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Executive action to improve U.S. economic measurements

March 3, 2021

Relevant federal offices and agencies

White House Office of Management and BudgetInteragency Working Group on Equitable DataBureau of Economic Analysis, Department of CommerceOffice of Tax Policy, Department of the TreasuryRelevant laws and Executive orders

Internal Revenue Code, Section 5103(j)Executive Order On Advancing Racial Equity and Support for Underserved Communities Through the Federal Government (Executive Order #13985)

The rise of economic inequality over the past four decades has changed the U.S. economy in fundamental ways. Unfortunately, the data that our federal statistical agencies produce to measure the nation’s economic progress has not kept up with these structural changes. At the same time, historical racial economic disparities

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Executive action to combat wage theft against U.S. workers

February 24, 2021

Relevant federal offices and agencies:

Wage and Hour Division of the U.S. Department of LaborRelevant laws:

The Fair Labor Standards Act of 1938 (29 U.S.C. § 203)

Wage theft against U.S. workers exacerbates the long-run problem of low and stagnant wages. When companies commit wage theft, they impoverish families and deprive workers of the just compensation for their hard work, robbing workers of the value they contribute to economic growth and exacerbating economic inequality.

The odds that a low-wage worker will be illegally paid less than the minimum wage ranges from 10 percent to 22 percent, depending on overall economic conditions, and each violation costs that worker an average of 20 percent of the pay they deserve. Women, people of color,

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Executive action to reform the cost-benefit analysis of U.S. tax regulations

February 24, 2021

Relevant federal offices and agencies:

Office of Information and Regulatory AffairsU.S. Department of the TreasuryRelevant laws and guidance:

Executive Order 12866Memorandum of Agreement, Review of Tax Regulations under Executive Order 12866

Beginning in April 2018, the federal government required a cost-benefit analysis for many more tax regulations than it had in the past. More than 2 years later, it is clear this experiment in cost-benefit analysis of tax regulations failed. The cost-benefit analyses released alongside regulations implementing the Tax Cuts and Jobs Act of 2017 provide little information relevant to assessing the merits of those regulations. Moreover, while tax experts criticize many of the TCJA regulations for providing unmerited

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Executive action to coordinate antitrust and competition policies across the federal government

February 19, 2021

Relevant federal offices and agencies:

National Economic CouncilCouncil of Economic AdvisersOffice of Information and Regulatory Affairs, or OIRAOffice of Management and BudgetDomestic Policy Council

The U.S. economy is plagued by a problem of excessive market power, stemming, in part, from years of weakened competition and antitrust enforcement. Growing market power disrupts the operation of free and fair markets, and harms consumers, businesses, and workers. It exacerbates inequality and compounds the harms of structural racism.

But it is not too late to change course. A bold vision—one that relies on Congress reengaging on competition policy, the antitrust enforcement agencies adopting an affirmative agenda to strengthen deterrence, and the

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Executive action to coordinate federal countercyclical regulatory policy

February 17, 2021

This factsheet has been adapted from Yair Listokin’s Vision 2020 essay and his 2019 book, Law and Macroeconomics: Legal Remedies to Recessions.

Relevant federal offices and agencies:
• National Economic CouncilRelevant laws:• Executive Order 12835, Code of Federal Regulations


Traditional macroeconomic tools—fiscal policy from the U.S. Congress and monetary policy from the Federal Reserve—are critical but not sufficient responses to the current coronavirus recession. To round out the federal government’s actions to deal with the ongoing economic downturn, executive agencies should consider how their regulatory power can be aggressively leveraged to provide a much-needed, countercyclical boost to the ailing U.S. economy. Regulatory actions that encourage

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ASSA Round-up: Day 3

January 6, 2021

Today was the final day of the three-day annual meeting of the Allied Social Science Associations, which is organized by the American Economic Association. The conference, held virtually this year, featured hundreds of sessions covering a wide variety of economics and other social science research. We’ve already posted the abstracts of some of the papers that caught the attention of Equitable Growth Staff during Day One and Day Two, as well as links to the sessions at which they were presented. Following are additional papers from the first two days as well as some from today’s final slate of sessions.

