BHI STAMP measures up Illinois renewable policy
Study: Illinois's renewable policy no help to state economy
(Boston, MA) Closing so-called loopholes in Illinois’s mandated use of renewable energy program, in an effort to expand ‘green’ industries, will harm the state’s economy, according to a study from The Beacon Hill Institute at Suffolk University in Boston.
Illinois requires that its major utilities obtain 25 percent of their electricity sales from renewable sources by the year 2026, but the ability of customers to choose other providers has undermined the intent of the law. Nevertheless, the targets as presently constituted have the effect of dramatically raising the cost of energy for Illinois citizens, which affects consumers’ ability to meet their other financial obligations. According to the Institute’s analysis, Illinois businesses and residents will pay an additional $4.5 billion for electricity from 2014 to 2026 because of the Renewable Portfolio Standard. More
Press Release: PDF
Complete Study, “The Economic Impact of Illinois's Renewable Portfolio Standard” (PDF)
Response to the Instititute on Taxation and Economic Policy Critique of the BHI STAMP
ITEP's flawed critique of BHI STAMP:
On May 21, 2014, The Institute on Taxation and Economic Policy (ITEP) released a report entitled, “STAMP is an Unsound Tool for Gauging the Economic Impact of Taxes.” The report makes several criticisms of the Beacon Hill Institute (BHI) State Tax Analysis Modeling Program (STAMP®).
BHI responds to the criticisms contained in the Executive Summary of the report. (PDF)
Renewable Portfolio Standard for Maryland
Study: Maryland’s Renewable Energy Standard harmful to state’s residents, business
(Boston, MA) Two of Maryland’s Democratic candidates for governor have called for doubling the renewable energy requirements from the state’s existing mandate, but a new study released today by economists at the Beacon Hill Institute at Suffolk University in Boston reveals even the current standard is hamstringing the economy.
Gov. Martin O’Malley has been a consistent supporter for the law that now demands utilities to generate 20 percent of their electricity from alternative sources such as wind and solar by the year 2022. But while he has touted the amount of jobs created by the “green” energy sector under the mandate, BHI’s study shows the overall effects upon Free Staters are harmful. According to the Institute’s analysis, businesses and residents will pay an additional $3.3 billion for electricity from 2014 to 2022 because of the state’s Renewable Energy Standard, which will dramatically diminish employment, disposable income and investment in the state.
See the BHI Study, “The Economic Impact of Maryland’s Renewable Energy Standard (PDF).
Press release (PDF)
Renewable Portfolio Standard for New Jersey
Study: New Jersey’s Renewable Energy Mandate is a Drag on the Economy
(Boston, MA) With one of the highest targets among states that mandate utilities to generate portions of their power from renewable sources, New Jersey has placed an unnecessary and costly economic burden upon businesses and residents that will continue to harm basic affordability, competitiveness and employment. That’s according to a new study released today by the Beacon Hill Institute at Suffolk University in Boston (BHI), which analyzed the economic impacts of the state’s Renewable Portfolio Standard. More.
Press Release PDF
13th Annual State Competitiveness Report
Massachusetts, North Dakota again top ranked in BHI measure of economic growth and income: NH rises
BOSTON - (April 10, 2014) Massachusetts secured the top spot on the 13th Annual Beacon Hill Institute’s State Competitiveness Index. Traditional strengths in human resources, technology and openness buoyed Massachusetts to the number one rank for the seventh time in nine years. New Hampshire rebounded to third place.
The BHI competitiveness index is based on a set of 46 indicators divided into eight sub-indexes – government and fiscal policy, security, infrastructure, human resources, technology, business incubation, openness, and environmental policy. The breadth of the BHI index distinguishes it from more narrowly-focused measures of competitiveness that target only taxes, high technology, or economic freedom.
