DISPATCH: Following Year of Devastating Cuts, States Turning to Revenue Options

In this week’s Research Roundup: Reports from the Economic Policy Institute on two and half years of sky-high unemployment, the Institute for Taxation and Economic Policy on understanding tax bases and tax rates, the Women of Color Policy Network on the plight of African-American workers, and a 2010 report from Demos on potential reforms for credit rating agencies.

Two-and-a-half years of a job-seeker’s ratio above 4-to-1 - The Economic Policy Institute released this analysis of this week’s Job Openings and Labor Turnover Survey (JOLTS) report from the Bureau of Labor Statistics. It found that as the number of job openings increased by 75,000 in June, the ratio of unemployed workers to job openings remained 4.5-to-1 - a slight improvement from the previous month, but “still extremely high.” A chart included in the analysis shows the rapid rise in the ratio of job seekers to job openings around the time of Great Recession that has yet to substantially decline. The fact that United States workers have seen two and a half years of a job seekers’ ratio substantially above 4-to-1 explains why, according to EPI’s analysis, extending “current extended unemployment insurance benefits, which last a maximum of 99 weeks, remain crucial.”

Tax Policy Nuts and Bolts: Understanding the Tax Base and Tax Rate - This Institute for Taxation and Economic Policy policy brief explains the basic terms of the “tax base” and “tax rate” commonly used in tax policy discussions. ITEP notes how, “since these concepts are often confusing, having a grasp on the ins and outs of tax bases and rates will help provide a better understanding of how all state and local taxes work.”

First to Fall, Last to Climb: Black Workers in the New Economy - The Women of Color Policy Network at New York University’s Robert F. Wagner Graduate School of Public Service published this policy brief outlining how recent studies have shown that “workers of color, Blacks in particular, have been left behind in both the recession and in the nascent economic recovery.” The report suggests “targeted and aggressive programs” to reverse this trend, including extending federal unemployment benefits, expanding jobless benefits at the state level, and supporting education and training programs for people of color in disadvantaged communities to provide "early links" to the labor market.

Reforming the Rating Agencies: A Solution that Fits the Problem - This 2010 briefing paper from Demos on potential reforms for credit rating agencies is timely once again in the wake of the recent downgrade of the United States by ratings agency Standard and Poors, which is already having an effect on the credit ratings of individual states. The report led off by strongly noting how the major credit rating agencies - Moody’s, Standard & Poors, and Fitch - all bore "a heavy burden of responsibility for the financial meltdown." It recommended at the very least the implementation of "a strong and independent watchdog agency to set basic ground rules for the ratings agencies, and to do spot-audits of their work."

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