Category: Uncategorized

Osborne & Pankovits: In Camden, N.J., Portfolio Schools, an Important School Board Election and a Commitment to Continued Reform

Posted on by The Progressive Policy Institute

With 55 percent of its students in chartered public schools or renaissance schools — neighborhood schools operated by charter organizations — Camden, New Jersey, has implemented one of the most ambitious portfolio strategies in the nation in recent years. It has done so under state control, but New Jersey will probably return power to an elected school board within the next few years. So November’s elections for an advisory school board, the first since state intervention, were an important barometer of local sentiment.

Of the three seats up for grabs, two were won by candidates who support the renaissance and charter schools. The third went to a candidate endorsed by the local teachers union, which ran candidates for all three seats. All three new members were sworn in Jan. 3.

With 75,000 people, Camden is one of the poorest cities in America. At the time of the state intervention in 2013, the Camden City School District was suffering from more than two decades of poor results, financial mismanagement, systemic inequity and grade-fixing scandals. Even though the district spends almost double the national per-pupil average, some 23 of the city’s 26 public schools scored in the bottom 5 percent of schools in New Jersey. Fewer than half of students were graduating from high school, and even fewer were proficient in reading and math in elementary and middle school. With half of the district’s buildings constructed before 1928, students attended crumbling schools, some of which even lacked running water.

Read more here.

Ritz for Forbes: “Democrats Finally Debated The Deficit. What Did They Say?”

Posted on by The Progressive Policy Institute

Two days ago, I noted there had been little mention in the Democratic debates of the trillion-dollar deficits being run up by the Trump administration. That discussion finally started last night after moderator Abby Phillip asked Sen. Bernie Sanders how he would finance his proposals to double existing federal spending. Several candidates weighed in, offering insight into how their management of the federal budget would differ from one another, as well as with President Trump.

Sanders rejected the premise of the question and insisted that his Medicare-for-All plan would actually reduce total health-care spending in the United States. The reality, however, is that – despite embracing almost every tax hike imaginable – Sanders hasn’t come up with a credible plan to finance even half of the more than $50 trillion in additional spending he’s proposed over the next 10 years. Sen. Elizabeth Warren, who has made enacting a federal wealth tax one of the central pillars of her campaign, said that some of the revenue from this tax could be used to pay down the growing national debt.

The problem here is that Warren – like Sanders – has already pre-committed every dollar of her wealth tax (and other revenue proposals) to new spending. Major federal programs, including Social Security and Medicare, are facing growing shortfalls due to our ageing population and the Trump administration’s reckless tax-cut and spending policies. As a result, the next president will likely inherit a 10-year deficit of almost $17 trillion. How could Warren or Sanders hope to pay for the promises our government is already making after they’ve tapped every revenue source they conceivably can to pay for new spending?

Read the full piece here.

Press Release: The Slowdown in American Entrepreneurship: “How Would a Democratic President Respond – And What Should Be Done?”

Posted on by The Progressive Policy Institute

WASHINGTON— Ahead of tonight’s Democratic Debate in Des Moines, Iowa, the Progressive Policy Institute released a new report on the troubling outlook for entrepreneurship in the United States, according to PPI Director of Policy Innovation Dane Stangler.

“Despite the continued macroeconomic expansion, there are worrying sub-surface trends,” Stangler said in Real Clear Markets. “Not potential signs of recession in the near future—but signs of potential economic erosion, threatening prosperity over the next several years.”

The report released today highlights Democratic candidates’ views on entrepreneurship, ideas, and innovation in the modern political era. A growing body of academic research has established a consistent set of empirical facts about the fall in rates of entrepreneurship and other indicators of declining dynamism:

  • The entry rate of new firms has fallen steadily, which has created an “accumulating startup deficit.”
  • There are fewer high-growth firms than 20 years ago—and their rates of growth have declined. In the terms of economists, “skewness” in firm growth has fallen.
  • These trends—falling firm entry and employment creation by high-growth firms— have been especially pronounced in the high-tech sector since 2000.
  • The overall population of U.S. businesses has grown “older and slower.”
  • Other measures of dynamism—job mobility, geographic mobility, and “job reallocation”— have also fallen.

