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Caution Is the Right Approach to State “Surpluses”

January 22, 2014

Wisconsin’s Governor Scott Walker and New York’s Governor Andrew Cuomo, as well as leading lawmakers in Michigan and elsewhere, are using their state’s budget “surplus” to justify new tax cuts.  That’s highly imprudent, if not irresponsible.

State budget surpluses typically appear when the economy emerges from recession.  After a few years of weaker-than-expected...

Unhappy New Year: North Carolina Eliminates Its EITC

January 13, 2014

Low-wage working families have less support in North Carolina as of January 1.  That’s when the state officially eliminated its earned income tax credit (EITC), giving North Carolina the dubious distinction of being the only state ever to do so.

Half the states have created EITCs (see map) to help working families with incomes up to roughly $50,000 make ends meet.  As...

Three Steps to Estimating the Cost of a State EITC

December 19, 2013

Half of the states and the District of Columbia have enacted earned income tax credits (EITCs) to supplement the federal EITC, the nation’s most effective tool for reducing poverty among working families and children.  The federal EITC lifted 6.5 million people — half of them children — out of poverty in 2012, and it has...

For Some States, Education Cuts and Tax Cuts Go Hand in Hand

November 11, 2013

Not only have many states imposed deep funding cuts for K-12 schools since the recession hit, as our recent report explained, but most of the states that cut the deepest also cut income tax rates, reducing revenue that might have gone to schools.

11-11-13sfp.pngFive of the seven...

The Price of Kansas’ Costly Tax Cuts

September 26, 2013

No state did more to cut taxes in 2012 than Kansas, and no governor proclaimed as loudly as Kansas’ Sam Brownback that tax cuts would have minimal negative impact on public services.  So it’s worth looking at what our recent 50-state report on...

K-12 School Funding Remains Below Pre-Recession Levels in at Least 34 States

September 13, 2013

States have made widespread and very deep cuts to education formula funding since the start of the recession, and those cuts linger in most states, our updated analysis of state school funding shows.

The reduced levels reflect not only the recession’s lingering effects but also continued austerity in...

North Carolina’s Cut to Jobless Benefits: Far From Responsible

July 12, 2013

Eileen Norcross of the Mercatus Center at George Mason University offers up a doozy in her piece about North Carolina’s unemployment benefit cuts in today’s New York Times.

North Carolina — where the...

Four Ways to Modernize State Sales Taxes

July 9, 2013

Outdated sales taxes are keeping states from fully competing in a 21st century economy.  As they emerge from the recession, many states are recognizing the urgent need to invest in highly competitive education systems, modern transportation networks, and a range of other innovative public initiatives that will form a strong foundation for future economic growth.  But states won’t be...

North Carolina’s Obscene Attack on Jobless Benefits

July 1, 2013

North Carolina, with one of the nation’s highest unemployment rates at 8.8 percent, imposed cuts in unemployment benefits today that are truly breathtaking:

  • Jobless workers can now receive only 19 weeks of benefits — less than half what any other state offers, even states like North Dakota where the economy is much stronger (see map).  The previous limit,
  • ...

Why Smart States Are Raising Revenues, in One Graph

May 30, 2013

4-15-13statetax2.jpg

Five years after the start of the Great Recession, state revenues remain 5 percent below pre-recession levels, after adjusting for inflation, even as the number of people needing state services has grown.  So, it’s not surprising that more than a dozen states have enacted or...

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