State budget surplus is a good thing

State budget surplus is a good thing

Louisiana’s modest budget surpluses over the last two years have been a welcome change from the recurring fiscal crises of just a few years ago. But with state taxes already too low to fund essential government services like road maintenance and child welfare protection at adequate levels, The Advocate and others are pointing out that conservative calls to cut taxes are irresponsible. The inimitable Jim Beam of the Lake Charles American Press reviews the near-perils of the recent legislative session and the areas of the state that continue to need investment: 

Efforts were made at the recent legislation session to begin lowering a state sales tax increase of 0.45 percent approved in 2018, but they were unsuccessful. The tax increase is already scheduled to go off the books in 2025. The extra revenues helped many areas of state government that had seen their budgets reduced for nearly a decade. Higher education, K-12 education and early childhood education were major beneficiaries. … The surplus should be applauded rather than seen as a cause for cutting taxes that are some of the lowest in the country.

 

Making prescription drug prices affordable
The rising price of prescription drugs can be a substantial barrier to those who rely on them to stay healthy. The well-documented rapid increase in insulin prices is one example of how consumers suffer when drug companies are underregulated. The U.S. Senate Finance Committee recently passed the Prescription Drug Pricing Reduction Act, which aims to rein in prices. Writing in The Advocate, James Napper, a Baton Rouge AARP member, reminds us why high drug prices are everyone’s problem: 

Even those of us who don’t need insulin or other prescription drugs are affected by skyrocketing drug prices. We pay not only at the pharmacy counter, but through higher insurance premiums, and through the higher taxes we need to pay to fund programs like Medicare and Medicaid. Older Americans are hit especially hard. Medicare Part D enrollees take an average of four to five prescriptions per month, and their average annual income is around $26,000. One in three Americans has not taken a medication as prescribed because of the cost.

 

Raising the minimum wage is a good idea
Louisiana’s lowest paid workers have not gotten a raise in more than a decade. Instead, Louisiana continues to default to the federal minimum wage, which has been stuck at $7.25 an hour since 2009. In a largely symbolic vote, the U.S. House of Representatives recently moved to give workers a boost by approving a gradual increase in the federal minimum to $15 an hour by 2025. The measure is expected to die in the Senate. Susan Milligan for U.S. News and World Report reviews the evidence on raising the minimum wage and finds it hasn’t hurt states and it has helped workers.

(I)n cases where states offer a higher minimum wage than the cost of living would indicate (Arizona, Minnesota and Michigan), the state economies are not worse for wear. (…) “What we found was these policies have the intended consequence of raises wages at the bottom” of the income scale and “have some degree of spillover beyond the minimum wage,” since other employers tend to hike their own wages when the minimum wage increases, (Arindrajit) Dube says. “At the same time, there’s no overall evidence we found that the number of low-wage jobs are actually reduced,” he adds. “We did not find there was any adverse impact on employment.” The one exception, he says, was in low-wage manufacturing jobs – but notes that those workers tended to find jobs elsewhere. (…) While the public impression of a minimum wage employee might be a teenager working at a fast-food restaurant, (Heidi) Shierholz says, many older adults work for the minimum as well. There are more people 55 and older earning minimum wage than those 19 or younger, she notes, and the average age of a minimum-wage employee is 35.

 

SNAP has widespread benefits in poverty reduction and health
For families struggling to get nutritious food on the table year round, SNAP (formerly, food stamps) can be the difference in a healthy dinner and going to bed hungry. And a growing body of research shows that increasing the program’s benefits may lead to even more widespread positive outcomes for kids, including reduced poverty and better overall health. Brynne Keith-Jennings of the Center for Budget and Policy Priorities highlights some of the key findings on increasing benefits: 

SNAP kept 7.3 million people out of poverty in 2016, including 3.3 million children, our analysis using the Supplemental Poverty Measure (which counts SNAP as income) and correcting for underreporting in government surveys found. SNAP lifted 1.9 million children above half of the poverty line that year – more than any other program. It had the greatest anti-poverty impact in 2009, when the Recovery Act temporarily boosted benefits, which suggests that raising benefits could reduce poverty further. A National Academy of Sciences expert panel recently proposed raising SNAP benefits as part of a package of policies to cut child poverty in half.

 

Number of the Day:
30 – The number of states using fines and fees to keep formerly incarcerated citizens from voting. Even with recent reforms, Louisiana is among them. (Source: Campaign Legal Center and Georgetown Law Civil Rights Clinic)

 

EDITOR’S NOTE: The Daily Dime will take a brief  hiatus for the rest of the week in order for staff to prepare for the Invest in Louisiana Policy Conference on Friday, August 16. It will be back in inboxes on Monday morning.