“The Effect of Unfair Chances and Gender Discrimination on Labor Supply”

Nickolas Gagnon, Vienna University of Economics and Business, Kristof Bosmans, Maastricht University,

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ASSA Round-up: Day 2

January 5, 2021

Today was the second day of the three-day annual meeting of the Allied Social Science Associations, which is organized by the American Economic Association. The conference, held virtually this year, features hundreds of sessions covering a wide variety of economics and other social science research. Below are some of the papers and presentations that caught the attention of Equitable Growth staff during the second day (as well as more from yesterday). Included below are the abstracts from those papers as well as links to the sessions at which they were presented. Check out the highlights from yesterday as well, and come back after tomorrow’s program for more highlights.

“Assessing the Impacts of Paid Family and Medical Leave Laws on Employers: Insights from Surveys of

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ASSA Round-up: Day 1

January 3, 2021

Today was the first day of the three-day annual meeting of the Allied Social Science Associations, which is organized by the American Economic Association. The conference, held virtually this year, features hundreds of sessions covering a wide variety of economics and other social science research. Below are some of the papers and presentations that caught the attention of Equitable Growth staff during the first day. Included below are the abstracts from those papers as well as links to the sessions at which they were presented. Come back tomorrow evening for more highlights.

“Sharing is Caring: Inequality, Transfers and Growth in the National Accounts”

Marina Gindelsky, U.S. Bureau of Economic Analysis

Abstract: Using the updated Distribution of Personal Income by the

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Lisa Cook, Hilary Hoynes, and Atif Mian join Equitable Growth Steering Committee

October 28, 2020

Equitable Growth welcomes three new Steering Committee members.The Washington Center for Equitable Growth announced today that three distinguished economists—Lisa D. Cook of Michigan State University, Hilary Hoynes of the University of California, Berkeley, and Atif Mian of Princeton University—have joined its Steering Committee to help guide the organization’s efforts to study economic inequality and its impact on economic growth and stability, and to build a new narrative about what makes the U.S. economy grow. As Steering Committee members, they will advise on the organization’s growing academic grants program and help strengthen connections to (and among) our academic community, especially in supporting the next generation of scholars.

“We’re thrilled that this trio of

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Equitable Growth’s Amanda Fischer joins others in comment letter to antirust regulator on harmful U.S. banking consolidation

October 27, 2020

A safe and strong banking sector is more important than ever as the coronavirus recession continues to strain individuals and families in the United States. In response to the U.S. Department of Justice’s Antitrust Division’s request for comments on its Bank Merger Review Guidelines, Washington Center for Equitable Growth Policy Director Amanda Fischer, along with Graham Steele, senior fellow at the American Economic Liberties Project and director of the Corporations and Society Initiative at Stanford University Graduate School of Business, and Sandeep Vaheesan, legal director at the Open Markets Institute, have submitted a comment letter to the Department. In the letter, Fischer, Steele, and Vaheesan argue that the Antitrust Division, along with banking regulators, must reverse

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Factsheet: New study shows that emergency paid sick leave reduced COVID-19 infections in the United States

October 26, 2020

Paid sick leave is an important public health tool in the fight against COVID-19.The United States is one of three high-income nations that does not guarantee paid sick leave for workers. As of March 2020, 25 percent of private-sector workers had no access to paid sick leave. This number is higher for part-time workers (55 percent) and low-income workers (69 percent).

Without access to paid sick leave, employees who are financially constrained may show up to work sick. When that happens, they risk passing their illness to others and impose costs on employers through lost productivity. Several studies demonstrate how paid sick leave guarantees at the state and local level can benefit public health and improve worker productivity, with one recent study finding an 11 percent

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Revamping U.S. small business rescue programs amid the coronavirus recession

August 27, 2020

Small firms need to be rescued with the same speed as large firms.The coronavirus economic rescue programs enacted by Congress this past spring failed to prevent layoffs and firm bankruptcies among the smallest employers in the United States. Existing resources, such as the Paycheck Protection Program, helped firms that needed a marginal boost to get through the worst of the shutdowns caused by the coronavirus pandemic. But the hardest-hit areas or businesses did not receive the help they needed because of the structure, timing, and delivery mechanisms of rescue aid.