The report highlights a number of potential proposals for Democratic candidates to adopt heading into 2020, and calls for candidates to add focus on innovative, entrepreneurial thinking to combat the decline in entrepreneurship and business dynamism in the Trump era.

“Democratic candidates—particularly those who have dominated headlines—need to put greater energy into addressing the importance of business creation,” said Stangler in the PPI report. “Acknowledging the slowdown in business creation is a start. Discussing this or that program to help is a positive step. Celebrating entrepreneurs and underscoring the urgent need to address the concerning trends in dynamism would be even better.”

Please click here to read the full report before tonight’s debate and the upcoming Iowa caucuses.

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The Progressive Policy Institute is a catalyst for policy innovation and political reform based in Washington, D.C. Its mission is to create radically pragmatic ideas for moving America beyond ideological and partisan deadlock.

Founded in 1989, PPI started as the intellectual home of the New Democrats and earned a reputation as President Bill Clinton’s “idea mill.” Many of its mold-breaking ideas have been translated into public policy and law and have influenced international efforts to modernize progressive politics.

Today, PPI is developing fresh proposals for stimulating U.S. economic innovation and growth; equipping all Americans with the skills and assets that social mobility in the knowledge economy requires; modernizing an overly bureaucratic and centralized public sector; and defending liberal democracy in a dangerous world.

Marshall for The Hill: “Pragmatic Democrats find their voice”

Posted on by The Progressive Policy Institute

Six Democrats running for president – a skeleton crew by campaign 2020 standards – will gather in Des Moines tonight to make closing arguments. It’s the last debate before the February 3 Iowa caucuses, when Democratic voters finally get a chance to cut through the fog of polls and punditry and start picking the party’s nominee.

The shrunken cast also will feature ideological parity, with former Vice President Joe Biden, Sen. Amy Klobuchar (D-Minn.) and former South Bend Mayor Pete Buttigieg representing the party’s quiet but large pragmatic wing, and Sens. Bernie Sanders (I-Vt.) and Elizabeth Warren (D-Mass.) and investor and activist Tom Steyer holding down the progressive left. Polls show the moderate and left-leaning candidates drawing support from about 37 percent of Iowa voters.

Could this signal an important turn in a debate thus far dominated by the passions and preoccupations of left-wing activists? Biden’s staying power, Buttigieg’s impressive leap from nowhere into the top tier and Klobuchar’s growing momentum in Iowa are all signs that mainstream Democrats are finding their voice.

Read the full piece here.

The Slowdown in American Entrepreneurship: How Would a Democratic President Respond – And What Should Be Done?

Posted on by The Progressive Policy Institute

In the November debate among Democratic presidential candidates, Sen. Cory Booker said the following: We Democrats also have to talk about how to grow wealth, as well. … [W]e as Democrats have got to start talking not just about how we tax from a stage, but how we growth wealth in this country amongst those disadvantaged communities that are not seeing it. … Small businesses, new startups are going down in this country. … We need to give more new entrepreneurs access to wealth.

What was notable about these statements was not so much the substance of what Booker said but that he said anything at all about entrepreneurship. During that debate, the word “entrepreneur” was only mentioned twice, both by Sen. Booker, who has since droped out. In fact, the word “business” was only spoken five times by the candidates on stage. Two of those were Booker talking about actual business creation. Others were in the context of assertions about “business as usual” in Washington. (Tom Steyer did mention his business experience.)

During the December debate, entrepreneurship was mentioned roughly zero times. The sole mention of business creation was by Sen. Elizabeth Warren in talking about her plan to erase most student loan debt. The only time the word “entrepreneurship” was actually uttered was when Andrew Yang talked about serving as “an ambassador of entrepreneurship” during the Obama administration. (And those mentions came toward the end of the night.)

Read and download the full report here,

Ritz for Forbes: “2019 Was Officially Trump’s First Trillion-Dollar Deficit. Will Democrats Debate It?”

Posted on by The Progressive Policy Institute

It’s official: the Trump administration spent $1 trillion more in 2019 than it raised in revenue. That deficit is 50% larger than the deficit in 2017, which was President Trump’s first year in office, and represents the first calendar-year deficit to top $1 trillion since 2012. Annual deficits will only grow worse in the coming decade, in large part thanks to the $2 trillion tax cut Trump signed into law in 2017 and a similarly-sized tax and spending deal he signed at the end of last year (over a quarter of which was added to the national debt).

