There’s not enough blue-collar labor here,” he said.

Data also shows when there are not enough workers to fill these roles, firms will automate their jobs with machines and technology investments, rather than turn to native workers.”

https://www.yahoo.com/news/data-shows-migrants-arent-taking-040445122.html

Science has a short-term memory problem

Posted on September 28, 2024September 28, 2024 by Lone Candle

“In the US, basic science research, studying how the world works for the sake of expanding knowledge, is mostly funded by the federal government. The NIH funds the vast majority of biomedical research, and the National Science Foundation (NSF) funds other sciences, like astrophysics, geology, and genetics. The Advanced Research Projects Agency for Health (ARPA-H) also funds some biomedical research, and the Defense Advanced Research Projects Agency (DARPA) funds technology development for the military, some of which finds uses in the civilian world, like the internet.
The grant application system worked well a few decades ago, when over half of submitted grants were funded. But today, we have more scientists — especially young ones — and less money, once inflation is taken into account. Getting a grant is harder than ever, scientists I spoke with said. What ends up happening is that principal investigators are forced to spend more of their time writing grant applications — which often take dozens of hours each — than actually doing the science they were trained for. Because funding is so competitive, applicants increasingly have to twist their research proposals to align with whoever will give them money. A lab interested in studying how cells communicate with each other, for example, may spin it as a study of cancer, heart disease, or depression to convince the NIH that its project is worth funding.

Federal agencies generally fund specific projects, and require scientists to provide regular progress updates. Some of the best science happens when experiments lead researchers in unexpected directions, but grantees generally need to stick with the specific aims listed in their application or risk having their funding taken away — even if the first few days of an experiment suggest things won’t go as planned.

This system leaves principal investigators constantly scrambling to plug holes in their patchwork of funding. In her first year as a tenure-track professor, Jennifer Garrison, now a reproductive longevity researcher at the Buck Institute, applied for 45 grants to get her lab off the ground. “I’m so highly trained and specialized,” she told me. “The fact that I spend the majority of my time on administrative paperwork is ridiculous.””

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“The Howard Hughes Medical Institute (HHMI) has a funding model worth replicating. It is driven by a “people, not projects” philosophy, granting scientists many years worth of money, without tying them down to specific projects. Grantees continue working at their home institution, but they — along with their postdocs — become employees of HHMI, which pays their salary and benefits.

HHMI reportedly provides enough funding to operate a small- to medium-sized lab without requiring any extra grants. The idea is that if investigators are simply given enough money to do their jobs, they can redirect all their wasted grant application time toward actually doing science. It’s no coincidence that over 30 HHMI-funded scientists have won Nobel Prizes in the past 50 years.”

https://www.vox.com/future-perfect/370681/science-research-grants-scientific-progress-academia-slow-funding

Mike Pence’s Sensible (and Probably Doomed) Plan To Fix the National Debt

Posted on September 26, 2024 by Lone Candle

“To get the debt under control, AAF points out that lawmakers cannot simply focus on the discretionary part of the federal budget—which accounts for less than 30 percent of all federal spending. Meanwhile, so-called “mandatory spending” accounts for more than 60 percent (the rest is interest payments on the debt).
Most of the mandatory spending category is made up of Social Security and Medicare, but several other programs also run on autopilot, including food stamps, federal worker retirement benefits, Obamacare’s health insurance subsidies, and veterans’ benefits.

“Mandatory spending is the biggest driver of the national debt because there is no restriction on the unchecked growth of these programs,” argues AAF’s debt report.

Among the proposals to bring mandatory spending under control, the group argues for means-testing future Social Security cost-of-living adjustments (COLAs) for individuals making more than $1 million annually, stopping President Joe Biden’s student loan cancellation plans, ending Obamacare’s insurance subsidies for wealthy Americans, and the formation of a congressional commission to propose spending cuts.

The group also calls for ending so-called “tax expenditures,” which are forms of spending hidden in the tax code—for example, corporate green energy subsidies delivered in the form of renewable tax credits.

The new document picks up where Pence left off in his failed Republican primary campaign last year. On the campaign trail, Pence talked up the importance of sane fiscal policy and condemned his former boss—Republican presidential nominee Donald Trump—for ignoring the threat posed by runaway borrowing and unsustainable entitlement programs.

Of course, Pence’s campaign never got off the ground in any meaningful sense. Former South Carolina Gov. Nikki Haley had a little more success, but there’s clearly not much of a constituency for serious talk about the debt.”

https://reason.com/2024/08/09/mike-pences-sensible-and-probably-doomed-plan-to-fix-the-national-debt/