What’s worse is that little data are available to evaluate whether rescue efforts have been equitable for Black and Latinx small business owners. Meanwhile, policy interventions through the Federal Reserve have

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Combating the market power of U.S. corporations over workers and consumers

August 26, 2020

U.S. antitrust laws, as interpreted and enforced today, are inadequate to confront and deter growing market power in the U.S. economy.Recent economic research establishes that the United States suffers from a growing market power problem. Market power, often referred to as monopoly power, means consumers pay more for the goods and services they need. Workers earn less. Small businesses have a harder time succeeding. Innovation slows. Market power exacerbates wealth inequality, too, because those who benefit from monopolies—the high-paid executives and stockholders of corporations—are wealthier, on average, than the consumers, workers, and small businesses who bear monopolies’ costs.

U.S. antitrust laws, as interpreted and enforced today, are inadequate to confront and deter

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Taxing wealth and investment income in the United States

August 25, 2020

The federal income tax does a poor job of taxing income derived from wealth. The root cause of this problem is that the tax code allows taxpayers to defer (without interest) paying tax on investment gains until assets are sold. Moreover, even when assets are sold, the investment gains are taxed at preferential rates. The top federal tax rate on wages and salaries is 37 percent while the top federal tax rate on investment gains is only 20 percent. Finally, if taxpayers can avoid selling assets until they die, the investment gains are wiped out for income tax purposes. The result is a two-tier tax system, where middle-class families pay full freight on their wages while wealthy, disproportionately White families pay reduced rates on their investment income.

Lawmakers in

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Achieving universal paid family and medical leave in the United States

August 24, 2020

Only 18 percent of private-sector workers have paid family leave and 44 percent have paid personal leave through their jobs.The coronavirus pandemic and the recession it caused lay bare a familiar challenge for U.S. workers—balancing family and job responsibilities without access to paid family and medical leave. When a new child arrives, loved ones get sick, or a serious illness strikes, people need time away from work. But even at these times of joy or stress, bills and expenses will keep coming, and families must find a way to cope with financial uncertainty. While some workers can count on their employers to provide them with paid leave, it is rare: Only 18 percent of private-sector workers have paid family leave and 44 percent have paid personal leave through their jobs.

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Building worker power in the United States

August 20, 2020

Union and AARP members rally in New York City on the city hall steps, March 2016.Wages have stagnated for most U.S. workers over the past 40 years while the labor market institutions that promote worker power have faltered in a pro-business and anti-worker policy environment. These two phenomena are two sides of the same coin—productivity decoupled from wage growth results in employers more able to exploit workers to produce more per hour worked while undercutting wages.

Labor market policies, such as minimum wages or premium pay amid the coronavirus pandemic, are not keeping up. Meanwhile, labor laws meant to protect collective action and unionization efforts, guarantee freedom from discrimination, and promote workplace safety are not well-enforced. Furthermore, trends such as

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Improving automatic stabilizers to combat U.S. economic recessions

August 19, 2020

Making recession aid more automatic will allow relief to start quickly, making the recession less severe.The new coronavirus pandemic and the recession it caused show that the typical set of economic policies used to fight recessions in the United States should be designed to automatically turn on and off in a downturn. It is impossible to predict when the economy will fall into a recession and, on the other end, when it will recover. Making recession aid more automatic will allow relief to start quickly, making the recession less severe. It also would commit Congress to stay the course until objective economic criteria are met and the recovery is well on its way.

Without this commitment, aid for the most vulnerable can be caught up in partisan politics and deal-making

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Addressing the U.S. racial economic mobility and inequality divides

August 18, 2020

Intentional policy action is necessary to correct the systemic and institutional barriers facing Black Americans.Economic mobility in the United States has been declining over the past half-century at the same time that economic inequality has been rising. Research by Harvard University economist and former Equitable Growth Steering Committee member Raj Chetty and his co-authors shows that rates of absolute intergenerational mobility have precipitously declined in the country during the latter part of the 20th century. People born in 1940 had about a 90 percent chance of growing up to earn more than their parents, but people born in 1980 had only about a 50 percent chance. Chetty also finds that Black Americans are more likely to experience downward mobility than White Americans,

