Wednesday, April 15, 2015

Wednesday, April 15, 2015

Fueling Young Minds and our Economy; Legislators lack confidence in governor; Tax Day: Congress looks out for top .2 percent and; Cutting taxes and helping low income families not mutually exclusive

Fueling Young Minds and our Economy

Members of the House Appropriations Committee set aside most of Tuesday to hear from citizens about the state budget. It’s an annual ritual, often emotional, when legislators get to learn from their constituents how Louisiana’s chronic revenue shortfalls have created lengthy waiting lists for at-home care for the developmentally disabled, threaten to disrupt care at 41 neighborhood clinics in New Orleans and could lead to higher tuition and fewer programs at colleges and universities. Melinda Deslatte of the Associated Press was there:


The stories were heartbreaking, and the list of budget requests expensive as parents, health care providers and advocacy groups asked lawmakers Tuesday to reverse cuts that Gov. Bobby Jindal proposes to balance next year’s budget. Parents of disabled children on waiting lists for at-home care, leaders of community clinics that rely on state financing and hospitals slated to receive less for taking care of Medicaid patients asked the House Appropriations Committee for more money.


But this year lawmakers also learned about Ready Louisiana.  This coalition of policy advocates, business leaders and nonprofit organizations seeks support for early care and education (ECE) programs that allow low-income parents to have high-quality learning environments for their children while they work. Led by the United Way of Southeast Louisiana, the Policy Institute for Children, the Louisiana Association of United Ways and others, the coalition is asking the Legislature for an $80 million down payment to fund Act 3, a 2012 law that reformed ECE in Louisiana. The ultimate goal is to get $208 million by 2020. Biz New Orleans has the story:


According to United Way of Southeast Louisiana and the Women’s Leadership Council, Louisiana appropriates $0 State General Funds for children under age four for early care and education, and Child Care Assistance has been cut by more than 58 percent over five years and the number of children served has been cut in half.  United Way of Southeast Louisiana and more than 20 other supporters of early childhood education have joined Ready Louisiana as a collective voice for young children. Ready Louisiana seeks $208 million by 2020 in funding, and is fighting for dollars as the State Legislature battles a $1.6B budget shortfall.


Click here to see a short video by the United Way on the importance of funding early care and education.


Legislators lack confidence in governor

Democratic and Republican legislators can agree on one thing this session: They expect little help from Gov. Bobby Jindal in trying to create solutions to close the $1.6 billion budget gap the state faces. The Advocate’s Tyler Bridges writes:


State legislators are weeks away from settling on a solution to Louisiana’s huge budget deficit, but on Tuesday, they said one thing is clear: They don’t expect much help from Gov. Bobby Jindal in solving the problem. Lawmaker after lawmaker — Democrats and Republicans alike — expressed disappointment that Jindal in his 21-minute address kicking off the 2015 legislative session on Monday didn’t offer more substantive ideas to help close a $1.6 billion deficit projected for the upcoming year. Several of them noted that Jindal ended his speech by wishing them good luck, as if, said state Sen. Robert Adley, R-Benton, “the problem is in our laps, and we need to solve it.”


Tax Day: Congress looks out for top .2 percent

Today is the federal deadline for paying your taxes, and to mark the occasion Republicans in Congress are trying to pass a massive tax break for America’s wealthiest households. As Dana Milbank explains:


On Tuesday afternoon, the House Rules Committee took up H.R. 1105, the “Death Tax Repeal Act of 2015,” with plans to bring it to a vote on the chamber floor Wednesday — Tax Day. It is an extraordinarily candid expression of the majority’s priorities: A tax cut costing the treasury $269 billion over a decade that would exclusively benefit individuals with wealth of more than $5.4 million and couples with wealth of more than $10.9 million. That’s a tax break for only the 5,500 wealthiest households in the country each year, according to the Joint Committee on Taxation. Of those, the 318 wealthiest estates each year — those worth $50 million or more — would see an average windfall of $20 million each, according to the Center on Budget and Policy Priorities.


Film industry study is a “Hollywood fantasy”

The Advocate’s editorial board is not impressed with the “study” sponsored by Louisiana’s film industry that uses tourism numbers to claim that the subsidies are a break-even proposition for state taxpayers.


That sounds, as economic analysis, laughable on its face. Louisiana’s generous subsidy program was designed to build a new industry for our state, and it has: We have surpassed Hollywood as the nation’s moviemaking capital. Government has a role to play in nurturing new industries, but taxpayers should demand that the subsidies will eventually end and the new industry will be standing on its own two feet. That is not happening with the film giveaways. The cost keeps rising — it’s grown more than sixfold in a decade, and in the past two years we’ve spent nearly half a billion dollars.


Cutting taxes and helping low income families not mutually exclusive

Strategies to curb tax incentives aimed at wealthy Americans in order to help low and moderate income families are beginning to gain traction.  Writing in The Washington Post, Michael R. Strain outlines some ideas.


Here’s a start: We should spend less money through the tax code on the rich and use some of the savings to encourage work and reduce poverty among low-income Americans.  The tax code includes many provisions that result in lost revenue by granting special tax treatment to specific activities.  These provisions, which seek to advance various social goals, are substitutes for direct federal spending programs and are called tax expenditures — spending that occurs through the tax code. And we’re not talking about peanuts; we spend more money through the tax code than we spend on national defense. Many tax expenditures are obscure. But several are familiar to large swaths of Americans, including the mortgage-interest deduction.  


Number of the Day

$70 Billion – Cost to the taxpayers of the mortgage interest deduction, nearly 75 percent of which accrued to households with income in the highest 20 percent of the population. (Source: Congressional Budget Office)