Congress Can Reduce the Deficit by $7.7 Trillion in 10 Years

Posted on by Lone Candle

“the CBO published its report on budget options. The two-volume document highlights options for deficit reduction. One volume details large possible spending reductions while the other lays out small ones—so the options are plenty. They include important reforms of some of the major drivers of future debt: Medicare, Medicaid, and Social Security.

All told, it’s possible to achieve deficit reduction of $7.7 trillion over 10 years. That’s enough to accomplish what some people mistakenly believe to be out of reach: balancing the budget without raising taxes. There are also a few options to simplify the tax code by removing or reducing unfair individual tax deductions and by cutting corporate welfare.

For instance, it’s high time for Congress to end tax deductions for employer-paid health insurance. This tax deduction is one of the biggest of what we wrongly call “tax expenditures.” It’s responsible for many of the gargantuan distortions in the health care market and the resulting enormous rise in health care costs. The CBO report doesn’t eliminate this deduction; instead, it limits the income and payroll tax exclusion to the 50th percentile of premiums (i.e. annual contributions exceeding $8,900 for individual coverage and $21,600 a year for family coverage). The savings from this reform alone would reduce the deficit by roughly $900 billion.

A second good option is to cap the federal contribution to state-administered Medicaid programs. That federal block grant encourages states to expand the program’s benefits and eligibility standards—unreasonably in some cases—since they don’t have to shoulder the full bill. CBO estimates that this reform would save $871 billion.

CBO also projects that Uncle Sam could reduce the budget deficit by $121 billion by raising the federal retirement age. CBO’s option would up this age “from 67 by two months per birth year for workers born between 1962 and 1978. As a result, for all workers born in 1978 or later, the FRA would be 70.” Considering that seniors today live much longer than in the past and can work for many more years, this reform is a low-hanging fruit.

Congress could save another $184 billion by reducing Social Security benefits for high-income earners. I support a move away from an age-based program altogether since seniors are overrepresented in the top income quintile. Social Security should be transformed into a need-based program (akin to welfare). Nevertheless, the CBO’s option would be a step in the right direction.”

5 Infuriating Ways People Got the First Amendment Wrong in 2022

Posted on by Lone Candle

“While college campuses are chock full of particularly mind-numbing misunderstandings of the First Amendment—from students and administration alike—the example that takes the cake this year comes from Yale Law School, where student activists disrupted a Federalist Society event discussing civil liberties.
As Foundation for Individual Rights and Expression (FIRE) attorney Zach Greenberg wrote, “Protesters banged on walls, stomped on the ground, chanted ‘Fuck you FedSoc,’ and screamed at the panelists…. The cacophony persisted for the majority of the event, and though panelists struggled to project their voices over the noise, the audience remained largely unable to hear them.”

The activists’ actions comprised a “heckler’s veto”—a form of unprotected speech where the heckler prevents someone from exercising their free speech rights by physically preventing them from being heard. However, the activists didn’t seem to care. When students were told their actions violated Yale’s free expression policies, a chorus of students insisted that “This is free speech.””

How To Empower Millions of Independent Workers

Posted on by Lone Candle

“Most Americans who enter independent work arrangements do so because they prefer them to the more structured and controlled world of traditional employment, not because they have no other choice. A 2021 Upwork survey found that more than 70 percent of both full‐time and part‐time independent workers see increased flexibility as the major reason for engaging in independent work. A separate 2021 survey from MBO Partners showed that nearly 90 percent of respondents were happier in independent work than in traditional jobs. It also found that roughly three‐quarters of independent workers are satisfied with their work, intend to remain in independent work, and are optimistic about their career future. Just 11 percent wanted to find full‐time traditional employment.

This preference extends to oft‐maligned gig work. According to a 2021 Pew Research Center survey, for example, almost 80 percent of gig platform workers rated their experiences positively, with almost half citing schedule flexibility as a major reason for doing the work. Only 28 percent of respondents said they performed gig work because there were few other job opportunities available where they live. And in 2019, when economist M. Keith Chen and his colleagues did a study of more than a million U.S. Uber drivers over an eight‐month period, they found that drivers valued the flexibility the arrangement provided—in both the timing and amount of work—at $150 per week (or 40 percent of expected earnings). Chen’s team also learned that drivers would need a 50 percent raise to work for a less flexible taxi company.”

What 2022 Taught Us About Freeing American Alcohol Markets

Posted on by Lone Candle

“In the first two years of the pandemic, American alcohol rules underwent a fundamental shift. States started enacting emergency orders—and then cementing those orders in legislation—that authorized never-before-seen innovations in alcohol policy, such as letting restaurants and bars deliver booze and sell it to go. But if 2020 and 2021 ushered in new hopes of opening up American alcohol markets, 2022 is the year when protectionism struck back.
In the early months of the pandemic, state governments were reacting in real time to unprecedented circumstances. The new environment included stay-at-home orders, social distancing guidelines, and masking mandates. It no longer became viable for most retail businesses to rely solely on an in-person customer base, as the entire economy shifted over to a delivery-centric model. Restaurants, breweries, wineries, and neighborhood liquor stores all faced an existential business crisis.

States reacted by upending a nearly centurylong consensus on alcohol regulations. Before, it was essentially unheard-of to let a pizzeria throw in a margarita with a delivery order. Then states started issuing emergency orders that allowed it. And practices that had been slightly more common—such as allowing alcohol to be included in grocery store deliveries, which numerous states permitted before COVID-19—spread to an unprecedented number of locales.

Unsurprisingly, these changes proved popular. In states where citizens were polled, strong majorities expressed their support for more types of to-go and delivery booze. Lawmakers can read polls, and a wave of states either extended the reforms or made them permanent.

The results were dramatic. When 2020 began, no place in America had a statewide to-go or delivery alcohol law for restaurants. By the fall of 2021, 29 states had such a law on the books. During that time, another seven states passed laws permitting alcohol delivery from off-premise stores, such as grocery or liquor stores, and eight states passed laws expanding the delivery capabilities of breweries, distilleries, and other alcohol producers.

But in 2022, this explosive rate of reform slowed down. The progress didn’t stop altogether: Nine more states passed to-go or delivery alcohol laws for restaurants, and one more state authorized alcohol delivery from off-premise stores. But the pace of change noticeably declined. Worse yet, several reforms suffered high-profile defeats.”

…

“The opposition has finally had a chance to get organized. And by the opposition, I mean entrenched economic interests. In Colorado, incumbent liquor store owners felt the proposed ballot initiatives would hurt their bottom lines by allowing other types of stores, like grocery or chain stores, to sell and deliver alcohol. . And in California and elsewhere, alcohol wholesalers have become increasingly aggressive in opposing any direct-to-consumer reforms that would let alcohol makers cut out the middleman and ship products directly to their customers.”