North Dakota finished second, followed by New Hampshire, Nebraska, Minnesota, Iowa, Colorado, Utah, Texas, and Virginia. While the rankings in sub-index measures were far from uniform, states that paid attention to fostering a well-educated and healthy workforce scored well. It also helps for a state to be business-friendly with reasonable labor costs and an environment with consistent firm births and a culture of risk-taking. More
Complete Report 13th Edition (2013)
Press Release with Rankings (PDF)
Response to Rep. Hunter of Washington State
Another day, another misfired STAMP critique.
Despite what people believe about economic models, they remain, in the absence of sound analysis, the best tool to assess the costs and benefits of tax policy changes. More.
Massachusetts State Tax Revenue Forecast
BHI Forecast: Driven by strong income growth, state tax revenues to rise this year and FY 2015
(Boston, MA) – The Beacon Hill Institute at Suffolk University (BHI) estimates that Massachusetts state tax revenues will come in at $23.283 billion for Fiscal Year 2014, 5.3% above FY 2013. Meanwhile, revenues will be $25.132 billion for FY 2015, 7.9% above FY 2014.
The 7.9% increase for FY 2015 is largely driven by a surge in personal income. The New England Economic Partnership projects state personal income to increase by 6.0% in Calendar Year (CY) 2014 and 6.7% in CY 2015. Read more.
Complete Forecast (PDF)
Press Release (PDF)
Press Coverage: WBUR 12/11: Experts See Rising Tax Collections In Mass.
Response to Critique of BHI's Renewable Portfolio Standards studies
An Appeal to Facts in a “Fact Check”
In their attempt to defend subsidies for green energy, supporters rely on Keynesian arguments to promote policies that will provide much-needed spending in an economy. The assumptions made by advocacy organizations such as the Union of Concerned Scientists are likely to hold only in the short run, if at all. Other arguments often made by critics of BHI's RPS studies have failed repeatedly to address the underlying basics of economics. Ultimately, while BHI sets out to soundly operationalize the true costs and benefits of projects like wind energy, green energy advocates fail to adequately put the relevant numbers to their claims. Read A Response to the Union of Concerned Scientists Critique of BHI’s Renewable Portfolio Studies
What Really Matters in Economics
How to think about job creation and spending: A primer
Policymakers and opinion leaders across the political spectrum seek to increase spending in the economy via regulation. However, the popular view of the relationship between spending and how it relates to unemployment and inflation is often wrong. Both sides should recognize that the purpose of any regulation should be to maximize economic efficiency and growth rather than increasing spending to create jobs. If policymakers aim to eliminate slack in an economy, they should use other more direct and effective methods of reaching the optimal level of spending. In his new study, How to Think About Job Creation and Spending: A Primer, BHI adjunct economist Ryan H. Murphy disentangles the confusion.
Without cost saving reforms, public sector unions pose future liability crisis for states
(BOSTON - May 23, 2013) A one percentage point increase in the unionization of a state’s public sector workforce is associated with an additional $78 of state and local government debt per capita. Meaning, if a state’s public sector unionization were to fall from 50% to 49%, that is associated with a fall in the public debt by $78 per person living in the state. Thus states with higher public sector unionized workforces are more likely to face higher levels of state debt. These are the findings of a new study from the Beacon Hill Institute at Suffolk University.
The Great Recession of 2008 left state and local governments exposed to structural deficiencies that threaten their ability to deliver basic public services in the future. For years, state and local governments took the easy path of not raising taxes or cutting spending to accommodate generous compensation packages negotiated through collective bargaining.
The study first finds that a one percentage point increase in the unionization of public sector employees is associated with an additional $78 of state and local government debt per capita. For instance, 59.8 percent of public sector employees in Massachusetts are unionized. So, the strength of unions in Massachusetts leads to an additional $4,672.17 of state and local debt per person. With its population of 6,587,489 people, Massachusetts faces about $31 billion in debt. More than 31 percent of Massachusetts’s debt is attributable to the strength of public sector unions. Read more.
Fiscally Illiberal: State and local projects cannot create jobs responsibly
Complete Paper (PDF only)