Month: October 2022

Government Worker Shortages Worsen Crisis Response

Mary Pat Campbell

Link: https://www.governing.com/work/government-worker-shortages-worsen-crisis-response

Graphic:

Excerpt:

States and cities all over the country have seen a loss of workers over the past several years, and many are struggling to hire new ones. According to the Bureau of Labor Statistics, state and local governments lost more than 600,000 workers between the start of the pandemic and June of this year. Those shortages have begun to affect basic services, including many that are critical to safety and quality of life. According to a Center for American Progress report from March, there were 10,000 fewer water and wastewater treatment plant operators in 2021 than there were in 2019.

…..

The obvious reason why governments have struggled to hire and retain workers over the past few years, says Brad Hershbein, senior economist and deputy director of research at the W.E. Upjohn Institute for Employment Research, is that they can’t improve pay rates as quickly as the private sector can in response to worker demands for better wages. Another reason is that lots of government work has become newly politicized during the pandemic — public workers can be “heroes one day and villains the next,” he says. And a third factor is that staff shortages tend to make work that much more difficult for people who remain, contributing to unattractive working conditions.

“The burnout gets worse,” Hershbein says. “You get a spiral, where fewer people are stuck trying to handle the same amount of work and the whole thing collapses. That’s a real risk at a lot of agencies.”

Author(s): Jared Brey

Publication Date: 3 Oct 2022

Publication Site: Governing

Ensuring Tax Rates Don’t Rise with Inflation

Mary Pat Campbell

Link: https://taxfoundation.org/inflation-tax-legacy/

Graphic:

Excerpt:

With record inflation now squeezing American household budgets, you can thank our Senior Fellow Emeritus Steve Entin for shielding U.S. workers from being pushed into higher tax brackets. If ever there was a paycheck protection program, defending people from bracket creep may be the most important one ever designed.

It all started some 40 years ago. After Ronald Reagan was elected President, Steve Entin, who had previously served as a staff economist on the Joint Economic Committee and studied under notable professors like Milton Friedman at the University of Chicago, was invited to work at the Department of the Treasury as Deputy Assistant Secretary for Economic Policy.

As many at the Tax Foundation can attest, Steve’s stories about his time in the Reagan administration are legendary, but one stands out. Steve did something that every household in America should be grateful for—he convinced President Reagan to call for indexing the tax code to inflation.

At the time, American taxpayers were subject to bracket creep, which occurs when inflation pushes taxpayers into higher income tax brackets or reduces the value of credits, deductions, and exemptions. The bracket thresholds failed to keep pace with inflation, resulting in an increase in income taxes without an increase in real income.

Indeed, President Reagan used the chart that Steve drew for him during a televised address asking Americans to call their members of Congress and demand they index the tax code. People did. And it worked.

Author(s): Scott A. Hodge

Publication Date: 12 Sept 2022

Publication Site: Tax Foundation

ILLINOIS’ PUBLIC PENSION MESS SHOWS THREAT OF UNCHECKED GOVERNMENT UNION POWER

Mary Pat Campbell

Link: https://www.illinoispolicy.org/illinois-public-pension-mess-shows-threat-of-unchecked-government-union-power/

Excerpt:

At the top of the Nov. 8 ballot is a proposal to change the Illinois Constitution called Amendment 1, which union backers are calling the “Workers’ Rights Amendment.” Just like the controversial decision to include rigid rules about pensions in the 1970 state constitution, Amendment 1 proposes rigid rules regarding how government unions are treated and makes their powers virtually untouchable.

State lawmakers cannot control soaring pension costs without changing the state constitution. Amendment 1 would similarly make it impossible for them to curb government union negotiating powers, and unchecked union power means an unchecked ability to make demands that taxpayers would have no choice but to fund. The cost of those demands is conservatively estimated at $2,100 for the typical Illinois family during the next four years if voters pass Amendment 1, but the tax damage could be far worse.

Looking back, the adoption of the pension protection clause in the 1970 Illinois Constitution started many of the problems Illinois faces today. Illinois’ pension protection clause has been interpreted to be more rigid than any similar provision in any state constitution. With no ability to rein in the cost of public pensions, payments have crowded out spending on education and public services even as Illinoisans bear some of the highest tax burdens in the country.