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Reforming Unemployment Insurance across the United States

August 17, 2020

Unemployed men wait in line to file Social Security benefit claims, circa January 1938.Longstanding problems with the Unemployment Insurance system in the United States are immediately evident amid the coronavirus recession and echo the problems experienced during the Great Recession more than a decade ago. These include:

Administrative failures at state Unemployment Insurance agenciesLack of a permanent Unemployment Insurance program that includes the self-employed and others traditionally left out of the programLow benefit levels that require emergency top-offsThe temporary nature of fixes when recessions hit, which, in turn, requires renegotiations just months after political compromises are reachedThe current disarray in the Unemployment Insurance system is neither a

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Weekend reading: The Unemployment Insurance benefits are not the work disincentive some claim they are edition

July 24, 2020

This is a post we publish each Friday with links to articles that touch on economic inequality and growth. The first section is a round-up of what Equitable Growth published this week and the second is relevant and interesting articles we’re highlighting from elsewhere. We won’t be the first to share these articles, but we hope by taking a look back at the whole week, we can put them in context.

Equitable Growth round-up

One of the most intense debates over the next coronavirus relief package in Congress will be about whether to extend the weekly $600 supplemental unemployment insurance benefit that expires July 31. The argument in favor of ending it, or sharply reducing it, is that it acts as a work disincentive—that people won’t bother returning to work if their

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Factsheet: Unemployment Insurance and why the effect of work disincentives is greatly overstated amid the coronavirus recession

July 21, 2020

The United Artists Theatres in Berkeley, CA., is one of the many venues that was forced to close at the onset of the coronavirus pandemic.Under the Coronavirus Aid, Relief, and Economic Security, or CARES, Act,the Pandemic Unemployment Compensation program added a $600 weekly boost to Unemployment Insurance payments. Despite being one of the most effective policy responses to the coronavirus recession yet, the enhanced payments are set to expire at the end of July. The idea that Unemployment Insurance creates incentives for workers to remain unemployed has emerged as the main argument against extending the additional weekly $600, with critics arguing that generous benefits are “undermining the economic recovery.”

As this factsheet points out, current labor market indicators show

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Experts discuss transformative ideas for 2020 U.S. economic policy debate at Vision 2020 event

July 2, 2020

The June Vision 2020 webinar discussed bold ideas for economic structural change and racial justice.Eliminate banks as the “middleman” for federal anti-recession aid. Cancel all student loan debt. Give workers a say in how their workplaces reopen and empower them to form unions. Provide federal relief to childcare programs to prevent them from shutting down permanently. Get Congress to do its job so the Federal Reserve can get out of the business of making fiscal policy.

These ideas for generating strong, sustainable, and broad-based economic growth and achieving racial justice in the wake of the coronavirus recession were put on the virtual table during a June 25 webinar sponsored by the Washington Center for Equitable Growth. “Vision 2020: Focusing on economic recovery and

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Elevating economic research on racist violence and exclusion in the United States

June 5, 2020

On May 25, 2020, a police officer murdered George Floyd in Minneapolis, Minnesota. This public killing was one of the most recent murders of Black people either by law enforcement or by civilians who faced no immediate consequences for their actions. Earlier in the month, the two men who shot and killed Ahmaud Arbery, a Black man out for a run in Georgia, were finally arrested for the February shooting, but only after national attention and sustained public outrage. The case of Breonna Taylor, an emergency medical technician murdered by police in Louisville, Kentucky as she lay in her own bed, similarly took months to gain national attention. These and so many other tragedies—the lost lives of Tony McDade, David McAtee, and far too many others—underscore the unacceptable view of the

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One year later: Recession Ready and the coronavirus recession

June 1, 2020

Proposals put forth can help support communities, stabilize the economy amid coronavirus recession
One year ago, long before the risks of the new coronavirus and the ensuing recession enveloped our nation, the Washington Center for Equitable Growth, in partnership with The Hamilton Project, released Recession Ready: Fiscal Policies to Stabilize the American Economy. This book advanced a set of evidence-based policy ideas for shortening and easing the adverse consequences of the next recession with the use of triggers that would increase aid to households and states during an economic crisis and only recede when economic conditions warranted. Experts from academia and the policy community proposed six big ideas, including two new initiatives and four improvements to existing

