Blog postings by CEPR staff and updates on the latest briefings and activities at the Center for Economic and Policy Research.

This version reflects corrections made on July 2, 2019. The original post mistakenly stated that four independent agency boards lacked quorums when, in reality, five did.

The federal government’s 40 independent agencies play an important role establishing and enforcing the regulatory frameworks that govern sectors as diverse as financial securities, chemicals, nuclear weapons, and postal services. Yet, despite these essential contributions to public safety, financial security, and the public good in general, these agencies are perpetually forgotten.  

Add a comment

In the coming days, advocates and lawmakers will fight to ensure that the findings of Mueller’s team are made public so that the American people may assess for themselves the results of the Special Counsel’s two-year investigation. Even as this important work unfolds, however, we must also acknowledge the limitations of the Special Counsel’s investigation. That’s why we renew our call from early January for Representative Richard Neal (D-MA) to perform his constitutional obligations and request Trump’s tax returns without any delay.

Add a comment

With just under $6 trillion in assets under management (as of year-end 2018) BlackRock is the largest money manager in the world. Virtually unheard of only a decade ago, it has now grown into one of the most powerful forces in financial markets and politics alike.

Central to this ascendance was its risk management software, Aladdin. Aladdin — an acronym for Asset Liability and Debt and Derivative Investment Network — has become the “industry’s dominant platform for keeping track of portfolios.” It counts among its clients approximately 200 financial firms who use the software to manage approximately $18 trillion in assets.

Add a comment

Protecting the health of workers is a crucial factor in maintaining a productive workforce. However, this objective remains inaccessible for many Americans due to the lack of universal access to paid sick leave. Over 40 million American workers still do not have access to paid sick leave and face the dilemma of either taking an unpaid day off or working while sick, thus risking their economic security, reducing workforce productivity, and threatening the health of co-workers and customers.

This problem disproportionately impacts the lives of part-time and low-wage workers. In 2018, only 40 percent of part-time workers had access to paid sick days. In comparison, 85 percent of full-time workers had access to sick pay. There’s an even larger disparity between low-income and high-income workers regarding sick pay. Shockingly, only 31 percent of the lowest income earners had access to sick pay, compared to 93 percent of the highest-paid workers.

Add a comment

Yesterday a coalition of good government and progressive groups sent a letter to Speaker Pelosi urging her to “to take every available step to ensure that the House Ways and Means Committee fulfills its Constitutional obligation to provide stringent oversight.”

You wouldn’t think such a letter would be necessary. Given the broad public outcry at different rules for the rich and everyone else, you would think a Democratic Party seeking to reclaim the mantle of populism would naturally pursue opportunities to discover the “who, what, when, where, why, and how” of tax evasion.

Add a comment

The Honorable Speaker Nancy Pelosi
1236 Longworth H.O.B.
Washington, DC 20515

Dear Speaker Pelosi,

We are writing you as organizations who believe that fairness and equity in both the writing and implementation of tax law is of critical importance. Our commitment to fairness is why we urge you to take every available step to ensure that the House Ways and Means Committee fulfills its Constitutional obligation to provide stringent oversight. 

Add a comment

In 1990, nearly three-quarters (74.0 percent) of prime-age women, ages 25 to 54, in the US participated in the labor force. Only the Nordic countries — Sweden, Norway, Denmark, and Finland — had substantially higher shares of women in the labor force, while women’s labor force participation in Canada was modestly higher at 75.5 percent. The US ranked sixth out of 22 Organisation for Economic Co-operation and Development (OECD) countries.

Add a comment

Today marks Equal Pay Day for Asian American and Pacific Islanders (AAPIs). In 2017, median earnings for Asian women in the United States — that is, those who identify themselves as “Asian alone” in the US Census Bureau’s American Community Survey and worked full-time, year-round — were $50,559 per year, compared to median annual earnings of $57,638 made by a white, non-Hispanic men (a difference of about $7,000 per year).  Asian women also earned 77 percent of what Asian men earned per year, which is smaller than what all women were paid as a percentage of all men (80 percent).

Add a comment

Don't let the headline ("House Democrats prepare case to request Trump tax returns") fool you: Richard Neal's announcement of a plan to issue a request letter for Trump's tax returns comes distressingly late — and projects to be vastly too modest in scope.

Revolving Door Project, which has helped lead the way in spotlighting Neal's shirking the need for serious Congressional oversight, notes the following problems with the request as reported by NBC News.

Add a comment

As federal policymakers shrink away from their campaign promises to request President Trump’s tax returns, state lawmakers are stepping up to take their place. On January 24, the New Jersey Senate passed a bill that would bar presidential and vice-presidential candidates from appearing on the ballot unless they released five years of federal tax returns. Meanwhile, there is growing momentum in New York for the TRUTH ACT, a bill which would require state tax authorities to release tax returns for any officials elected statewide, from State Comptroller and Attorney General up the ranks through to the President of the United States. That bill now has 78 cosponsors in the NY State Assembly (a majority) and 28 in the State Senate (four shy of a majority).