The state holds the lowest credit ratings in the country, and residents are consistently leaving for states unrestrained by an unyielding pension clause in their constitutions. State lawmakers made attempts to correct the problem in 2013, but the Illinois Supreme Court struck down most of those reforms. The only option left is to change the state constitution, which could let the state regain fiscal sanity.

Instead, state lawmakers went in the opposite direction and handed voters Amendment 1. Instead of giving Illinois more flexibility to handle its money problems, the proposal takes away options and is potentially more restrictive than even the 1970 constitution’s pension protection clause.

Author(s): Joe Tabor

Publication Date: 14 Sept 2022

Publication Site: Illinois Policy Institute

Texas Maternal Death Data to Be Published Post-Midterms

Mary Pat Campbell

Link: https://www.governing.com/now/texas-maternal-death-data-to-be-published-post-midterms

Excerpt:

Texas health officials have missed a key window to complete the state’s first major updated count of pregnancy related deaths in nearly a decade, saying the findings will now be released next summer, most likely after the Legislature’s biennial session.

The delay, disclosed earlier this month by the Department of State Health Services, means lawmakers won’t likely be able to use the analysis, covering deaths from 2019, until the 2025 legislative cycle. The most recent state-level data available is nine years old.

In a hearing this month with the state’s Maternal Mortality and Morbidity Review Committee, DSHS commissioner Dr. John Hellerstedt said the agency wanted to better align its methodology with that of other states, and that there hadn’t been enough staff and money to finish the review for a scheduled Sept. 1 release.

….

Ortique said the state has already identified 149 potential maternal deaths in 2019, of which 118 have been analyzed by the committee to see if they were pregnancy-related. Six newly identified deaths may be added to that group, she said. The numbers cover deaths during the pregnancy through one year after giving birth.

The state has published a maternal death report every other year since 2014, often based on preliminary data updated later. For example, the maternal death report in 2018 identified 29 deaths in 2012 that were not included in the previous report. The committee also released updating findings from its most recent report, studying deaths from 2013, at the Sept. 2 meeting.

Out of 175 potential maternal deaths in 2013, 70 have since been determined to be pregnancy-related.

Author(s): Julian Gill and Jeremy Blackman, San Antonio Express-News

Publication Date: 14 Sept 2022

Publication Site: Governing

Appeals Court Rules In City’s Favor Following Challenge From The Houston Fire Firefighters’ Relief And Retirement Fund

Mary Pat Campbell

Link: https://cityofhouston.news/appeals-court-rules-in-citys-favor-following-challenge-from-the-houston-fire-firefighters-relief-and-retirement-fund/

Excerpt:

Today, the Court of Appeals for the First District of Texas reversed and rendered a decision in favor of the City of Houston against the Houston Firefighters’ Relief and Retirement Fund (HFRRF).

HFRRF had challenged the constitutionality of a Texas statute designed to reform the City’s firefighter pension system that ensures that the actuarial assumptions for determining the City’s contribution rates are based on sound actuarial principles and establishes a process for setting the contribution rate when the City’s and HFRRF’s proposed contribution rates differ by more than two percentage points.

“The City of Houston has consistently maintained the constitutionality of the historic pension reform and welcomes the appeals court ruling,” said Mayor Sylvester Turner. “The firefighters’ pension is now 93 percent funded – compared to just 80 percent funded pre-pension reform – and is actuarially sound. It is important to note that the three pension systems – municipal, police, and fire – are healthier today because of the pension reform we have put in place.”

The latest ruling is the second time the Court of Appeals has upheld the constitutionality of the statute reforming the firefighter pension system, making the pension system more secure for Houston’s firefighters, both now and in the future.

The estimated unfunded pension liability reached as high as $8.2 billion before the 2017 reforms. Today, the unfunded liability of the City’s three pension plans is less than $1.5 billion.

Author(s): MAYOR’S OFFICE FILED UNDER: MYR – OFFICE OF THE MAYOR

Publication Date: 30 Aug 2022 (updated 14 Sept 2022?)