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Coronavirus recession: How to get the U.S. economy back on track

May 26, 2020

Equitable Growth launches new lecture series with inaugural event featuring Claudia Sahm on the economic crisis
Amid our nation’s health and economic crises, government officials must do more. They must use research and evidence-based polices to support people today and strengthen our economic future. The Washington Center for Equitable Growth is dedicated to promoting research that elevates effective and inclusive policies. Our new lecture series will highlight the latest economic research in order to provide policymakers with evidence-backed solutions to advance sustainable, broad-based growth.
Our first lecture in the series on May 19 was online. Claudia Sahm, who joined Equitable Growth 6 months ago as the director of macroeconomic policy, inaugurated this lecture series.

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The latest research on the public health and economic costs and benefits of containing the coronavirus pandemic

April 6, 2020

Scientists around the world are scrambling to find and test anti-viral drugs and a new vaccine for COVID-19, the disease behind the coronavirus pandemic now sweeping the planet. Economists and other social scientists are equally busy attempting to unravel the economic and social consequences of the new coronavirus pandemic. These scholars are looking at a range of issues. Several examine the public health and economic costs and benefits, and the overall efficacy of social distancing. Others explore the links between the epidemiology of the disease and its economic consequences. And others are looking at U.S. historical lessons about the economic impact of the 1918 “Spanish flu” and the political impact of other recent public health scares.
We’ve selected 10 recently published

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Paid caregiving leave: A missing piece in the U.S. social insurance system

March 25, 2020

Amid the ongoing public health crisis from the COVID-19 pandemic, many individuals can expect to be called away from work to care for a sick loved one or a child out of school. To support these workers during the coronavirus recession and beyond, paid family and medical leave is receiving increased attention in the United States by policymakers, employers, media, and the public.

Download FilePaid caregiving leave: A missing piece in the U.S. social insurance system

Family leave encompasses several distinct types of leave, including leave to care for a newborn or newly adopted child (generally referred to as parental leave), as well as leave to care for a family member with a serious illness, whether that be a spouse, domestic

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What does the research say about paid family and medical leave policy design options in the United States?

March 25, 2020

Policymakers have failed to provide Americans with guaranteed paid family and medical leave at the federal level. As a result, working families across the United States must strike a delicate balance: attending to their own medical needs and caregiving responsibilities at the same time as they keep the economy humming through their activities in the workplace. When a new child joins a family, when a serious personal medical need strikes, or when a loved one has an acute need for care, workers need time off from work. To keep the lights on and a roof overhead, they need pay during this time. And when a public health crisis strikes, this need for paid time off for one’s personal health needs and caretaking responsibilities is amplified.

Download FileWhat

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What is paid medical leave and how does it support U.S. workers’ health and the U.S. economy?

March 25, 2020

When U.S. workers fall ill, it can be challenging to balance medical needs and job responsibilities. For short sicknesses, such as a cold or the flu, several days of rest at home might be all that is needed. With more significant illnesses or injuries, however, it may be impossible for a worker to return to the job for several weeks or even months. These workers face a significant dilemma. How can they take time to focus on their health without facing financial hardship? Even in times of illness, bills and expenses continue to add up. For these individuals, paid sick days are not enough to cover needed time off. Paid medical leave provides partial wage replacement to workers who need recovery periods longer than a few days.

Download FileWhat is paid

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Economic experts propose policy responses to coronavirus recession

March 24, 2020

University of California, Berkeley economists Emmanuel Saez and Gabriel Zucman, in cooperation with Economics for Inclusive Prosperity, are hosting an invitation-only online conference today to discuss economic policy responses to the coronavirus recession.
In the days following the conference, Equitable Growth, in cooperation with UC Berkeley, Economics for Inclusive Prosperity, and the presenters, will publish a series of columns summarizing the proposals and discussion.
The discussion will include brief comments from eight economic policy experts, beginning with opening thoughts from Olivier Blanchard, senior fellow at the Peterson Institute for International Economics and the former chief economist of the International Monetary Fund, followed by:
Arindrajit Dube,

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