If passed, New York state tax authorities will be required to release Trump’s tax records within 30 days. Those records would not just include income earned in New York state but worldwide income as well.

Add a comment

Social networks and the development of platform technologies have drastically transformed the way people live, work, and spend their money. The use of information and communication technologies has become an important aspect of jobs in occupations ranging from medical assistants to fast food operators, lawyers, steel workers, and others employed in traditional employment relations. The growth and popularity of online and app-based platforms like Uber, GrubHub, and TaskRabbit have raised the profile of the gig economy* and created the impression that employer-less work and gig jobs are a pervasive aspect of modern employment. A lack of consistent, rigorous data on twenty-first-century employment relations allowed speculation about the role of independent contractors, and especially gig workers, to dominate conversations about the future of work.

Add a comment

CEPR regularly publishes a curated collection of original research from academic institutions and nonprofits on the state of the US labor market. The compilation is part of our ongoing effort to promote informed debate on the most important economic and social issues that affect people's lives.


Center for American Progress (CAP)

Trump’s Trade Deal and the Road Not Taken

In November 2018, the Trump administration prioritized and signed a revision to the Northern American Free Trade Agreement (NAFTA) that was rebranded as the US-Mexico-Canada Agreement (USMCA). Unfortunately, President Trump’s agreement fails to deliver on strong labor and environmental standards that workers need. Specifically, the revised agreement fails to address climate change in trade and expands monopoly protections for pharmaceutical companies that would keep US drug prices rising. This report describes what a meaningful alternative to NAFTA requires by discussing NAFTA’s economic effects on US workers and proposing recommendations that could be used to rewrite NAFTA that supports the middle class, the environment, and cooperative relationships in all three countries.

Add a comment

As America grows to be a more diverse society, in many ways, it has also become a far more unequal one. American inequality has fluidly adapted to prevailing federal, state, and local institutions and continues to expose a country that has repeatedly fallen short of amending the systemic disparities among race, class, gender and ethnicity. These disparities have become increasingly more pronounced in the US economy, creating even more inequality and insecurity.

In an economy in which the wealthy benefit and the rest of the country are dramatically left behind, many lower- and middle-class workers struggle to achieve upward economic mobility due in part to flat wages and the rising costs of housing, healthcare, and the overall cost of living. These obstacles limit access to higher incomes and in turn, wealth. As high earners save much more of their income than low-wage workers, they are able to acquire more assets and build wealth — a path that is especially obstructed for black Americans who often earn much less. This is compounded by the fact that for decades, people of color have lagged behind white people by almost every economic indicator due largely to the legacy of slavery, the manifestation of structural racism, and the institutionalized exclusion of people of color from social and economic progress. Black people often face gross, structural barriers in attaining economic prosperity and wealth by way of an ascendant American social structure that has historically worked against them. American society routinely benefits white Americans while also generating adverse outcomes for people of color in the aggregate.

Add a comment

In this widely read article on President Trump and the Justice Department, the New York Times characterized the Deputy US Attorney for the Southern District of New York (SDNY), Robert Khuzami, in an entirely inaccurate manner. Not only was the characterization factually wrong, meriting a correction on its own, but it also gives readers unwarranted confidence in Khuzami's independence. Indeed, Khuzami’s actual professional history merits serious scrutiny from the Times. 

The February 19, 2019 article stated that, "The inquiry is run by Robert Khuzami, a career prosecutor who took over after Mr. Berman, whom Mr. Trump appointed, recused himself because of a routine conflict of interest." (emphasis added)

The phrase “career prosecutor” conveys to a reader that Khuzami was a nonpolitical appointment who had spent the vast majority of his career in nonpolitical public service jobs prosecuting alleged criminals. Neither meaning is close to accurate, and the distance from truth actually elides the reason why Khuzami’s central role ought to stoke fear rather than generate calm.

Add a comment

The Honorable Laura Wertheimer
Inspector General
Federal Housing Finance Agency
400 7th Street, SW
Washington, DC 20219

The Honorable Eric M. Thorson
Inspector General
Treasury Department
1500 Pennsylvania Avenue, N.W.
Washington, DC 20220

Dear Inspector General Wertheimer and Inspector General Thorson:

We write to request an investigation into whether officials at the Federal Housing Finance Agency (FHFA) or Office of the Comptroller of the Currency leaked information about the agency’s plans regarding reform to the Government Sponsored Entities (GSEs) with intent to manipulate markets for the benefit of investors in preferred and common shares. Sharing this confidential, market-moving information with the intent of benefiting Fannie Mae and Freddie Mac’s shareholders would represent a breach of securities law.[1]

Add a comment

By February 18th, someone making $1,000,000 in 2019 will have stopped paying into Social Security for the year. Social Security, which provides retirement, disability, and survivor benefits to countless Americans every year, only taxes the first $132,900 of a salary (up from $128,400 in 2018). If you make more than this cap, that income is not subject to the tax.