Publication Site: City of Houston, Texas

Bill Would Tighten Pension Rules for Convicted Public Workers

Mary Pat Campbell

Link: https://www.governing.com/finance/bill-would-tighten-pension-rules-for-convicted-public-workers

Excerpt:

New Jersey would make it harder for public employees who commit crimes to collect their pensions under a bill legislators are fast-tracking through the state Assembly.

The proposed reforms to the state’s pension law were recommended without discussion Thursday, Sept. 29, by the Assembly Judiciary Committee, just one week after they were introduced. That allows the measure to move to the Assembly floor for a vote expected on Monday.

The legislation would tighten the criteria under which pension boards decide whether former government workers convicted of on-the-job misconduct should lose some or all of their pensions. It would also expand the list of offenses that automatically disqualify public employees from receiving those benefits.

….

That change would take more pension decisions out of the hands of the state’s retirement boards, which are often reluctant to strip officials of their full pensions, under a process in which they weigh offenders’ misconduct against the good they did throughout their careers. The proposal would also revamp how boards consider those factors, making it easier for them to refuse to grant benefits.

To become law, the bill would have to pass the Assembly and Senate and be signed by Gov. Phil Murphy. So far, no Senate version has been introduced, and its potential fate in the upper chamber remains unclear.

Author(s): Riley Yates, NJ.com

Publication Date: 30 Sept 2022

Publication Site: Governing

Women now outnumber men in the U.S. college-educated labor force

Mary Pat Campbell

Link: https://www.pewresearch.org/fact-tank/2022/09/26/women-now-outnumber-men-in-the-u-s-college-educated-labor-force/

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Excerpt:

In the second quarter of 2022, the labor force participation rate for college-educated women was 69.6%, the same as in the second quarter of 2019. In contrast, men and most other educational groups now have lower rates of labor force participation than they did in the second quarter of 2019.

This shift in the college-educated labor force – as women now comprise a majority – comes around four decades after women surpassed men in the number of Americans earning a bachelor’s degree each year.

Author(s): Richard Fry

Publication Date: 26 Sept 2022

Publication Site: Pew Research Center

Using First Name Information to Improve Race and Ethnicity Classification

Mary Pat Campbell

Link: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2763826

Graphic:

Abstract:

This paper uses a recent first name list to improve on a previous Bayesian classifier, the Bayesian Improved Surname Geocoding (BISG) method, which combines surname and geography information to impute missing race and ethnicity. The proposed approach is validated using a large mortgage lending dataset for whom race and ethnicity are reported. The new approach results in improvements in accuracy and in coverage over BISG for all major ethno-racial categories. The largest improvements occur for non-Hispanic Blacks, a group for which the BISG performance is weakest. Additionally, when estimating disparities in mortgage pricing and underwriting among ethno-racial groups with regression models, the disparity estimates based on either BIFSG or BISG proxies are remarkably close to those based on actual race and ethnicity. Following evaluation, I demonstrate the application of BIFSG to the imputation of missing race and ethnicity in the Home Mortgage Disclosure Act (HMDA) data, and in the process, offer novel evidence that race and ethnicity are somewhat correlated with the incidence of missing race/ethnicity information.

Author(s):

Ioan Voicu
Office of the Comptroller of the Currency (OCC)

Publication Date: February 22, 2016

Publication Site: SSRN

Suggested Citation:

Voicu, Ioan, Using First Name Information to Improve Race and Ethnicity Classification (February 22, 2016). Available at SSRN: https://ssrn.com/abstract=2763826 or http://dx.doi.org/10.2139/ssrn.2763826

Most Americans don’t plan to get a flu shot this season — lots of them say they’ll mask to avoid germs instead

Mary Pat Campbell

Link: https://www.cnbc.com/2022/10/04/fewer-americans-plan-to-get-a-flu-shot-this-season-2022.html

Excerpt:

Only 49% of U.S. adults plan to get their flu shot this flu season, according to a survey conducted by the National Foundation for Infectious Diseases (NFID). Even 1 in 5 of those who are at higher risk for influenza-related complications say they won’t get vaccinated.

