Blog

This tax season, some Americans will receive a financial boost from federal and state refunds while others will face unexpected payments. The Hamilton Project takes this moment to highlight three types of reform that would promote work—focusing on secondary earners, caregivers of young children, and low-wage workers. 

The recently released Trump Administration 2019 budget includes forecasts for economic growth that are substantially more positive than most private sector or other government forecasts. In this blog, Hamilton Project Director Jay Shambaugh assesses these forecasts. 

The difficult realities and constraints facing the U.S. federal budget, coupled with the evident value of investing in children and families, raise a complex question for the Trump Administration and Congress: how should we determine our nation’s spending priorities?  In anticipation of the President's proposal for its fiscal year 2018 budget, The Hamilton Project offers this analysis.

Previous Hamilton Project author James Ziliak comments on The President's proposal for a massive investment in our nation’s young children and working families as part of the 2016 budget released today. 

James P. Ziliak explores new legislation introduced this week that would dramatically reform government subsidies for child care, and compares it to his recent Hamilton Project proposal where he suggests comprehensive reforms to the Child and Dependent Care Credit (CDCC). Ziliak believes both approaches would offer tremendous benefit to working families.

The Washington Post's Catherine Rampell takes a closer look at how the current tax system impacts married low- and middle-income working families, creating what is often called "marriage penalties." Rampell cites findings from a Hamilton Project paper by Melissa S. Kearney, Giving Secondary Earners a Tax Break.

Senate Budget Committee Chairwoman Patty Murray introduced legislation that would provide tax relief for working families by establishing a deduction for two-earner families and expanding the Earned Income Tax Credit (EITC) for childless individuals.The proposed legislation closely follows the secondary earner deduction outlined in a Hamilton Project paper by Melissa Kearney and Lesley Turner.

Senate Budget Committee Chairwoman Patty Murray introduced the "21st Century Worker Tax Cut Act" to establish a new deduction for married couples who are both employed and have young children, and to increase the earned income tax credit (EITC) for childless workers.The Act would implement the policies introduced by two Hamilton Project proposals designed to help “make work pay” by allowing low- and middle-income families keep more of what they earn.

Wonkblog features two of THP Founder Robert Rubin's favorite graphs of the year, including The Hamilton Project's graph "Highest Educational Attainment of Family Head, by Income Relative to the Federal Poverty Level (FPL)."

Differences in income and other characteristics mean that federal income tax burdens vary substantially across counties. Ben Harris explains why these variations exist, noting that the higher incomes found in areas near large cities contribute greatly to those counties' higher income tax burdens.

In her latest Project Syndicate column, Advisory Council member Laura D’Andrea Tyson discusses the nation’s retirement system. Tyson highlights policies that would make saving easier and more financially rewarding, including better-targeted tax incentives, matching government contributions and state-wide retirement plans. In a recent, Hamilton Project paper, “Better Ways to Promote Saving through the Tax System” Karen Dynan explores the design of government incentives for personal savings, outlining how reforms to these programs would improve saving and economic security for low-income households and reduce expensive and ineffective federal subsidies for high-income households.

In a recent article on Americans’ disposable income, the Epoch Times’ Heide Malhotra highlights data from The Hamilton Project’s “Better Ways to Promote Saving through the Tax System,” by Karen Dynan. In the proposal, Dynan examines the design of government incentives for personal savings, outlining how reforms to these programs would improve saving and economic security for low-income households and reduce expensive and ineffective federal subsidies for high-income households. Malhotra discusses findings from the paper that show the personal saving rate has declined dramatically over the past several decades. Americans saved about 4 percent of after-tax personal income in 2012, down from average saving rates of 5.5 percent in the 1990s, 8.6 percent in the 1980s, and 9.6 percent in the 1970s. To read the full piece, click here.

A recent Washington Post editorial on tax reform suggests “a carbon tax is one of the best ideas in Washington almost no one in Congress will talk about.” The editorial highlights the Hamilton Project's "The Many Benefits of a Carbon Tax," in which Adele Morris of the Brookings Institution proposes a carbon tax as a new source of revenue that could also help address climate change.” The editorial notes Morris’ finding that even a modest carbon tax could help reduce the federal budget deficit by almost a trillion dollars over two decades. To read the full piece, click here.

Michael Greenstone and Adam Looney discuss a new Hamilton Project interactive feature that allows users to see how implementing different proposals in The Project's "15 Ways to Rethink the Federal Budget" could impact the 10-year budget picture.

In a recent Washington Post column on federal budget negotiations, Ruth Marcus highlights several proposals from The Hamilton Project’s “15 Ways to Rethink the Federal Budget.” Marcus offers the proposals as “suggested reading” for policymakers and suggests that there are several ideas that could be appealing to both parties. Marcus features ““Transitioning to Bundled Payments in Medicare,” by Michael Chernew and Dana Goldman; “Restructuring Cost Sharing and Supplemental Insurance for Medicare,” by Jonathan Gruber; “Replacing the Home Mortgage Interest Deduction,” by Alan Viard; and “Better Ways to Promote Saving through the Tax System,” by Karen Dynan. To read the full piece, click here.

A recent Washington Post editorial highlights the Hamilton Project's "The Many Benefits of a Carbon Tax," in which Adele Morris of the Brookings Institution proposes a carbon tax as a new source of revenue that could also help address climate change. She suggests that a carbon tax would reduce the buildup of greenhouse gasses, replace command-and-control regulations and expensive subsidies with transparent and powerful market-based incentives, and promote economic activity through reduced regulatory burden and lower marginal tax rates. The editorial argues that the plan should be politically attractive to both parties as it would "cut future deficits, slash taxes, eliminate wasteful government spending and reduce climate change." To read the full piece, click here.

