In Point of Fact

from NewsLink, Vol. 2, No. 2, Winter 1998

After the budget deal, the deadwood remains.

What are our collective needs and responsibilities? A sensible debate would expand important programs and end outdated ones. (In a $1.7 trillion budget a few big programs must be clunkers.) With any remaining surplus, we then decide how much to cut taxes or reduce debt. Such a refined debate seems unlikely. Programs endure; beneficiaries enjoy unstated property rights in their payments; favored constituencies get selective tax breaks. Congress and the President tinker and wait to be moved by big events, for good or ill.
Robert Samuelson, Washington Post, January 22, 1998.

Even in Massachusetts we learn that business taxes are too high!

Just as the downturn and recovery have altered the shape of the state's economy, so have they changed public opinion on some bread-and-butter issues: a clear case is the shift in the view of the state's usiness taxes. In Spring 1995, we asked: "Are the state' taxes on business too high, too low, or about right?" Of all of those surveyed, 31 percent picked 'too high,' 12 percent 'too low' and 17 percent 'about right.' A year later a shift was apparent... Overall, the 'too high' percentage had risen 11 points - to 42 percent... [In October 1996] the survey detected a further shift. Overall, 'too high' was up to 55 percent.
"Street Signs," Massachusetts Benchmarks, Fall 1997.

For some, the UI fund surplus should truly be out of this world.

As of January 1, the unemployment insurance rates fell to the level Senate President Tom Birmingham wouldn't permit last year, but they're still fourth highest in the nation. Acting Gov. Paul Cellucci has filed a bill to lower them another 10 percent next January 1, a $100 million relief for business, which would only put us eighth. Actually, the rates could safely come down sooner. But Birmingham is caressing his six-shooter again: "We should wait to see the health of the [Unemployment] Fund." This is like insuring against fire, flood and invasion by Martians. At some point it makes no sense to keep buying insurance.
Editorial, Boston Herald, January 12, 1998.

Social Security, the road ahead.

Reform is necessary, and the sooner we address it, the less severe the necessary adjustments will be. Any economic growth and improvements in living standards we can achieve will also mitigate the strains that reform will impose. However, any course we take will substantially affect both workers and retirees, other sources of retirement income, the income distribution, the federal budget, and even the economy as a whole. Such effects should be well understood in making reforms.
Barbara D. Bovbjerg, General Accounting Office, in U.S. Senate testimony, November 20, 1997.

A nous la pause caf!

France's Socialist-led government recently adopted a bill cutting the legal working week. The bill, the first of two that will reduce the working week to 35 hours from 39 by the year 2000, will reward firms with cash subsidies if they shorten working hours and recruit more staff from next year onwards. The bill is the carrot in a carrot-and-stick policy the government hopes will ease near record unemployment, now running at 12.5 percent. It will be followed by a second bill, the stick, obliging firms to respect a shorter 35-hour work week from 2000 onwards.
Brian Love, Reuters, December 10, 1997.
[Editor's Note: On February 10, 1998 the French National Assembly approved a bill reducing the work week. ]

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NewsLink is the quarterly newsletter of the Beacon Hill Institute for Public Policy Research at Suffolk University. © 1996-2002. All rights reserved.

9/9/02 4:21 PM