People who are more likely to have severe outcomes from a flu infection include those over the age of 65, pregnant people, children younger than five years old, and individuals with underlying conditions, according to the Centers for Disease Control and Prevention.

….

Most Americans agree. Nearly 70% believe that getting an annual flu vaccination is the best way to prevent influenza-related deaths and hospitalizations, the NFID found. And yet many people remain hesitant to get their vaccine.

Instead, more U.S. adults are gravitating towards masking as a form of protection against the flu. A higher percentage of Americans (58%) plan to mask at least sometimes this flu season than intend to get vaccinated.

Author(s): Renée Onque

Publication Date: 4 Oct 2022

Publication Site: CNBC

SOA Diversity Report

Mary Pat Campbell

Link: https://www.soa.org/4a79dc/globalassets/assets/files/static-pages/about/diversity-inclusion/summer-2022-diversity-report.pdf

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Excerpt:

The Society of Actuaries (SOA) leadership and staff work closely with the Diversity, Equity, and Inclusion Committee (DEIC) to support the journey to increase diversity in membership and in the actuarial profession, as part of the SOA’s Long-Term Growth Strategy.

We strive for transparency and accountability in our DEI efforts and are committed to sharing our demographic data and long-term goals to support our pledge and responsibility. We have collected member voluntary demographic data since 2015. With this data, we present an infographic for the pathway from aspiring actuaries to members with ASA or FSA designations.

Author(s): Society of Actuaries

Publication Date: Summer 2022

Publication Site: Society of Actuaries

The Inevitable Financial Crisis

Mary Pat Campbell

Link: https://www.nakedcapitalism.com/2022/10/the-inevitable-financial-crisis.html

Excerpt:

For months, I have been confident that Europe would suffer a financial crisis and a depression, as in a real economy catastrophe accompanied by a market crash. It might not be as severe and lasting as 1929, but the breadth would mean there would not be 1987 quick bounceback nor a 2008 derivatives crisis concentrated at the heart of the banking system. Even though that looked like financial near-death experience, the same factors that made it more acute in many respects also made it easier for the officialdom to identify and shore up the key institutions that took hits below the water line.

….

That view was based simply on the level of damage Europe seemed determined to suffer via the effect of sanctions blowback on supplies of Russian gas. There are additional de facto and self restrictions on Russian commodities via sanctions on Russian banks and warniness about dealing with Russian ships and counterparties. For instance, Russian fertilizer is not sanctioned; indeed, the US made a point of clearing its throat a couple of months back to say so. Yet that does not solve the problem African (and likely other) buyers suffer They had accounts with now-sanctioned Russian banks and have been unable to come up with good replacement arrangements.

Another major stressor is the dollar’s moon shot. It increased the cost of oil in local currency terms, making inflation even worse. It also will produce pressure, and potentially defaults, in any foreign dollar debtor because he local currency cost of interest payments will rise. Given the generally high state of nervousness in financial markets, anyone who had been expected to roll maturing debt will be in a world of hurt (Satyajit Das in a recent post pointed out that investors typically don’t expect emerging market borrowers to repay).

….

Yet another big concern is hidden leverage, particularly from derivatives. A sudden rise in short term interest rates and increased volatility can blow up derivative counterparties. It’s already happening with European utility companies, many of whom are so badly impaired as to need bailouts.

And the failure of regulators to get tough with banks in the post-crisis period is coming home to roost. Nick Corbishley wrote about how Credit Suisse went from being a supposedly savvy risk manage to more wobbly than Deutsche Bank due to getting itself overly-enmeshed in the Archegos “family office” meltdown and then the Greensill “supply chain finance” scam. Archegos demonstrated a lack of regulatory interest in “total return swaps” which in simple terms allow speculators to create highly leveraged equity exposures. Highly leveraged equity exposures was what gave the world the 1929 crash. The very existence of this product shows the degree to which the officialdom has unlearned big and costly lessons.

Author(s): Yves Smith

Publication Date: 3 Oct 2022

Publication Site: naked capitalism