Last night on MSNBC’s “The Last Word,” Ezra Klein highlighted his top five proposals from The Hamilton Project’s “15 Ways to Rethink the Federal Budget.” Klein featured “The Many Benefits of a Carbon Tax,” by Adele Morris; “Transitioning to Bundled Payments in Medicare,” by Michael Chernew and Dana Goldman; “Limiting Individual Income Tax Expenditures,” by Diane Lim, “Funding Transportation Infrastructure with User Fees ,” by Tyler Duvall and Jack Basso; and “Making Defense Affordable,” by Cindy Williams. For more information on all fifteen policy proposals, or to download all the proposals in a single volume, either in PDF format or as a free ebook, click here. For the video clip, click here.

Michael Greenstone and Adam Looney preview The Project’s forthcoming budget report, which includes fifteen pragmatic, evidenced-based proposals to reduce the deficit and achieve broad-based economic benefits.

In a Financial Times article on tax reform, Hamilton Project Policy Director Adam Looney discusses aspects of the system that could be corrected. Looney discusses the controversial aspects of value added taxes and notes that many areas of the tax code have “pernicious effects.” Read the full piece here.

The Washington Post’s Wonkblog highlights work from The Hamilton Project and selections by several Advisory Council members in its feature titled, “2012: The Year in Graphs.” The piece quotes Hamilton Project Director Michael Greenstone and highlights two graphs from The Project on costs associated with various sources of electricity generation and the change in family earnings of children. Wonkblog also quotes Advisory Council members Robert Greenstein, Peter Orszag and Alice Rivlin who weigh in on charts and graphs they felt best represented the year. To read the full piece, click here.

In a Quartz opinion piece, Hamilton Project Director Michael Greenstone and Policy Director Adam Looney discuss three challenges facing lawmakers as they negotiate on the fiscal cliff and work to reform the tax code. Greenstone and Looney write that any successful plan will need to address the nation's daunting outlook for budget deficits, the increasingly competitive global economy, and rising income inequality. To read the full piece, click here.

In Project Syndicate, Advisory Council member Laura D’Andrea Tyson discusses the challenges to achieving a balanced deficit-reduction plan that includes both increases in revenue and cuts to spending. Tyson says that despite the bipartisan support for a balanced approach, there has not been agreement on tax rates for high-income Americans. She highlights President Obama’s proposal to let 2001 and 2003 rate cuts for the top 2-3% of taxpayers be allowed to expire at the end of the year, while the rate cuts for other taxpayers are extended. She notes that Republicans want the rate cuts to be extended for all taxpayers, arguing that increases in top rates would discourage job creation. Tyson discusses recent research suggesting no link between tax cuts for high-income taxpayers and job creation, and highlights findings from a Hamilton Project paper, “A Dozen Economic Facts About Tax Reform,” which show that the federal tax system has become less progressive at the same time as the biggest tax cuts have gone to high-income Americans.

Politico's Lauren French and the New York Times' Annie Lowrey in articles today discussed the role of tax expenditures in negotiations on the federal budget. The Hamilton Project's "A Dozen Economic Facts About Tax Policy" includes an interesting visual that provides context for the ways in which many tax reform options fit into the budget debate. Click herefor the visual.

In a New York Times opinion piece, Advisory Council member Robert E. Rubin suggests that the focus on reducing or eliminating tax expenditures to address the fiscal cliff and the nation’s long-term fiscal trajectory is misguided. Rubin argues that many of these cuts would hit important and popular policy programs and ultimately would not create enough savings to have a significant impact on tax rates or the budget deficit. He also suggests that continuing to discuss proposals that would reduce tax rates and deficits, such as the Simpson-Bowles plan, could backfire. Rubin highlights data from a Hamilton Project paper, “A Dozen Economic Facts About Tax Reform,” that show lowering individual income tax rates would modestly increase the earnings of the typical American family while substantially increasing the federal budget deficit. Read the full piece here.

Advisory Council members Peter Orszag and Laura D’Andrea Tyson were among those discussing how President Obama’s reelection will affect budget negotiations going forward. Tyson, in an interview with Wall Street Journal Live, said the “key challenge is to find a way to avoid going over the fiscal cliff to provide time to really make a long-run deal.” Orszag in his Bloomberg column said the main obstacle will be determining how to handle the expiring Bush-era tax cuts and suggests that the Obama administration should have been working with one of three options over the past few months to move forward.

Advisory Council member Lawrence Summers on Friday discussed the fiscal cliff, the presidential election and other topics as a guest host on CNBC's Squawk Box. Watch the video here.

In the New York Times' The Conscience of a Liberal, Paul Krugman highlights a graph from “A Dozen Economic Facts about Tax Reform" to illustrate that the vast majority of Americans pay income taxes at some point during their lifetime. Read the full piece here.

The Fiscal Times cites data from a forthcoming Hamilton Project document showing eliminating certain tax expenditures would have different distributional impacts on different income brackets.

In The Washington Post, Lori Montgomery cities forthcoming Hamilton Project research showing that policymakers would have to remove roughly four-fifths of tax breaks to reduce the top tax rate to 25 percent.

In the Financial Times, Advisory Council member Lawrence H. Summers discusses why he believes tax reform is critical for economic growth, fairness, and deficit reduction.

Hamilton Project Advisory Council member Les Samuels lays out six nonpartisan principles to guide tax reform in an op ed for the Los Angeles Times.