With trillion-dollar annual deficits stretching into the future indefinitely, will Democrats address this generational challenge in their Presidential debate? There sure is an appetite for it: when I had the privilege of speaking with students at the New England College Convention in New Hampshire last week, they expressed deep concern about the rising national debt they’re poised to inherit and how the Democratic candidates would pay for their proposals.

Unfortunately, these issues haven’t been raised in any of the more than 500 questions asked throughout the last six presidential debates. The seventh debate on Tuesday night presents one last opportunity to change this dynamic before the Iowa Caucus.

Read the full piece here.

Discussing the Budget with Students at the New England College Convention

Posted on by The Progressive Policy Institute

Ben Ritz, the Director of PPI’s Center for Funding America’s Future, presented to students during two breakout sessions at the New England College Convention in Manchester, New Hampshire this week. The first session was a joint presentation about the national debt as an intergenerational issue with Bob Bixby from The Concord Coalition and Brian Riedl from the Manhattan Institute. The panelists spoke with local radio host Chase Hagaman about their presentation on his show, Facing the Future, which airs on New Hampshire’s WKXL station and can be found at the link below. Hagaman also moderated a second session in which Ben discussed with students the public investment proposals presented so far in the presidential campaign, how candidates would fund their agendas, and the impact these plans would have on young Americans.

Listen to the interview here.

Stangler for Medium: “The first Democratic debate of 2020 is next week: Guess what won’t be talked about?”

Posted on by The Progressive Policy Institute

The Democratic presidential field continues to be in flux, with Julian Castro dropping out and Michael Bloomberg ramping up his campaign. Participation in the January 14th debate is, as of yesterday, limited to just five candidates. Those five — Joe Biden, Amy Klobuchar, Elizabeth Warren, Pete Buttigieg, and Bernie Sanders — have hit the polling and donation thresholds to qualify.

The narrowing is unsurprising, but unfortunate in many respects. The biggest is that it means the debate likely won’t include much mention of one of the most important economic issues facing the country. What’s that?

Declining business creation and overall economic dynamism.

Read the full piece here.

Ritz for Forbes: “The Trillion-Dollar Question Missing From The Presidential Debate”

Posted on by The Progressive Policy Institute
Congress voted this week for a $1.9 trillion tax and spending deal, over a quarter of which was added to our $23 trillion national debt. Thanks to this and other fiscally irresponsible legislation signed into law by President Donald Trump, the federal government will run an annual budget deficit of over $1 trillion this year and every year that comes after it. Yet of over 500 questions asked throughout six presidential debates, not a single one has raised the issue.

 

Read the full piece on Forbes.

McDermott for Medium: “Buttigieg Is Right: Not Every Program Can Be Universal. So Which Should?”

Posted on by The Progressive Policy Institute

Read the piece on Medium.com. 

At last night’s Democratic presidential debate, South Bend Mayor Pete Buttigieg once again criticized Senators Warren and Sanders for proposing to provide free public college tuition to all students, even if they come from wealthy families. “Yes, we must deliver big ideas, and yes, taxes on wealthy individuals and on corporations are going to have to go up,” the Mayor said. “We can also be smart about the promises we’re making. Make sure they’re promises that we can keep, without the kind of taxation that economists tell us could hurt the economy…. If you’re in that top 10 percent, how about you pay your own tuition and we save those dollars for something else that would make a big difference.”

These comments follow a TV commercial in which Mayor Buttigieg argues that the benefits from any free public higher education program should be “means-tested,” or only provided to low- and/or middle- income people, because wealthy people have the means to pay for their children through college. Buttigieg is not the only candidate proposing to means-test certain benefits: Sen. Elizabeth Warren proposes means-testing benefits for her universal childcare and student debt relief plans, and both Sens. Warren and Sanders propose means-testing their aid aimed at students’ non-tuition costs. Still, critics claim that Mayor Buttigieg’s critiques of universal programs are unfair, as such programs can be more politically durable and easier to administer. Sen. Sanders also claimed that because he would pay for benefits for the wealthy with taxes on the wealthy, creating a universal program can still be economically progressive.

