The reason wages are sluggish

The reason wages are sluggish

Those who focus too much on President Donald Trump’s efforts to bring back lost manufacturing jobs are missing a central point about changes that have rocked the U.S. economy.

Those who focus too much on President Donald Trump’s efforts to bring back lost manufacturing jobs are missing a central point about changes that have rocked the U.S. economy. Eduardo Porter, writing for the New York Times, says a bigger cause of wage stagnation is the fact that big companies are increasingly outsourcing many tasks to low-margin industries based in the United States.

The trend is hard to measure, since subcontracting can take many forms. But it is big. A study last year by Lawrence F. Katz of Harvard and Alan B. Krueger of Princeton, a former chief economic adviser to President Barack Obama, concluded that independent contractors, on-call workers and workers provided by contracting companies or temp agencies accounted altogether for 94 percent of employment growth over the last 10 years. Nonstandard employment arrangements like these account for nearly one in six jobs today. That is 24 million jobs, nine million more than 10 years ago.


Public dollars for private schools

Louisiana’s private school voucher program is shrinking. But The Advocate’s Charles Lussier reports that another, less noticed state program that funnels public dollars to private and parochial schools is starting to take off. Using data from a pro-voucher organization, Lussier reports that Louisiana is on track to spend $7 million this year on a tuition rebate program that serves 1,672 students. That’s an increase of 900 students from last year. The program offers participants a 95 percent state refund – plus a federal tax deduction – for dollars donated to private schools to provide tuition assistance for low-income students. So far, data is lacking on whether the money is well spent.

Rebate scholarships, by design, cover only part of the tuition. The voucher program, by contrast, requires private schools to treat the payment as full tuition and fees. … And while rebate students, like voucher students, must take state standardized tests, the results cannot be used to cut private schools out of the program that fall short. Several large voucher schools that failed to make the grade were cut off. That has forced the closure of several private schools, including Redemptorist High in 2015.


Louisiana ranked as “worst” state

A new report says Louisiana’s high incarceration rate, poor educational outcomes and health rankings are key factors in making it the “worst” state in America. The rankings come from U.S News and World Report, which uses a slew of federal data to evaluate and rank the 50 states. The Advocate’s Elizabeth Crisp reports:

The review for Louisiana isn’t pretty, with the state receiving low marks in individual rankings on crime and corrections (50th); opportunity (49th); education, economy and government (46th in each); health care (45th) and infrastructure (39th). … Louisiana did see a couple of bright spots, ranking 7th in state budget transparency and 18th in affordability.Gov. John Bel Edwards’ administration noted that the assessment is based on, in some cases, data that dates back to 2013.

“This is a great effort and could be a valuable tool in guiding public policy, but the initial report lacks critical information and uses outdated statistics that pre-date the current administration,” Edwards spokesman Richard Carbo said.


Is tax reform possible?

The inimitable Jim Beam of the Lake Charles American-Press has seen tax reform effort come and go during his four decades of covering Louisiana politics. He notes in his Sunday column that the compromise plan that ended the February special session left hopes high that a similar deal could be struck in the upcoming regular session. But he notes that several GOP legislators don’t want to look at restructuring the state income tax, which is the linchpin of any reform.

Rep. Chris Leopold, R-Belle Chasse, laid out the challenge when he told The Advocate, “The appetite for taxes is not there. We’ll have to do things we’ve never done before so we won’t be at the same fiscal crossroads every year.” A recent task force and others before that one know what the solutions are, and Leopold is correct. Take the sales tax, for example. It’s the highest in the country and a 1 percent increase last year has to stay off the books when it expires July 1, 2018. … Republicans, particularly, don’t want anyone doing anything about income taxes. That is unfortunate because income tax revenues improve when personal and corporate incomes improve. Jay Dardenne, state commissioner of administration and Edwards’ budget chief, told The Advocate the governor will soon decide on specific tax changes he will recommend for the April session.

LBP’s proposals for overhauling Louisiana’s broken tax system can be found at or on our website,


Number of the Day
$11.74 billion – Amount of tax dollars contributed each year to state and local coffers by undocumented immigrants (Source: Institute on Taxation and Economic Policy)