Most people in the United States make less than $132,900 per year, so they will pay the 6.2 percent payroll tax every time they get a paycheck in 2019. Those who make over $132,900 get a break on any income above that amount.

If a person made $50,000 in 2019, for example, they’d pay taxes until December 31st — and have an effective tax rate of 6.2 percent. But someone making $1,000,000 in 2019 would stop paying Social Security taxes on February 18th and see a bump in their pay afterwards. This person’s effective tax rate would be just 0.8 percent. The burden of Social Security taxes falls more heavily on those who make less.

Social Security’s finances also depend on the tax cap. Social Security is projected to have a shortfall in the medium term and many argue that the program, despite its importance, needs to be cut today. Part of this shortfall is because more money has been shifted above the $132,900 cap over the last few decades: in 1983, 10 percent of wage income was over the cap; in 2016, over 17 percent was. This change represents a large share of the shortfall.

Add a comment

February 12 marks the introduction of the Family and Medical Insurance Leave Act (FAMILY Act) into both houses of Congress. The FAMILY Act would create a national paid leave program that would cover working people across the country. It would allow moms and dads paid time off to care for or bond with a new child, partners and spouses time to care for a sick loved one and military caregiving. The Act is respectful of the diversity of modern families and recognizes that the need for family leave can extend beyond the traditional parent-child relationship, for instance, ensuring that a grandparent can take time to care for an ailing grandchild. The Act would provide much needed support to the 83 percent of workers without family leave through their employers and the less than 40 percent that have medical leave through an employer-provided disability insurance program.

Paid leave is widely popular with the public with voters across the country recognizing the need for a national paid family leave program. States and cities helped build momentum for paid leave at the national level through their own successful paid leave programs. Like the FAMILY Act, many of these programs require a small contribution from both the employee and the employer. Opponents to paid leave often claim that these policies are job-killers and impose an undue burden on businesses. Evidence shows, however, that these state and city programs have been very successful without hurting employers.

Add a comment

As the percentage of workers who can count on a traditional defined-benefit pension is falling rapidly, we have been lowering the Social Security benefits relative to their earnings. This reduction in benefits has not been widely noted because it takes the form of an increase in the age at which workers can receive their full benefits. This had been age 65 for workers who reached age 62 before 2003.

The age for full benefits then rose gradually to age 66 for workers who reached age 62 after 2008. It remained at this age until 2017, at which point it again began to increase, reaching 67 for workers who turn 62 after 2022. This increase in the age for full benefits amounts to roughly a 12 percent reduction in the value of a worker’s Social Security.

There was a further reduction in the 1990s that received little attention because of its technical nature. Benefits are indexed after retirement to the rate of inflation as measured by the Consumer Price Index (CPI).

Add a comment

This post was last updated on September 27, 2019

Last fall, Democrats ran and won on an anti-corruption platform. The Revolving Door Project (RDP) is committed to ensuring that members of the new majority fulfill their promises to bring accountability to Trump, his powerful allies, and corporate bad actors. Oversight is an incredibly powerful tool that can shine a light on overlooked issues, unearth answers about clandestine misbehavior, and generate consensus around reforms.

Add a comment

This version reflects edits made on February 28, 2019 to clarify the sequence of leaks, include price movement information for the GSEs’ preferred shares, and include a more comprehensive graphic. For additional context, please also read this letter that we, in conjunction with Public Citizen, submitted to the Inspectors General of the Federal Housing Finance Agency and the Treasury Department requesting that they investigate potential instances of insider trading.

Immediately following President Trump’s election, Fannie Mae and Freddie Mac’s future generated renewed and robust interest. The Government Sponsored Entities’ (GSE) shares rallied on expectations that the Trump administration would take both entities out of conservatorship in a manner that rewarded all shareholders, including hedge-fund speculators. In the intervening two years, however, those expectations faded and shares in the GSEs underwent a slow decline.

That changed December 20th, 2018 when President Trump announced that he would appoint Comptroller of the Currency, Joseph Otting, to serve as Acting Director of the Federal Housing Finance Agency (FHFA). Since that announcement, shares in Fannie Mae common stock had risen 165 percent (as of the market’s close on January 28), with a similar increase in the value of shares in Freddie Mac. Meanwhile the value of Fannie Mae’s preferred stock had increased by 29.5 percent while Freddie’s preferred shares rose by 33.5 percent. Less than two weeks after taking office on January 7, 2019, Otting had already made clear that investors’ confidence has not been misplaced; in a January 17 meeting, Otting told FHFA employees that the administration would release a plan in the coming weeks to take the GSEs out of conservatorship according to two separate leaks to MarketWatch and Politico on January 19 and January 24, respectively.   

Add a comment

CEPR regularly publishes a curated collection of original research from academic institutions and nonprofits on the state of the US labor market. The compilation is part of our ongoing effort to promote informed debate on the most important economic and social issues that affect people's lives.

Add a comment