These points have some merit, and many fundamental government services — from Social Security to streetlights — are provided universally today. But Mayor Buttigieg is correct that real fiscal constraints exist, and the government cannot provide every worthwhile public service to everyone. A combination of Republican tax cuts and the growing costs of an aging society have already put the national debt on track to nearly double over the next 30 years to 144 percent of gross domestic product, the value of all goods and services the American economy produces in a year. It will take meaningful tax increases and spending reductions just to stabilize the debt. Given these constraints, leaders must choose which needs would be best served by universal programs and which can be sufficiently met with means-tested programs that save fiscal room for other legitimate needs.

There are also real limits to the government’s power to tax. If the government raises taxes on labor, people may decide it is a better use of their time to stay home than to earn more taxable income, and the tax hike will be less effective the larger it is. While it is difficult to estimate the tax rate that will raise the most revenue from high-income people, two prominent studies estimate that the rate is between 63 percent and 73 percent.

The United States isn’t close to that point today — the average person in the highest-earning 1 percent pays roughly a 47 percent rate on the last dollar they earn from work, accounting for federal, state, and local taxes. The revenue-maximizing tax rate on income from capital is lower, but the federal government taxes capital below that rate as well. Still, money raised and spent for one purpose cannot be spent on another, and the limits on the government’s power to tax restrict the scale of possible government spending. Policymakers who criticize or defend proposals for universal programs should explain whether universality is the best model to resolve the issue in question, not debate the merits of universality as a general principle.

Typically, successful universal programs solve problems in markets that are not always related to a person’s income. For example, Social Security ensures that all Americans can enjoy a dignified retirement after a lifetime of hard work and replaces the income of people who are too old or disabled to work. Medicare, meanwhile, ensures that these communities have adequate medical care. Other universal programs ensure that everyone pays for “public” goods, which are goods that everyone needs but that private actors do not have an adequate incentive to produce. The government taxes the community and provides such goods to ensure that it is adequately provided.

These are not the only models of successful universal programs today, and there may be other appropriate models besides those already in use. But due to our limited power to raise tax revenue, those who want to make some programs universal — as well as those who want to criticize other candidates’ universal program proposals — need to justify or critique universality on an issue-by-issue basis, not on its general merits.

Stangler for Medium: “The Democrats Should Talk About This Tonight”

Posted on by The Progressive Policy Institute

Here is how tonight’s Democratic debate should begin:

The American economy has always been driven by entrepreneurial energy — the creation and growth of new businesses. Today, however, entrepreneurship in the United States is in trouble. Business creation has stalled; overall economic dynamism is faltering. We are experiencing what some researchers call a “startup deficit.”

How would your administration address this?

Most of the seven debate participants would be speechless, at least momentarily, before quickly running through a litany of actions they would take — some of which are tangential to entrepreneurship. A few of them would talk about the virtues of small business before bashing the evils of big business. A few might actually say the word “entrepreneurship.” At least a couple of them would be able to talk coherently about how they would tackle the startup deficit.

In all likelihood, of course, this question won’t be asked and entrepreneurship will barely be mentioned. More attention will be paid to the labor issues that almost derailed the debate. Yes: unions and the minimum wage should be topics of discussion. But, without the businesses to employ union workers and pay higher wages, those issues are moot.

Read the full piece here.

Gold for Medium: “Attention Democrats: UK Elections Not Only Cautionary Tale from Europe”

Posted on by The Progressive Policy Institute

As Democratic presidential hopefuls gather in Los Angeles this week for the last debate of 2019, candidates should look across the Atlantic for a cautionary tale.

No, I’m not just talking about last week’s UK elections, which saw Labour’s far left-wing leader, Jeremy Corbyn, get crushed by Brexiteer Boris Johnson. Democrats can also draw useful lessons from the United Nations Conference of Parties (COP25) in Madrid, which by all accounts failed to kickstart progress toward implementing the Paris Climate Accords.

The culprit here, of course, is President Trump. His threat to pull the United States out of international efforts to combat climate change has created a major vacuum of leadership. What happened in Madrid underscores the folly of relying mainly on governments to tackle the climate crisis. Democratic presidential hopefuls should promise not only to re-exert U.S. leadership but to engage the private sector in efforts to reduce greenhouse gas emissions — regardless of which way the political winds happen to be blowing.

