Several right-wing lawmakers utilized the weak economy to pursue damaging and radical proposals in legislative sessions this year. Some of the more egregious measures have included efforts to privatize functions of state government, including libraries, youth shelters, group homes, ambulance services, and transit networks. The pursuit of privatization is often rooted in misleading ideology that mythologizes private sector efficiency rather than demonstrable results of savings or quality. In fact, several privatization schemes have compromised service delivery, increased costs and fees for taxpayers, and severely reduced public accountability.
In this week’s Research Roundup: Reports by the National Employment Law Project on states enacting unprecedented rollbacks in their unemployment insurance programs, the Roosevelt Institute on why women have suffered heavily disproportionate job losses since the recession officially ended in 2009, the Pew Research Center on the alarming and growing wealth gap between black, white, and Latino households, the Alliance for a Just Society on the stories of some of the real people in communities of color who rely on Medic
Lawmakers confronted massive budget shortfalls, persistently high unemployment, and myriad fiscal and economic obstacles during 2011 state legislative sessions. With states still reeling from effects of the economic downturn and with federal investment in state economies receding, lawmakers considered drastic measures to confront budgetary constraints. Though many state revenue outlooks improved slightly in the past few months, partly as a result of tax increases passed in recent years, it was little comfort as states faced collective shortfalls of $103 billion in fiscal year 2012. As sessions progressed, it became painfully apparent that conservative lawmakers were not interested in job creation, economic growth, or support for those who have been hit hardest by the recession, but rather ideologically-driven platforms that sacrificed fiscal sustainability and the economic security of millions of families for the benefit of the affluent and huge corporations.
Beginning almost immediately with the gaveling-in of sessions in January, newly empowered conservatives unleashed a torrent of attacks aimed directly at workers, women, children, immigrants, historically disenfranchised populations, and the very existence of the middle class. Coordinated multi-state efforts like the assault on collective bargaining, extremist restrictions on reproductive rights, broad Arizona-style attacks on immigrants, and attempts to institute new barriers to voting through Voter ID requirements all repeatedly made national news.
This week marks the tenth anniversary of the enactment of the first Bush tax cuts for the wealthy. Commenting at the time on the surplus his administration inherited and in favor of flawed trickle-down economics, former President George W. Bush remarked upon its passage: "We recognize, loud and clear, the surplus is not the government's money. The surplus is the people's money. And we ought to trust them with their own money." In reality, the Bush tax cuts, along with the economic downturn and the wars in recent years, have proven to be by far the largest contributor to the country's deficit. And just as the most affluent are not contributing their fair share, large corporations are engaging in several tax avoidance schemes by utilizing offshore tax havens and other mechanisms.
This session, right-wing officials have been peddling costly, inefficient, and socially damaging prison privatization schemes. Several states, including Louisiana, Florida, and Ohio, have considered proposals to hand over the operation and management of prisons to private entities.
In this week’s PSN Research Roundup: a report from Policy Matters Ohio on the real costs of prison privatization, an analysis by the Immigration Policy Center on the billions of dollars of contributions made by undocumented immigrants to state and local tax coffers, and a study on the high cost of immigration enforcement to the nation’s currently cash-strapped cities by the Drum Major Institute for Public Policy.
At the end of March, the New York Times published an explosive story finding that General Electric (G.E.), the nation's largest company which reported $5.1 billion in profit last year from operations in the U.S., would not pay a dime in federal taxes. Similarly, ExxonMobil posted profits exceeding $45 billion last year, but as a result of aggressive tax avoidance strategies, paid no federal income tax in 2009. Almost as shockingly, in a 2008 report, the Government Accountability Office discovered that two out of every three U.S. corporations paid no federal income taxes from 1998 through 2005.
Several elected officials across the states have approached budget shortfalls with extremely short-sighted and economically damaging proposals, including lavish tax breaks for corporations, slashing unemployment benefits, heinous cuts to programs that primarily benefit middle class and working families, eliminating earned income tax credit (EITC) programs, and privatizing services and institutions across the board, such as mental health services, prisons, and infrastructure. These types of policies will only serve to worsen fiscal pressures, exacerbate the economic pain of the middle class, increase inequality, and heighten the current regressivity of state tax structures, which, on average, place a heavier burden on low and middle-income earners than the rich. This is demonstrative of a disturbing and pervasive recent trend: tax breaks for the affluent and corporations, and austerity for the rest.