Unemployment insurance policy in New England: background and issues
Almost two-thirds of the states, and all the New England states except New Hampshire, have exhausted their unemployment insurance trust fund and borrowed from the federal government at least once during the past 35 years. Under such circumstances, states are required by law to raise unemployment insurance taxes in order to replenish their trust funds and to pay off their debts to the federal government. Since higher unemployment insurance taxes increase employer costs, replenishment forces states into a trade-off between economic competitiveness and trust fund adequacy. In recent years, ...
Come the devolution, will states be able to respond?
Since the founding of the Republic, Americans have engaged in endless debate about the division of fiscal and regulatory responsibilities among levels of government. The controversy has often involved the concomitant question of the optimal role of government as a whole. The issue has been not only which level of government should do what, but also what government at any level should do.
Heat, light, and taxes in the granite state.
Water, water everywhere: dare I drink a drop? (with apologies to Samuel Taylor Coleridge)
Given New England?s ample rainfall, green forests, and extensive wetlands, many of the region?s inhabitants might question the notion that it faces potentially severe water shortages. Yet, parts of the region already confront such shortages. These shortages are likely to spread, absent corrective action. This paper describes the characteristics of New England responsible for its looming water problems, identifies areas within the region most vulnerable to such problems, and analyzes alternative strategies for alleviating them. Small, shallow, porous aquifers are the region?s primary ...
Taking charge: should New England increase its reliance on user charges?
New England relies less on user charges for its state and local revenues than any other region of the country. As a result, some policymakers maintain that increases in user charges would correct an "imbalance" in the regions revenue mix. However, the national mix of state and local revenues is not necessarily the best mix for the states of New England. The degree to which a state should rely on u. ser charges depends on the priorities of its policymakers among competing principles of taxation, the conditions under which each principle favors user charges over taxes, and the extent to which ...
Fiscal disparity among the States revisited
The 50 states differ sharply in the scope of public services their state and local governments must deliver and in the costs of providing them. The governments of many states, through no fault of their own, must work relatively hard to provide the services needed by those who reside, work, travel, and vacation within their borders. The states also differ dramatically in fiscal capacity, that is, the capacity of their state and local governments to raise revenues. The degree of fiscal disparity among the states has been a salient issue throughout our nation's history, and a focal point of the ...
Cyclical swing or secular slide? Why have New England's banks been losing money?
Are the losses recently incurred by New Englands banking industry symptomatic of chronic excess capacity that will depress the industrys profitability even after the regions economy recovers from its current recession? Or can the industry restore its profitability by ridding itself of the extraordinary costs resulting from its large overhang of bad loans? This article maintains that the industry is not "overbanked" and that its underlying profitability will eventually reemerge. In support of this contention, the article provides estimates of the "normal" profitability of New Englands ...
Massachusetts business taxes: unfair? inadequate? uncompetitive?
In debating Massachusetts business tax policy, protagonists have cited many different indicators purporting to assess the fairness, adequacy, and competitiveness of the Commonwealth?s business taxes. These statistics actually reveal very little about the degree to which Massachusetts business taxes achieve these widely accepted tax policy goals. The author explains why these indicators are misleading and presents new indicators of business tax competitiveness that, although imperfect, are more accurate than those most widely quoted. The article concludes that the fairness of Massachusetts ...
State business tax climate: how should it be measured and how important is it?
States are more concerned than ever before about their business tax climate. Over the past two decades, profound technological and political changes have enhanced employers' geographic mobility and extended their geographic range, thereby intensifying economic competition both within the United States and throughout the world. This study ranks the business tax climate of 22 states, including the six within New England. It finds only modest differences in business tax climate among most states. Within the region, New Hampshire and Massachusetts have the most attractive business tax climates.> ...
Rating Massachusetts' tax competitiveness