Read the full piece here.

Marshall for the Daily News: “Britain’s Warning to American Democrats”

Posted on by The Progressive Policy Institute

British Prime Minister Boris Johnson’s thumping victory last week confirms that 2016 was a political watershed. It marked the beginning of a new political alignment that is rewriting the rules of party competition here and abroad.

That was the year voters stunned the UK political establishment by voting narrowly to leave the European Union. Then followed Donald Trump’s equally shocking election. Both votes highlighted new political divides based on culture, identity and geography, as well as the waning relevance of old left-right debates.

So far, conservative parties have adapted to this changing landscape better than progressive parties. That’s why it’s crucial that Democrats come to terms with why Britain’s Labour Party, led by Jeremy Corbyn, was routed last week.

Corbyn blames Brexit for his defeat, and it obviously played a big role. Johnson offered voters a simple, unequivocal message on Brexit — get it done so Britain can move on. Corbyn and Labour took an ambiguous stance, and managed to win only 40% of the parliamentary constituencies that backed Remain.

Read the full piece here. 

Ritz for Forbes: “Naughty Or Nice? Breaking Down Congress’s $1.9 Trillion Budget Deal”

Posted on by The Progressive Policy Institute
The House of Representatives earlier this afternoon passed two bills to provide $1.4 trillion in funding for defense and non-defense spending programs that must be appropriated on an annual basis. As is often the case with must-pass legislation at the end of the year, these bills have become “Christmas trees” decorated with various policy riders and pet projects for members of both parties in Congress. What are the major provisions attached to this legislation that help add $500 billion to its price tag, and should they put Congress on the naughty or the nice list?

Read the full piece on Forbes.

Ritz for Forbes: “Who Is Fighting For Fiscal Responsibility?”

Posted on by The Progressive Policy Institute

The federal government is ending 2019 with a national debt of over $17 trillion for the first time in U.S. history – and if one includes intragovernmental debt, such as that held by the Social Security trust funds, this figure rises to $23 trillion. Beginning in 2020, the government is projected to add more than $1 trillion to the debt every year in perpetuity. Amid this rising tide of red ink, is anyone willing to fight for fiscal responsibility?

Certainly not President Donald Trump. Since taking office three years ago, Trump earned his crown as the self-proclaimed king of debt by signing into law a $2 trillion tax cut and shattering spending caps created under President Obama. Congressional Republicans – the same folks who demanded these caps be imposed in the first place – had no qualms about charging these costs to the national credit card. After eight years of lambasting deficits under President Obama, most Republican deficit hawks have revealed themselves to be nothing more than peacocks.

Thankfully, there is some leadership on the other side of the aisle. When Democrats retook control of the U.S. House of Representatives earlier this year, Speaker Nancy Pelosi reinstated pay-as-you-go (PAYGO) rules requiring legislation that cuts taxes or increases automatic spending to be fully offset. Although not all of her caucus supports PAYGO, the moderate House Blue Dog Coalition – which spearheaded the push to bring back the rule after it was repealed by Republicans in 2011 – has rebuffed efforts to waive PAYGO, sending a clear signal that at least some Democrats oppose digging the nation’s fiscal hole deeper.

Read the full piece here.

Valentine for the Washington Informer: “Talent First: How the Phalen Leadership Academy Closed Achievement Gaps Through Effective Teaching”

Posted on by The Progressive Policy Institute

“We will retain 85 percent of our effective teachers and remove 100 percent of my ineffective teachers.”

Those words from Earl Martin Phalen, founder of the George and Veronica Phalen Leadership Academy (PLA) in Indianapolis, represent more than a strategic goal. They are PLA’s foundational priority: the quality of its teachers will be the driver of student success.

Six years ago, Earl Martin Phalen founded what has quickly become the largest African American-run charter school network in the country. In just six years, Phalen Leadership Academies (PLA) has grown from one school to 20, most of them in Indiana but also four in Tampa, one in Detroit, and two schools in Beaumont, Texas. All but two are previously underperforming schools that districts asked PLA to turn around.

Read the full piece here.